[Senate Hearing 113-762]
[From the U.S. Government Publishing Office]



 
       DEPARTMENT OF DEFENSE APPROPRIATIONS FOR FISCAL YEAR 2015

                              ----------                              


                       WEDNESDAY, APRIL 30, 2014

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 10:02 a.m., in room SD-106, Dirksen 
Senate Office Building, Hon. Richard J. Durbin (chairman) 
presiding.
    Present: Senators Durbin, Leahy, Murray, Shelby, Collins, 
and Murkowski.

                         DEPARTMENT OF DEFENSE

                         Department of the Army

                        Office of the Secretary

STATEMENT OF HON. JOHN M. McHUGH, SECRETARY

             OPENING STATEMENT OF SENATOR RICHARD J. DURBIN

    Senator Durbin. The subcommittee meets this morning to 
receive testimony on the fiscal year 2015 request for the 
United States Army. I am pleased to welcome the Secretary of 
the Army, John McHugh; the Army Chief of Staff, General Raymond 
Odierno, thank you; the Chief of the National Guard Bureau, 
General Frank Grass; the Chief of the Army Reserve, Lieutenant 
General Jeffrey Talley; and the Acting Director of the Army 
National Guard, Major General Judd Lyons. Thanks for being 
here.
    The fiscal year 2015 President's budget request includes 
$119 billion for the Army that falls under the Defense 
Subcommittee's jurisdiction. The budget request does not 
include funding for Overseas Contingency Operations, known as 
OCO. That's a big concern. Until we receive the President's 
plan for support in Afghanistan post-2014, it's really 
difficult if not impossible to appropriate proper levels of 
funding to support our warfighters.
    To comply with the budget caps specified in the Budget 
Control Act (BCA), the Army is facing an estimated $170 billion 
in budget reductions over the next 10 years on top of 
sequestration, which forced the Army to cut an additional $37 
billion in fiscal year 2013.
    How to achieve these savings is a familiar story. Each 
military service is forced to find a balance between end 
strength, readiness and modernization. The Army is reducing end 
strength as rapidly as possible in order to rebuild readiness. 
But to do this, you must accept greater risk in modernization 
programs. Your fiscal year 2015 request establishes obvious 
priorities. The purpose of this hearing is to investigate the 
rationale behind those decisions and determine whether they are 
the right ones.
    Despite budget challenges we face, we cannot waver from 
protecting our most precious asset. I say to you, gentlemen, 
and I know that you know this far better than I do, not only do 
you represent our men and women in uniform and their families 
but you also represent a devoted and competent and professional 
civilian workforce, a crucial part of the Army team. However, 
there's a proposal recently surfacing in Congress to cut DOD 
(Department of Defense) civilian workforce by 15 percent and to 
somehow use the ``savings'' to invest in weapons systems and 
other capabilities.
    Our witnesses know the value of our civilian workforce. I 
see it in my home State of Illinois at the Rock Island Arsenal. 
When the private sector couldn't provide our troops with what 
they needed to fight with in Iraq, the civilian workers at Rock 
Island stepped up to answer the call. These men and women are a 
national treasure wherever they serve our military.
    Rock Island is also home to much of the Army's contract 
oversight capability, which we've only recently rebuilt as a 
Nation. I hope that many people still remember, in the 1990s, 
large civilian layoffs forced the Pentagon to hire contractors 
to oversee contractors. And the result was tens of billions of 
dollars wasted in Lead System Integrator or TSPR (Total System 
Performance Responsibility) contracts.
    This outsourcing of weapons systems oversight cost 
taxpayers and the Army dearly. The Future Combat Systems 
program cost $20 billion before it was cancelled, and yielded 
very few fielded capabilities. Another example, the Ground 
Mobile Radio, which was 7 years behind schedule and 70 percent 
over its development budget when it was finally terminated.
    The drastic cuts in civilian oversight were a critical 
failure in both of these programs. We cannot repeat this 
mistake again.

                           PREPARED STATEMENT

    I look forward to working with you, our distinguished 
panel, throughout the year; so that our fiscal year 2015 
appropriations bill can enable the United States Army to 
successfully defend our national interests around the world.
    We sincerely appreciate your service to America and the 
dedication and sacrifice made daily by the men and women in our 
Army.
    Thank you, ahead of time, for your testimony. And your full 
statements will of course be included in the record.
    [The statement follows:]
            Prepared Statement of Senator Richard J. Durbin
    The subcommittee meets this morning to receive testimony on the 
fiscal year 2015 budget request for the United States Army.
    I am pleased to welcome:
  --The Secretary of the Army, John McHugh;
  --The Army Chief of Staff, General Raymond T. Odierno;
  --The Chief of the National Guard Bureau, General Frank Grass;
  --The Chief of the Army Reserve, Lieutenant General Jeffrey W. 
        Talley;
  --The Acting Director of the Army National Guard, Major General Judd 
        H. Lyons.
    Thank you for being here with us today and providing your 
testimony.
    The fiscal year 2015 President's budget request includes $119 
billion for the Army that falls under the Defense Subcommittee's 
jurisdiction. The budget request does not include funding for Overseas 
Contingency Operations, which is a major concern for the Committee. 
Until we receive the President's plans for support in Afghanistan post-
2014, it is impossible to appropriate proper levels of funding to 
support our warfighters serving in war zones.
    To comply with the budget caps specified in the Budget Control Act, 
the Army is facing an estimated $170 billion in budget reductions over 
the next decade, on top of sequestration, which forced the Army to cut 
an additional $37 billion in fiscal year 2013.
    How to achieve these savings is a familiar story: Each military 
service is forced to find a balance between end strength, readiness and 
modernization. The Army is reducing end strength as rapidly as possible 
in order to rebuild readiness. But to do this, you must accept greater 
risk in modernization programs. Your fiscal year 2015 request 
establishes obvious priorities. The purpose of this hearing is to 
investigate the rationale behind those decisions and determine whether 
they are the right ones.
    Despite the budget challenges we are facing, we must not waver from 
protecting our most precious asset--our people. Gentlemen, not only do 
you represent our men and women in uniform and their families, you also 
represent the civilian workforce, who are a crucial part of the Army 
team. However, a proposal has recently surfaced in Congress to cut 
DOD's civilian workforce by 15 percent, and use the savings to invest 
in weapons systems and other capabilities.
    Our witnesses know the value of this workforce. I see it every day 
in Illinois at the Rock Island Arsenal. When the private sector 
couldn't provide our troops with what they needed for the fight in 
Iraq, the civilian workers at Rock Island stepped up to answer the 
call. Those personnel are a national treasure.
    Rock Island is also home to much of the Army's contract oversight 
capabilities, which we've only recently rebuilt as a Nation. Some may 
have forgotten, but in the 1990s, large civilian layoffs forced the 
Pentagon to hire contractors to oversee other contractors--and the 
result was tens of billions of dollars wasted in ``Lead System 
Integrator'' or ``TSPR'' contracts.
    This outsourcing of weapons system oversight cost the Army dearly. 
The Future Combat Systems program cost $20 billion before it was 
cancelled, and yielded very few fielded capabilities. Another example 
is the Ground Mobile Radio, which was 7 years behind schedule and 70 
percent over its development budget by the time it was terminated.
    The drastic cuts in civilian oversight were a critical failure in 
both of these programs, and it is a mistake that we cannot afford to 
repeat again.
    I look forward to working with you, our distinguished panel, 
throughout the year; so that our fiscal year 2015 appropriations bill 
can enable the United States Army to successfully defend our national 
interests around the world.
    We sincerely appreciate your service to our Nation and the 
dedication and sacrifices made daily by the men and women in our Army.
    Thank you for your testimony this morning, and your full statements 
will be included in the record.
    Now I will turn to the Vice Chairman, Senator Cochran, for his 
opening remarks.

    Senator Durbin. Senator Cochran is not here at this moment 
but I will recognize him for opening remarks when he does 
appear.
    Senator Collins, is there anything you'd like to say at the 
outset?

                 STATEMENT OF SENATOR SUSAN M. COLLINS

    Senator Collins. Thank you, Mr. Chairman.
    First, I want to thank you for holding this hearing to 
review the Department of the Army's fiscal year 2015 budget 
submission.
    Last January, I joined a bipartisan group of 58 Senators in 
sending a letter to Secretary Hagel supporting a strong Army 
National Guard and urging him to carefully consider the 
appropriate balance of Active and Reserve component personnel. 
I was, therefore, disappointed when the President's budget 
request calls for such drastic cuts to the Army Reserve and 
National Guard end strengths.
    As the military resizes, following more than a decade of 
war, I believe that the Department of Defense should place 
greater reliance on the more cost effective Reserve and 
National Guard components; not less. Time and time again, the 
Army National Guard has answered our Nation's call to duty, 
whether here, at home, or halfway around the world. And we must 
make certain that we retain the important capabilities that the 
Guard represents.
    So, for my part, I look forward to engaging the witnesses 
today on that important issue. And I will continue to press for 
maintaining a strong Army National Guard.
    Let me just end by saying that I think it would be a 
disaster if the sequestration, which has already harmed our 
Government, comes back into play in the year 2016. And I hope 
that we can ensure that doesn't happen.
    Thank you, Mr. Chairman.
    Senator Durbin. Thanks, Senator Collins.
    I was given a note by the staff that Senator Cochran had to 
return to Mississippi because of the tornado damage. He won't 
be with us this morning, but I'd like to recognize Senator 
Shelby.
    Senator Shelby. Mr. Chairman, I just want to welcome 
Secretary and Chief of Staff and all of these other panelists 
today. I look forward to hearing them.
    Senator Durbin. Thanks a lot, Senator.
    Secretary McHugh.

               SUMMARY STATEMENT OF HON. JOHN M. MC HUGH

    Secretary McHugh. Thank you very much, Mr. Chairman, 
Senator Shelby, Senator Collins. Thank you for allowing us to 
be here. This is my fifth appearance before this distinguished 
subcommittee. And, as always, we deeply appreciate the 
opportunity to discuss, what I know you'll agree, the really 
incredible work of our soldiers, our civilians and our leaders 
this past year to talk with you as well about the current state 
of America's Army. And as I think you, perhaps better than many 
on this Hill, understand the very perilous times that lie ahead 
should the vital requirements in our budget request not be 
approved.
    I think it's important that I be clear up front and, simply 
put, the time for action is now. And frankly, perhaps as much 
as any time in our recent past, we need your support and your 
leadership going forward. We believe, very strongly, we require 
this budget to properly restructure, reduce, and to revamp our 
force. And, quite frankly, we need it to protect your Army as 
we march into a dangerous and very unpredictable future.
    As you, the members of this subcommittee know, full well, 
the cuts that Senator Collins mentioned, that we've endured 
from the Budget Control Act and sequestration, have already 
damaged our readiness, drastically reduced our modernization 
programs, and demanded sharp cuts to our end strength. These, 
coupled with significant shortfalls in 23 OCO funding, caused 
your Army to enter this year with a $3.2 billion hole in 
readiness alone. Moreover, and although the Bipartisan Budget 
Agreement provides some temporary relief, we're still 
implementing a $7.7 billion cut to our fiscal year budget 
request for 2014, and, to meet our top line requirements, we've 
had to cut another $12.7 billion from our 2015 submission.
    In order to protect current operations, our combat power, 
as well as our soldiers and their families, we've been forced 
to make extremely hard choices in this budget. Choices that 
impact virtually every component, will affect every post, camp 
and station, and limit nearly every modernization and 
investment program.
    This is not what we want. It's not what I believe your Army 
deserves, but it is what we have had to do to preserve 
America's land power in such an austere fiscal environment as 
constructed by the dictates approved in law. Nevertheless, in 
spite of turbulent funding and tremendous change, this past 
year has been one of great transition, transformation, and, I 
might add, triumph for America's Army not just here at home but 
across the globe as well. From intense combat to 
counterterrorism retrograde to humanitarian relief, disaster 
assistance, and regional engagement, your soldiers, civilians 
from every component, Active, National Guard, and Reserve, have 
seen unprecedented success, saved countless lives, and promoted 
freedom and democracy in some 150 nations around the world.
    In Afghanistan, as your Army continues to fight insurgents 
and terrorists, we further transition into a training and 
support role helping to set conditions for elections in April 
and appropriate withdrawal in December. Simultaneously, we 
continued one of the largest retrograde operations in history; 
returning, removing or demilitarizing some 580,000 pieces of 
equipment in the past 12 months alone. We plan to retrograde 
over $10.2 billion of the Army's $15.5 billion in equipment 
that remains there at this time.
    As we continue to fight in one theater, we also expanded 
our regional alignments conducting dozens of engagements with 
partners around the world. From the rebalance to the Pacific to 
exercises in the Middle East, Africa, South America, and 
Europe, our soldiers demonstrated their global responsiveness, 
reassured our allies, and deterred would-be aggressors.
    As our forces performed these vital missions around the 
world, the Army began a major transformation to reorganize our 
brigade combat teams (BCTs), accelerate end-strike reductions, 
and cut our headquarters staff; all designed to help protect 
critical readiness and seek more balance under severe budgetary 
constraints.
    As we continue to retrograde, restructure, and reduce, we 
also continue our transition to decisive action training 
replacing our recent focus on counterinsurgency. Unfortunately, 
due to the severe cuts in fiscal year 2013 we were forced to 
cancel seven combat training rotations and significantly reduce 
home station training. Although we ensured deploying units were 
fully trained, sequestration cuts directly impacted the 
training, readiness, and leader development of more than two 
divisions' worth of soldiers. And although readiness levels 
will increase through this year and into fiscal year 2015, as 
Senator Collins did note, the pending return of sequestration 
in fiscal year 2016 will quickly erode these gains.
    Finally, I'd be remiss if I did not thank the Chairman, 
particularly for his comments about our extraordinary civilian 
employees. As the Chairman has said, they have borne a great 
burden. They have faced, over the past year, pay freezes and 
furloughs. And although our fiscal year 2014 appropriation 
brought some much needed relief, I fear we have yet to see the 
true impacts of these cuts as it will bear on their morale and, 
sadly, their retention. We owe them so very, very much.
    Our fiscal year 2015 budget reflects the challenging fiscal 
times in which we live by making the hard strategic choices 
now. No question we face difficult decisions to further reduce 
end strength, realign our aviation assets, prioritize near-term 
readiness, and protect soldier and family programs. We do much 
of this by taking calculated risk in modernization and 
facilities programs. This budget is lean, it is stark, but it 
is critical to meet the needs of our Nation and its soldiers. 
And our request will begin further reductions to our end 
strength; reaching 450,000 Active, 335,000 Guard, and 195,000 
Reserve soldiers by the end of fiscal year 2017.
    It's important to note that we're also adjusting our force 
mix in favor of the Reserve component. This is the maximum end 
strength we can afford to protect readiness and the minimum we 
need to execute the 2012 Defense Strategic Guidance. 
Nevertheless, this is not without risk.
    Members, we believe very strongly we must restructure our 
aviation portfolio. We know this is controversial, but we have 
no choice. The money is gone and we must balance these vital 
assets in a way that maximizes our readiness and minimizes 
costs across all components. And make no mistake about it, if 
our restructure proposals are delayed or rejected whether 
through a commission or other actions, we will be forced to 
take other immediate cuts to the Active Forces and those 
programs that have already been heavily impacted; further 
eroding our readiness and in impacting manning both civilian 
and military at every post, camp and station in the United 
States.
    So, instead, we propose generating savings by reducing our 
total number of rotary platforms from seven to four. We will 
divest the older, less capable Kiowa Warrior and TH-67 trainers 
in favor of the Apaches and the Lakotas. In support, the Guard 
will transfer their low-density, high demand Apache attack 
helicopters to the Active Army and, in return, receive over 100 
of our most modern Blackhawks, which are ideal for the dual 
combat and state support role.
    This is the right thing to do. It allows us to better 
sustain a modernized more capable fleet across all components 
and significantly reduce sustainment cost. Once again, the vast 
majority of cuts, a total of 86 percent, come from the Active 
Army. Overall, the Guard's fleet will decline by just 8 percent 
while the Active Force declines by some 23 percent.
    At its core, our Army is people. Accordingly, we are 
committed to protecting our soldiers, civilian, and family 
programs and, where appropriate, adding resources. And, in 
fact, we increased funding by nearly 46 percent across the 
myriad of programs associated with our ready and resilient 
campaign. In the prevention of sexual assault and harassment 
and suicide to transition assistance and comprehensive soldier 
and family fitness, we are determined to meet the needs of our 
warriors, employees and their families. We believe we have a 
sacred covenant with all who serve and all who support them and 
we will not break it.
    Regarding facilities, our budget is just 49 percent of our 
fiscal year 2014 MILCON appropriation. And we are deferring 
some 20 projects across all components with, again, the vast 
majority coming from the Active component.
    On a related note, let me take a moment to mention BRAC 
(base realignment and closure). I know it's not popular. As a 
member, I had a base in my district that closed due to BRAC. It 
wasn't fun. It's hard and we understand that. But, it was 
necessary then and, we believe, it's more necessary now. We 
cannot afford to pay for the maintenance and upkeep of unused 
or unnecessary facilities. It wastes money that we just don't 
have.
    Members, as I've noted, we didn't want to make these 
decisions. We didn't want to limit our programs or cut the 
Army's end strength, but we had little choice. Nevertheless, we 
firmly believe we've developed a plan that balances the needs 
of our Nation, our soldiers, and their family members against 
the severe budget constraints and calculated risk. And now, we 
need your help.
    If our planned reductions and realignments are derailed or 
delayed, we don't have the funding or time to adjust. Simply 
put, we need protection. We need predictability. We don't need 
politics.

                           PREPARED STATEMENT

    In conclusion, on behalf of the men and women of your Army, 
let me thank you for your thoughtful oversights, steadfast 
support and proud partnership. Now, as I said before, we need 
your help. We need your leadership to safeguard the most 
capable land force the world has ever known as we prepare to 
meet the unforeseen challenges that lay ahead.
    Thank you, Mr. Chairman. I look forward to your questions.
    [The statement follows:]
             Prepared Statement of Hon. John M. McHugh and 
                       General Raymond T. Odierno
                              introduction
    America's Army remains heavily committed in operations overseas as 
well as at home in support of our Combatant Commanders. More than 
66,000 U.S. Army Soldiers are deployed to contingency operations, with 
nearly 32,000 Soldiers supporting operations in Afghanistan. In 
addition, there are approximately 85,000 Soldiers forward stationed 
across the globe in nearly 150 countries worldwide. Every day, the 
Soldiers and Civilians of the Active Army, Army National Guard and Army 
Reserve inspire us with their competence, character and commitment to 
serving our Nation. A typical day for our Soldiers may include 
patrolling alongside our Afghan National Army partners, standing watch 
on the DMZ in Korea, manning missile batteries in Turkey and Guam, 
delivering humanitarian relief to the Philippines, conducting logistics 
training in Sierra Leone, securing facilities in South Sudan and 
responding to floods, wildfires and tornados across the United States.

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                      the army's strategic vision
    The All-Volunteer Army will remain the most highly trained and 
professional land force in the world. It is uniquely organized with the 
capability and capacity to provide expeditionary, decisive land power 
to the Joint Force and ready to perform across the range of military 
operations to Prevent, Shape and Win in support of Combatant Commanders 
to defend the Nation and its interests at home and abroad, both today 
and against emerging threats.

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

    Throughout our Nation's history, the United States has drawn down 
military forces at the close of every war. Today, however, we are in 
the process of rapidly drawing down Army forces before the war is over. 
At the same time, we continue to face an uncertain, complicated and 
rapidly changing international security environment, as stated in the 
2014 Quadrennial Defense Review. In light of domestic fiscal 
challenges, the Army is committed to doing its part to restore fiscal 
discipline and contribute to our Nation's economic strength. In a time 
of budget stringency, the Army's greatest challenge is providing 
steadfast support to worldwide operational commitments to include 
Afghanistan while simultaneously drawing down, reorganizing and 
preparing the force for a wider array of security missions and threats 
in the future. We are committed to ensure the U.S. Army remains the 
most highly trained and professional land force in the world.
    Together, we must ensure our Army is trained and ready to prevent 
conflict, shape and set theaters for our geographic Combatant 
Commanders, deter aggression, and if necessary, win decisively in a 
sustained major combat operation. However, over the last 2 years, the 
impact of the Budget Control Act (BCA) of 2011 has resulted in 
declining readiness throughout the Total Army (Active Army, Army 
National Guard and Army Reserve).
               budgetary reductions and strategic choices
    Over the past 4 years, the Army has absorbed several budget 
reductions in the midst of conducting operations overseas and 
rebalancing the force to the wider array of missions required by 2012 
Defense Strategic Guidance. To comply with the funding caps specified 
in the BCA, the fiscal year 2013 budget proposed $487 billion in DOD 
funding reductions over 10 years, of which the Army's share was an 
estimated $170 billion. In addition, sequestration was triggered in 
2013, forcing an additional $37 billion reduction in fiscal year 2013 
and threatening a further total reduction in DOD funding of 
approximately $375 billion through fiscal year 2021, with the Army's 
portion estimated at $95 billion. In fiscal year 2013, a combination of 
sequestration and overseas contingency operations funding shortfalls 
degraded Army readiness levels. It caused the Army to carry over a 
readiness shortfall of $3.2 billion to fiscal year 2014.
    The Army continues to face an uncertain fiscal environment in the 
years ahead. The Bipartisan Budget Act (BBA) of 2013 provides the Army 
modest, temporary relief from BCA defense spending caps in 2014. The 
predictability afforded by known budget levels is appreciated, and the 
BBA supports an fiscal year 2015 Army funding level of $120.5 billion. 
However, the Army still faces budget cuts of $7.7 billion in fiscal 
year 2014, and an additional $12.7 billion in fiscal year 2015, when 
compared to the President's fiscal year 2014 budget request. While we 
welcome the relief and predictability that the BBA provides, the Army 
will be forced to cut $20.4 billion in planned funding, an abrupt 
reduction over a short 2-year period of time. Beyond fiscal year 2015, 
fiscal uncertainty remains, including the potential resumption of the 
sequestration-level spending caps in fiscal year 2016.
    During this period of uncertainty in the fiscal and strategic 
environment, our goal has been to maintain the proper balance between 
end strength, readiness and modernization across the Total Army. We are 
reducing end strength as rapidly as possible, while still meeting our 
operational commitments, in order to concentrate remaining funds on 
rebuilding readiness. However, to do this we must accept greater risk 
in our modernization programs. To rebuild and sustain a force capable 
of conducting the full range of operations on land, to include prompt 
and sustained land combat, it is essential that we take steps to 
prevent hollowness within the force. Therefore, consistent with the 
2012 Defense Strategic Guidance, we are in the process of drawing down 
Active Army end strength from a wartime high of 570,000 to 490,000--a 
14 percent cut--by the end of fiscal year 2015. The Army National Guard 
will reduce from 358,200 to 350,200 and the Army Reserve will remain 
relatively constant, decreasing from 205,000 to 202,000 Soldiers. In 
conjunction with these end strength reductions, the Army decided to 
reorganize the current operational force of Active Army Infantry, 
Armored and Stryker Brigade Combat Teams (BCTs) from 38 to 32. This 
force structure reorganization will allow us to eliminate excess 
headquarters infrastructure while sustaining as much combat capability 
as possible.
    The fiscal year 2015 budget request provides a balanced and 
responsible way forward in the midst of ongoing fiscal uncertainty. It 
allows the Army to reduce and reorganize force structure, but incurs 
some risk to equipment modernization programs and readiness. Under the 
fiscal year 2015 budget request, the Army will decrease end strength 
through fiscal year 2017 to a Total Army of 980,000 Soldiers--450,000 
in the Active Army, 335,000 in the Army National Guard and 195,000 in 
the Army Reserve. This reduction will also adjust the force mix ratio 
between the active and reserve components. We will reverse the force 
mix ratio, going from a 51 percent active component and 49 percent 
reserve component mix in fiscal year 2012 to a 54 percent reserve 
component and 46 percent active component mix in fiscal year 2017. The 
Army will be able to execute the 2012 Defense Strategic Guidance at 
this size and component mix, but it will be at significant risk.
    But with sequestration-level caps in fiscal year 2016 and beyond 
the Army will be required to further reduce Total Army end strength to 
420,000 in the Active Army, 315,000 in the Army National Guard and 
185,000 in the Army Reserve by the end of fiscal year 2019. This would 
end up being a total reduction of 213,000 Soldiers with 150,000 coming 
from the Active Army, 43,000 coming from the Army National Guard and 
20,000 from the Army Reserve. This includes a 46 percent reduction in 
Active Army BCTs and a 21 percent reduction in Army National Guard 
BCTs. Sequestration-level spending caps would also require a 25 percent 
reduction to Army modernization accounts, with no program unaffected. 
Major weapon programs will be delayed, severely impacting the 
industrial base both in the near and long term. Most significantly, 
these projected end strength levels would not enable the Army to 
execute the 2012 Defense Strategic Guidance.
    For the next 3 years, as we continue to draw down and restructure 
into a smaller force, the Army will continue to have degraded readiness 
and extensive modernization program reductions. Under the President's 
budget, we will begin to regain balance between end strength, 
modernization and readiness beyond fiscal year 2017. Our goal would be 
to achieve balance by the end of fiscal year 2019 with 450,000 Soldiers 
in the Active Army, 335,000 in the Army National Guard and 195,000 in 
the Army Reserve.
    Under sequestration-level spending caps, from fiscal year 2019 to 
fiscal year 2023 the Army will begin to establish the appropriate 
balance between readiness, modernization and end strength, albeit for a 
much smaller Army at 420,000 Soldiers in the Active Army, 315,000 in 
the Army National Guard and 185,000 in the Army Reserve. We will 
stabilize our end strength and force structure. From fiscal year 2020 
to fiscal year 2023 we would begin achieving our readiness goals and 
reinvesting in modernization programs to upgrade our aging fleets. Our 
goal is to achieve balance by fiscal year 2023. The reduction in our 
institutional base will make reversibility significantly more 
difficult. Finally, the size of our Army at this level of funding will 
not allow us to execute the Defense Strategic Guidance and will put in 
doubt our ability to execute even one prolonged, multi-phased major 
contingency operation.
                           leader development
    Developing adaptive Army leaders who possess the individual 
toughness, battlefield skill and fighting spirit that typify the 
American Soldier is one of our highest priorities. The unpredictable 
nature of human conflict requires leaders to not only lead in close 
combat but understand the operational and strategic environment, to 
include its socio-economic, cultural and religious underpinnings. Our 
leaders must demonstrate the competence, proficiency and professional 
values necessary to achieve operational and strategic mission success. 
We must continue to educate and develop Soldiers and Civilians to grow 
the intellectual capacity to understand the complex contemporary 
security environment to better lead Army, Joint, Interagency and 
Multinational task forces and teams. Therefore, we will reinvest and 
transform our institutional educational programs for officers and 
noncommissioned officers in order to prepare for the complex future 
security environment.
    We will continue to build leaders who exhibit the character, 
competence and commitment that are hallmarks of the Army Profession. We 
are aggressively and comprehensively reinforcing our core values and 
ethical leadership throughout all unit and institutional training, 
leader development programs and professional military education. We 
will also transition to a new officer evaluation system that 
strengthens accountability and emphasizes the evaluation of character 
attributes and competencies. We have completed a 360-degree assessment 
pilot for all battalion and brigade commanders, which will be fully 
institutionalized across the force in 2014. We will continue peer 
assessments for all general officers and will institute 360-degree 
assessments for all general officers upon promotion to each general 
officer rank.
    Today, our leaders are the most competent and operationally 
experienced since World War II. We must build on this incredible 
experience to develop leaders who can operate in an ever-changing, 
complex strategic environment, understanding the implications of 
critical thinking, rapid communications and cyber warfare as it relates 
to combined arms maneuver, irregular warfare and counterinsurgency 
operations.
the army: globally responsive, regionally engaged strategic land forces
    There is no more unambiguous display of American resolve than the 
deployment of the American Soldier. As part of the Joint Force, the 
Army deters potential adversaries by presenting a credible element of 
national power: Landpower that is decisively expeditionary and 
strategically adaptive. The Army possesses a lethal combination of 
capability and agility that strengthens U.S. diplomacy and represents 
one of America's most credible deterrents against hostility. If 
necessary, a ready Army can defeat or destroy enemy forces, control 
land areas, protect critical assets and populations and prevent the 
enemy from gaining a position of operational or strategic advantage. 
Ultimately, potential adversaries must clearly perceive Army forces as 
being capable of appropriate and rapid response anywhere in the world 
and across the entire range of military operations, from stability 
operations to general war.
    A ready and capable Total Army provides Joint and Combined forces 
with expeditionary and enduring landpower for the full range of 
military operations. Regionally aligned Army forces provide direct 
support to geographic and functional combatant commands. Army forces 
are tailorable and scalable, prepared to respond rapidly to any global 
contingency mission. The Army maintains a responsive force posture 
through an effective mix of Total Army capabilities and network of 
installations at home and abroad, to include Army prepositioned stocks. 
The Army National Guard and Army Reserve provide predictable, recurring 
and sustainable capabilities and strategic depth. Rapidly deployable 
Army forces, to include airborne forces, are able to respond to 
contingencies and conduct forcible entry operations anywhere in the 
world on short notice. Army prepositioned equipment across the globe 
also enables the rapid air deployment of Army combat and support 
forces.
Missions as a Member of the Joint Force
    As an interoperable member of the Joint Force, the Army sets the 
theater for Combatant Commanders by providing unique capabilities en 
route to, and operating within, austere environments to support all 
plans and contingencies. These capabilities include special operations 
and ground forces, operational leadership and mobility, and critical 
enablers such as aviation, missile defense, intelligence, engineers, 
logistics, inland ground transportation infrastructure, medical and 
signal/communications.
    The Army provides the Joint Force versatility across the full range 
of military operations, underpinning operational and strategic reach 
through the full length of a campaign, often in contested environments. 
Effective joint operations require Army ground combat forces and Army 
critical enablers. A significant portion of the Army's force structure 
is devoted to enabling the Joint Force as well as our Multinational and 
Interagency partners.
    We provide a variety of Joint Task Force headquarters certified and 
trained to lead Joint Forces, plan operations and exercise mission 
command of units across the full range of military operations. We 
provide strategic, operational and tactical logistics, worldwide 
engineering support and intelligence capabilities, as well as space-
based and terrestrial command and control networks that connect our own 
units, the Joint community, and Interagency and Multinational partners. 
The Army is also investing in emerging and evolving missions such as 
operations in cyberspace and countering weapons of mass destruction. 
For example, we continue to develop and field cyber mission forces that 
enable the success of our national mission force, combatant commands 
and Army land forces.
Regionally Aligned Forces
    The Army is regionally aligning forces in support of the geographic 
and functional combatant commands. These forces provide deployable and 
scalable regionally focused Army forces task organized for direct 
support of geographic and functional combatant commands and Joint 
requirements. Forward stationed Army forces in the Republic of Korea, 
Japan and Europe, along with Army units based in the United States are 
aligned with combatant commands. These forces shape and set theaters 
for regional commanders employing unique Total Army characteristics and 
capabilities to influence the security environment, build trust, 
develop relationships and gain access through rotational forces, 
multilateral exercises, military-to-military engagements, coalition 
training and other opportunities.
    Army forces strengthen alliances and ensure collective capability 
while building capacity and serving common interests. In many regions 
of the world, Army military-to-military relationships have enabled the 
U.S. to remain a trusted and welcome partner over the years. The Army's 
Special Forces Groups provide extraordinary regional expertise and 
unique capabilities, as well as years of experience, to the combatant 
commands. The Army National Guard, through the State Partnership 
Program, maintains long-term partnerships worldwide.

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    We are expanding regional alignment of the Total Army as the 
drawdown in Afghanistan continues and additional formations become 
available. The Army's first regionally aligned BCT--the 2nd Brigade, 
1st Infantry Division stationed at Fort Riley, Kansas--began actively 
supporting U.S. Africa Command in March 2013 and has conducted over 70 
missions, from crisis response to security cooperation, in more than 30 
countries. 1st Infantry Division headquarters, building upon the 
initial success of its 2nd Brigade and aligned with U.S. Africa 
Command, is planning a Libyan General Purpose Force training mission. 
The 48th Infantry BCT, Georgia Army National Guard, is aligned with 
U.S. Southern Command and has deployed teams to several Central and 
South American countries. The Fort Hood-based 1st BCT, 1st Cavalry 
Division, aligned with U.S. European Command, participated in 
multilateral exercises and training as the primary U.S. land force 
contribution to the NATO Response Force.
    About 80,000 active and reserve component Soldiers are postured to 
support operations and engagements in the Asia-Pacific region. I Corps, 
stationed at Joint Base Lewis-McChord, Washington, and assigned to U.S. 
Pacific Command, provides deployable mission command capability for 
contingencies and enhances an already strong Army presence in the Asia-
Pacific region. The Army maintains a Terminal High Altitude Area 
Defense battery deployed to Guam, defending our allies and supporting 
the Pacific theater's ballistic missile defense posture. During fiscal 
year 2013, U.S. Army Pacific conducted 28 large-scale exercises with 13 
countries. Soldiers also conducted security cooperation engagements 
with 34 countries in the Asia-Pacific region.
    During fiscal year 2013, a total of more than 109,000 Soldiers 
deployed in support of operations in Afghanistan. More than 4,300 
Soldiers supported Operation Spartan Shield, our ongoing effort to 
maintain stability in the region and reassure our allies and partners 
in U.S. Central Command's area of responsibility. In addition, during 
fiscal year 2013 more than 2,200 Soldiers participated in seven 
exercises in the region. III Corps, stationed at Fort Hood, Texas, and 
1st Armored Division headquarters, stationed at Fort Bliss, Texas, are 
both aligned with U.S. Central Command. In June 2013 the 1st Armored 
Division headquarters deployed to Jordan, providing mission command for 
several regional exercises and conducting training with allied and 
partner forces.
Missions at Home and Support of Civil Authorities
    The Total Army defends the Homeland and supports civil authorities 
for a variety of complex missions. Soldiers from the active and reserve 
components are engaged in the Homeland on a daily basis, in capacities 
ranging from personnel serving as defense coordinating officers in 
support of the Federal Emergency Management Agency to U.S. Army North 
leading and coordinating Army missions in support of civil authorities. 
The Army stands ready to conduct a no-notice response in support of 
civil authorities, particularly for a complex catastrophe that may 
require the employment of a significant Army force. The Total Army also 
provides the preponderance of forces for the Department of Defense's 
Chemical, Biological, Radiological and Nuclear Response Enterprise. 
Army National Guard air and missile defense units protect our Nation's 
Capital and provide manning for Ground-based Midcourse Defense systems 
deployed in Alaska and Colorado that will deter and defeat missile 
attacks on our Nation. Soldiers support Federal drug enforcement 
efforts along our Nation's southern border every day.
    Over the past year, the Army responded to natural disasters in the 
United States with sustained, life-saving support. The Army National 
Guard conducted firefighting operations in several Western States. In 
September 2013, active and reserve component Soldiers provided rapid 
assistance when severe storms caused devastating floods and landslides 
in northern Colorado. A team of about 700 Soldiers from the Colorado 
and Wyoming Army National Guard, as well as the Active Army's 4th 
Infantry Division stationed at Fort Carson, Colorado, evacuated more 
than 3,000 displaced residents. Soldiers and Civilians from the U.S. 
Army Corps of Engineers also supported operations in Colorado, and 
continue to support ongoing national efforts to restore critical 
infrastructure following Hurricane Sandy.
                         ensuring a ready army
    A trained and ready Army must be able to rapidly deploy, fight, 
sustain itself and win against complex state and non-state threats in 
austere environments and rugged terrain. Readiness is measured at both 
the service and unit levels. Service readiness incorporates 
installations and the critical ability of the Army to provide the 
required capacities (units) with the requisite capabilities (readiness) 
to execute the roles and missions required by combatant commands. Unit 
readiness is the combination of personnel, materiel and supplies, 
equipment and training that, when properly balanced, enables immediate 
and effective application of military power.
Training
    Training across the Total Army serves two main purposes: Preparing 
units to support combatant commands worldwide and developing leaders 
who can adapt to the complex security environment. To meet demands 
across the full range of military operations, the Army will shift the 
focus of training on rebuilding war fighting core competencies. We are 
reinvigorating our Combat Training Centers (CTCs), to challenge and 
certify Army formations in a comprehensive and realistic decisive 
action training environment that features regular, irregular and 
insurgent enemy forces. Tough, realistic multi-echelon home station 
training using a mix of live, virtual and constructive methods 
efficiently and effectively builds Soldier, leader and unit competency 
over time.
    From 2004 to 2011, all CTC rotations were focused on building 
readiness for assigned missions in a counterinsurgency environment. 
This shift impacted 5,500 company commanders, 2,700 field grade 
officers and 1,000 battalion commanders. Recognizing this atrophy in 
readiness for the full range of military operations, the Army returned 
to conducting decisive action CTC rotations in 2011, with a plan to 
cycle nearly all Active Army BCTs by the end of fiscal year 2015 along 
with the requisite amount of available Army National Guard BCTs. 
However, due to sequestration, the Army canceled seven CTC rotations in 
2013 and significantly reduced home station training, negatively 
impacting the training, readiness and leader development of more than 
two divisions' worth of Soldiers. Those lost opportunities only added 
to the gap created from 2004 to 2011, creating a backlog of 
professional development and experience.
    The BBA allows us to remedy only a fraction of that lost 
capability. Even with increased funding, in fiscal year 2014 the Army 
will not be able to train a sufficient number of BCTs to meet our 
strategic requirements. Seventeen BCTs were originally scheduled to 
conduct a CTC rotation during fiscal year 2014. BBA-level funding 
enables the addition of another two BCT rotations, for a total of 19 
for the fiscal year. However, due to the timing of the additional 
funding, some BCTs were still unable to conduct a full training 
progression before executing a CTC rotation. Without the benefit of 
sufficient home station training, BCTs begin the CTC rotation at a 
lower level of proficiency. As a result, the CTC rotation does not 
produce the maximum BCT capability, in terms of unit readiness. For 
BCTs that do not conduct a CTC rotation, we are using available 
resources to potentially train these formations up to only battalion-
level proficiency.
    The Army can currently provide only a limited number of available 
and ready BCTs trained for decisive action proficiency, which will 
steadily increase through fiscal year 2014 and the beginning of fiscal 
year 2015. But with potential sequestration in fiscal year 2016, 
readiness will quickly erode across the force. We must have 
predictable, long-term, sustained funding to ensure the necessary 
readiness to execute our operational requirements and the Defense 
Strategic Guidance.
    Fiscal shortfalls have caused the Army to implement tiered 
readiness as a bridging strategy until more resources become available. 
Under this strategy, only 20 percent of operational forces will conduct 
collective training to a level required to meet our strategic 
requirements, with 80 percent of the force remaining at a lower 
readiness level. Forward stationed forces in the Republic of Korea will 
remain ready, as will those dedicated as part of the Global Response 
Force. Forces deployed to Afghanistan are fully trained for their 
security assistance mission but not for other contingencies. The Army 
is also concentrating resources on a contingency force of select 
Infantry, Armored and Stryker BCTs, an aviation task force and required 
enabling forces to meet potential unforeseen small scale operational 
requirements. Unless Army National Guard and Army Reserve units are 
preparing for deployment, the Army will only fund these formations to 
achieve readiness at the squad, team and crew level.
Force Structure
    We have undertaken a comprehensive reorganization of Army units to 
better align force structure with limited resources and increase unit 
capability. Unit reorganizations are necessary to begin balancing force 
structure, readiness and modernization. However, when combined with 
reduced funding and operational demand, the pace of force structure 
changes will reduce our ability to build readiness across the force 
during fiscal year 2014 and fiscal year 2015.
    Reorganization of the current operational force of Active Army 
Infantry, Armored and Stryker BCTs from 38 to 32 reduces tooth to tail 
ratio and increases the operational capability of the remaining BCTs. 
All Active Army and Army National Guard BCTs will gain additional 
engineer and fires capability, capitalizing on the inherent strength in 
combined arms formations. Initially, 47 BCTs (29 Active Army and 18 
Army National Guard) will be organized with a third maneuver battalion. 
The remaining 13 BCTs (3 Active Army and 10 Army National Guard) will 
be reevaluated for possible resourcing of a third maneuver battalion in 
the future.
    Following a comprehensive review of our aviation strategy, the Army 
has determined that it must restructure aviation formations to achieve 
a leaner, more efficient and capable force that balances operational 
capability and flexibility across the Total Army. We will eliminate 
older, less capable aircraft, such as the OH-58 A/C Kiowa, the OH-58D 
Kiowa Warrior and the entire fleet of TH-67 JetRangers, the current 
trainer. The Army National Guard will transfer low-density, high-demand 
AH-64 Apache helicopters to the Active Army, where they will be teamed 
with unmanned systems for the armed reconnaissance role as well as 
their traditional attack role. The Active Army in turn will transfer 
over 100 UH-60 Blackhawk helicopters to the Army National Guard. These 
aircraft will significantly improve capabilities to support combat 
missions and increase support to civil authorities, such as disaster 
response, while sustaining security and support capabilities to civil 
authorities in the states and territories.
    The Army will also transfer nearly all Active Army LUH-72 Lakota 
helicopters to the United States Army Aviation Center of Excellence at 
Fort Rucker, Alabama, and procure an additional 100 LUH-72 Lakotas to 
round out the training fleet. These airframes will replace the TH-67 
JetRanger helicopter fleet as the next generation glass cockpit, dual 
engine training helicopter. At current funding levels, this approach 
will enable the Army National Guard to retain all of its LUH-72 
aircraft for general support requirements as well as ongoing border 
security operations. The Aviation Restructure Initiative allows us to 
sustain a modernized fleet across all components and reduces 
sustainment costs. Eighty-six percent of the total reduction of 
aircraft (687 of 798) will come out of the active component. The Active 
Army's overall helicopter fleet will decline by about 23 percent, and 
the Army National Guard's fleet of helicopters will decline by 
approximately 8 percent, or just over 100 airframes. The resulting 
active and reserve component aviation force mix will result in better 
and more capable formations which are able to respond to contingencies 
at home and abroad.
  soldiers, civilians and our families: the premier all-volunteer army
    Trust is the foundation of military service. An individual's choice 
to serve, whether enlisting or reenlisting, depends on a strong bond of 
trust between the volunteer, the Army and the Nation. Soldiers need to 
know that the Nation values their service and will provide them with 
the training, equipment and leadership necessary to accomplish their 
mission. They also want to know that their Families will enjoy a 
quality of life that is commensurate with their service and sacrifice. 
For that reason, one of our top priorities as we make the transition 
from war and drawdown the Army--regardless of fiscal challenges--must 
be the welfare, training and material resources we put toward 
maintaining the trust of our Soldiers, Civilians and their Families.
Ready and Resilient Campaign
    Perhaps nothing exemplifies the idea of trust more than President 
Abraham Lincoln's second inaugural address when he called upon the 
Nation to care for those who have borne the burdens of battle and their 
Families. The effects of deploying are sometimes severe and lifelong. 
As a result, the continued care and treatment of Soldiers and their 
Families is a lasting priority. Yet even as we work to recover and 
rehabilitate those most severely affected by two wars, we know that an 
ever increasing portion of our Army has not faced warfare. 
Understandably, they have new and different challenges. In both cases, 
Army readiness is directly linked to the ability of our force to deal 
with personal, professional and unforeseen health concerns, such as 
mental and physical challenges. We must also begin to view health as 
more than simply healthcare, and transition the Army to an entire 
system for health that emphasizes the performance triad--sleep, 
activity and nutrition--as the foundation of a ready and resilient 
force.
    The Ready and Resilient Campaign, launched in March 2013, serves as 
the focal point for all Soldier, Civilian, and Family programs and 
promotes an enduring, holistic and healthy approach to improving 
readiness and resilience in units and individuals. The campaign seeks 
to influence a cultural change in the Army by directly linking personal 
resilience to readiness and emphasizing the personal and collective 
responsibility to build and maintain resilience at all levels. The 
campaign leverages and expands existing programs, synchronizing efforts 
to eliminate or reduce harmful and unhealthy behaviors such as suicide, 
sexual harassment and assault, bullying and hazing, substance abuse and 
domestic violence. Perhaps most importantly, the campaign promotes 
positive, healthy behaviors while working to eliminate the stigma 
associated with asking for help.
Sexual Harassment/Assault Response and Prevention (SHARP) Program
    The Army is an organization built on and bound by values. Sexual 
harassment and assault in all its forms is abhorrent to every one of 
those values. Simply put, sexual assault is a crime that will not be 
tolerated. The overwhelming majority of Soldiers and Civilians serve 
honorably and capably, but we must recognize that the ill-disciplined 
few jeopardize the safety of all our people as well as the trust and 
confidence the American people have in their Army.
    Army actions to combat sexual assault and harassment are driven by 
five imperatives. First, we must prevent offenders from committing 
crimes, provide compassionate care for victims and protect the rights 
and privacy of survivors. Second, we must ensure that every allegation 
is reported, it is thoroughly and professionally investigated, and we 
must take appropriate action based on the investigation. Third, we 
shall create a positive climate and an environment of trust and respect 
in which every person can thrive and achieve their full potential, and 
continually assess the command climate. Fourth, we will hold every 
individual, every unit and organization and every commander 
appropriately accountable for their behavior, actions and inactions. 
Finally, the chain of command must remain fully engaged--they are 
centrally responsible and accountable for solving the problems of 
sexual assault and sexual harassment within our ranks and for restoring 
the trust of our Soldiers, Civilians and Families.
    Our goal is to reduce and ultimately eliminate this crime from our 
ranks. To underscore the importance of the chain of command's role in 
preventing sexual assault, the Army now includes command climate and 
SHARP goals and objectives in all officer and non-commissioned officer 
evaluations and unit command climate surveys. Accountability is 
reinforced by training and education on the appropriate behaviors, 
actions and reporting methods. The Army has integrated SHARP training 
into every professional development school, making sure it is tailored 
to roles and responsibilities appropriate to each course's population.
    We are making progress, particularly on reporting and investigating 
these incidents. Over the past year the Army expanded the Special 
Victim Capability Program to include 23 special victim prosecutors, 22 
sexual assault investigators and 28 special victim paralegals at 19 
installations worldwide. These professionals are trained in the unique 
aspects of investigating and prosecuting sexual assault cases. We have 
also trained 81 active and 24 reserve component judge advocates through 
our Special Victim Counsel Program, which was established in September 
2013. As of December 2013, 241 victims had received over 1,443 hours of 
legal services from these specially trained counsel, including 
appearances at Article 32 hearings and courts-martial.
    Army commanders, advised by judge advocates, continue to take the 
most challenging cases to trial, including cases that civilian 
authorities have declined to prosecute. For cases in which the Army had 
jurisdiction over the offender and a final disposition was made, 
commanders prosecuted rape and sexual assault at a rate more than 
double the estimated average prosecution rates in civilian 
jurisdictions. The Army also provides sexual assault patients with 
expert, emergency treatment for their immediate and long-term needs. 
Regardless of evidence of physical injury, all patients presenting to 
an Army medical treatment facility with an allegation of sexual assault 
receive comprehensive and compassionate medical and behavioral 
healthcare.
    Sexual assault is antithetical to competent command, and it is 
important that commanders retain their authority over the disposition 
of sexual assault cases. Removal of that authority would make it harder 
to respond to the needs of Soldiers within the command, especially the 
victims. Many of the Army's most difficult problems--such as 
integration--were solved by making commanders more accountable, not 
less. Therefore the Army opposes legislative efforts to remove 
commanders from the disposition process.
Suicide Prevention
    The Army Suicide Prevention Program, part of the Ready and 
Resilient Campaign, has significantly enhanced our understanding of one 
of our greatest challenges: the loss of Soldiers to suicide. The Army 
has expanded and increased access to behavioral health services and 
programs that develop positive life-coping skills. A comprehensive 
education and training program is helping Soldiers, Civilians and 
Family members improve their ability to cope with stress, 
relationships, separations, deployments, financial pressures and work-
related issues. The goal is to increase resiliency and, just as 
important, access to support. Our Suicide Reduction Working Group 
provides a forum for stakeholders to collaborate on initiatives that 
mitigate high-risk behaviors. The Army continues to revise and create 
policy to promote and increase awareness of prevention and intervention 
skills, services and resources. We have seen an aggregate drop in 
suicides, and while not a declaration of success, it is a leading 
indicator that our resiliency efforts are starting to take hold across 
the force.
Role of Women in the Army
    Women continue to play an important role in making our Army the 
best in the world. We are validating occupational standards for 
integrating women into all career fields. By reinforcing universal 
standards for each Soldier--regardless of gender--in a deliberate, 
measured and responsible manner we increase unit readiness, cohesion 
and morale while allowing for qualification based on performance, not 
gender, across our profession.
    Army Training and Doctrine Command is leading our effort with the 
Soldier 2020 initiative, which seeks to ensure we select the best 
Soldiers for each military occupational specialty, regardless of 
gender. It is a standards-based, holistic and deliberate approach that 
uses scientific research to clearly define physical accessions 
standards based on mission requirements for each Army occupation. 
Simultaneously, we are conducting an extensive study to identify the 
institutional and cultural factors affecting gender integration, to 
develop strategies for the assimilation of women into previously 
restricted units. An important part of that process will be to ensure 
we have a qualified cadre of female leaders, both officers and 
noncommissioned officers, in place prior to the introduction of junior 
female Soldiers to serve as role models and provide mentorship during 
this transition.
    During the last year the Army opened approximately 6,000 positions 
in 26 BCTs, select aviation specialties in special operations aviation 
and approximately 3,600 field artillery officer positions. The Army 
anticipates opening an additional 33,000 previously closed positions 
during fiscal year 2014.
Recruitment and Retention
    The Army is defined by the quality of the Soldiers it recruits and 
retains. We are only as good as our people, and recruiting standards 
and reenlistment thresholds remain high. During fiscal year 2013, 98 
percent of the Army's recruits were high school graduates, exceeding 
our goal of 90 percent. We are also on track to achieve retention rates 
consistent with the past 3 years. The need to recruit and retain high-
quality Soldiers will only grow in importance as we continue to draw 
down our forces.
    Unfortunately, natural attrition alone will not achieve the Army's 
reduced end strength requirements. Inevitably, the Army will not be 
able to retain good Soldiers on active duty who have served their 
Nation honorably. The Army must responsibly balance force shaping 
across accessions, retention, and promotions, as well as voluntary and 
involuntary separations. During fiscal year 2013, the Army reduced 
accessions to the minimum level needed to sustain our force structure, 
achieve end strength reductions and reestablish highly competitive but 
predictable promotion opportunity rates. The Army also conducted 
Selective Early Retirement Boards for lieutenant colonels and colonels 
and, likewise, a Qualitative Service Program for staff sergeants 
through command sergeants major, all aimed at achieving 490,000 Active 
Army end strength by the end of fiscal year 2015. During fiscal year 
2014 the Army will conduct Officer Separation Boards and Enhanced 
Selective Early Retirement Boards for qualified majors and captains. We 
remain committed to assisting Soldiers and their Families as they 
depart Active Army formations and transition to civilian life, and we 
encourage continued service in the Army National Guard or Army Reserve.
Role of the Army Civilian
    As the Army evolves so too must its civilian workforce, which will 
also draw down concurrent with reductions to military end strength. 
Army Civilians will reduce from a wartime high of 285,000 to 263,000 by 
the end of fiscal year 2015. As the civilian workforce is downsized, we 
will do it smartly, focusing on preserving the most important 
capabilities. This requires a broader strategy that links functions, 
funding and manpower to produce the desired civilian workforce of the 
future--one that fully supports the generation of trained and ready 
combat units. The Army will manage the civilian workforce based on 
workload and funding available. We will use all available workforce 
shaping tools such as Voluntary Early Retirement Authority and 
Voluntary Separation Incentive Pay to reduce turbulence in our civilian 
workforce. We will target the skills we need to retain, and voluntarily 
separate those with skills no longer needed. If we cannot achieve our 
Army Civilian reduction goals by voluntary means, we will use Reduction 
in Force as a last resort.
    The possibility of future reductions only adds to the burdens we've 
placed on Army Civilians in recent years. Last year, the Army 
furloughed more than 204,000 civilian employees, forcing them to take a 
20 percent reduction in pay for 6 weeks during the fourth quarter of 
fiscal year 2013. Furloughs came on the heels of 3 years of frozen pay 
and performance-based bonuses. The tremendous impact on the morale of 
our civilian workforce cannot be understated, and some of our highest 
quality civilian personnel have sought employment in the private 
sector.
    We rely heavily on our Army Civilians, and they have remained 
dedicated and patient during the last few years of uncertainty and 
hardship. Like their uniformed counterparts, Army Civilians are 
required to demonstrate competence, technical proficiency and 
professional values to achieve mission and individual success. Over the 
past 3 years the Army has implemented a number of changes to improve 
training, educational and experiential opportunities for the civilian 
workforce. Focused leader development, improvements to the Civilian 
Education System and continued maturity of the Senior Enterprise Talent 
Management Program are all designed to build a more professional and 
competency-based civilian workforce.
    The Army is also streamlining its contractor workforce by reducing 
contract spending at least to the same degree as, if not more than, 
reductions to the civilian workforce; contractor reductions are 
approximately $1.5 billion in fiscal year 2015. The use of contracted 
services will continue to be reviewed to ensure the most appropriate, 
cost effective and efficient support is aligned to the mission. As the 
Army continues its workforce shaping efforts, contracted manpower will 
be appropriately managed based on functional priorities and available 
funding to ensure compliance with law.
Compensation Reform
    We are extremely grateful for the high quality care and 
compensation our Nation has provided to our Soldiers over the last 
decade. Military manpower costs remain at historic highs. We must 
develop adjustments to military compensation packages that reduce 
future costs, recognize and reward our Soldiers and their Families for 
their commitment and sacrifice, while ensuring our ability to recruit 
and retain a high quality All-Volunteer Army. While we recognize the 
growing costs of manpower, we must also approach reform from the 
perspective that compensation is a significant factor in maintaining 
the quality of the All-Volunteer Army, and always has been.
    After 13 years of war, the manner in which we treat our Soldiers 
and Families will set the conditions for our ability to recruit in the 
future. That said, if we do not slow the rate of growth of Soldier 
compensation, it will consume a higher, disproportionate percentage of 
the Army's budget and without compensation reform we will be forced to 
reduce investments in readiness and modernization. The Army supports a 
holistic and comprehensive approach that reforms military compensation 
in a fair, responsible and sustainable way. Changes to military 
compensation included in the fiscal year 2015 budget request--which 
include slowing the growth of housing allowances, reducing the annual 
direct subsidy provided to military commissaries and simplifying and 
modernizing our TRICARE health insurance program--are important first 
steps that generate savings while retaining competitive benefits. These 
savings will be invested in readiness and modernization.
 equipment modernization, business process improvement and sustainment
    The Army makes prudent choices to provide the best possible force 
for the Nation with the resources available, prioritizing Soldier-
centered modernization and procurement of proven and select emerging 
technologies. The institutional Army manages programs that sustain and 
modernize Army equipment, enabling the operational Army to provide 
responsive and ready land forces. We will continue to improve the 
efficiency and effectiveness of our business processes to provide 
readiness at best value.
Focus Area Review
    Army senior leaders conducted reviews to consolidate and reorganize 
organizations, programs and functions across several focus areas--
readiness, institutional and operational headquarters reductions, 
operational force structure, installations services and investments, 
the acquisition workforce and Army cyber and command, control, 
communications and intelligence. As a result of this effort, the Army 
will achieve greater efficiency across our core institutional 
processes, consolidate functions within the acquisition workforce and 
reduce headquarters overhead by up to 25 percent.
Equipment Modernization
    Modernization enables the Army to meet requirements with a smaller, 
fully capable and versatile force that is equipped to defeat any enemy 
and maintain dominance on land. BCA-driven budget reductions have 
placed Army equipment modernization at risk through program 
terminations, procurement delays and program restructures. Research, 
development and acquisition funding has declined 39 percent since the 
fiscal year 2012 budget planning cycle and the long-term effect will be 
additional stress on current vehicle fleets, reduced replacement of 
war-worn equipment, increased challenges sustaining the industrial base 
and limited investment in the modernization of only the most critical 
capabilities.
    The Army's equipment modernization strategy focuses on effectively 
using constrained resources for near-term requirements and tailoring 
our long-term investments to provide the right capabilities for 
Soldiers in the future. This approach calls for carefully planned 
investment strategies across all Army equipment portfolios, which will 
involve a mix of limiting the development of new capabilities, 
incrementally upgrading existing platforms and investing in key 
technologies to support future modernization efforts. The strategy 
captures the Army's key operational priorities: enhancing the Soldier 
for broad joint mission support by empowering and enabling squads with 
improved lethality, protection and situational awareness; enabling 
mission command by facilitating command and control, and 
decisionmaking, with networked real-time data and connectivity with the 
Joint Force; and remaining prepared for decisive action by increasing 
lethality and mobility, while optimizing the survivability of our 
vehicle fleets.

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                        army equipping strategy
    Investment focused on:
  --Deploying and redeploying units,
  --Managing equipment retrograde,
  --Reorganizing BCTs,
  --Supporting rebalance to the Asia-Pacific region,
  --Resetting our equipment,
  --Redistributing equipment to raise readiness across all Army 
        components,
  --Repositioning forces,
  --Aligning wartime equipment with the Army's current needs,
  --Divesting equipment we no longer need, and
  --Remaining prepared for homeland defense priorities.

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    In the short-term, the Army remains focused on several efforts. We 
are reducing procurement to match force structure reductions. We will 
continue to apply business efficiencies such as multiyear contracts, 
planning for should-cost and implementation of Better Buying Power, to 
facilitate smarter investing. We will tailor capabilities in 
development to meet requirements under affordability constraints. We 
will not transition four programs to the acquisition phase, to include 
the Ground Combat Vehicle and the Armed Aerial Scout. Additionally, we 
will end 4 programs, restructure 30 programs and delay 50 programs. 
Lastly, the divestiture of materiel and equipment, where appropriate, 
will reduce maintenance and sustainment costs and support the 
maximization of resources. Over the long-term, investing in the right 
science and technology and applying affordable upgrades to existing 
systems will allow us to keep pace with technological change and 
improve capabilities.
            Ground Vehicles
    A new Infantry Fighting Vehicle (IFV) remains a key requirement for 
the Army. However, due to significant fiscal constraints, the Army has 
determined that the Ground Combat Vehicle program will conclude upon 
completion of the Technology Development phase, expected in June 2014, 
and will not continue further development. In the near-term, the Army 
will focus on refining concepts, requirements and key technologies in 
support of a future IFV modernization program. This will include 
investment in vehicle components, sub-system prototypes and technology 
demonstrators to inform IFV requirements and future strategies for 
developing a Bradley Infantry Fighting Vehicle replacement. Over the 
long-term, the Army anticipates initiating a new IFV modernization 
program informed by these efforts as resources become available.
    The Army is also committed to developing and fielding the Armored 
Multi-Purpose Vehicle to replace our obsolete M113 family of vehicles 
and augmenting our wheeled vehicle fleet with the Joint Light Tactical 
family of vehicles. In addition, the Army will continue to fund a third 
brigade's set of Double V-Hull (DVH) Stryker vehicles, while supporting 
an incremental upgrade to DVH Strykers for power and mobility 
improvements.
            Army Aviation
    The Army will divest legacy systems and fund the modernization and 
sustainment of our most capable and survivable combat-proven aircraft: 
the AH-64 Apache, UH-60 Blackhawk and CH-47 Chinook helicopters. We 
will divest almost 900 legacy helicopters including the entire single 
engine OH-58D Kiowa Warrior and TH-67 helicopter training fleets. The 
Army will also modernize our training fleet with LUH-72 Lakota 
helicopters.
            The Network
    The equipment modernization strategy seeks to provide the Soldier 
and squad with the best weapons, equipment, sustainment and protection 
with the support of the network. LandWarNet is the Army's globally 
interconnected network that is ``always on and always available,'' even 
in the most remote areas of the globe. LandWarNet enables mission 
command by carrying the data, voice and video every Soldier and leader 
needs to act decisively and effectively. It supports all Army 
operations, from administrative activities in garrison to operations 
conducted by our forward stationed and deployed Soldiers. Additionally, 
it forms the basis of our live, virtual and constructive training.
Equipment Reset and Retrograde
    Retrograde is the return of equipment to facilities for reset and 
to support future force structure and operations. By December 2014, the 
Army plans to retrograde approximately $10.2 billion of the $15.5 
billion worth of Army equipment currently in Afghanistan. The balance 
of the equipment will be used by our forces, transferred to the Afghans 
or to another troop contributing nation, or disposed of properly in 
theater, which will provide a cost avoidance of more than $844 million 
in transportation, storage and security costs. The total cost of moving 
the equipment out of Afghanistan is estimated at roughly $1-3 billion. 
The cost range is due to the unpredictable nature of our ground routes 
through Pakistan and other Central Asian countries that may require a 
shift to more expensive multimodal or direct air cargo movement.
    Once the equipment returns to the United States, our reset program 
restores it to a desired level of combat capability commensurate with a 
unit's future mission. A fully funded Army reset program is critical to 
ensuring that equipment worn and damaged by prolonged conflict in harsh 
environments is recovered and restored for future Army requirements. 
During fiscal year 2013, the Army reset approximately 87,000 pieces of 
equipment at the depot level and about 300,000 pieces of equipment, 
such as small arms; night vision devices; and nuclear, biological and 
chemical equipment, at the unit level. As a result of sequestration, we 
deferred approximately $729 million of equipment reset during fiscal 
year 2013, postponing the repair of nearly 700 vehicles, 28 aircraft, 
2,000 weapons and Army prepositioned stocks. The projected cost of the 
reset program is $9.6 billion (not including transportation costs), 
which extends for 3 years after the last piece of equipment has 
returned. Resources available under planned spending caps are not 
sufficient to fully reset returning equipment from Afghanistan in a 
timely and efficient manner.
Organic and Commercial Industrial Base
    The Army's industrial base consists of commercial and Government-
owned organic industrial capability and capacity that must be readily 
available to manufacture and repair items during both peacetime and 
national emergencies. The Army must maintain the critical maintenance 
and manufacturing capacities needed to meet future war-time surge 
requirements, as well as industrial skills that ensure ready, effective 
and timely materiel repair. We are sizing the organic industrial 
workforce to meet and sustain core depot maintenance requirements and 
critical arsenal manufacturing competencies. We will also continue to 
work with our industrial partners to address energy, water and resource 
vulnerabilities within our supply chain.

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

                        organic industrial base
    During Operations Iraqi Freedom and Enduring Freedom, the organic 
industrial base surged capacity and in some cases tripled their prewar 
output. The organic industrial base consists of:
  --Five maintenance depots,
  --Three manufacturing arsenals and
  --Eleven ammunition plants.

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

    Both the commercial and organic elements of the industrial base are 
essential to the efficient development, deployment and sustainment of 
Army equipment. Over the past decade, the Army relied on market forces 
to create, shape and sustain the manufacturing and technological 
capabilities of the commercial industrial base. However, reduced 
funding levels due to sequestration accelerated the transition from 
wartime production levels to those needed to support peacetime 
operations and training. During fiscal year 2013, the Army lost more 
than 4,000 employees from the organic industrial base and will continue 
to lose highly skilled depot and arsenal workers to other industries 
due to fiscal uncertainty. Hiring and overtime restrictions, in 
addition to furloughs, affected productivity and increased depot 
carryover, not to mention the detrimental effect on worker morale.
Installations
    In fiscal year 2013, the Army deferred critical upkeep on thousands 
of buildings across Army installations due to a reduction of $909 
million in sustainment, restoration and maintenance funding. End 
strength reductions have reduced some associated sustainment costs, but 
key facility shortfalls remain that will continue to impact Army 
readiness. Increased funding in fiscal year 2014 enables investment in 
facility readiness for critical infrastructure repair as well as high 
priority restoration and modernization projects. The fiscal year 2015 
budget reflects our measured facility investment strategy that focuses 
on restoration, modernization and limited new construction.
    The capacity of our installations must also match the Army's 
decreasing force structure. At an Active Army end strength of 490,000 
Soldiers, which we will reach by the end of fiscal year 2015, we 
estimate that the Army will have about 18 percent excess capacity. We 
need the right tools to reduce excess installations capacity, or 
millions of dollars will be wasted maintaining underutilized buildings 
and infrastructure. Failure to reduce excess capacity is tantamount to 
an ``empty space tax'' diverting hundreds of millions of dollars per 
year away from critical training and readiness requirements. Trying to 
spread a smaller budget over the same number of installations and 
facilities will inevitably result in rapid decline in the condition of 
Army facilities.
    The Base Realignment and Closure (BRAC) process is a proven, fair 
and cost-effective means to address excess capacity in the United 
States. BRAC has produced net savings in every prior round. On a net 
$13 billion investment, the 2005 BRAC round is producing a net stream 
of savings of $1 billion a year. We look forward to working with 
Congress to determine the criteria for a BRAC 2017 round.
Energy and Sustainability
    We are establishing an energy informed culture as a key component 
of Army readiness. Through a synchronized campaign of performance 
initiatives, business process changes and education and training 
opportunities, the Army seeks to achieve a lasting capability to use 
energy to the greatest benefit. The campaign includes efforts focused 
on both the energy required for military operations (operational 
energy) and the energy required by our power-projection installations 
around the world.
    In a tighter budget environment, the Army must manage its 
installations in a sustainable and cost-effective manner, preserving 
resources for the operational Army to maintain readiness and capability 
across the range of military operations. We will leverage institutional 
energy savings to generate more resources that we can use to train, 
move and sustain operational forces and enhance Army mobility and 
freedom of action. To take advantage of private sector efficiencies, 
Army installations are privatizing utilities and entering into public-
private energy-saving performance contracts. By partnering with 
experienced local providers, the Army has privatized 144 utilities 
systems, avoiding about $2 billion in future utility upgrade costs 
while saving approximately 6.6 trillion British thermal units a year. 
The Army is also exploring opportunities to expand public-public 
partnerships.
    Operational energy improvements to contingency bases, surface and 
air platforms and Soldier systems will increase overall combat 
effectiveness. Improved efficiencies in energy, water and waste at 
contingency bases reduce the challenges, risks and costs associated 
with the sustainment of dispersed bases. Next generation vehicle 
propulsion, power generation and energy storage systems can increase 
the performance and capability of surface and air platforms and help 
the Army achieve its energy and mobility goals. Advances in lightweight 
flexible solar panels and rechargeable batteries enhance combat 
capabilities, lighten the Soldier's load and yield substantial cost 
benefits over time. Emergent operational energy capabilities will 
enable Army forces to meet future requirements and garner efficiencies 
in a fiscally constrained environment.
Business Transformation
    The Army continues to transform its business operations to be 
smarter, faster and cheaper. We are working to reduce business 
portfolio costs by almost 10 percent annually as we capitalize on the 
progress made with our Enterprise Resource Planning systems. Our 
business process reengineering and continuous process improvement 
efforts continue to confer significant financial and operational 
benefits. Through our focus area review we will reduce headquarters 
overhead, consolidate and streamline contracting operations and improve 
space allocation on Army installations. We are reengineering core 
processes in acquisition, logistics, human resources, financial 
management, training and installations to improve effectiveness and 
reduce costs. Over the long-term, the Army will improve its strategic 
planning, performance assessment and financial auditability so that 
commanders can make better-informed decisions on the utilization of 
resources to improve readiness.
                                closing
    Throughout our history, we have drawn down our armed forces at the 
close of every war. However, we are currently reducing Army end 
strength from our wartime high before the longest war in our Nation's 
history has ended, and in an uncertain international security 
environment. Our challenge is to reshape into a smaller, yet capable, 
force in the midst of sustained operational demand for Army forces and 
reduced budgets. The resulting decline in readiness has placed at risk 
our ability to fully meet combatant commander requirements. Our ability 
to provide trained and ready Army forces will improve as we begin to 
balance readiness, end strength and modernization. However, if 
sequestration-level spending caps resume in fiscal year 2016, we will 
be forced to reduce end strength to levels that will not enable the 
Army to meet our Nation's strategic requirements.
    We have learned from previous drawdowns that the cost of an 
unprepared force will always fall on the shoulders of those who are 
asked to deploy and respond to the next crisis. The Nation faces 
uncertainty and, in the face of such uncertainty, needs a strong Army 
that is trained, equipped and ready. No one can predict where the next 
contingency will arise that calls for the use of Army forces. Despite 
our best efforts, there remains a high likelihood that the United 
States will once again find itself at war sometime during the next two 
decades. It is our job to be prepared for it.

    Senator Durbin. Thanks, Mr. Secretary.
    General Odierno.
STATEMENT OF GENERAL RAYMOND T. ODIERNO, ARMY CHIEF OF 
            STAFF
    General Odierno. Chairman Durbin, Senator Shelby, Senator 
Collins, thank you for being here today.
    I'm truly humbled to lead the extraordinary men and women 
of our Army who volunteered to raise their right hand and serve 
our country. As a division, corps and theater commander for 
nearly 5 years in combat, I've personally led and seen the 
tremendous sacrifice the soldiers of the Active Army, the Army 
National Guard and the U.S. Army Reserve have made for our 
Nation.
    As the Chief of Staff, my focus is on ensuring all soldiers 
from all components are properly trained, equipped, and ready. 
Despite declining resources, the demands for the Army forces 
continue. Today, as I sit here, we have nearly 70,000 soldiers 
deployed today. Our contingency operations and another 85,000 
soldiers are forward stationed in nearly 150 countries 
including nearly 20,000 on the Korean peninsula. Our soldiers, 
civilians, and family members continue to serve with the 
competence, commitment, and character that our great Nation 
deserves.
    Your Army continues to respond whenever needed. Just this 
week, we deployed soldiers to Poland, Estonia, Latvia, and 
Lithuania to conduct joint training and to reassure our Eastern 
European allies against Russian aggression. We have soldiers 
training and supporting the Afghan security forces, standing 
guard at the DMZ (demilitarized zone), conducting operations in 
Kosovo, Jordan, and Kuwait. We continue to have more than 2,000 
soldiers on the African continent building partner capacity to 
include those providing security for the U.S. Embassy in South 
Sudan.
    As we continue the future roles and missions and funding 
for our Army, it is imperative we consider the world as it 
exists, not as one we wish it to be. It demands that we make 
prudent decisions about the future capability and capacity that 
we need within our Army. Therefore, we must ensure that our 
Army has the ability to rapidly respond to conduct the entire 
range of military operations from humanitarian assistance, 
partnered activities, stability operations to general war.
    We appreciate the short-term predictability in fiscal year 
2014 and 2015 afforded by the budget levels in the Bipartisan 
Budget Agreement. The Bipartisan Budget Agreement supports the 
fiscal year 2015 Army funding level to $120 billion, but it's 
still $12.7 billion short of our request. This has allowed us 
to buy back some short-term readiness by funding additional 
training and sustainment to include multi-echelon, 
multicomponent training events at our combat training centers 
(CTCs) which starts us on a path of increased readiness.
    However, the continued accumulation of budget reductions 
requires us to make difficult choices. Last year, I testified 
that we can implement the defense guidance at moderate risk 
with an end strength of 490,000 in the Active Army, 350,000 in 
the Army National Guard, and 202,000 in the U.S. Army Reserve. 
And I stand by that assessment. However, sequestration is the 
law of the land and its full brunt will return in fiscal year 
2016 without congressional action. Under sequestration for the 
next 3 to 4 years, we will continue to reduce end strength as 
quickly as possible while still meeting our operational 
commitments.
    As we continue to draw down and restructure into a smaller 
force, the Army will continue to have degraded readiness and 
extensive modernization shortfalls. At the end of fiscal year 
2019, we will begin to establish the appropriate balance 
between end strength, readiness, and modernization, but for an 
Army that is much smaller than it is today.
    From fiscal year 2020 to fiscal year 2023 we will begin to 
achieve our readiness goals and reinvest in our modernization 
programs. We will have no choice but to slash end strength 
levels if sequestration continues in order to attain the proper 
balance between end strength, readiness, and modernization. We 
will be required to further reduce the Active component to 
420,000; the Army National Guard to 315,000; and the U.S. Army 
Reserve to 185,000. At these end strength funding levels, we 
will not be able to execute the current defense strategy.
    In my opinion, this will call into question our ability to 
execute even one prolonged, multiphased, major contingency 
operation. I also have deep concerns that our Army at these end 
strength levels will not have sufficient capacity to meet 
ongoing operational commitments while simultaneously training 
to sustain appropriate readiness levels.
    The President's budget submission supports end strength 
levels at 440,000 to 450,000 in the Active Army, 335,000 in the 
Army National Guard, and 190,000 in the U.S. Army Reserve. I 
believe this should be the absolute floor for Army end strength 
numbers. To execute the defense strategy, it's important to 
note that as we continue to lose end strength, our flexibility 
deteriorates as does our ability to react to strategic 
surprise.
    My experience tells me that our assumptions about the 
duration and size of future conflicts, allied contributions, 
and the need to conduct post-conflicts stability operations are 
optimistic. If these assumptions are proven wrong, our risk 
will grow significantly.
    In order to meet ongoing and future budget reductions, we 
have developed a Total Force Policy in close collaboration with 
Army and DOD leaders. The Secretary of Defense directed the 
Army to not size for large, prolonged, stability operations. 
Furthermore, we were not to retain force-structure at the 
expense of readiness and to develop balanced budgets that 
permitted the restoration of desired levels of readiness and 
modernization by the end of the sequestration period.
    The Secretary of the Army and I provided additional 
guidance to fulfill the needs of our combatant commanders first 
and then to disproportionately reduce our Active Forces while 
implementing modest reductions in our Guard and Reserve. The 
Army and the Office of the Secretary of Defense conducted a 
transparent, open, and highly collaborative budget formulation, 
force-structure and aviation restructure decision process that 
included representation from all components and analysis from 
experts at every level. The result is a balanced approach that 
gives us the best Army possible even if sequestration continues 
in fiscal year 2016.
    The plan calls for end strength reductions of a total of 
213,000 soldiers with a disproportionate cut of 150,000 coming 
from the Active Army; 43,000 from the Army National Guard; and 
20,000 from the Army Reserve. These reductions to the Active 
Army represent 70 percent of the total end strength reductions 
compared with 20 percent from the National Guard and 10 percent 
from the U.S. Army Reserve. This will cause us to reduce up to 
46 percent of the brigade combat teams in the Active Army and 
up to 22 percent of the brigade combat teams from the National 
Guard. This will result in an Army going from a 51 percent 
Active and 49 percent Reserve component to a 54 percent Reserve 
component and 46 percent Active Army.
    The Army will be the only service in which the Reserve 
component outnumbers the Active component. And we believe that, 
under these fiscal constraints, this is appropriate.
    The aviation restructure initiative allows us to eliminate 
obsolete airframes, sustain a modernized fleet, reduce 
sustainment costs, and officially organize ourselves to meet 
our operational commitments and imperatives. But even in 
aviation restructure, disproportionate reductions come from the 
Active component. We will inactivate and eliminate three 
complete combat aviation brigades in the active component and 
we will remove all LUH-72s from the Active component in order 
to train our pilots of all components at Fort Rucker.
    In the National Guard, we'll maintain all 10 current 
aviation brigades. We will move Apaches to the Active component 
while increasing the fleet of UH-60s by sending 111 of the most 
modern Blackhawk helicopters to the National Guard. The 
National Guard will also retain all of its LUH-72s and CH-47s.
    In the end, the Active component will be reduced by 687 
aircraft, which is 86 percent of the total reduction. The 
National Guard will be reduced by 111 aircraft which is 14 
percent of the total reduction. The Aviation Restructure 
Initiative will result in better and more capable formations 
which are able to respond to contingencies at home and abroad. 
Let me be very clear: These are not cuts we want to take; these 
are cuts we must take based on sequestration. I believe our 
recommendation delivers the best total Army for the budget we 
have been allocated.
    The Secretary and I understand that the American people 
hold us to a higher standard of character and behavior. 
Combating sexual assault and harassment remains our top 
priority. Over the past year, the Army has established more 
stringent screening criteria and background checks for those 
serving in positions of trust. Army containers--excuse me, Army 
Commanders continue to prosecute the most serious sexual 
assault offensives at a rate more than double that of civilian 
jurisdictions, including many cases that civilian authority has 
refused to pursue.
    We appreciate the continued focus of Congress as we 
implement legislative reforms to enhance the rights of 
survivors and improve our military justice system. We continue 
to take this issue very seriously, and also know much work 
remains to be done in this area.
    We're also aggressively and comprehensively tackling the 
issue of ethical leadership individually, organizationally and 
through systematic reviews. We initiated 360 degree assessments 
on all officers, especially commanders and general officers. We 
implemented a new officer evaluation report to strengthen 
accountability for our general officers and all officers. We 
also conduct peer surveys and develop the specific ethics focus 
as part of our senior leader education programs throughout the 
entire process.
    We must keep in mind that it is not a matter of ``if'' but 
``when'' we will deploy our Army to defend this great Nation. 
We have done it in every decade since World War II. It is 
incumbent on all of us to ensure that our soldiers are highly 
trained, equipped, and organized. If we do not, they will bear 
the heavy burden of our miscalculations.
    I am proud to wear this uniform and represent all the 
soldiers of the United States Army, Active, National Guard, and 
U.S. Army Reserve. Their sacrifice has been unprecedented over 
the last 13 years. We must provide them with the necessary 
resources for success in the future.
    Thank you, Mr. Chairman, and thank you for the entire 
committee for the support that you have given us and for 
allowing us to have this discussion today.
    Thank you very much.
    Senator Durbin. Thank you very much, General Odierno.
    General Grass.
STATEMENT OF GENERAL FRANK J. GRASS, CHIEF, NATIONAL 
            GUARD BUREAU
    General Grass. Chairman Durbin, Senator Shelby, Senator 
Collins, and Senator Murray, good morning.
    It's an honor to be here today to represent the 460,000 
Army and Air National Guardsmen across the States, territories 
in the District of Columbia.
    As we move into an uncertain security and fiscal future, 
our Nation is fortunate to have today's operational National 
Guard. Your Guard is efficient, effective, and as fast to the 
fight as needs to be at home and abroad. The Department of 
Defense, though, and our Nation will face deep challenges in 
the decades ahead. We need to maintain the gains achieved by 
your National Guard over more than a decade of combat 
experience. Put simply, the effective and affordable Guard you 
have today arrives on the scene at the precise right time.
    As Secretary Hagel and Chairman Dempsey have consistently 
observed, the fiscal challenges that lay ahead will 
dramatically constrain decisionmaking. This will affect the 
size, shape, and roles of our military including the National 
Guard.
    In the near-term, the looming cuts to the fiscal year 2015 
budget of almost $1 billion on the Army National Guard will 
challenge the Army Guard in several areas, and General Lyons 
will address those in a moment. The risk we will assume will 
certainly increase when the Budget Control Act resumes in 
fiscal year 2016. The Governors and Adjutants General have 
relayed to me that the unique efficiencies of the National 
Guard should be part of the solution. I echo their sentiments. 
Fiscal challenges may drive us to a greater programmed reliance 
on Reserve components in the future.
    I'd like to briefly share with you my observations on three 
key points worthy of your consideration. First, I agree 
completely with Secretary McHugh and General Odierno of the 
risk our Nation faces in our Army. For the Guard to meet that 
means the Guard that is properly resourced and programmed for 
use.
    The current generation of guardsmen expects to be deployed 
both at home and abroad. The Guard we have today is equipped, 
trained, and tested in the field of battle; 760,000 successful 
global deployments over the last 12 years testifies to this. In 
the homeland, when disaster strikes, our Governors know within 
certainty that the Guard is always there. We saw this again, 
this week, with the terrible storms across the Midwest and the 
South. The Nation cannot afford to squander the gains in 
readiness and leadership. Modest but necessary investments will 
keep your Army Guard operational and ready for any contingency.
    Second, the Guard is fully capable where it has mattered 
the most: On the field of battle; that Army National Guard has 
accomplished every wartime mission assigned to them since 9/11.
    When our enemies look at America's military, they see the 
best fighting force in history. They do not see different 
components. This is how we have built the Total Force for the 
past decade. Preserving the strengths of this Total Force is 
our goal. The National Guard's proficiency in executing complex 
missions allows us to handle the complex emergencies at home.
    Third, the Army National Guard is an efficient hedge in an 
uncertain security environment. It enables easy expansion of a 
Total Force when required.
    During peacetime, investing in a strong Guard frees up 
resource for modernization to readiness across the Total Force. 
Additionally, the stable unit structure of the Guard provides a 
unique tool to build enduring security partnerships across the 
globe. This matters a great deal in the world today as a threat 
to one can quickly become a threat to all. Today, we have 
enduring partnerships in 74 countries in our State partnership 
program.
    From my visits with the soldiers across America and around 
the world, I can tell you that our successes are due to our 
most important resource; our people. The wellbeing of our 
soldiers, airmen, their families, and their employers remains a 
top priority of every leader in the National Guard. We are 
aggressively working to eliminate sexual assault, enhance 
mental health programs, and reduce suicides across the force. 
Congress's recent and continued assistance in resourcing the 
programs that address these critical issues is greatly 
appreciated.

                           PREPARED STATEMENT

    Chairman, Senators, your National Guard is accessible by 
law, as ready as resourced and capable because they are 
experienced. In my professional opinion, the fiscal challenges 
facing us now and in the future will require us to plan, 
program, and use an operational National Guard. Today's 
National Guard is fully prepared for that mission.
    I'm honored to be representing the men and women of the 
Army and Air National Guard and I thank this committee for the 
opportunity to testify today. I look forward to your questions.
    [The statement follows:]
              Prepared Statement of General Frank J. Grass
                            opening remarks
    Chairman Durbin, Vice Chairman Cochran, distinguished members of 
the subcommittee: I am honored to appear before you today representing 
more than 460,000 Citizen-Soldiers and Airmen of the Army and Air 
National Guard. The National Guard serves with distinction as the 
Department of Defense's primary combat reserve to the Army and Air 
Force and as the Governor's military force of first choice in times of 
domestic crisis. Each day Citizen-Soldiers and Airmen serving 
throughout the Nation help to achieve our Nation's overseas and 
domestic security objectives by doing three things extraordinarily 
well: Fighting America's wars, protecting the homeland, and building 
global and domestic partnerships. These three overlapping operational 
missions align within Chairman Dempsey's strategic direction to deter 
threats, assure partners, and defeat adversaries while also providing 
localized, reliable, on-demand security and support to Americans within 
their own neighborhoods. The National Guard stands poised to build upon 
its 377-year legacy as an operational force deeply engrained within the 
foundation of American strength and values.
    Today, thanks to the support of Congress and the American people, 
after 12 years of war the operational National Guard is the best 
manned, trained, equipped and led force in its history. We are able to 
do all of this because of our great Citizen Soldiers and Airmen. 
Today's Guard is accessible, ready, and capable; and I might add, it 
provides a significant value to the American taxpayer.
Accessible
    There is no limit to accessibility due to a full suite of 
authorities available to access and employ the Guard. Since 9/11 our 
leaders have mobilized our National Guard members more than 760,000 
times for overseas operations in a variety of wide ranging roles at the 
Brigade Combat Team level, to include full spectrum Counter Insurgency 
Operations (COIN), Security Force Operations (SECFOR), and training and 
mentoring the newly created Afghan National Army/Afghan National 
Security Forces (ANSF) to establish and maintain law and order 
throughout Afghanistan. We have filled every request for forces, 
meeting or exceeding Army readiness standards, while also meeting every 
request to support domestic response missions at home. At the same time 
the National Guard is present in approximately 3,000 communities and 
immediately accessible to their governors in the event of a domestic 
incident or natural disaster. The National Guard is scalable and able 
to provide forces for any contingency or emergency.
Ready
    The National Guard is at its highest state of readiness as a result 
of readiness funding and equipment modernization provided by the 
Congress. I want to especially thank the Congress for funds provided in 
the National Guard and Reserve Equipment Account which have been 
critical to our equipment and modernization upgrades. Your support 
ensures that the men and women of the National Guard have the resources 
they need when called upon by the Nation.
    The Army National Guard adheres to the same individual readiness 
requirements as the Active Army. It differs when it comes to collective 
training. This difference is by design. All Army units, regardless of 
component, follow the same training strategy. The Army strategy 
reflects the characteristics of the components and maintains some parts 
of the active Army at a higher state of readiness for nearly immediate 
employment. Leveraging the inexpensive cost of dwell, Army Guard units 
maintain sufficient collective proficiency to support leader 
development and are ready to quickly surge to a higher level of 
readiness. Our Brigade Combat Teams culminate their progressive force 
generation cycle at Combat Training Center rotations like their active 
duty counterparts. If mobilized, these units can achieve Brigade Combat 
Team level proficiency after 50-80 days of post-mobilization training. 
When deployed for operational missions Guard and Active Army units are 
indistinguishable. Army Guard Brigade Combat Teams will not replace 
early deploying Active Army Brigade Combat Teams in their overseas 
``fight tonight'' missions. Army Guard Brigade Combat Teams are well 
suited for surge and post surge mission sets.
    The National Guard is the ``fight tonight'' force in the homeland; 
ready to respond rapidly and decisively to the Governor's requirements. 
Just as the active Army and Air Force are forward-deployed around the 
world the National Guard is forward-deployed in communities across 
America. The Guard's ability to provide the Essential 10 capabilities 
that the Governors' rely on for domestic incidents and its forward 
presence in the homeland saves lives.
Capable
    The capability of the Army National Guard is exactly as it should 
be today. Our units and Soldiers have accomplished every mission 
assigned to them, including the broadest range of mission sets 
possible: From Brigade Combat Teams conducting counterinsurgency 
operations and Combat Aviation Brigade deployments, as well as non-
standard units such as Agribusiness Development Teams. In fact, since 
2003, the Army National Guard has deployed 46 Brigade Combat Teams, 
with 49 percent of those deployments being Security Force Operations, 
36 percent Counter Insurgency operations, and 15 percent training and 
mentoring the newly created Afghan National Army/Afghan National 
Security Forces. With our attack-reconnaissance aviation units, 12 
battalions and 5 companies have also deployed since 2003 to Bosnia, 
Kosovo, Iraq, and Afghanistan. We have done all of these missions side-
by-side with our Total Army partners.
    The Army National Guard allows the Nation to rapidly expand the 
Army though mobilization with trained and ready units. The only way you 
can do this is if the Army Guard has sufficient capacity with the same 
training, organization and equipment maintained at appropriate 
readiness levels. Maintaining an Army Guard with similar force 
structure to the Active Component is important to growing future combat 
leaders and providing the necessary strategic depth we need in our land 
forces.
    Domestically, we have proven time and again our ability to meet the 
needs of the governors and our citizens, regardless of the scope of the 
crisis. Whether responding to a natural disaster such as Hurricane 
Katrina or Sandy, Colorado flooding, California wildfires, or the 
Boston Marathon Bombing, the National Guard is everywhere when it is 
needed.
Value
    As an adaptive force capable of rapidly generating as-needed 
forces, today's National Guard offers significant fiscal value to the 
Nation for tomorrow's turbulent security environment. The National 
Guard's lower personnel costs and unique capacity-sustaining strengths 
also provide efficiencies to free up critical resources for Total Force 
modernization, recapitalization, and readiness. At one-third of the 
cost of an active duty servicemember in peacetime the Guard provides a 
hedge against uncertainty while allowing us to address our fiscal 
situation. Furthermore, every dollar invested in the National Guard 
allows for a dual use capacity that provides the Governors and the 
President capabilities to meet the demands both within and beyond U.S. 
borders.
Fiscal Challenges
    This Army National Guard force I have outlined will be at risk if 
the cap reductions required under the Budget Control Act are fully 
implemented. Although Congress provided relief to the Department of 
Defense with the Bipartisan Budget Act, the Army National Guard fiscal 
year 2015 budget will nonetheless be cut $1 billion from fiscal year 
2014 levels. This will require the Army Guard to accept risk in fiscal 
year 2015 in several areas: Our Brigade Combat Teams will be limited to 
achieving Individual, Crew and Squad-level proficiency in their 
training; personnel will have fewer opportunities to attend schools and 
special training; and our armories--which average 44 years in age--will 
lack funding for repairs beyond those that will ensure health and 
safety.
    The Department of Defense faces tough decisions on how to balance 
readiness while preserving force capacity as a strategic hedge in an 
uncertain and complex world. Looking forward, if the cap reductions 
required under the BCA are fully implemented in 2016, we will have to 
make further difficult decisions. These decisions will continue to 
atrophy Army National Guard readiness as a result of our inability to 
sufficiently train our units and Soldiers, modernize our equipment and 
maintain our facilities. We also face the prospect of a reduction in 
Army National Guard End Strength to 315,000 by 2019. This significantly 
increases the risk to our ability to conduct Defense Support to Civil 
Authorities in the Homeland, and it places our ability to meet the 
Defense Strategic Guidance at risk. Moreover, it further degrades our 
capabilities in the National Guard's Essential 10--command and control, 
logistics, aviation, security, engineering, transportation, medical, 
CBRN, maintenance, and communications--all of which the Governors rely 
upon to direct their States during times of disaster. These fiscal 
challenges come at a time when we are faced with asymmetric and 
conventional threats from State and non-State actors; to include the 
physical environment. However, as we move forward in this difficult 
financial environment, today's unprecedented National Guard readiness 
posture offers options to preserve both capability and capacity rather 
than choose between them.
Accountability
    Ensuring the National Guard is an effective and accountable steward 
of public resources begins with every Soldier and Airman. Innovations 
that improve efficiency must continue to be encouraged and implemented. 
Everyone in the National Guard--from general officers to privates and 
airmen--must strive to ensure that the American people feel confident 
that our actions, with regard to the use of resources, are above 
reproach. We must audit activities, both inside and outside of the 
National Guard Bureau, to bolster an environment of full accountability 
if we hope to continue to earn the respect of the American public and 
to recruit the best and brightest that America has to offer.
    We are currently doubling our efforts to ensure that we remain good 
stewards of the taxpayer's money. Despite having an already lean 
headquarters we have followed the Secretary of Defense's directive to 
decrease our headquarters staff by 20 percent. We are completing a 
major overhaul of our contracting process through a number of steps, to 
include a revamped organizational structure to provide greater senior 
leadership oversight, improved formal training, an internal contract 
inspection program, and a rewritten National Guard Acquisition Manual. 
We will continue to actively advance our methods of increased 
accountability as we hold ourselves to the highest standards of fiscal 
integrity.
                               the future
    Looking to the future, there are three things the National Guard 
will continue to do extremely well for this Nation. First, we will 
execute the warfight as the proven combat reserve for both the Army and 
Air Force. Second, we will protect the homeland as the ``fight 
tonight'' force in our local communities. Finally, the structure of our 
force, the very nature of our force, is trained for the warfight and 
ready to respond in the homeland, allowing us to continue to build 
enduring partnerships both at home and abroad.
Fighting America's Wars
    The Department of Defense continues to meet the challenges posed by 
the persistent, evolving, and emerging threats and to engage around the 
world. Crucial to meeting these challenges is sustaining the National 
Guard as an operational force. Some 115,000 Guardsmen have two or more 
deployments. Furthermore, as of today, there are over 11,700 National 
Guard personnel deployed overseas, to include Afghanistan, the Horn of 
Africa, and the Sinai. However, we expect these deployments to decrease 
over time as the conflict in Afghanistan draws down.
    There is no question that National Guard Citizen-Soldiers and 
Airmen training, equipment, and capabilities closely mirror that of 
their active component counterparts. We are an adaptive force that is 
changing as the threats to the United States evolve. Modernization and 
equipping of Army Guard units gives the Nation a rapidly scalable land 
force to address threats to the United States and its allies. 
Sustaining the advantages of today's National Guard requires 
maintaining a high state of readiness through some level of operational 
use, relevant training, and continued investment in modernization and 
force structure.
    A force of Citizen-Soldiers and Airmen that has met or exceeded 
established readiness and proficiency standards, the National Guard is 
a crucial operational asset for future contingencies. We will remain 
adaptable as we plan and prepare to operate effectively in the joint 
operational environment as part of the Army and Air Force and execute 
emerging missions.
Protecting the Homeland
    The National Guard provides the Governors with an organized, 
trained, and disciplined military capability to rapidly expand the 
capacity of civil authorities responding under emergency conditions. 
Prepositioned for immediate response in nearly every community across 
the country the National Guard can quickly provide lifesaving 
capabilities to the States, territories, and the District of Columbia. 
Whether it is the 3,100 National Guard members supporting recent winter 
storms across 12 States, 7 Civil Support Teams supporting water 
decontamination in West Virginia, or the Dual Status Command concept in 
support of the Super Bowl, our Soldiers and Airmen are always ready. 
Should the ``worst day in America'' occur, our fellow citizens and 
State Commanders-in-Chief expect us to be there; ready to respond 
quickly and effectively.
    The National Guard also assists U.S. Northern Command, the North 
American Aerospace Defense Command, and the military services in the 
daily execution of Federal missions such as disaster response and 
protecting the skies over America by standing alert with fighter and 
missile defense units to protect our Nation's airspace and by providing 
immediate response against weapons of mass destruction. In fact, the 
National Guard comprises 63 percent of the Chemical, Biological, 
Radiological, Nuclear enterprise. The National Guard supports the 
Department of Homeland Security to assess the vulnerabilities of our 
Nation's critical infrastructure, assists in interdicting transnational 
criminals at our borders, conducts wildland firefighting, and augments 
security during special events. The National Guard community-based 
tradition spans 377 years of localized experience and national service 
in times of need and is America's clear first choice for military 
response in the homeland.
Building Global and Domestic Partnerships
    Each day, the National Guard strengthens and sustains partnerships 
around the world and within our communities. The National Guard's 
innovative State Partnership Program pairs individual States with 
partner nations to establish long-term cooperative security 
relationships in support of the Geographic Combatant Commands. The 
State Partnership Program is a joint security cooperation enterprise 
highly regarded by U.S. ambassadors and Combatant Commanders around the 
world that has evolved over 20 years and currently consists of 68 
partnerships involving 74 countries. As a result of these strong 
relationships, 15 partner nations have paired up with our States and 
deployed 79 times together to Iraq and Afghanistan. National Guard 
Airmen and Soldiers participated in 739 State Partnership Program 
events across all combatant commands in fiscal year 2013 alone.
    The three fundamental characteristics of the State Partnership 
Program that help define its success are, first and foremost, the 
enduring relationships fostered; the ability to share the National 
Guard's highly relevant domestic operations expertise; and lastly, the 
National Guard's interagency and inter-governmental role in response to 
domestic crises and disasters. Additional benefits of the State 
Partnership Program include economic co-development, educational 
exchanges, agricultural growth to build food security, and support to 
other Federal agencies such as the State Department. National Guard 
civilian expertise in areas such as engineering, emergency management, 
infrastructure development and reconstruction are in significant demand 
within developing nations that are eager to partner with America, but 
require sustained trust-building engagements before relationships can 
realize their full potential. Some of today's State partnerships span 
more than 20 years. During that time, the individual careers of 
National Guard Soldiers and Airmen have matured alongside those of 
their counterparts in partner countries thereby creating enduring 
relationships. Overall, the complementary nature of the National 
Guard's three core competencies provides a powerful security 
cooperation enabler for Combatant Commanders to employ.
    The National Guard's three core competencies are who we are and 
what we do. But there is more to it than that; our core competencies 
permeate throughout the more than 3,000 communities in which we reside. 
These core competencies drive us to serve our individual States and the 
Nation from within the same communities where we live and work. The 
local relationships we forge with our public and private partners, from 
first responders to school boards, provide daily benefits that 
strengthen and unite through community-based activities and programs. 
One such program is the National Guard Youth ChalleNGe--a successful 
community-based program that leads, trains, and mentors 16-18 year old 
high school dropouts. Over the past 21 years Youth ChalleNGe has 
graduated 122,000 youth who have given back to their communities in the 
form of 8.4 million hours of community service totaling $163 million. 
More importantly, by graduating from this invaluable National Guard 
program, these young Americans significantly increased their chance for 
a successful future.
Our People
    At the very heart of these core competencies is our most important 
resource--our people. The well being of our Soldiers, Airmen, their 
families and their employers remains a top priority for every leader 
throughout the National Guard. We will continue to aggressively work to 
eliminate sexual assault, reduce suicides across the force and maintain 
faith with our people--the very same people who have put their faith in 
us.
Prevent Sexual Assault and Harassment
    Sexual assault is a crime, a persistent problem that violates 
everything we stand for. All of us have a moral obligation to protect 
our members from those who would attack their fellow servicemembers and 
betray the bonds of trust that are the bedrock of our culture. 
Eliminating sexual assault in the National Guard remains a moral 
imperative, with leaders setting and enforcing standards of discipline, 
creating a culture that instills confidence in the system, and a no 
tolerance culture for inappropriate relationships or sexist behavior.
    To assist us in preventing sexual assault and harassment, in August 
2012 the National Guard Bureau established the Office of Complex 
Investigations within the Bureau's Judge Advocate's Office to assist 
the Adjutants General in responding to reports of sexual assault 
arising in a non-Federal status. To date the Bureau has certified 92 
specially trained investigators that are able to assist the States and 
to respond to their needs when an incident of sexual assault or 
harassment arises. The efforts of the Office of Complex Investigations 
to work in close collaboration with the State military leadership has 
been a tremendous success and invaluable enabler in assisting the 54 
States, territories and the District of Columbia in addressing this 
most serious problem.
Suicide Prevention
    One of the strengths of the National Guard is that we are 
representative of our great American society. Unfortunately, this also 
means that the suicide trends our society struggles with are also 
present in the National Guard. While suicides in the Air National Guard 
are decreasing, the Army National Guard rates remain high. Although 
there have been a below average number of Army National Guard suicides 
year to date in 2014, there were 119 suicides in 2013, the highest per 
year number over the past 6 years.
    To better understand and address this serious issue we have taken a 
number of actions. We have reached out to the State Mental Health 
Directors and Commissioners for opportunities to partner with and 
establish relationships, which will allow us to ensure that appropriate 
State, local and community resources are available to our Citizen-
Soldiers and Airmen. Furthermore, each State, territory and Air 
National Guard wing currently has a licensed behavioral health provider 
that provides clinical mental health assessments, education, 
information and referrals for our Soldiers and Airmen. These providers 
also act as subject matter expert advisors to our senior leaders. We 
are also working with the Air Force to learn from its superior suicide 
prevention program. Fortunately, Congress allocated $10 million for 
additional Army National Guard behavioral health counselors in the 
fiscal year 2014 budget. The National Guard Bureau also has 
representation in suicide prevention at the DOD level where we 
participate on suicide prevention committees and councils, and to 
ensure we are getting the best information and the latest research. 
This is a complicated problem; however, I assure you that the National 
Guard will engage all support programs in order to work collaboratively 
to address this heartbreaking challenge.
National Guard Psychological Health Program
    Our Psychological Health Program provides ready access to high 
quality mental health services to our Airmen, Soldiers and their 
families. We provide support to our member in several ways. Our State 
Directors of Psychological Health (DPH) are very effective at directly 
addressing help-seeking behaviors and reducing stigma by educating all 
levels of leadership about psychological health as part of force 
readiness. We work closely with the Department of Health and Human 
Services (HHS) to leverage services and support for our members by 
increasing access to behavioral healthcare and offering mental health 
vouchers through the Substance Abuse and Mental Health Services 
Administration Access to Recovery program. Through HHS, the Health 
Resources and Service Administration identifies specific federally 
funded health initiatives and programs to better support healthcare 
needs for the National Guard population, especially in remote, rural 
areas. Additionally, the Centers for Medicare and Medicaid, through our 
close working relationship with HHS, has trained all National Guard 
contracted counselors on the Affordable Care Act for Guardsmen who may 
be uninsured or underinsured. Finally, we have a total of 174 Army and 
Air National Guard mental health counselors throughout the 54 States, 
territories and the District of Columbia that are available to our 
Guardsmen who are in need of assistance.
National Guard Family Programs
    As Overseas Contingency Operations wind down in 2014, funding is 
also expected to decrease for our family readiness programs that are 
tied to the challenges our Guardsmen face when dealing with a 
deployment. Our lessons learned during the last 12 years have shown 
that we cannot go back to pre-9/11 assumptions with little to no 
support infrastructure for geographically dispersed servicemembers and 
their families. Our family programs leverage a network of strategic 
partnerships that enhance well-being through increased access to 
outreach services. For instance, 454 Army National Guard Assistance 
Center specialists and 91 Air National Guard Airman and Family 
Readiness Program Managers are spread throughout the Nation and offer 
immediate outreach and referral for servicemembers and families. 
Moreover, each of the 101 National Guard State Child and Youth Program 
Coordinators provide support to our servicemembers' children that in 
2013 saw more than 50,000 National Guard children participate in events 
such as youth camps and councils. Maintaining access to current 
services and resources, particularly those that build strong family and 
spouse relationships, and strengthen financial wellness and employment 
will pay dividends in future years as it will directly contribute to 
the readiness of our force.
              closing remarks: always ready, always there
    The National Guard is always there when the Nation calls. Whether 
serving in uniform or in their capacity as civilians, National 
Guardsmen are vested in a culture of readiness and volunteer service. 
Time and time again, I see examples of where innovative civilian skills 
complement military training in operations both overseas and at home. 
Likewise, the military expertise garnered from the past 12 years of 
consistent operational use has improved our ability to support the 
homeland. Whether responding to a manmade or natural disaster or 
planning for future emergencies with first responders, the unique 
combination of civilian and military experience pays tremendous 
dividends to the American taxpayer. At a fraction of the cost to 
maintain during peacetime, the National Guard is a great value as a 
hedge against unforeseen threats in a complex and ambiguous world. 
Today's National Guard is flexible and scalable to America's changing 
needs on any given day. The National Guard has been and will remain 
``Always Ready, Always There'' for our Nation.
    I want to thank you for your continued support of our Citizen-
Soldiers and Airmen. I look forward to your questions.

    Senator Durbin. Thanks, General Grass.
    General Talley.
STATEMENT OF LIEUTENANT GENERAL JEFFREY W. TALLEY, 
            CHIEF, ARMY RESERVE
    General Talley. Chairman Durbin, Senator Shelby, Senator 
Collins, Senator Murray: Thank you very much for the 
opportunity to appear before you today. It's an honor to 
represent America's Army Reserve. It's a lifesaving and life-
sustaining Federal force for the Nation. And I'd like to begin 
by thanking the committee for your steadfast support that you 
provided to all members of our Armed Forces and their families.
    The Army Reserve is a community-based force of 205,000 
soldiers, 12,900 civilians, living and operating in all 54 
States and territories and in 30 countries. We provide about 20 
percent of the total Army force structure for only about 5.8 
percent of the budget. That's a great return on the investment 
especially given the positive economic impact we make 
everywhere we are. As the only component of the Army that is 
also a single command, we're embedded in every Army service 
component command and combatant command around the world.
    When the Nation reaches out or our allies reach out and 
call for help, the Army Reserve soldiers answer the call with 
pride and professionalism. We respond at home, such as in 
October 2012 when Superstorm Sandy struck the Northeastern 
United States causing major flooding and widespread power 
outage. We respond abroad, providing relief when our friends 
are overcome by natural disaster, such as the 2013 typhoon in 
the Republic of the Philippians. We support ongoing contingent 
operations with almost 20,000 soldiers today serving around the 
globe with over 6,000 still fighting in Afghanistan.
    We provide, also I think uniquely compared to all the other 
components and services, a direct linkage to industry private 
sector as most of the troops in the Army Reserve are 
traditional reservists who work in technical civilian careers 
in the private sector that directly correlate with what they do 
in the Army Reserve. In fact, most of the total Army's support 
and sustainment capabilities, such as attorneys or legal 
support, chaplain, civil affairs, military, history, 
logisticians, information operations, postal, personnel, 
medical doctors and nurses, chemical, transportation, public 
affairs, full spectrum engineering--hopefully you're getting 
the idea here--are in the Army Reserve; not in the regular Army 
or one of our great Army National Guards.
    Because the majority of these soldiers are traditional 
Reserve soldiers, they keep their technical skills sharp at 
little or no cost to the Department of Defense. In fact, 
currently 74 percent of the doctorate degrees and half of all 
the masters' degrees, in the total Army, are held by Army 
Reserve soldiers.
    Since September 11, 2011, more than 275,000 Army Reserve 
soldiers have been mobilized. Like all Reserve components, we 
have become de facto part of the operating force. And I'm sure 
we all agree that we must preserve that capability. Essential 
to that effort is the necessity to maintain our full-time 
support which currently is authorized at 13 percent. That's 
significantly lower than any other service or component. The 
Department of Defense average for full-time support is 19.4 
percent.
    The Army Reserve is the largest three-star command in the 
Department of Defense and the second largest command in the 
total Army, yet is manned at 13 percent full-time manning 
compared to the other Reserve components which averaged 19.4 
percent. This is a challenge for the Army Reserve.
    The funding reflected in our fiscal year 2015 budget, that 
request that is currently before you, helps us to maximize our 
end strength and maintain our ability to meet the steady demand 
signal that we see from our combatant commands. As the 
Department of Defense and Army leaders have testified in recent 
weeks, the Army Reserve end strength should not be permitted to 
drop below 195,000. However, return to the sequester level 
funding in fiscal year 2016 would force us to go below that 
number. This would seriously degrade our ability to meet the 
demands of the National Defense Strategy as already testified 
by Secretary McHugh and General Odierno.
    I'd like to thank the committee for its support of the 
current budget request. But I also wish to highlight the areas 
which we were found to accept more risk and that is our 
Operations and Maintenance, Army Reserve account, which took 
nearly a $500 million hit or reduction. This reduction forces 
us to forego all but the most necessary facilities maintenance 
and scale back training opportunities for our soldiers.
    The Army reserve is posed to provide a soft landing for 
quality mid-level soldiers who depart our regular Army and 
Active component sooner than they had planned. However, if 
we're unable to continue to offer relevant and engaging 
training for this all volunteer force of our soldiers, we will 
experience difficulty in recruiting and retaining the best 
talent, especially those brave men and women from our Active 
component who have served so well in combat all these many 
years.

                           PREPARED STATEMENT

    Finally, I want to emphasize that the Army Reserve is a 
full partner with the total Army as we develop the budget. 
Current times require us to make painful decisions, but the 
budget before you reflects the most thoughtful vision for the 
allocation of scarce resources and for the structure of our 
Army. I am deeply concerned about the impact of any actions 
that would shift the burden away from any one component, 
therefore, forcing deeper cuts in others.
    As you're aware, I provided the committee a statement that 
outlines the challenges of the Army Reserve and some specific 
ways the committee and the Congress can assist in keeping us 
viable and strong to answer the call of duty. I ask for your 
continued support for all of our services and components as we 
keep America secure and prosperous. I look very much to your 
questions. Twice the citizen and, absolutely, Army strong.
    [The statement follows:]
       Prepared Statement of Lieutenant General Jeffrey W. Talley
                  america's enduring operational force
    The Army Reserve is America's dedicated operational Federal reserve 
of the Army--a premier provider of trained, equipped, ready and 
accessible Soldiers, leaders and units to the Total Army, the Joint 
Force and civilian authorities nationwide.
    Since September 11, 2001, more than 275,000 \1\ Army Reserve 
Soldiers have been mobilized and seamlessly integrated into Active 
Component and the Joint Force missions. Today, approximately 19,000 
still serve in direct support of Army Service Component Commands and 
Combatant Commands across the globe, including nearly 4,000 \2\ 
Soldiers in Afghanistan.
---------------------------------------------------------------------------
    \1\ 275,542 since September 11, 2001, as per G-3/5. Source: HQDA 
system ``MDIS'' Mobilization deployment information System.
    \2\ From G-3/5: as of March 11, 2014, 18,990 AR Soldiers were on 
duty in support of ASCC/COCOMS, and 3,951 AR Soldiers were in 
Afghanistan.
---------------------------------------------------------------------------
    Yet, while we are no longer in Iraq and will soon be out of 
Afghanistan, we continue to face a dangerous world--one which Secretary 
Hagel recently described as ``growing more volatile, more unpredictable 
and in some instances more threatening to the United States.'' 
Continued regional instability, violent extremism, the proliferation of 
weapons of mass destruction, and any number of other factors, would 
seem to predict that the future global security environment is likely 
to be even more complex and potentially dangerous than it is today. And 
so we must be prepared to meet the threats and challenges of the 
future.
               army reserve capabilities vital to america
    Never before in the history of our Nation has the Army Reserve been 
more indispensable to the Army and the Joint Force, and the reason is 
the critical skills and capabilities they bring to the fight--skills 
often acquired through their civilian careers and honed in service to 
our Nation.
    We not only provide the professional skills and capabilities vital 
to the success of the Total Army and the Joint Force--but we also 
provide capabilities not found anywhere else in the Active Army, the 
Army National Guard, or our sister Services. Most, if not all, of those 
capabilities are vital during major combat operations, but are also 
valuable during times of local and national emergencies affecting the 
homeland.
    Those capabilities include theater-level transportation and 
sustainment, pipeline and distribution management, railway and water 
terminal operations as well as other high demand career fields such as 
doctors and nurses, lawyers, engineers, and cyber warriors. Put simply, 
the Army Reserve Citizen-Soldiers add the operational flexibility and 
strategic depth so essential to the Army's ability to Prevent, Shape 
and Win across the full range of military operations in which our 
Nation is, and will continue to be, engaged.
    A significant portion of the Army's enablers--including 90 percent 
of civil affairs, 65 percent of logistical units; 60 percent of 
doctors, nurses and other healthcare professionals; 40 percent of 
transportation units; 35 percent of engineers; 24 percent of military 
police--are provided by the Army Reserve. We also provide 50 percent of 
the Army's combat support and 25 percent of it's mobilization base 
expansion capability.
    As a dedicated reserve force under Federal control, the Army 
Reserve is an indispensable Total Army partner that is ready and 
accessible 24/7. It provides direct and immediate access to high-
quality, operational Soldiers, leaders and units for both planned and 
emerging missions. Our focus to support the Army's Regionally Aligned 
Forces ensures that Army Reserve Soldiers and leaders will be ready to 
support the Department of Defense's global requirements.
    We are a single command and a component within the Army with an 
authorized end strength of 205,000 Soldiers and 12,600 civilians 
arrayed under a variety of theater commands. Inherently flexible, the 
Army Reserve can quickly task organize in to force packages ranging 
from individuals to large units. These packages can be tailored to 
support a full range of missions, including homeland response, theater 
security cooperation, and overseas contingency operations.
    Indeed, steady demand for Army Reserve capabilities has introduced 
a new paradigm of reliance on the Army Reserve as an essential part of 
our national security architecture.
                               resourcing
    The Army Reserve is concerned that declining Defense budgets will 
adversely affect our readiness and modernization for the next several 
years. We are a full partner with the Army in striving to achieve the 
proper balance between end-strength, readiness, modernization, and 
budgets. In the fiscal year 2015 budget request, the Army Reserve's 
end-strength was reduced from 205,000 to 202,000 Soldiers. As Secretary 
Hagel and General Odierno have testified, Army Reserve end-strength 
should be no lower than 195,000 Soldiers, which we will achieve by 
fiscal year 2017. However, the currently scheduled sequestration-level 
caps will drive the Army Reserve end-strength down to a critically low 
level of 185,000 Soldiers, by fiscal year 2019, which is unacceptable 
for the execution of the defense strategy.
    Our near term resources no longer support unit level readiness and 
put in jeopardy our experienced and operational Army Reserve. Our 
Soldiers have served their Country proudly over the past decade and 
have gained invaluable experience that needs to be maintained through 
realistic and worthwhile training. Reductions in funding to our 
institutional training programs will adversely impact Duty Military 
Occupational Skill readiness, future Soldier promotion potential, as 
well as recruiting and retention.
    Army Reserve installation services have also taken a significant 
cut. Funding reductions in our facilities sustainment programs will 
accelerate the decay of our training facilities and force projection 
platforms. Of particular concern, is the significant reduction in Base 
Support funding which will require us to reduce critical Base 
Operations Services in areas such as physical security, base 
information management, environmental compliance and municipal 
services.
    As the active component draws down, we need a robust incentive/
bonus structure to attract those quality Soldiers into the Army Reserve 
and retain them as Soldiers for Life. The investment to retain these 
Soldiers in the Army Reserve is more than offset by the costs of 
recruiting and training new Soldiers.
                  defense support of civil authorities
    In 2012, Congress provided the Department of Defense with new 
Reserve Component access authority in 10 U.S. Code Sec. 12304a. This 
law clears the way for the Army Reserve to assist our fellow Americans 
during domestic emergencies when Federal Assistance is requested by the 
Governors through the Federal Emergency Management Agency. The same 
life-saving and life-sustaining capabilities so essential to missions 
abroad make the Army Reserve an optimum force for preserving property, 
mitigating damage and saving lives here at home.
    In fact, key capabilities in high demand during a major disaster, 
such as an earthquake or hurricane, are prominent in the Army Reserve 
and nearly all Defense Support of Civil Authorities (DSCA) response 
missions could benefit from the Army Reserve's unique capabilities and 
core competencies. In addition to those already mentioned, Army Reserve 
capabilities also include aviation lift, search and rescue or 
extraction; quartermaster units (food, shelter, potable water, heated 
tents, etc.); supply; civil affairs; public affairs; public and 
civilian works; protection of key infrastructure; as well as a 
significant portion of full spectrum engineer capability--with some 
capabilities predominately within the Army Reserve.
    Our Expeditionary Sustainment Commands go into places devoid of 
infrastructure and quickly open seaports and airports, while our 
logistics and supply chain personnel are experts at moving supplies 
into affected areas.
    Army Reserve aviation units possess robust capability. Medical 
evacuation helicopters and fixed wing aircraft can provide quick 
transportation in a disaster response area. Medium and heavy lift 
helicopters can rapidly move relief supplies, equipment and 
construction material into devastated areas.
    Our Engineer units include search and rescue teams, debris removal 
capabilities, horizontal and vertical construction and bridge 
construction capabilities. We even have a prime power company, 
headquartered at Fort Belvoir, Virginia that provides commercial-level 
electrical power to affected areas.
    We also provide 100 percent of the Army's Emergency Preparedness 
Liaison Officers (EPLOs) and 33 percent of the Department of Defense's 
EPLOs, who maintain communications between the Department of Defense, 
Federal, State and local governments, and nongovernmental organizations 
to coordinate assistance between all parties during emergency response 
events. They serve as subject matter experts on specific capabilities, 
limitations and legal authorities and keep track of Army Reserve 
capabilities in their states and regions.
    Thus, the same trained and ready forces that provide indispensable 
and immediately accessible capabilities for operations abroad, today 
stand ready to support domestic emergency and disaster relief efforts 
at home.
                 a good return on america's investment
    The Army Reserve provides all of these capabilities, including 
nearly 20 percent of the Army's trained Soldiers and units, for just 6 
percent of the total Army budget.\3\ We are the most efficient and 
cost-effective reserve component in the Army and operate with the 
lowest ratio of full-time support to end strength in the entire 
Department of Defense--about 13 percent. With our unique structure of 
combat support and combat service support enablers, the majority of our 
Soldiers are traditional Army Reserve Soldiers, with full-time jobs in 
the public and private sectors, who keep their technical skills sharp 
at little or no cost to the Department of Defense.
---------------------------------------------------------------------------
    \3\ Does not include Army Procurement funding for Army Reserve 
equipment.
---------------------------------------------------------------------------
    With steep force reductions anticipated across the services, it is 
imperative that our Nation remains committed to sustaining a strong and 
ready operational Army Reserve. For many missions supporting a 
Combatant Command's Theater Security Cooperation Strategy such as 
Building Partner Capacity, it makes sense to leverage the capabilities 
of the Army Reserve, especially since Congress increased direct access 
to our capabilities with 10 U.S. Code Sec. 12304b. In this era of 
constrained fiscal resources, using the Army Reserve is a particularly 
cost-effective way to mitigate the risks while maintaining an 
operational reserve. The use of the Army Reserve in support of the 
Combatant Commands maintains the operational experience gained during 
the last decade. This use of our capabilities also supports the Total 
Force Policy for the Army by having all components working together for 
the Combatant Commands while leveraging the Operational Reserve.
    In addition to the return on investment the Army Reserve provides 
to the Army and the Department of Defense, there is also a return in 
the form of a positive economic impact to States and communities across 
the United States.
    Each year the Army Reserve invests billions in local communities in 
a number of ways. These investments include payroll to local Soldiers 
and Department of Defense employees, utilities and other services to 
municipalities, civilian contractors and administrative support; as 
well as professional, scientific and technical services in areas like 
environmental clean-up and protection. This investment in turn 
generates tens of thousands of new food industry, service-related, and 
other non-DOD jobs, creating new income for families and a positive 
economic climate for State and local communities.
                a new generation of army reserve leaders
    For these reasons, the Army Reserve that some people still recall 
from the 1990s is long gone. As my predecessor testified 3 years ago to 
the Senate Appropriations subcommittee, ``I have seen the Reserve of 
the future and it is now.''
    Our Citizen-Soldiers are highly educated and professionals in their 
civilian careers. They are our doctors, lawyers, academics, scientists, 
engineers and information technology specialists on the leading edge of 
their fields--a new generation of Soldiers who grew up with technology 
in their hands, practice it in their professions and leverage it while 
in uniform. Today, 75 percent of the doctorate degrees in the Total 
Army and half its master's degrees are found in the Army Reserve. This 
education and their skills are invaluable to the civilian career fields 
in which they work, but they are also invaluable to the Army.
    Physically and mentally fit, and fundamentally resilient, Army 
Reserve Soldiers are America's steady state, operational reserve force. 
In times of crisis or national emergency, the Army Reserve can respond 
quickly to our Nation's call. A ready Army Reserve not only offers the 
Nation an insurance policy, but it can provide an opportunity for 
Soldiers leaving active service due to end-strength reductions a chance 
to continue serving. As we downsize the Active Component, transitioning 
Soldiers to the Army Reserve helps the Army keep faith with them and 
their families who demonstrate a propensity to serve their country. 
This preserves the taxpayer's investment in training these Soldiers, 
and can offer new military career tracks that may bridge the transition 
for Soldiers and their families.
    Offering a continuum of service option supports, the Chief of Staff 
of the Army's recent guidance to leverage the unique attributes and 
responsibilities of each Component and preserves the operational 
experience gained from more than 12 years of war while continuing to 
prepare Soldiers and units for future challenges.
 national guard and reserve equipment appropriation and modernization 
                               challenges
    The Army Reserve appreciates the steadfast support the Committee 
has provided for more than a decade and particularly the National Guard 
and Reserve Equipment Appropriation (NGREA) funding that has improved 
our equipment acquisition and modernization levels. The Army Reserve is 
at an all-time high for equipment modernization and equipment on hand, 
and was a full partner in developing and submitting the fiscal year 
2015 President's budget for equipment procurement and modernization. 
However, we still suffer from significant equipment shortfalls and are 
the least equipped and modernized Army component.
    In the 2014 National Guard & Reserve Equipment Report, dated March 
2013, the Army Reserve's modernization rate was 66 percent. As of 
December 2013, the rate increased to 76 percent. While the Army 
Reserve's equipping posture has improved during the past 10 years, 
critical equipping and modernization shortages remain one of the Army 
Reserve's greatest challenges. Program procurement delays and the 
restructuring of requirements as a result of budget reductions, will 
further widen modernization gaps and impede our interoperability with 
the Joint Force.
    Since 2011, the Army Reserve's base budget for equipment 
procurement had seen an overall decrease of 45 percent. The Army 
Reserve, in coordination with the Army, continues to develop mitigation 
strategies aimed at improving equipment modernization. Congressional 
support through NGREA is essential to successfully execute mitigation 
strategies and improving Army Reserve equipment modernization levels. 
Even in these times of constrained fiscal resources, we cannot afford 
to let this challenge go unaddressed as it directly impacts our ability 
to train and sustain an operational force that is properly equipped to 
meet National Security responsibilities while enhancing Federal 
response to Homeland Defense and DSCA.
High Mobility Multipurpose Wheeled Vehicle Challenges
    A challenge for the Army Reserve is modernization of the legacy 
Light Tactical Vehicle fleet. The Army Reserve is scheduled to replace 
one-third of the High Mobility Multipurpose Wheeled Vehicle (HMMWV) 
fleet with Joint Light Tactical Vehicle beginning in 2022. As a result, 
we must maintain two-thirds of the legacy fleet for 31 additional 
years, through 2045, without any scheduled modernization, leaving the 
Army Reserve, and especially our medical units, with an unfunded 
modernization requirement.
    Today, 48 percent of the Total Army's ground ambulance companies 
reside in the Army Reserve. The Army Reserve has on hand only 64 
percent of its required Light Ground Ambulances. This more than 20-
year-old legacy Ambulance fleet was not included in previous 
modernization efforts and is short 36 percent of the HMMWV Ambulances 
required to support contingency operations and potential mass casualty 
events in the homeland.
Clearance and Bridging Capabilities
    Similarly, 35 percent of the Army's total engineering capacity--
which includes 80 percent of its Area Clearance capabilities and 36 
percent of its Multi-Role Bridging capabilities--are provided by the 
Army Reserve. In just 6 years, by 2020, only 20 percent of the Common 
Bridge Transport System, and none of the Joint Assault Bridge system 
will be modernized.
Logistical Capabilities
    Lastly, the Army Reserve provides 65 percent of the Army's total 
logistics capabilities, of which the majority is Critical Dual Use 
equipment for enabling support to Homeland Defense and DSCA. 
Significant shortfalls in this area include water and fuel storage and 
distributions systems and material handling equipment. Only 43 percent 
of the Fuel Distribution System, and 20 percent of the Army's Light 
Capability Rough Terrain Forklift for moving material, will be 
modernized by the end of 2020.
    While the Army Reserve's equipping posture has improved during the 
past 10 years, critical equipping and modernization shortages remain 
one of the Army Reserve's greatest challenges. Even in these times of 
constrained fiscal resources, we cannot afford to let this challenge go 
unaddressed as it directly impacts our ability to train and sustain an 
operational force that is properly equipped to meet National Security 
responsibilities while enhancing Federal response to Homeland Defense 
and DSCA.
Full Time Support
    Ensuring our operational Army Reserve will continue to meet global 
mission requirements with trained and ready forces requires resourcing 
adequate full time support. Our full time Active Guard and Reserve 
(AGR) Soldiers and Civilians ensure the precious time of our 
traditional Reservists is focused on training and readiness rather than 
the abundant administrative and preparatory tasks. At the Budget 
Control Act and even the Bipartisan Budget Act level of funding, the 
Army Reserve was forced to reduce Full Time Support. Military 
technicians (MILTECHs) will be reduced by 500 in fiscal year 2015, with 
an additional 500 programmed in fiscal year 2016 for a total of a 1000 
MILTECH reduction across the Army Reserve.
    Army Reserve full time support is currently authorized at 13 
percent of end-strength, while the Department of Defense average for 
all Reserve Components is 19.4 percent. Increasing Army Reserve full 
time support will improve Army Reserve unit readiness by moving non-
readiness producing administrative tasks from the part time Soldier to 
the full time support staff. In addition, we urge congressional support 
of two important legislative proposals submitted to the committees on 
modifying the military technician program. These legislative proposals 
allow for greater flexibility and upward mobility for our members both 
as Soldiers and Department of the Army Civilians.
 america's army reserve: a life-saving, life-sustaining force for the 
                                 nation
    Whether it is providing trained and ready forces for combat 
missions and contingency operations abroad, or saving lives and 
protecting property at home, today's Army Reserve is America's life-
saving, life-sustaining force for the Nation.
    Thank you for the opportunity to appear before you and for the 
steadfast support Congress has always provided to the men and women who 
have served our country so selflessly over the past 106 years, and 
continue to do so every day.

    Senator Durbin. Thank you, General Talley.
    General Lyons.
STATEMENT OF MAJOR GENERAL JUDD H. LYONS, ACTING 
            DIRECTOR, ARMY NATIONAL GUARD
    General Lyons. Good morning, Chairman Durbin, Senator 
Shelby, Senator Collins, Senator Murray. I'm honored to appear 
before you today, representing more than 355,000 soldiers in 
the Army National Guard.
    At home, our Guard's men and women continue to answer the 
call. Today, they are assisting in the aftermath of deadly 
tornados in Arkansas, Mississippi, Alabama and Tennessee; as 
well as flooding in Florida and North Carolina. Army National 
Guard soldiers are always ready to respond to natural disasters 
anywhere in the country.
    Thanks to the firm and committed support of Congress and 
the Army over the past 13 years, the Army Guard has transformed 
from a strategic Reserve into an operational force. Since 
September 11, 2001, we've mobilized soldiers, more than 525,000 
times.
    As part of our total Army, Guard units have performed every 
assigned mission from counterinsurgency operations in Iraq and 
Afghanistan to maintaining the peace in Kosovo and the Sinai. 
Your Army Guard is actively adapting to a new global 
environment as part of the total Army. As the Army transforms 
its training from counterinsurgency focus to decisive action, 
Vermont's 86th Infantry Brigade Combat Team will be the first 
Army Guard BCT in a decade to conduct a decisive action 
rotation at the joint readiness training center in Fort Polk, 
Louisiana this summer.
    The fiscal year 2015 budget submission required hard 
choices and has significant impact in our National Guard 
personnel and operations and maintenance funding. The based 
budget request for these two accounts is nearly $1 billion 
below what was appropriated in fiscal year 2014. This will 
require the Army Guard to accept risk in fiscal year 2015.
    Our brigade combat teams lack NGPA (National Guard 
Personnel, Army) and OMNG (Operations and Maintenance, National 
Guard) for CTC rotations and will be limited to achieving 
individual, crew and squad level proficiency in their training. 
Personnel will have fewer opportunities to attend schools and 
special training and our depple level overhaul of our trucks 
will be deferred. Our armories, which average 44 years of age, 
will lack funding for repairs beyond those that will ensure 
health and safety.
    Yet, these reductions pale in comparison to what will be 
required under Budget Control Act levels. Under BCA, Army 
National Guard end strength is reduced to 315,000. Our 
reduction of 35,000 Guard soldiers means the elimination of 
many critical command and control headquarters, the loss of 
experienced leaders and fewer opportunities for Active-Duty 
soldiers to transition into the Guard. We will be in fewer 
communities and face closing armories.
    Ultimately, this combination of these impacts equals 
increased response time for domestic emergencies and fewer 
forces available for Title 10 missions in case of a national 
emergency.
    Because people are our number one resource, we are 
committed to eliminating sexual assault and to enhancing our 
behavioral health programs. We're working diligently to deal 
with these challenges and to provide resiliency building tools 
to our soldiers and their families. These are top priorities 
for all Army Guard leaders.

                           PREPARED STATEMENT

    With committed Citizen Soldiers in our formations, the Army 
Guard presents tremendous value to the Nation and to the 
communities where we live, work, and serve. The last decade-
plus of war has demonstrated our strength as a combat-ready, 
operational force or role that, with your support, we will 
probably continue to perform for the Army and for our Nation.
    I appreciate the opportunity to be here today and I look 
forward to your questions.
    [The statement follows:]
           Prepared Statement of Major General Judd H. Lyons
                            opening remarks
    Chairman Durbin, Vice Chairman Cochran, members of the 
subcommittee: I am honored to appear before you today, representing 
more than 354,000 Soldiers in the Army National Guard. For 377 years 
our Citizen Soldiers have been central to how the Nation defends itself 
at home and abroad. Through resolve and readiness, Army National Guard 
Soldiers deliver essential value to our Nation and our communities.
    The men and women of the Army National Guard continue that history 
and contribute immeasurably to America's security. They have been an 
integral part of the Army, supporting the National Military Strategy 
and Army commitments worldwide. In more than a decade of fighting two 
wars, the Army National Guard has successfully expanded the capacity 
and capabilities of our Army, conducting every mission assigned.
    Since September 11, 2001, Guard Soldiers have completed more than 
525,000 mobilizations in support of Federal missions. The Army National 
Guard mobilized more than 17,300 Soldiers for service around the world 
during fiscal year 2013, a number substantially lower than our peak 
years of 2003 and 2004, when we mobilized more than 80,000 per year. 
Currently, we have nearly 15,000 mobilized, of which 6,500 are deployed 
to multiple locations in the U.S. and around the world defending our 
national interests.
    There is a direct and powerful connection that begins with the Army 
National Guard's organization, equipment and training for overseas 
missions and leads to our unequaled capacity to complete domestic 
missions. On the home front, the Army National Guard continues to 
fulfill its centuries-old obligations to the communities in which we 
live and work. Guard Soldiers live in each congressional district, 
playing a vital role as the military's first domestic responders and 
linking national efforts to local communities. In fiscal year 2013 Army 
Guard Soldiers served nearly 388,000 duty days under the command of the 
Nation's governors assisting our fellow citizens during domestic 
emergencies. Yet, despite a large call up for Hurricane Sandy, fiscal 
year 2013 was historically a slow year. The current fiscal year has 
already seen State activations for ice storms in the south, unusually 
high levels of snow throughout the country, floods in several States, 
and a major water contamination disaster in West Virginia. Whether at 
home or abroad, the National Guard lives up to its motto--Always Ready, 
Always There.
    The Army National Guard of 2014 remains at peak efficiency in 
manpower, training, equipping, leadership and experience. We haven't 
arrived at this level by accident. This is a direct result of the 
resourcing and legal authorities that Congress has dedicated to this 
purpose over the past decade-plus of conflict, and a tremendous effort 
by the Total Army to reach this level of operational capability. I can 
assure you that this effort has not only been worthwhile, but that the 
results have brought an excellent return on the taxpayers' investment. 
The National Guard delivers proven, affordable security and we do it on 
an as-needed basis.
    The Army National Guard, the active Army and the Army Reserve, 
ensure the Total Force remains capable of providing trained and ready 
forces for prompt and sustained combat, in support of the Nation's 
security strategy.
    The transition from a strategic reserve to an operational force 
means the Army Guard is resourced, trained, ready, and used on a 
continual basis. When properly resourced we can conduct the full 
spectrum of military operations in all environments as a part of the 
Total Force.
    The fiscal constraints imposed by sequester level reductions under 
the Budget Control Act, though temporarily eased by the Bipartisan 
Budget Agreement, will lead to inevitable reductions in funding in 
years ahead. The Army Guard will share in these cuts; however, it is in 
these challenging times that the inherent value of the ARNG to the 
American taxpayer comes most clearly into focus. As numerous studies 
both internal and external to the Department of Defense have 
demonstrated, a reserve component service member costs a third of his 
or her active component counterpart when considering the fully burdened 
cost over the lifetime of the individual. Because Congress has already 
invested in the training and equipping of the Army National Guard over 
the past 13 years of war, it now takes only a continued modest 
investment to maintain an operational force when compared to the 
strategic reserve the Nation had prior to 9/11. But that investment is 
more than made up for in the responsiveness, flexibility and readiness 
resident in a reserve component where 84 percent of the personnel serve 
in a part-time status.
                             accountability
    We must protect the Nation's investment by insuring that the ARNG 
is an effective and accountable steward of public resources. We 
continue to encourage and implement innovations to improve efficiency 
to sustain hard-won readiness gained over the last decade. Despite 
having a lean headquarters we have followed the Secretary of Army 
directive to decrease our headquarters staff by 20 percent by fiscal 
year 2019. We will continue to actively advance our methods of 
increased accountability as we hold ourselves to the highest standards 
of ethics and integrity. We must ensure that the American people feel 
confident that our actions are above reproach.
                          status of the force
    Guard Soldiers continue to demonstrate a strong willingness to 
serve this great Nation and their communities. This appetite for 
service continues to draw America's youth to the Guard's ranks. To meet 
our obligation to the great men and women who step forward to serve, 
everyone--general officer to private--must adhere to and embody the 
ethical standards articulated in our core values. By remaining focused 
on ethical standards and our core values we will continue to attract 
and retain Citizen Soldiers.
    The Army Guard achieved 98.5 percent of its recruitment goal of 
45,400 new Soldiers. Overall, our retention rate during fiscal year 
2013 was 86.3 percent, as 51,145 Guard Soldiers extended their 
enlistments; of note, this was a 3.8 percent increase over the previous 
5 years.
    For active component Soldiers who choose to leave active duty, the 
National Guard continues to offer an excellent opportunity to remain in 
service to our country and for the country to retain the investment in 
developing the skills of these veterans. More than 4,600 Soldiers 
joined the Guard last year directly from the active Army, which 
surpassed the Guard's goal (105.9 percent). As future end strength cuts 
loom, the Guard stands ready to retain combat-proven Soldiers in the 
Army. But this talent cannot be retained if there is no place to put 
it. By maintaining sufficient force structure in the Guard, the Army 
can provide service opportunities for combat-proven Soldiers, as well 
as saving some of the costs incurred in training new recruits.
    Those Soldiers who join the Guard from the active component are 
signing up with a well-trained, seasoned cohort. Nearly 50 percent of 
our Soldiers today are veterans of a deployment with the Army National 
Guard, many having served multiple tours. Retaining a corps of 
experienced troops not only sustains the Guard's readiness, but becomes 
an overwhelming benefit to the Total Army. A total of 303,282 Soldiers, 
or 85 percent of our force, have joined the Army National Guard since 
9/11, knowing they were likely to deploy overseas. This is a special 
class of people that we want to hold on to, and improving on the 
retention rate last year was important for us. The likelihood of 
deploying on operational missions overseas is not nearly as great as it 
was 6 years ago, and money for training and equipment will not be as 
readily available. So keeping these Soldiers interested and engaged--
and thus willing to stay in our ranks--is becoming a significant 
challenge not just for our retention personnel, but for leaders at 
every level.
    Certainly, bonuses and incentives play an important role in keeping 
Soldiers in uniform, but we know that the desire for relevant training 
and utilization at home and abroad play a significant role in their 
decisions to stay. A key component of the operational reserve is that 
it is a force that sees regular use, through a progressive readiness 
model--such as Army Force Generation--that prepares Soldiers and units 
for deployment. Regular employment ensures unit readiness remains high. 
It provides Soldiers, their families and civilian employers the 
predictability they need to plan their civilian lives and careers. 
Also, it develops critical leadership skills, while exercising our 
systems to ensure we can rapidly deploy when needed.
                             accessibility
    In the 2012 National Defense Authorization Act, Congress addressed 
concerns about accessing the reserve components for domestic or 
overseas missions in situations short of war or a national emergency. 
The authority granted in Title 10, section 12304(b) removed a 
significant impediment to maintaining an operational reserve that can 
be flexibly employed by combatant commanders as required. Title 10, 
section 12304(a) likewise removed an impediment to employing all 
Federal reserve capabilities for domestic emergencies at the request of 
the governors. There remain no significant statutory barriers to 
accessing the Army National Guard for either domestic or overseas 
missions, though consistent budgeting for use of these authorities 
remains an issue to address. The Army National Guard is accessible and 
ready to meet the needs of the Nation.
            an operational force that fights america's wars
    The Army National Guard has demonstrated this capability in full 
during the wars in Iraq and Afghanistan. Citizen Soldiers have been 
mobilized in units ranging in size from two-to-three man teams, to 
Brigade Combat Teams, to Division headquarters exercising command and 
control over multiple Brigade Combat Teams and supporting forces. Guard 
BCTs performed every mission in Iraq and Afghanistan their active 
component counterparts performed except the initial invasion. Guard 
BCTs successfully performed a wide variety of missions including 
security force, counter-insurgency operations, and advising and 
assisting host nation military and police forces in both countries.
    In fiscal year 2013, more than 17,300 Army National Guard Soldiers 
were mobilized in support of a multitude of ongoing missions around the 
world. Approximately 10,300 served in Afghanistan, while others served 
in the Horn of Africa, Kosovo, the Sinai, Honduras, the Philippines, 
and mobilized for operational missions within the United States.
    While this contribution is noteworthy, there is significantly more 
capacity within the Army National Guard should the Nation require a 
surge of forces. For example, at one point during 2005 more than 
100,000 Guardsmen were mobilized and 8 of 15 Brigade Combat Teams in 
Iraq were Army National Guard. Later that same year, with 80,000 
Soldiers still mobilized, the Army Guard surged more than 50,000 
Soldiers in the span of a week to deploy to the gulf coast in the wake 
of Hurricane Katrina. In summary: In the year in which the Army 
National Guard underwent its largest mobilization since the Korean War, 
it also experienced the largest domestic response in its history. This 
capacity and capability continues to reside in your Army National 
Guard.
    Response time is a critical consideration when determining the 
right mix of forces to meet planned or unanticipated contingencies. The 
past 13 years of war have demonstrated that even the largest Guard 
formations can be trained to the Army standard, validated and deployed 
well within the timelines required by combatant commanders. The 
experience of deploying repeatedly over the past decade has honed this 
training regimen and reduced post-mobilization training time 
considerably since 2003. As the Office of the Secretary of Defense 
validated in its December 2013 report to Congress, ``Unit Cost and 
Readiness for the Active and Reserve Components of the Armed Forces,'' 
even the most complex Guard formations, the Brigade Combat Teams, take 
only 50-80 days after mobilization to be ready for deployment when they 
are mobilized at company-level proficiency, or 110 days when mobilized 
at platoon-level proficiency. The ability of the Army National Guard to 
respond to worldwide contingencies provides tremendous flexibility to 
the Nation as we seek to achieve defense goals with a constrained 
budget.
    In fiscal year 2015, the ARNG is programmed to return to its pre-9/
11 strength of 350,200, a reduction of 4,000 in end strength from 
fiscal year 2014 and 8,000 from our wartime high of 358,200 between 
2008-2013. If Budget Control Act level cuts are re-imposed in 2016, the 
Army will face even tougher choices and challenges in managing risk and 
balancing readiness, modernization and end strength. Under these 
conditions, the Secretary of Defense has announced that ARNG end 
strength will have to be further reduced to 315,000 by fiscal year 
2019. This will mark a significant reduction in the strategic hedge 
against uncertainty that the Army Guard affords the Nation for 
unforeseen contingencies. It will also undoubtedly impact domestic 
response times. While the Guard will always respond to a domestic 
emergency, response times may suffer as readiness centers are 
shuttered, equipment maintenance is deferred, and training is reduced.
            an operational force that protects the homeland
    In fiscal year 2013, Citizen Soldiers responded to hurricanes, 
winter storms, floods, tornadoes, search and rescue missions, and the 
bombing of an iconic sporting event in one of our Nation's oldest 
cities. There were 52 major disaster declarations in 24 States and 
territories in 2013, but the biggest response of the year came in its 
first month. Super Storm Sandy devastated communities along the east 
coast in late October, and Guard members from 21 States responded, with 
many remaining on duty for several weeks. At the height of the 
response, more than 11,900 Guardsmen were activated. These were joined 
by active component Soldiers, Sailors, Airmen, Marines, as well as Army 
Reservists, all of whom fell under dual status commanders in New York 
and New Jersey. Both dual-status commanders were National Guard 
brigadier generals, successfully integrating DOD capabilities under 
State and Federal control to more effectively serve our citizens in 
their time of need.
    Warmer weather did not mean the National Guard would have the rest 
of 2013 off. On the afternoon of May 20, an EF5 tornado packing winds 
above 200 mph tore into the Oklahoma City area. The suburb of Moore was 
severely impacted. Dozens of people were killed, entire neighborhoods 
were flattened, and homes and businesses were destroyed. Elementary 
school children were trapped in what remained of their schools, and 
Army National Guard members assisted in rescuing survivors. In total, 
more than 530 Army National Guard members supported the relief effort, 
performing search and rescue and security support missions.
    The ARNG's largest rescue operation last year was in response to 
the floods that wiped out numerous roads and bridges, devastating 
communities in Colorado in September 2013. Thousands of citizens were 
stranded in the mountains of the Front Range. Eight people were killed, 
218 were injured, and thousands of commercial and residential buildings 
damaged or destroyed. More than 750 National Guard members with a total 
of 21 helicopters and 200 military vehicles were joined by active 
component Soldiers and aircraft from Fort Carson. More than 3,233 
Civilians and 1,347 pets were rescued and evacuated. In the aftermath, 
Army National Guard engineers from Colorado and several neighboring 
States quickly restored miles of highway that were washed out in the 
floods before winter snows would have made reconstruction impossible.
    One event that has long been an annual requirement for the 
Massachusetts National Guard was anything but routine last year: The 
117-year old Boston Marathon. Massachusetts Guardsmen have long 
supported State and Federal law enforcement at the event, providing 
traffic control, area security, and a standby Civil Support Team. Their 
familiarity with the marathon was extremely helpful, and indeed 
lifesaving, last year. Approximately 250 Guard members were on State 
Active Duty supporting the Boston Marathon on April 15 when two 
improvised explosive devices detonated near the finish line. This 
attack killed three spectators and injured hundreds more. National 
Guardsmen on site immediately provided lifesaving aid and conducted 
security cordons and traffic control operations to assist emergency 
responders with their coordinated response. The 1st Civil Support Team 
of the Massachusetts National Guard quickly determined that no chemical 
agents had been used in the bombing. By the next morning, approximately 
1,000 National Guard members were called to State Active Duty to assist 
civil authorities. In addition to Massachusetts, the States of Rhode 
Island, New Hampshire and New York provided Citizen Soldiers for this 
response. In the days to come, armed National Guard military police 
used armored Humvees to facilitate the tactical movement of law 
enforcement personnel.
    The Army National Guard's support to the U.S. Border Patrol along 
the Southwest border continued into 2014, although at a reduced rate 
than in years past. Approximately 220 Guard members from 34 States or 
territories served on this ongoing mission along the 1,933-mile border 
of California, Arizona, New Mexico, and Texas. The current mission 
focuses on criminal analysis and aerial detection and monitoring. 
Still, during the 2013 calendar year, ARNG aviation personnel flew more 
than 10,635 flight hours in support of this mission, assisting in the 
seizure of 40,264 pounds of marijuana and 139 pounds of cocaine.
    Army National Guard aviation was particularly active in the 
domestic arena, flying more than 19,100 hours supporting civil 
authorities in natural disasters, conducting medical evacuations, and 
conducting preplanned activities such as counter drug missions. Army 
Guard aircraft hauled nearly 422,000 pounds of cargo, transported more 
than 18,000 passengers and worked with multiple law enforcement 
agencies on a regular basis, assisting in the seizure of an estimated 
$5.03 billion in drugs during the course of the year. Most importantly, 
Army Guard aircraft rescued 1,604 citizens in Search and Rescue and 
medical evacuation missions.
              an operational force that builds partnership
    One of the National Guard's greatest strengths is building 
partnerships. In 2013, the Army National Guard provided 12,265 Soldiers 
to support 72 military exercises in 76 countries. The Guard's 
experience with the warfight, domestic disaster response, our Soldiers' 
wide variety of civilian professional and educational experiences, and 
close community connections to many civilian institutions such as 
hospitals and universities, ideally position the National Guard for 
building partnerships that are multi-dimensional.
    Today, the National Guard Bureau's State Partnership Program (SPP) 
consists of 68 partnerships with a total of 74 partner countries. SPP 
promotes security cooperation activities for military-to-military 
training, disaster response, border and port security, medical, and 
peacekeeping operations. Calendar year 2013 marked the 20th anniversary 
of this innovative program, which continues to produce immense benefits 
for both the United States and partner nations at minimal cost. In 
support of the Chief of Mission and the U.S. Department of State, and 
at the request of the regional combatant commanders, SPP is conducted 
jointly by Army and Air Guard forces in the States, territories and the 
District of Columbia under the leadership of the respective adjutants 
general. As such, SPP is the perfect complement to the Army's Regional 
Alignment of Forces concept and Chief of Staff of the Army's effort to 
shape the security landscape, but with unique advantages. Because of 
the relative stability of a Guard Soldier's career, which in most cases 
remains within a single State, that Soldier has the opportunity to 
forge enduring relationships with his or her counterparts in one or two 
foreign nations over long periods of time. In some cases, the crucial 
bonds have been cultivated and maintained for more than two decades.
    These bonds have borne fruit on the battlefield. Since 2003, 16 
partner nations deployed units to Iraq and Afghanistan more than 87 
times alongside Guard men and women from their partner states. 
Additional benefits of the State Partnership program include economic 
co-development, educational exchanges, agricultural growth to build 
food security, and support to other Federal agencies.
                    resourcing the operational force
    The fiscal year 2015 budget submission represents a significant 
reduction in appropriations for the Army National Guard in both 
Operations and Maintenance (OMNG) and Personnel (NGPA) accounts 
compared to fiscal year 2014. OMNG funding for fiscal year 2015 
reflects a 12-percent reduction from fiscal year 2014. This will only 
allow the ARNG to provide minimal training for units, with no 
additional funding to allow for combat training center rotations in 
fiscal year 2015. In addition to the decrease in OPTEMPO funding, the 
ARNG assumes risk in such areas are Base Operations Support, 
modernization to infrastructure, and depot maintenance of equipment and 
vehicles.
    NGPA funding for fiscal year 2015 is 1.2 percent below fiscal year 
2014 levels. While this fully funds statutory requirements of inactive 
duty training, annual training, and initial entry training, the ARNG 
has assumed risk with significant reductions in funding for training 
and schools as compared to last year.
    These reductions will begin to degrade the readiness that the Guard 
has built up over the past 13 years, limiting how rapidly ARNG units 
may be operationally employed. The reductions for fiscal year 2015 will 
pale in comparison, however, to the reductions that are forecast to 
take place beginning in fiscal year 2016 when the Army returns to the 
sequestration levels of funding imposed by the Budget Control Act.
    Quite simply, the Army National Guard can be as ready as it is 
resourced to be. The Guard will achieve desired levels of 
responsiveness if properly resourced--and it will do so by maximizing 
taxpayers' investment in programs directly contributing to Army 
National Guard readiness.
  maintaining the operational force: support to soldiers and families
    People are the Guard's most precious resource, and the ARNG 
sponsors a wide variety of programs intended to enhance coping skills 
in Soldiers and their families--skills with an application to everyday 
life as well as the military.
           sexual harassment/assault response and prevention
    The Army National Guard SHARP program reinforces the Total Army's 
commitment to eliminating incidents of sexual harassment and assault 
utilizing education, disciplinary action, and victim-centered response 
services. In fiscal year 2012, the ARNG assigned a full-time program 
manager to each State and territory and the District of Columbia; 
during this past fiscal year the ARNG assigned 93 full-time victim 
advocates within each State and territory and the District of Columbia. 
In addition to full-time support personnel, the ARNG has trained more 
than 2,400 collateral duty Sexual Assault Response Coordinators and 
Victim Advocates at the brigade and battalion level. The Army National 
Guard's minimum goal was to train 1,864 SHARP personnel to DOD Sexual 
Assault Advocate Certification Program standard. With 2,309 certified, 
we are at 127 percent of that goal.
                           suicide prevention
    Calendar year 2013 saw a record 119 suicides of Guard Soldiers. 
Combating suicides has been a persistent challenge for the Army Guard, 
since leaders typically only see the majority of their Soldiers during 
a single drill weekend each month. This limits a leader's ability to 
intervene in a crisis. That's why the Army Guard is focusing on 
training and programs to increase resilience, reduce risk, and increase 
leadership awareness. In September 2013, the ARNG awarded a national 
contract to provide a Suicide Prevention Program Manager (SPPM) in 
every State. The SPPM manages State suicide prevention efforts, 
training, and suicide surveillance. The ARNG trained 120 trainers in 
the Applied Suicide Intervention Skills Training (ASIST) program in 
fiscal year 2013, bringing the total to 517. These personnel trained 
4,042 gatekeepers in advanced suicide intervention skills. Gatekeepers 
are trained to recognize someone in crisis, intervene to keep them 
safe, and provide referrals to assistance. The goal in fiscal year 2014 
is to train an additional 120 ASIST trainers who will, in turn, train 
approximately 11,000 gatekeepers. The Army National Guard is also 
participating in Army studies of suicide trends in an attempt to 
determine if prevention resources can be better focused to particular 
units, States, or at-risk Soldiers. Even one suicide is one too many; 
however, the trend is improving. Thus far in 2014, the number of 
completed suicides is below the pace of 2013--a trend we are working 
hard to sustain.
    In fiscal year 2013, ARNG behavioral health counselors provided 
informal behavioral health consultations to more than 30,000 Soldiers 
and family members; 2,939 of these consultations identified emergent 
situations leading to critical psychological care. The ARNG reported 
876 command interventions in suicide attempts (including expressed 
desire to commit suicide) in the 2013 calendar year. The ARNG reports 
172 ideations as of mid-March 2014. We will continue to work 
collaboratively to address this heart breaking challenge.
                   directors of psychological health
    Prior to last year, one Director of Psychological Health (DPH) was 
provided for each of the 50 States, three territories and the District 
of Columbia. The National Defense Authorization Act for 2014 authorized 
funding for an additional 24 DPHs, increasing the ARNG's total from 54 
to 78. In accordance with NDAA 2014, the 24 new DPHs were assigned to 
high-risk States. The ARNG has seen a significant increase in usage 
rates addressing emergent and high-risk cases. Command consultation, 
follow-up and multidisciplinary team consultations went from 13,525 to 
26,766, and behavioral health case management went up from 3,556 to 
10,264. We are grateful that Congress allocated $10 million for 
additional Guard behavioral health counselors in the fiscal year 2014 
budget.
                       guard resilience training
    Resiliency training offers strength-based, positive psychology 
tools to aid Soldiers, leaders, and Families in their ability to grow 
and thrive in the face of challenges and to recover from adversity in 
our communities. Soldiers complete the Global Assessment Tool annually 
to measure and track a Soldier's resilience over time. Master 
Resilience Trainers (MRTs) provide training to units and Families, 
serving as the commander's principal advisors on resilience. In fiscal 
year 2013, the ARNG obligated $10.4 million for the resilience program, 
which trained more than 1,550 MRTs and 4,600 Resilience Trainer 
Assistants.
    In late 2011, the Army National Guard teamed with the Office of the 
Secretary of Defense for Reserve Affairs and the Air National Guard to 
launch a highly successful phone and Internet-based help line, 
Vets4Warriors. This help-line, which is operated by Rutgers University 
Behavioral Health Care, provides peer-to-peer support from a staff of 
more than 30 veterans representing all branches of service and family 
members. They can provide referrals as appropriate, resilience case 
management and outreach services to help overcome an individual's or a 
family's daily challenges. Vets4Warriors initially served only reserve 
component members, but in November 2013 it was made available to all 
active duty military service members and their families, wherever they 
are located. Since its inception, the Vets4Warriors support line 
received more than 41,000 calls and conducted nearly 1,900 live online 
chats.
    Family Readiness Groups are essential to creating a bond within 
units that facilitates assistance and reduces unnecessary stress. 
Family Readiness Support Assistants provide a great return on 
investment by helping our commanders create and sustain those groups, 
and by providing volunteer and resilience training at the unit level. 
Family Assistance Centers serve family members of all military 
components and are located in 396 communities around the Nation. We are 
now facing reductions in the Family Assistance Center, Family Readiness 
Support Assistance and Child & Youth Program personnel currently 
provided to the States and territories. Family Readiness Support 
Assistants provide logistics to 312 brigade and troop commands in 
support of the Unit Readiness Program, and are the ARNG's key training 
asset for volunteers, family readiness and resilience initiatives. 
Funding is projected to be cut from $15.5 million in fiscal year 2014 
to $10.9 million in fiscal year 2015. This, in combination with cuts to 
Family Assistance Center funding, will potentially result in a 
reduction of FRSAs from 312 to approximately 165.
                              strong bonds
    Strong Bonds is a unit-based, chaplain-led program that assists 
commanders in building Soldier and family member readiness and 
resilience through relationship education and skills training. The Army 
National Guard provides the 50 States, three territories and the 
District of Columbia with information, guidance and training related to 
this program. In fiscal year 2013 the ARNG held 544 Strong Bonds events 
serving 22,284 Soldiers and family members throughout the Army Guard. 
With a budget of just over $6 million, the ARNG's cost per person is 
$269. A variety of Strong Bonds programs are available focusing on 
building strong relationships for married couples, single Soldiers, and 
families taught by certified chaplains.
                        substance abuse program
    The ARNG's Substance Abuse Program (SAP) provides a continuum of 
substance abuse services, including prevention, assessment, and brief 
intervention services. In September 2013, the ARNG awarded a national 
contract to provide Alcohol and Drug Control Officers and Prevention 
Coordinators in every State and territory and the District of Columbia. 
The SAP has also partnered with the Substance Abuse and Mental Health 
Services Administration to pilot the Substance Abuse Services 
Initiative, which will provide Soldiers with a voucher for substance 
abuse assessments. In fiscal year 2013, more than 135,000 Soldiers 
completed the Unit Risk Inventory (URI), which is an anonymous survey 
measuring many of the stressors that contribute to substance abuse, 
suicide, and sexual assault. Utilizing the URI results, units receive 
prevention training, resources, and interventions tailored to their 
unit.
                         employment assistance
    The Army National Guard has been, and remains, deeply concerned 
with the civilian employment status of its Soldiers. The ability of 
Guard Soldiers to gain and maintain civilian employment is essential to 
retaining these Soldiers in the ARNG. While unemployment remains most 
acute immediately following redeployment, employment challenges extend 
beyond those returning mobilized Soldiers. The Guard continues to work 
diligently to find solutions to assist its geographically dispersed 
population, working closely with the States to spread best practices 
from each State across the country.
    The Veterans Opportunity to Work (VOW) Act of 2011 mandates the 
Transition Assistance Program (TAP) for all Soldiers separating from a 
Title 10 active duty tour of more than 180 days. The Army National 
Guard is working closely with the Department of the Army and OSD to 
implement the transition mandates set forth in the legislation. States 
report 34,162 demobilized ARNG Soldiers since November 2012 with 26,999 
(79 percent) exempt from the Department of Labor Employment Workshop 
(DOLEW) due to full-time employment or student status. Of the remaining 
6,998, some 5,477 (78 percent) completed the DOLEW at one of 268 
workshops conducted. In fiscal year 2014 compliance has improved 
through February 2014 with 2,342 Soldiers requiring the DOLEW and 2,153 
(92 percent) compliant. The ARNG will continue to promote and leverage 
an array of employment programs and resources to support VOW mandates 
and reduce Soldier unemployment.
          maintaining the operational force: medical readiness
    Medical Readiness is a foundational requirement to maintaining the 
Army National Guard as an operational force; fully medically ready 
Soldiers are the key to ready and relevant units. Medical Readiness is 
an area in which congressional resourcing and leadership focus have 
made dramatic improvements. The Army Guard improved from a fully 
medically ready percentage of 51 percent in July 2009, to 85 percent as 
of October 2013. That is the highest percentage of medical readiness 
we've ever recorded, and higher than either the active Army or the Army 
Reserve at that time.
    However, this is an area in which readiness will rapidly slip if 
resources are reduced. For example, because a substantial number of 
Soldiers were not able to conduct Periodic Health Assessments that were 
scheduled for October 2013 due to the Government shutdown, medical 
readiness slipped 3 percent to 82 percent in a single month. It took us 
4 months just to climb back to 83 percent. It doesn't take long for our 
medical readiness to slip dramatically in a short period of time, but, 
turning things around is a much slower, more deliberate process. This 
not only requires funding, but a tremendous amount of time--time that 
we can never get back. Sustaining medical readiness is far cheaper than 
rebuilding it; and most importantly, it allows the capability and 
capacity for medically ready Soldiers to respond when needed for 
domestic or overseas missions.
         maintaining the operational force: equipping the force
    The Army National Guard has received significant investments in 
equipment, increasing Equipment on Hand (EOH), Critical Dual-Use 
equipment (CDU--equipment that is of use for domestic response as well 
as for war fighting missions), and the overall modernization levels. 
Army National Guard EOH for Modified Table of Organization and 
Equipment units is currently at 91 percent, an increase from 88 percent 
last year and from 85 percent 2 years ago. Overall CDU EOH is 93 
percent, an increase from 90 percent last year and a significant 
increase from 65 percent in 2005, when the Guard responded to Hurricane 
Katrina. Of the total quantity of equipment authorized, 85 percent is 
on-hand and considered modernized, up from 70 percent last year. This 
dramatic increase was partly due to new equipment purchases, but 
principally due to the Army re-defining in the past year what models of 
equipment it considers as modern. The steady improvement of equipment 
on hand, particularly CDU, can in part be traced to the continued 
appropriation of the National Guard and Reserve Equipment Account funds 
(NGREA), which has allowed the Army Guard a degree of flexibility in 
procurement, enabled it to meet training readiness goals, and improved 
modernization levels.
            maintaining the operational force: installations
    The Army National Guard has facilities in more than 2,600 
communities, making it the most dispersed of any military component of 
any service. In many towns and cities these facilities are the only 
military presence, with the Guard serving as the most visible link 
between hometown America and the Nation's armed forces. These readiness 
centers, maintenance shops and training centers serve as platforms for 
mobilization during times of war as well as command centers and 
shelters during domestic emergencies. Providing quality facilities 
across 50 States, three Territories and the District of Columbia has 
been an on-going challenge. The Army National Guard transformed from a 
strategic reserve to an operational force over the past 13 years, but 
many of our facilities have not been updated in decades. The average 
age of Army Guard readiness centers is 44 years. More than 30 percent 
of them are 55 years old or older, the limit to what is considered 
``useful life'' for that type of facility. Many fail to meet the needs 
of a 21st century operational force, cannot accommodate modern 
equipment and technology, are poorly situated, and are energy 
inefficient. Facilities are critical to readiness and support unit 
administration, training, equipment maintenance, and storage.
    This wide array of uses makes Military Construction and Facilities 
Sustainment, Restoration and Modernization funding a critical matter 
directly impacting unit readiness and morale, continuity of operations 
and domestic preparedness.
                            closing remarks
    With our Nation operating during an era of budgetary pressure, the 
Army National Guard is structured to efficiently provide capacity and 
capabilities our Nation requires in a dangerous world. With committed 
Citizen Soldiers as our foundation, the Army National Guard represents 
tremendous value to the Nation at large and within American communities 
where we live, work and serve. A flexible force serving our citizens 
for 377 years, the Guard's history shows that it has always adapted to 
change in America and around the world and risen to the challenge. The 
last 13 years have demonstrated these traits in full. That is why the 
National Guard has been and will remain ``Always Ready, Always There'' 
for our Nation.
    I want to thank you for your continued support for the Army 
National Guard and I look forward to your questions.

    Senator Durbin. Thank you very much, General.
    Mr. Secretary, reflecting on where we are today as we 
contemplate our challenges at your table and here at ours, it's 
clear that there's a tension. A tension that has been created 
by competing interest, limited resources and, what I would say 
across the board, a genuine commitment to the defense of this 
Nation. I don't question the sincerity of that commitment. 
There are different points-of-view on how to achieve it and I 
think that's why there is this competition of ideas.
    No one has experienced this more than Senator Murray, as 
Chairman of the Budget Committee, because she's been tasked 
with coming up with a budget with our colleagues in the House 
where we both served. And she has noted, I'm sure, as all of us 
have the tension between defense and non-defense and then 
within the defense community, the different and competing 
points-of-view.
    So I'd like to ask you about two or three issues that are, 
really, front and center in terms of most of the inquiries I 
receive from my colleagues about this budget. And some of them 
have been alluded to; some of them have been addressed 
directly. But let's start with the obvious and controversial 
issue of Army Aviation.
    Can you tell me how much of the total Army Aviation mission 
in Iraq and Afghanistan was completed by the National Guard?
    Secretary McHugh. I can give you breakdown by platform. In 
other words, Apache versus Blackhawk by flying hours, but I 
don't have the compo breakdown. I can tell you, based on 
deployments, the average Active component, Apache Brigade 
Combat Team, deployed four times with a number deploying five 
and six times. That's because, as all of us I think can agree, 
these are, in time of conflict, very high-demand assets.
    The Guard components deployed, understandably, somewhat 
fewer times. They did deploy. I've read stories that say Apache 
units in the Guard were not engaged, that's incorrect. But, on 
average, they deployed about twice with more than half of those 
units, I believe, deploying once. That's because these are 
Citizen Soldiers. They go home to jobs. They have different 
dwell times. But anyone who suggests that the Guard units were 
not on post and station, I think, is being less than genuine.
    The hard choice we had to make is that Apache platforms in 
the Active component do not meet current needs. And so given 
that, that is a first out-the-door kind of capability; we made 
the hard choice. And the recommendation in this budget that we 
moved those units into the Active component, saving billions of 
dollars over the program, and at the same time recognizing the 
important role of Guard aviation providing, as both the Chief 
and I've noted, more than 100 Blackhawks which also fly in 
combat roles, and in fact, flew the majority of combat----
    Senator Durbin. If I can ask you, Mr. Secretary, you've 
stated the obvious. And that is you're faced with budgetary 
challenges. You're trying to meet those while maintaining our 
national defense in this and so many other areas. We have a 
report that the Army National Guard, AH-64, Apache fleet, on 
average can be maintained for 42 percent of the cost of its 
Active component counterparts.
    So, if the issue here is savings, how can shifting these 
helicopters from Guard assignment to Active assignment save 
money if there's a 42-percent increase?
    Secretary McHugh. Well, I think you have to look at how 
those figures were derived. The Guard, obviously, costs less 
when it's in non-Active status. Their training schedules are 
different. Their service weekends are different; whereas, the 
Active component is trained to be on the alert and ready to go. 
The Apache unit cost in the Active component is undoubtedly 
higher because it has to be out the door the first day.
    And not only that, as we go forward, Apache training is one 
of the most complex missions that we have. In fact, we're 
integrating unmanned aerial systems into the Apache formations, 
which makes that training very, very complex and is difficult 
and highly expensive to maintain in the Guard component.
    Senator Durbin. May I ask you, before----
    General Odierno. Senator, could I just----
    Senator Durbin. Of course. Go ahead, General.
    General Odierno. Thank you.
    It's not just Apaches. The reason this has to be done is 
because we're eliminating a whole fleet, OH-58s. So we're 
eliminating over 600 OH-58 aircrafts out of the Active 
component. So you get all that savings. So it's not just Apache 
versus Apache. It's the fact that we're taking out 600 OH-58s 
out of the Active component. And we're taking the Apaches to 
replace some of those OH-58s.
    So it's not just the comparison of ``it's 42-percent 
cheaper to have it in the Guard and the Active;'' it's the fact 
that we're saving $12 billion by removing the OH-58s out of our 
inventory completely.
    Senator Durbin. But let me ask the next question to either 
or both. In a recent report, we've seen a steady increase in 
the cost of remanufactured Apache. In a recent report, the 
program's cost estimates have increased 11 percent. So if the 
Army projects to save $12 billion with this restructure 
initiative, are these increased Apache costs included in that 
proposal? How is the Army confident that this proposal is going 
to be an actual savings in light of this increase?
    General Odierno. We're absolutely confident in it's 
savings.
    Again, it's about a $12.7 billion savings. We've already 
programmed in these increases. Now, the reason the cost is 
increasing is because of reduced budgets. We've had to reduce 
the number that we were going to purchase and slow it down over 
the long-term because of our budget reductions. That's why it's 
costing more. So that's going to happen no matter what you do. 
But that cost will be an increase no matter what decision we 
make. That increase is going to continue because we've had to 
expand the programs over, now, instead of 6, 7 years, to 12, 13 
years because of the sequestration budget reductions.
    Senator Durbin. Senator Collins.
    Senator Collins. Thank you, Mr. Chairman.
    First, let me say to each of you that I'm grateful for your 
service and I do understand how difficult the decisions that 
you're being called upon to make must be.
    Major General Lyons, you did an excellent job of outlining 
the critical role that the Army National Guard plays not only 
when it's deployed as it has been many, many times in Iraq and 
Afghanistan but here at home whenever disaster strikes. It's 
the Guard as well as our first responders who are first to 
respond to the call for help.
    I want to give a very specific example from my home State 
of Maine of what this budget would mean for the National Guard 
there because, as I understand it, these cuts would bring the 
Active-Duty force to pre-war levels but the Guard would be cut 
below pre-war levels even though the percentages of the cut may 
suggest the opposite conclusion.
    Let me give you an example of what Maine's TAG (The 
Adjutant General) has told me that the cuts in the Guard would 
be in Maine. He estimates that the Maine Army National Guard 
would be under 2,000. That is the smallest that it has been 
since Maine achieved statehood in 1820. He would have to close 
remaining armories in Calais and Houlton, Maine, leaving only 
one small unit in the State, north of Bangor, Maine. That's 
covering almost two-thirds of the State.
    And I think that is why the TAGs and the Governors have 
been virtually unanimous in raising their very deep and genuine 
concerns about the Army's plan. And I would ask you to give 
your professional opinion. If we accept these cuts, what is the 
impact going to be on the Guard's ability to respond to a 
terrorist attack at home; a natural disaster such as we're 
seeing in the South and in so many parts of our country; as 
well as the Guard's ability to deploy to future conflicts?
    Because, after all, this is a dangerous world and we just 
would never have predicted, prior to September 11, 2001, the 
strain that we would be putting on our Guard with repeated 
deployments and extended and shortened dwell times.
    General Lyons. Yes, Senator.
    In reference to the impact, at 315,000 soldiers underneath 
Budget Control Act, in the illustrative example you used in 
Maine, there is direct impact at those levels both in terms of 
not only the reduction in the number of soldiers that we have 
physically present, as you outlined, but a loss of leaders, 
experienced leaders, who have been honed over 12 years both in 
wartime experience and in responding domestically.
    So we are a community-based organization as the committee 
knows; over 2,600 communities. So when we reduce down to 
315,000 soldiers under BCA, that dispersed community footprint 
is going to shrink. And so, Adjutant Generals will be faced 
with tough decisions about closing facilities. We use those 
armories, as you know, as our projection platforms when we 
respond here at home. As you constrict that footprint, our 
response time, depending on where that disaster strikes, is 
increased. And so, that has direct impact on our ability to 
respond. So it's unacceptable impact in terms of risk, at 
315,000 for the Army National Guard.
    General Odierno. Senator, if I could just say, the Active 
component in 2001 was 485,500. We were going to 420,000. So 
there's a 64,000 reduction from pre-war levels in the Active 
component. I just want to make sure that's very clear.
    So we have taken reductions from every component based on 
pre-war. The other thing I would point out, since 2001, we have 
increased full-time support to the National Guard by an 
additional 16,000 soldiers and that's staying. We have not 
taken that out of the budget. So although their end strength is 
coming down, the amount of full-time support continues to be 
much higher than it was pre-war. And that is what we've 
invested into the Guard, and that's remaining.
    So I want to make it very clear. The percentage of the 
budget that we're allocating to the Guard in this proposal, 
that is at a much higher percentage than it has ever been in 
our total budget. We have not reduced that. We recognize the 
point you're making, that they are worth the cost. And that's 
why we've taken much smaller reductions in the Guard and will 
take the preponderance of the reductions in the Active crux. We 
recognize exactly what you're saying.
    Senator Collins. Well, I've spent a great deal of time on 
the Homeland Security Committee; I've served on it for more 
than a decade, I know how absolutely critical the Guard is to 
emergency preparedness and response. And I don't think we can 
forget that role as well; as well as the fact that it's less 
expensive to have the Guard ready to deploy.
    But, General, I'm also concerned for the Active-Duty. I 
don't mean to imply otherwise because the 2014 QDR (Quadrennial 
Defense Review) states that the U.S. military will no longer be 
sized to conduct large-scale, prolonged, stability operations. 
You said the Army was directed to scale down and not to size 
for those kind of operations. And I couldn't help but when you 
were talking about the unpredictability of the threats, to 
think about Secretary Gate's comments back in 2011 when he 
says, ``When it comes to predicting the nature and location of 
our next military engagement since Vietnam, our record has been 
perfect. We have never gotten it right.''
    And that's why I'm very concerned on the Active-Duty side 
as well. I know that I'm out of time. I will submit some 
additional questions for the record with the Chairman's 
permission.
    But I would be remiss, and Mr. Secretary, you and I have 
discussed this many times, if I didn't once again express my 
concern about mental health services to Guard members; to 
return home to rural America where we have a real absence of 
mental health professionals who can help them, or soldiers who 
have retired from the service. We've got to reduce the stake 
level; we've got to make greater use of telemedicine; and we've 
got to have active drug take-back programs that I've been 
pushing the DEA (Drug Enforcement Administration) to allow our 
military hospitals in our VA (Department of Veterans Affairs) 
facilities because that's part of the suicide problem as well.
    And I know you care deeply about that.
    Secretary McHugh. I do, Senator. And we all deeply 
appreciate yours and the other senators--Senator Murray 
principally amongst them--the other committee members, who care 
about this as deeply as we do.
    I deeply appreciate the effort on the medicine take-back. 
We think that makes common sense. We think all the services 
believe that we can conduct it safely without any of the 
concerns the DEA has, I think, understandably expressed. But 
without some change in what is currently allowed, we're not 
going to be able to go forward there.
    Senator Collins. Well, I'm going to continue to push really 
hard on this. I've got a bill. I'm working with OMB (Office of 
Management and Budget), DEA, and it's just ridiculous that DEA 
is not more cooperative in this area.
    Secretary McHugh. Thank you very much, Senator.
    Senator Collins. Thank you.
    Senator Durbin. Senator Murray.
    Senator Murray. Thank you very much, Mr. Chairman, for 
having this hearing. And thank you for all of our witnesses.
    And I'd be remiss if I did not start out by thanking the 
National Guard on behalf of the communities in my State, in the 
aftermath of the Oso mudslide, the tremendous outpouring of 
support from the National Guard. We just can't thank you all 
enough. I was up there many times. I've never seen a disaster 
like this and the National Guard members, along with our first 
responders who were digging in the worst of conditions, 75 feet 
of mud, looking for victims and their affects and day-after-day 
without complaining. And I just want to convey our thank you 
for all of those men and women who are out there and are 
still--some of them out there, working on that.
    As Senator Durbin referred to the budget issues, we all 
know, we're all struggling through this, obviously grateful 
that we're not still dealing with sequester for the immediate, 
but it is hanging out there and we all have some tough 
decisions to make and appreciate all of your comments today as 
we try to work forward through that.
    But I want to follow-up on what Senator Collins referred to 
at the end of her questioning because the 2012 DOD suicide 
report was recently issued and it shows that we are still very 
much struggling to combat suicide in the military. But a change 
in counting suicides in the Guard and Reserves shows the 
problem is actually significantly worse than was previously 
reported.
    I'm going to be asking for a lot of answers from the 
offices responsible about those changes and why it took them so 
long to get this to us. But for now, the obvious problem in the 
Guard and Reserve is much worse than we were led to believe.
    So for all of our witnesses--and Major General Lyons, if I 
can start with you--in light of this new information that we 
now have, what are you going to be doing to better address 
suicide especially in the Guard and Reserve?
    General Lyons. Senator, with respect to the recently 
released report that you mentioned, you know, accurate figures 
are--I welcome that. It helps us see ourselves better; helps us 
apply our resources more effectively. And so, I view that as a 
positive step.
    In terms of what we're doing, leaders at all levels in the 
Army National Guard from the Adjutant General in the State down 
to first-line squad leaders are very concerned about this. 
We're a geographically dispersed, primarily, part-time force. 
And so, at the leader level, the small unit leader level, that 
interaction of knowing your soldiers, knowing what's going on 
in their lives, understanding and recognizing changes in their 
behavior, and then having the knowledge to escort that person 
that's in crisis to a caregiver is something we spend quite a 
bit of time on.
    We also dedicate resources to that in the terms of full-
time Directors of Psychological Health (DPH). We have 78 DPHs 
across the 54 States, territories in the district. We continue 
to apply additional resources that Congress has given us in 
fiscal year 2014 to expand that footprint. Right now, it's 
about one Director of Psychological Health to 4,500 soldiers. 
We hope to close that gap down to about one to 2,300 and 
continue to embed those professionals.
    We continue to stress resiliency training in our 
formations. In fact, we're starting to do that now, when 
soldiers first join the Guard and they enter what we call the 
Recruit Sustainment Program, before they even ship off to basic 
combat training, introducing resiliency in risk reduction 
training into that training before they even ship off.
    We spend quite a bit of time with something called ASIST--
it's Applied Suicide Intervention Skills and Training. We have 
35,000 of our guardsmen trained in ASIST. And again, that's all 
about recognizing changes in behavior and recognizing when 
someone is in crisis and knowing what to do and protecting that 
person and escorting them to care.
    We continue to focus on the role of our chaplains who 
provide 24/7 crisis counseling to our servicemembers. And so, 
these are some areas that we continue to engage on. Our 
Adjutants General are partnering with local communities 
stressing the importance of engagement with the Veteran's 
Administration and, also, the role of TRICARE Reserve Select 
for our members as an access to care.
    Senator Murray. General.
    General Grass. Senator, thank you.
    One of the things we're doing at the National Guard Bureau, 
in addition to what the Army and Air Guard are doing, really, 
at the unit level is I've been working with Health and Human 
Services and the Public Health Service. I have a rear admiral 
from Public Health Service that serves as my liaison. And we've 
been meeting with members of the Surgeon General's office to 
take a look at how this problem is being dealt with for our 
Nation.
    I'm very concerned especially with the issues we're dealing 
with today, but I'm also concerned about the future. I'm not 
sure we really grasp yet the impact of 12 years or more on any 
member of our society and, coming back home to small-town 
America, will we have the resources there? We're working 
closely with General Shinseki's staff, but Health and Human 
Services and the Public Health Service is going to do some 
study work for us to see, because we draw our men and women 
right out of our communities and when they return, what can we 
do to make local and State health resources available and the 
professionals.
    Senator Murray. Which is where they are when they go home.
    General Grass. Yes, ma'am.
    Senator Murray. Okay.
    Anybody else want to comment quickly on this?
    General Odierno. If I could, just a couple.
    The Telehealth has increased significantly over the last 
couple years. We have thousands now available that helps 
National Guard and Reserve through Telehealth especially in 
behavioral health.
    The other thing is I want to thank everyone for the TRICARE 
Reserve Select that has been put into place that is a low-cost 
capability for our Reserve, specifically for our Reserve and 
National Guard that helps them get care outside of the military 
treatment facilities. And now that that's available, we're 
starting to see the differences. So we appreciate the work 
Congress has done to put that into place and those are helping 
significantly.
    Senator Murray. I appreciate that. And I will continue to 
follow-up with all of you.
    And I wanted to ask one other quick question, General 
Odierno, while I'm here. I really appreciate the work the Army 
has done to implement, under your leadership, the Hire Heroes 
Act. Working at JBLM (Joint Base Lewis-McChord), I'm seeing 
some really great programs, significant numbers of soldiers 
accepting job offers prior to separation so we don't have that 
gap. We're in the midst of a pilot program out there.
    But I wanted to ask you, I understand there's been a long 
delay in giving the unit commanders' access to the ACAP XXI 
System. That's what tracks the soldier's process through ACAP. 
So if the unit commander doesn't have the information, they're 
not able to follow-up and make sure it's happening. When is 
that capability going to be available?
    General Odierno. We think we've got it about there. So we 
think within the next month or so that that capability is going 
to be able to provide the information for the commanders. It's 
critical----
    Senator Murray. Yes.
    General Odierno [continuing]. As we go through this. You 
are exactly right. And so, we've been working very hard to get 
this in place.
    Senator Murray. Okay.
    I would like to follow-up with you on that as well because 
we've got to get that information to the commanders.
    General Odierno. Sure.
    Senator Murray. Thank you, Mr. Chairman.
    Senator Durbin. Senator Shelby.
    Senator Shelby. Thank you, Mr. Chairman.
    General Odierno, you outlined all of this real well. And I 
appreciate that and I appreciate your service.
    I want to direct a couple of questions to you, if I can. I 
realize, as you do, that the big problem is lack of funding. 
That's cuts to everything. If we're going to have a first-class 
Army, Navy, Marine, Air Force, we've got to pay for it. If 
we're going to have the Guard, we've got to pay for it. If 
we're going to have a Reserve, which we have to have, for the 
security. And I think the American people have got to realize 
that. Do they want to be the top military force in the world? I 
hope so. And it's manifested right here, starting in this 
committee here.
    General, could you just for a minute discuss the importance 
of continuing to fund missile defense in spite of our cuts? And 
how important is the funding of missile defense looking at 
what's happening in Eastern Europe, what's happening in Korea 
right now, to us and to our allies?
    General Odierno. Well, Senator, obviously our missile 
defense program and our ability to protect ourselves is 
becoming more and more important as the Army continues to have 
over 50 percent of its Ballistic Missile Defense capability 
deployed around the world; and the Middle East and the Pacific, 
trying to prevent and ensure that we protect our allies and 
ourselves from ballistic missile attack. And we see individuals 
in North Korea continue to demonstrate a capability of the 
ballistic missile capability that should be concerning to all 
of us. So we have to continue to build our capabilities to 
ensure we can defend ourselves at both here and our entities 
abroad as well.
    Senator Shelby. End strength reduction, which you talked 
about, I think it's very important because we get down to the 
bare bones of the Army, the Guard, the Reserve, the whole 
thing. Could you describe again, for the record, how this 
drawdown could impact or will impact the Army's ability to 
maintain a globally responsive land force?
    General Odierno. Senator, as I've said before, is if we 
have to go to sequestration levels, the Active component at 
420, the Guard at 315, the Reserves at 185, it really puts into 
question our ability to even, in my opinion, to do one 
prolonged multiphased campaign.
    It also impacts our ability to respond to multiple 
campaigns in multiple continents which is becoming more and 
more viable. And so, for me, it's concerning. And so, the risk 
is significant today.
    Our assumptions are that it won't be prolonged. Our 
assumptions are we'll have appropriate allied support. Our 
assumptions are they won't last very long. If any of those 
assumptions are wrong, then our risk goes much higher than it 
is today.
    And so, I think we're on a dangerous path if we have to go 
to full sequestration and our ability to, what I consider to 
do, is to protect our national security interests.
    Senator Shelby. We're headed down the road to decimating 
our armed forces; aren't we?
    General Odierno. I think it's going to be difficult. And I 
think it puts us in a 4- or 5-year period of great 
vulnerability as we draw down our end strength because our 
readiness and modernization is not being properly invested in.
    Senator Shelby. Secretary McHugh, I have a couple of 
questions if I could direct them to you.
    Could you elaborate on the Army's requirement to procure a 
fourth brigade combat set of DVH (double-V-hull) Strykers? And 
then, also, what is the modification timeline for this project?
    Secretary McHugh. Well, did you say, ``For the record,'' 
Senator? Or would you like----
    Senator Shelby. You can do it now if you want to.
    Secretary McHugh. I know it's----
    Senator Shelby. I'd appreciate it.
    Secretary McHugh. No, I'm happy to do it, Senator.
    Well, we always try to take lessons learned. And one of the 
lessons we learned, particularly in Afghanistan, is that this 
platform was highly effective in keeping our soldiers safe 
while giving us appropriate mobility across the battlefield.
    As you know, we had some discussion as to how do we go 
forward in capturing that improvement, buying new or recapping, 
retrofitting flat-bottom, single hull Strykers into the double-
V. After assessing the variances in cost, we determined that to 
retrofit and refit the existing fleet with a V-hull, double-V-
hull, saved us about $1 million a platform. So we have been 
adding those, first, the third brigade and now a fourth 
brigade.
    If funding continues as we hope, I believe we're talking 
about a procurement end of about 19 but that may have to change 
based on the uncertainty of funding as you know. But right now, 
that's a modernization priority for us.
    Senator Shelby. My next question would deal with the 
Distributed Common Ground System, you called the DCGS-A.
    In March of this year, a GAO (Government Accountability 
Office) report noted continuing performance challenges for the 
Distributed Common Ground System, DCGS-A; the Army's program of 
record for intelligence data analysis, sharing, and 
collaboration, which I think is very important. The Army's 
budget decreases DCGS-A funding by almost 27 percent.
    Is DSG--DCGS, let me say it right, still a priority for the 
Army? And if so, how do you intend to continue its development 
in view of everything we've got going on and why is it 
important?
    Secretary McHugh. Well, as you noted, the ability to gather 
the most successful amount and most accurate amount of 
intelligence, particularly in a theater of combat, is 
absolutely essential. And the Chief has spoken on multiple 
occasions about the kinds of capability and the expanse of 
intelligence information through the number and added sources 
that are available today, to today's commander compared to what 
he had available when he was commanding in theater.
    I think it's important to note, DCGS-A is not a thing onto 
itself. It is a system of systems. It is software; it is 
hardware. And as the GAO noted, it's a program in progress. We 
think, at this point, the observations that GAO made and based 
on other tests that we have done in the field and feedback 
we've received, we've corrected, or certainly modified and 
nullified, most of the concerns raised in that particular 
report. It is our intent, in the next increment of DCGS-A, 
which we hope to be underway by 2015, that we will go to full 
and open competition.
    Senator Shelby. General, do you want to comment on that and 
what this program will, after you work out a full challenges, 
what will it do?
    General Odierno. Yes, Senator, the report that you gave us, 
that you mentioned, is an old report.
    Senator Shelby. Okay.
    General Odierno. It's about a 2-year-old report. We have 
corrected, already, many of the deficiencies that were 
contained in that report. It's a multi-int, multi-echelon, 
intelligence capability. It's a system that we have that takes 
national intelligence, tactical intelligence, common SIGINT, 
any int we have; it puts it into one processing where you can 
put data together and then provide information to our war 
fighters at all levels. It's the only system that enables us to 
do that.
    And so, for us it's absolutely important. We now have our 
allies looking at it. The SOF (special operations forces) 
community is now adopting it; the Marines. So we are very 
confident with this. We obviously still have, you know, we are 
going to continue to work through some of the problems----
    Senator Shelby. Sure.
    General Odierno [continuing]. But we think it's absolutely 
the right system.
    Senator Shelby. What will it do for you that you don't have 
today?
    General Odierno. Well, see what we don't have, what we 
haven't had today, is the ability to get all the--you have to--
--
    Senator Shelby. Put it all together?
    General Odierno. It puts it all together. It synchronizes 
everything together.
    You have it coming in different places. Now, this gets it 
in one place. It also processes the data and it also gives you 
answers based on all the--it gives you information based on all 
of the int that it gets one place. So it's a significant 
improvement in what we had.
    Senator Shelby. And it's got a lot of promise.
    General Odierno. It's got a lot of promise.
    Yes, sir.
    Senator Shelby. Thank you, Mr. Chairman.
    Senator Durbin. Senator Leahy.
    Senator Leahy. Thank you, Mr. Chairman.
    It's good to see all of you here. I think back, with 
pleasure, the days when Secretary McHugh was Congressman 
McHugh. We often flew home together to our area.
    General Odierno, I still remember very well that 
conversation late one night walking around.
    And, General Grass, I might address this at the risk of 
being a tiny bit parochial. As you know, and General Lyons 
mentioned, the 86th Infantry Brigade Combat Team based in 
Vermont is the only National Guard unit attending a CTC to 
train at the brigade combat team level over this year. They've 
been preparing for that for 4\1/2\ years. They're ready to go. 
I think the Nation is lucky to have the Green Mountain Boys 
ready to answer.
    I'll just ask you: How does the National Guard Bureau use 
funds to help the 86th or other units, not just in Vermont, 
become ready in anticipation for operational use?
    General Grass. Senator, I actually look very much forward 
to being with the 86th this summer in June. I'm going to go 
down and visit them. And this is the first time, in many years, 
that we've actually been able to return to Fort Polk.
    Senator Leahy. And I'm going to try to be there with you 
when you do. Go ahead.
    General Grass. Yes, sir.
    You know, we have a program that we work with U.S. Forces 
Command and with First Army. And once a unit is assigned, 
there's a lot of additional resources that go to that unit, 
additional training periods, so that when you ramp up to be 
ready to deploy and go to the Joint Readiness Training Center 
at the brigade level of operations, those extra resources are 
given to the State. I know that General Lyons can go into great 
detail what tasks they accomplish. The hard part for us right 
now, though, is looking to the future with the cuts that we 
have and especially under the BCA.
    We will not be able to have those resources in the 
earliers, the 3 to 4 years prior, much less the years to 
execute those missions both at the National Training Center and 
the JRTC.
    Senator Leahy. Well, we should have a further conversation 
about this you and General Lyons, as we work on the 
appropriations bill.
    And, General Odierno, as you know, Senator Lindsey Graham, 
and I are considering a commission to look at the Army's 
future. And I happen to know you stated opposition to a 
commission as it was described in a House proposal. Now, do you 
object to any independent look at the future of the Army or 
only one that costs $1 billion annually in delays made of the 
agreed upon changes to go forward?
    General Odierno. Part of the problem, Senator--the reason 
that we object to it is if it delays decisions 2 years, it 
imposes, as you've mentioned, a $2 billion bill. Actually, it's 
greater than that because if it goes into the second year, it's 
about a $6 or $7 billion bill that we simply can't pay for if 
we don't make the decisions now. So that makes it more 
difficult.
    We would never reject an independent look but because of 
sequestration and the near-term nature of it, I'm just not sure 
that we can wait that long. And so, the length of it is of 
great concern to us.
    We also believe that we've been open and allowed many to 
have provide input to our process as we've gone through this. 
We've been working on this for a very long time so we feel 
comfortable that we've gotten a lot of input. But again, it's 
more about the budget, it's about the immediacy of it and the 
fact if we have to delay these recommendations we're making, 
we're going to have to take the money from somewhere else and 
it's going to be out of readiness and modernization. We already 
don't have enough money in readiness and modernization. So it's 
of great concern to me, sir.
    Senator Leahy. Well, as the senior most member of this 
committee and one who has served here longer than anybody else, 
I've seen the debates over the years--from the time of Vietnam 
straight through, on the budget and I am concerned about that. 
But I'm also wearing another hat as the chair of judiciary, I 
realize as we all do, the Constitution requires Congress to 
raise and equip Armies as well as the part for the militia that 
might be called into Federal service.
    We, Senator Graham and I, are concerned enough because we 
think a number of--small number--of the choices before the Army 
are truly controversial. And I think they could fundamentally 
change the nature of the Army we know. You and I may disagree 
on some of those, but we will introduce legislation. And we 
will, and I say this in all honestly, we will look forward to 
the feedback you have when you see the legislation. But I 
suspect it has a good chance of passing and I want to make sure 
we don't throw the baby out with the bathwater.
    But I am concerned that there has not been--while I'm 
concerned, on the one hand, the restrictions you have on 
funding but, the other hand, that we have not looked at what 
the long-term change might be not just for the Army but for the 
Guard and Reserves in this. And that's one of the things we 
will talk about in our commission.
    General Odierno. Senator, that's fine. I mean, the 
Secretary and I have a total Army policy that we are very 
serious about. And my responsibility is to oversee the total 
Army, which is the Guard, Reserve, and Active component. That's 
my responsibility and I take it very seriously. And I believe 
that, when we look at these problems, we look at it from all 
perspectives.
    So again I look forward to working with you, sir.
    Senator Leahy. Well, General, as you know I've been 
supportive of a lot of the things you've done in the past. 
Maybe in some areas we may disagree, but this is one where I 
want some other outsiders to also look at it.
    You also made it clear, from your testimony last June to 
the Congress, and you did again today here, you are committed 
to rooting out cultural elements within the Army that may play 
a role in the current environment that led to sexual assault 
and harassment and hold those accountable; they're responsible.
    I have many, many friends in the military. I have a son who 
served in the military, I have neighbors and friends at home 
who are retired, and throughout all of them they've raised this 
question: What's the best way to handle it? The Washington 
Post, last week, published a story saying a prominent commander 
was suspended, relieved of command this August after an IG 
report review showed he repeatedly failed to pursue allegations 
of sexual misconduct against a subordinate. But then, once he 
was removed, he was made Director of Program Analysis and 
Evaluation on the Army staff.
    What is the appropriate level of response? How do you 
balance it? I realize you can't--as a prosecutor of 8 years--I 
realize there's no one-size-fits-all. But how do you balance 
what is an appropriate response and punishment, to use that 
word, as a deterrent for future conduct?
    General Odierno. Senator, it's a great question and it's 
one that the Secretary and I spend a lot of time talking about.
    First off, we have to make sure we have--we still have to 
provide to make sure every individual has the rights that he 
has. And so, during that time that you talk about, he was 
suspended from command. We did a full investigation. We had to 
put him in a position that he had some expertise in that would 
help us to move forward. And then, once the investigation was 
done, we took immediate action. And that's the action that you 
saw of relief and then other actions that the Secretary will 
take.
    And so, we look at each one of these individually. We're 
very serious about this. And we, I'm telling you, our 
commanders understand this. That if somebody doesn't take 
appropriate action then we will punish them. We look across the 
board at what's available. If somebody does something illegal, 
that's one thing. If somebody does something against 
regulation, that's another thing. And we take appropriate 
action based on that.
    The one thing is reputation that you never get back. And 
that's the one thing we never remember how big that is, is your 
own reputation when something like this happens.
    Secretary McHugh. And, Senator, may I just add something? 
Because, from the civilian side, you've raised a point that was 
something of a mystery to me when I first arrived. And that is 
we had an occasion, including the specific one you mentioned, 
where you have an officer where the charges have been 
substantiated, whether it be a trial or whether it be through 
an IG investigation, and yet, by law, they have to remain on 
the payrolls because they do have due process as you as a 
former prosecutor know.
    And so, the question becomes for us, all right, we have to 
pay him. Shouldn't we get value by the taxpayer dollars as we 
go through that interim period of where that officer can file 
certain matters on his own behalf and matters of appeal? Or do 
we sit him in a corner somewhere? So, in the case in question, 
he had certain skills and we thought it was better for the 
taxpayer and the Army if we got some value out of it. After the 
case and due process period was closed, we've taken some pretty 
significant actions. And, as the Chief alluded to, I still have 
the authority to review his status, rank and grade of 
retirement, which will be part of the process going forward.
    Senator Leahy. Thank you.
    Thank you, Chairman.
    Senator Durbin. Thank you. Senator Murkowski.
    Senator Murkowski. Thank you, Mr. Chairman.
    Gentlemen, thank you.
    I want to just begin my questions this morning with a 
direct thank you, Secretary McHugh, General Odierno. You have 
helped us yet again this year by allowing Major General Karen 
Dyson to be available as our guest of honor and the keynote 
speaker at the Fairbanks Military Appreciation event. This is 
the 46th Annual Banquet that they've had up there. And I 
believe that this is the first time that we have a female 
general officer ever to keynote it. And I'm very proud of that. 
And thank you for that. I know that the people of Fairbanks 
will look forward, too, to visit with her.
    General Odierno, it was a couple years ago before this 
subcommittee that I asked you the question about the strategic 
importance of Alaska going forward as we shift to the Pacific. 
And you emphasized, I think, very clearly the importance of 
Alaska's role from a geopolitical perspective, our position 
there in the Pacific and, really, our overall defense 
capability. That, of course, was before sequestration. Not only 
are we looking at that but some very difficult decisions coming 
up in 2016 if we don't find a solution to the Budget Control 
Act and sequestration.
    So my question to you this morning is what value does the 
Army place on maintaining two brigade combat teams in Alaska if 
we're not able to get around the BCA if you're forced to draw 
down fore-structure to a level of 420,000; and, really, the 
whole subject of pivoting to the Pacific, if those are the 
numbers that we're looking at?
    General Odierno. Well, we're going to have to go through a 
thorough review of where we need our forces, what type of 
forces we need. And we're starting that process now because, if 
this in fact happens, we'd have to be at 420 by fiscal year 
2019. And so, we'll start to do those reviews now. And it's a 
series of capabilities based on training capabilities, 
positioning, how do they respond to our national security 
requirements, which the Asia-Pacific regions is up there very 
high. So we'll take a look at all of those things as we 
determine what capabilities we need. So we would've not begun 
that process in earnest; we will soon.
    As I've stated to you before, you know, we cherish our 
relationship that we have with Alaska and the units we have 
there, but I can say that for almost every place that we go. 
So, as we evaluate that, we'll have to take all of those types 
of considerations before we make any decisions. I mean, I would 
just highlight that, as you probably know, you know, with the 
Airborne Brigade, they just did a joint exercise in Thailand 
where they did a joint airborne exercise with the Thai Army and 
several other great things that we continue to do out of our 
units in Alaska. So we are very proud of what they do and what 
they've done there and what they continue to do to support our 
missions around the world.
    Secretary McHugh. Senator, can I just add a little context?
    Senator Murkowski. Yes.
    Secretary McHugh. Just so everyone knows the extent, 
possibly, that we may have to go.
    As you know, we just went through a process that took down 
a BCT out of every multi-BCT post in the continental United 
States. We have issued a data call to every post, camp and 
station asking for what their structure would look like at a 
variety of numbers. For those larger maneuver-type bases, that 
number is up to 16,000 fewer troops. So we don't expect that 
that would be a uniform figure across-the-board, but that is 
the depth of analysis that we're going to have to do and that 
is the possible implication, at least to a base or two, that 
would go about if we have to go to BCA levels.
    Senator Murkowski. Very sobering.
    General Grass, I want to continue the conversation that 
we've been having regarding management of sexual assault and 
related integrity issues with the Alaska National Guard. You 
may be aware that just last week, on Sunday, the Anchorage 
Daily News, a columnist reported on the issue rather 
extensively in terms of who knew what when. I want to focus 
just on one aspect of this issue.
    My staff had learned about the Chaplain's concerns of 
reporting sexual assaults. I learned about it on June 12, 2013. 
I signed a letter to the Defense Department, IG, requesting an 
inquiry just 7 days after that. The chaplains had alleged that 
they had raised their concerns through the chaplain channels to 
the National Guard Bureau but it doesn't appear that anything 
happened other than a staff assistance visit; which kind of 
leads to the question of what did the National Guard Bureau 
know and when did it know it?
    But, beyond that, I'm led to believe that the National 
Guard Bureau has either very little oversight, or perhaps no 
oversight, over day-to-day problems that may exist in the 
States even when there's a suggestion that allegations of 
sexual assault are perhaps being swept under the rug unless a 
Governor or the Adjutant General invites the National Guard 
Bureau in.
    These are clearly integrity issues and I'm really quite 
surprised, perhaps shocked, that the National Guard Bureau 
claims to have very little power to pursue them because they're 
State forces. So this investigation, of course, is moving 
forward.
    General, I would hope that you know, in my judgment, I 
think we need to have a process that is able to deal with 
resolution of allegations that you may have Guard units that 
are engaged in perhaps systemic misconduct as I think we're 
finding in Alaska. And, that the process needs to be a Federal 
process that does not depend on the willingness of a State to 
be investigated. So your thoughts on this matter.
    We're learning a lot after the fact but one of the issues 
that we're reconciling now is you've got a National Guard 
Bureau that may or may not have the ability to intervene and to 
weigh in on issues that, I think we would all concur, are 
extraordinarily troubling.
    General Grass. Senator, first, let me say that as me and my 
senior enlisted, we share this with every State and guardsmen 
and women across the map as we go out: Sexual assault is a 
crime. And we've got to go after this and take it on. We've got 
to have the full suite of authorities, especially in the Guard, 
because we have situations where somebody may not be on a duty 
status when it occurs. We don't care. If it's a guardsman, 
we're going to use whatever we can.
    And, ma'am, I appreciate your question the last time we 
were here. I think it was with the SACD for the Air Force. I 
went back and reviewed that several years ago when it came. The 
National Guard Bureau sent forward to Alaska a group of 
investigators to look at the processes to see if the State had 
the processes. And, at that point, the response came back that, 
yes, the processes were there.
    I walk a fine line, though. At some point, where trying to 
work with the Adjutant General and the Governor, respecting 
their authority, but at some point I do, I mean, I can enter 
into the discussion. There is a colonel that works in every 
State; works for me because of the Title 10 resources; the 
Federal resources and the equipment. So I always have that 
ability. The Inspector Generals in each State; I'm their 
seniorator. They work for the Adjutant General but I'm their 
seniorator. Most of them are Active Duty officers. So we have 
several means there.
    And I would tell you, ma'am, that the Office of Complex 
Investigations that the National Guard stood up just over 2 
years ago, and we have 92 trained, they're trained at Fort 
Leonard Wood, special investigators, were specifically for this 
situation where there may not be a local jurisdiction that will 
handle the case or there may not be a uniform code of military 
justice. So we actually are working right now very closely with 
the Governor's office. And there's other actions underway I 
think you're aware of in Alaska.
    So we do feel we have the right mechanisms now to go after 
this. That did not exist 2 years ago, the OCI, what we call the 
Office of Complex Investigations. Also, we have a Special 
Victims' Council that I've requested both from the Secretary of 
the Army and Secretary of the Air Force, which we should be 
hearing back shortly, that we will also be able to provide that 
resource to the victims in State.
    Senator Murkowski. Well, I appreciate that, General, and 
perhaps if we have an opportunity to follow up in the near 
future on these issues. I appreciate what you're saying about 
the Federal process. And perhaps we didn't have it in place 2 
years ago. I do find it somewhat disconcerting because, as we 
know, these issues of sexual assault and the allegations that 
are behind them have been going on for a long period of time. I 
do want to know that processes that we have in place; they're 
working; they're adequate; and responsive. So I'd be happy to 
follow up with you later. And I appreciate you.
    General Grass. Thank you, Senator.
    Senator Murkowski. Thank you.
    Senator Durbin. Thanks, Senator Murkowski.
    Mr. Secretary, if I can ask two questions here that are a 
little different in scope. I've raised in previous hearings the 
for-profit colleges and universities that are offering 
educational opportunities to not only the men and women in 
uniform but their families. And the fact that study after study 
shows that these for-profit colleges and universities are twice 
as expensive as their public and not-for-profit counterparts. 
They have lower success rates when it comes to the students who 
take the courses including lower graduation rates, worse 
employment outcomes, and, in some cases, not particularly in 
this case, debt levels and loan default rates dramatically 
higher than in public and not-for-profit circumstances.
    Can you tell me what is being done in the Army now? I'll 
give you an example: I have a nephew out in Fort Drum who went 
to Afghanistan and came back safely; was deployed, then, to 
Korea and he wrote me an email and said, ``I got great news for 
you. I just signed up at the American Military University.''
    And I had to write back to him and say, ``You've made a big 
mistake. This is not a good school. You've got an option to 
take courses at University of Maryland, they've been doing it 
for decades. And the hours are transferable to your home State 
university when you get out of school.'' And he said, ``I 
didn't know that.''
    He was a specialist, served our country; thought he was 
doing the right thing. He was misled into believing that one of 
these for-profit schools was worth his time and the 
Government's money. What is your thought?
    Secretary McHugh. Well, we've discussed this before, and we 
certainly agree that the last thing we want to see is: (a) a 
soldier who is trying to do the right thing and further his 
education is somehow cheated out of that genuine opportunity; 
and (b) the end result is also a waste of taxpayer dollars. In 
Army dollars by and large.
    So, through our Tuition Assistance program, we have been 
trying to establish a framework within which we can do our best 
to ensure that whereever a soldier seeks to use his or her 
tuition assistance that it goes only to an accredited 
university. And we use the Federal Department of Education 
standards and accept their accreditation. We think that's the 
best way to do this.
    The other thing we have established is a Memorandum of 
Understanding with all schools who fall into that category, who 
choose to pursue Army TA dollars, that set certain standards, 
set certain requirements for them and obligations to them from 
them to the soldier, in our case. And, in fact, we're finding 
that the questionable schools are refusing to sign that and, as 
such, we disqualify them for fund eligibility. We've had 
several hundred disqualify just over the past few years.
    So we want what you want. And we're trying to work in 
partnership, as I saw, with the Department of Education to make 
sure that we're as closely aligned to the national standards as 
possible.
    Senator Durbin. And we're not making your job any easier 
because the U.S. Department of Education literally accredits 
some of these awful schools and says to students in the outside 
world, not military world, you're eligible for Pell grants and 
Government loans. What's a student to think? This must be a 
real school. So we're not making it easier and I'm letting 
Secretary Duncan know my disappointment with what's going on at 
that level.
    General Odierno. Senator, if I could just add?
    Senator Durbin. Sure, General.
    General Odierno. Just that 279 have been suspended by us; 
schools. A new list is going to come out in about 30 days and 
we'll suspend more that are not meeting our criteria.
    The other thing we've done is we now have lists. These 
lists are now available in our Soldier for Life Program at 
every installation. So, when soldiers start talking about doing 
education, we now show them the lists of these schools so they 
understand who is on it and which ones not to sign up for. And 
we're really trying to work this very hard to educate. There 
are so many cases and it's so unfortunate that they waste their 
benefits on institutions that, frankly, do not provide them 
anything worthwhile as an education.
    Senator Durbin. Thank you.
    General Talley. Mr. Chairman, if I could?
    Senator Durbin. Sure.
    General Talley. I'm kind of a recovering academic. I've 
been a professor at three universities before I came back into 
the Active component. So, first off, for that great specialist, 
if he wants to transition to the Army Reserve, I think we can 
help him.
    We initiated a private partnership initiative that has 
agreements in place with over 6,000 private companies to 
include academia. And so, what we're doing, and I have met with 
the President of Norwich University yesterday, we are taking 
companies----
    Senator Durbin. That's to get my attention; right, General?
    General Talley. Roger that, sir. It was a great meeting. I 
met with him and Gordon Sullivan.
    What we've done is both companies and private not-for-
profits, so academia as well as those that give the 
certification registrations in those trade and professional 
industries, they're partnering with the Army Reserve on our new 
initiative where they provide the resourcing and funding to our 
soldiers and their family members so they can get that type of 
education; both formal academic education and the certification 
to get the registrations. We're having great success. And I 
assure you, we only work with those universities that are 
absolutely first rate.
    Senator Durbin. Great.
    Another unrelated topic: A year and a half ago, there was a 
terrible tragedy in Bangladesh when a fire broke out at a 
garment factory killing over 100 workers. And, in the course of 
going through the ashes, it was discovered that this garment 
factory was supplying the Marine Corps with fabrics and 
garments that have been made with the Marine Corps logo. When 
the Marine Corps found out about it, they said we are going to 
make sure that we are never doing business with someone that's 
exploiting labor in the United States or anywhere in the world. 
And they sent out a new standard in terms of what they would 
require.
    Has the Army looked into instituting similar standards in 
contracts to crack down on these kinds of abuses? And can you 
work with us if you have or have not to promote this throughout 
the military?
    Secretary McHugh. I can assure you we will do everything we 
can to both support any efforts up here on the Hill but also to 
enact our own. We have very compliant measures whereby we try 
to do everything we can to buy American, thereby obviating at 
least the overseas challenge in where there are questions of 
human rights abuses and such. As the gentlemen on your right 
knows quite well, we have very strict oversight from Congress. 
We're not, in theory, allowed to do that kind of business with 
those kinds of organizations but it needs to be an effort of 
continued vigilance.
    Senator Durbin. Our appropriation bill affecting this year 
requires some quarterly reports. So if you could take a closer 
look. We understand there may be some question raised about 
Cambodian suppliers to the United States military, in 
particular the Army. So if you could take a look at that, I'd 
appreciate it.
    Secretary McHugh. We will do that.
    Senator Durbin. My colleagues have any follow-up questions?
    Senator Shelby.
    Senator Shelby. Brief.
    I know we've touched on a lot of things at the hearing, but 
what I get out of the hearing overall, underlying everything, 
is a lack of funding. A lack of funding for the Reserve, the 
Guard, the regular forces, you name it. And there's an old 
saying that we all know about: You get what you pay for. And 
the American people, through us, are going to have to change 
what we're doing.
    Thank you.
    Secretary McHugh. Thank you, Senator.

                     ADDITIONAL COMMITTEE QUESTIONS

    Senator Leahy. No. In fact, I found every one of the 
witnesses here to always be available if I had a phone call or 
a question. So I have nothing further.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]
                Questions Submitted to Hon. John McHugh
            Question Submitted by Senator Richard J. Durbin
    Question. Secretary McHugh and General Odierno, the subcommittee 
has been concerned about the health of the combat vehicle industrial 
base for several years, and the termination of the Ground Combat 
Vehicle (GCV) program in fiscal year 2014 has only added to this 
concern. The engineering workforce that is essential to these efforts 
is seemingly at risk, and once gone is difficult and expensive to 
replace. With the termination of GCV, the Armored Multi-Purpose Vehicle 
(AMPV) is seen as vital to the combat vehicle industrial base.
    How did the Army evaluate the requirements for AMPV, particularly 
regarding the relative capabilities of tracked vs. wheeled vehicles? 
How does the Army evaluate the cost to operate a tracked vs. wheeled 
vehicle?
    Given the Ground Combat Vehicle termination, what is your plan for 
maintaining the workforce necessary to design and produce the next 
generation of fighting vehicles?
    Answer. The Army conducted a detailed Analysis of Alternatives in 
2011 to identify the most cost-effective solution for replacing the 
M113 while reducing technical, schedule and cost risk. The Analysis of 
Alternatives identified five mission roles that the M113 vehicle 
performed within the Armored Brigade Combat Team: General Purpose; 
Medical Treatment; Mission Command; Medical Evacuation; and Mortar 
Carrier. The study then identified 115 vehicles, both foreign and 
domestic, that were viable candidates to fulfill the five mission 
roles. All candidates were evaluated against four screening categories: 
Mission Equipment Package suitability; rough-order-of-magnitude average 
procurement unit cost; initial performance analysis on mobility; and 
initial performance analysis on protection attributes compared against 
the base M113.
    The study identified four candidates for further consideration: a 
turret-less Bradley Fighting Vehicle; a Mobile Tactical Vehicle Light 
with added force protection; the Caiman Multi-Terrain Vehicle; and a 
Stryker Double-V Hull. Additionally, the Analysis of Alternatives 
informed the requirements process and validated the capabilities needed 
of the replacement system that were further validated by the Joint 
Requirement Oversight Council in 2013.
    An AMPV solution, whether tracked or wheeled, needs to have the 
mobility required to perform to the same abilities of the primary 
combat vehicles in a formation. An AMPV must be able to traverse 
complex slopes in several directions (up, down, sideways). An AMPV must 
be able to conduct very wide Gap Crossings of trenches in forward and 
reverse. An AMPV must also be able to execute a controlled 360 degree 
left or right turn within 1.5 times the vehicle length. This allows the 
vehicle and unit commanders to negotiate and quickly maneuver in cross 
country and urban terrain, particularly during Mounted Operations in 
Urban Terrain environments where tight turning radius is particularly 
necessary. The Analysis of Alternatives analyzed different types of 
vehicles to see which were able to meet the aforementioned mobility 
requirements.
    In determining operating costs for programs in the acquisition 
process, the Army considers such major cost elements as consumable 
spares: reparable parts; petroleum; oil; and lubricants; ammunition; 
personnel (crew); and depot maintenance. Early in the acquisition life 
of a system, a cost estimate is developed by determining the closest 
analogous system(s) and/or component(s). Actual historical costs are 
acquired for use in these analogies. Then, these historical costs are 
adjusted based on such known characteristics as weight, reliability, 
and power. Per-mile metrics for repair parts and spares are valuable in 
making comparisons between wheeled and tracked vehicles due to the 
apparent cost deltas that exist between these vehicle types. 
Historically, tracked vehicle repair parts and spares cost per mile, 
and fuel costs have revealed higher operational costs than wheeled 
vehicles. This is mostly due to the additional weight and complexity of 
tracked vehicles.
    The Army evaluates contractor's estimated operating costs of a 
proposed system during Source Selection Evaluation Boards (SSEBs) prior 
to contract awards. During SSEBs, the Army determines how well system 
proposals meet defined Key System Attributes (KSAs) as specified in 
requirement documents, e.g., Capability Development Documents. The 
Sustainment Key Performance Parameter includes the Operations & Support 
Cost KSA alongside Reliability, Availability (both material 
availability and operational ability) and Maintainability in order to 
ensure that the entire lifecycle cost is captured and considered.
    The Army shares concerns regarding the Defense industry's combat 
vehicle intellectual industrial base and its ability to maintain an 
adequate level of engineering skills and personnel to design and 
develop combat vehicles in the future. To address these concerns, the 
Army has developed a strategy that will explore and refine future 
combat vehicle concepts and requirements, as well as leverage its 
robust Science & Technology (S&T) investment for the next generation 
infantry fighting vehicle while keeping the combat vehicle engineering 
industrial base engaged.
    Under this strategy the Army will leverage the current Ground 
Combat Vehicle program prime contractors' technology development 
designs to facilitate the maturation and integration of advanced 
technology into a variety of advanced combat vehicle concepts, which 
will keep the intellectual industrial base engaged. Additionally, the 
combat vehicle primes will support our assessment of Army S&T 
technology maturation initiatives and their effects on current and 
potential vehicle designs. This will enable the Army to build a 
knowledge base to inform Future Fighting Vehicle requirements by 
assessing design and cost tradeoffs and reduce risk. These efforts will 
support a Future Fighting Vehicle program of record when resources 
become available.
                                 ______
                                 
              Questions Submitted by Senator Mark L. Pryor
    Question. The Arsenal Sustainment Initiative directs you to release 
the Army Organic Industrial Base Strategy Report no later than 30 days 
after the enactment of the fiscal year 2014 Omnibus Appropriations 
Bill. What is the status of this report?
    Answer. The Office of the Under Secretary of Defense for 
Acquisition, Technology, and Logistics submitted the following report 
to Congress in August 2013: ``Report to Congress on Critical 
Manufacturing Capabilities and Capacities.'' This submission fulfills 
the requirement in the Arsenal Sustainment Initiative to submit to 
Congress a report that identifies critical capabilities for arsenals.
    Question. The Arsenal Sustainment Initiative directs the Army to 
assign the arsenals a sufficient workload to maintain the critical 
capabilities identified in the Army Organic Industrial Base Strategy 
Report. How is the Army ensuring that the arsenals are receiving a 
sufficient workload for efficient operations that assists the arsenals 
in maintaining a ``blue line level?''
    Answer. The Army is engaged in several efforts to ensure that the 
arsenals are receiving a sufficient workload to maintain critical skill 
sets.
    The Assistant Secretary of the Army for Acquisition, Logistics and 
Technology has directed Program Executive Officers (PEO) and Program 
Managers (PM) to take advantage of arsenal capabilities where feasible, 
and to account for arsenal capabilities early on in the acquisition 
process when possible. PEOs report annually on the workload directed to 
the arsenals.
    The Army Materiel Command has also developed the Materiel 
Enterprise Capabilities Database (MEC-D), a standardized market 
research tool with electronic access to enterprise-wide Army arsenal 
and depot capabilities. This database provides the Army acquisition 
community relevant Organic Industrial Base capabilities when 
considering manufacturing or repair requirements. PEOs, PMs, and 
Product Support Managers use MEC-D to assist with ``make-or-buy'' 
analyses as performed under Title 10 United States Code 4532.
    Lastly, the Secretary of the Army has directed the Army Materiel 
Command to work directly with the Defense Logistics Agency (DLA) to 
explore ways to make Army arsenals a DLA source of supply for Army-
related manufacturing requirements.
                                 ______
                                 
              Questions Submitted by Senator Thad Cochran
    Question. Secretary McHugh, I have been informed that the Army is 
requiring the National Guard to divest itself of up to four Brigade 
Combat Teams. It is unfortunate that we are looking to reduce the 
combat capabilities of the National Guard after they have proven 
themselves to be worthy over the past 12 years of conflict. The 155th 
Brigade from my home State of Mississippi has deployed twice to Iraq. 
In 2005, they served alongside the Marines and conducted full spectrum 
missions in Najaf, Karbala, North Babil and Eastern Al Anbar. They 
performed admirably at a critical time and should be commended for 
their service. Given the current budget constraints why are you not 
looking to sustain the National Guard, which is less expensive when not 
activated than the same force in the Active Component, and maintain 
combat capability instead of divesting force structure?
    Answer. We have made a fundamental decision that we will rely more 
on the U.S. Army Reserves (USAR) and the Army National Guard (ARNG). 
This will be necessary since we are taking a much larger reduction in 
the Active Component (AC) than in the Reserve Component (RC). The RC 
plays an important role in peace and war, and will make up more than 50 
percent of the Total Army endstrength. Reserve formations are best 
suited to predictable, infrequent deployments, domestic missions, and 
providing operational and strategic depth to the Joint Force in 
contingency operations. Missions the RC conducts in support of civil 
authorities, such as disaster relief, reinforce the RC's competency to 
provide critical capabilities necessary for overseas operations. We 
will continue to retain the RC as an operational reserve and employ it 
as funding permits.
    We have taken cost into consideration and determined that a larger 
share of the cuts should come from the Active Component (AC) instead of 
the Reserve Component (RC). Our plan calls for cutting a total of 
213,000 Soldiers from the Total Force; 150,000 from the Active 
Component, 43,000 from the ARNG, and 20,000 from the Army Reserve. A 
full 70 percent of the total cuts will be from the AC. This will 
ultimately result in our Total Army going from a 51 percent AC and 49 
percent RC mix to a 54 percent RC and a 46 percent AC mix.
    The Army has relied on the Reserve Component as an integral partner 
over the last 13 years in support of world-wide contingency operations 
and they have met all assigned mission requirements. However, there are 
certain capabilities that are better suited for the Active Component 
and others that are better suited for the Reserve Component. In 
general, organizations that are large and complex, such as Armored 
Brigade Combat Teams, are easier and cheaper to sustain at high levels 
of readiness if in the Active Component. Units that are smaller, less 
complex, and primarily composed of Soldiers with skills easily 
sustained in civilian employment, such as transportation companies or 
certain construction engineer units, are far more cost effective in the 
Reserve Component. Readiness, capability, and agility are all critical 
to the success of the both the Reserve Component and the Active 
Component.
    It is important to highlight an independent RAND study that 
examined force mix and tour output. What we learned was that large, 
complex organizations which require skills not easily sustained in the 
civilian market (such as Armor Brigade Combat Teams or Combat Aviation 
Brigades) are considerably cheaper to have in the AC. However, less 
complex organizations which require skills easily sustained in the 
civilian market (Finance and Transportation Brigades for example), are 
considerably cheaper to maintain in the RC. This information 
contributed greatly to our decisions on not only where to reduce end 
strength, but where to maintain specific capabilities as well.

    [Note: The follow question was answered by Hon. John McHugh and 
General Raymond T. Odierno.]

    Question. Mr. Secretary, I have been informed that the Army is 
putting an additional Combined Arms Battalion in each of its Brigade 
Combat Teams. While this should increase the combat capability, it 
would also increase the operation and maintenance costs. Instead of 
putting all that additional force structure in some of the Active force 
brigades, why not use existing National Guard combat units? Have you 
looked at combining the Active Army and the Army National Guard to form 
multi-component or associated units? During the 1980s and 1990s the 
Army had a ``Round-Out'' program where National Guard combat units were 
used to round-out the brigades and divisions. How effective was that 
program? With the current Guard combat training and equipment readiness 
rates, do you think a program like that would benefit the Nation during 
these times of decreased resources?
    Answer. Lessons learned from combat operations over the last 12-
plus years of conflict resulted in the Army 2020 Brigade Combat Team 
(BCT) redesign. In addition to a third maneuver battalion, the Army 
2020 BCT adds an engineer battalion and precision fires capability to 
the Infantry BCT. The conversion to this design coincides with the 
reduction of 13 Active Component (AC) BCTs to achieve a 490K force and 
allows the realignment of maneuver battalions to achieve the three 
maneuver battalion design in all but the three overseas Infantry BCTs. 
Our plan will also reorganize ARNG BCTs with a majority of the end 
strength reductions coming from the removal of Headquarters which the 
reorganizations would render as unnecessary overhead. These BCTs will 
continue to be organized with only two maneuver battalions. The Army 
continues to assess opportunities to integrate reserve component 
Soldiers into Active Component formations either individually or by 
unit. We are currently studying the possibility of integrating Reserve 
Component Soldiers into AC Divisions and Corps and rounding out select 
AC BCTs with Army National Guard Battalions.
    We agree that leveraging the ARNG's force structure will benefit 
the Total Army and the Nation during these fiscally uncertain times. As 
a result, we are currently analyzing the multi-component unit (MCU) 
Brigade Combat Team (BCT) option you reference. Our analysis includes--
a yet to be determined, but at least two--MCU BCTs that will 
incorporate ARNG infantry maneuver battalions into Active Component 
(AC) BCTs. The Army continues to assess opportunities to integrate 
reserve component Soldiers into Active Component formations either 
individually or by unit. We are also studying the possibility of 
integrating Reserve Component Soldiers into AC Divisions and Corps.
    The Army will continue to build Army National Guard and Army 
Reserve forces through Army Force Generation. For example, we are 
planning to send one Army National Guard Brigade Combat Team (BCT) to 
Combat Training Centers in fiscal year 2014 and two in fiscal year 
2015. These events represent a significant investment in preserving 
Reserve Component readiness and ensuring an integrated and ready Total 
Force. Pursuant to the Army Total Force Policy, the Army will continue 
to consider using Reserve Component units for steady state rotations, 
as it has in the past; however, the Army has not planned to employ Army 
National Guard BCTs for rotations to Korea because the BCTs cannot 
reach the desired level of training proficiency within their allotted 
training days.
    In general, if the Army National Guard maintains too much force 
structure, its readiness funding must be reduced. Therefore, it is 
essential that the Army National Guard reduce force structure as 
outlined in the Army's budget submission in order to preserve its 
capability as an operational force.
                                 ______
                                 
             Questions Submitted by Senator Lamar Alexander
    Question. The Army's aviation plan is premised on saving money by 
divesting airframes, including the OH-58D Kiowa Warriors in my home 
State, and moving all AH-64 Apache helicopters from the National Guard 
to the Active Component. You have testified that there would be 
approximately $12 billion in savings if your plan goes forward.
    Over how many years would your plan achieve those savings? What is 
the cost of retraining all of the pilots? Would it be more efficient to 
retain Apaches in the National Guard as opposed to the Active Component 
since they are not being deployed?
    Answer. The Aviation Restructure Initiative (ARI) will avoid an 
estimated $11.9 billion in one-time costs. The Army will avoid paying 
for the Cockpit and Sensor Upgrade Program (CASUP), Service Life 
Extension Programs (SLEP) for the OH-58D and TH-67 training helicopter, 
and a new training helicopter to replace the aging TH-67 fleet. The 
Army programmed $1.457 billion for CASUP between fiscal year 2015 and 
fiscal year 2019. The breakdowns of those costs are as follows: $245.01 
million in fiscal year 2015; $223.12 million in fiscal year 2016; 
$257.22 million in fiscal year 2017; $308.32 million in fiscal year 
2018; and $423.42 million in fiscal year 2019. The Army estimated 
spending an additional $1.9 billion for CASUP between fiscal year 2020 
and fiscal year 2030. CASUP was a stop-gap measure to allow the Kiowa 
Warrior to be more combat effective until a long-term solution for 
performing the armed aerial reconnaissance mission could be identified. 
The CASUP funds were reprogrammed to directly pay for training Soldiers 
and aviators across all components to meet the demands of the new force 
structure. The funds will also procure Tactical Common Data Link (TCDL) 
for Shadow Unmanned Aircraft Systems (UAS), AH-64E manned-unmanned 
teaming capability, Gray Eagle UAS KA satellite communications upgrade, 
and LUH-72 simulation transition at Fort Rucker, Alabama.
    The majority of ARI cost avoidance occurs outside of the fiscal 
year 2015-2019 Future Years Defense Plan. The Army estimates it would 
have been required to spend $6.96 billion on OH-58D SLEP, $191 million 
on TH-67 SLEP and upgrades, and $1.43 billion on a new training 
aircraft to replace the TH-67 in fiscal year 2020 and beyond.
    The cost to retrain both the Active and Reserve Component Aviators 
and Soldiers is about $444 million between fiscal year 2015 and fiscal 
year 2019. The cancellation of CASUP within the fiscal year 2015-2019 
Future Years Defense Plan facilitates the reallocation of $1.457 
billion to pay for training transitions, Ft. Rucker's transition to an 
LUH training fleet, UAS modernization, and certain AH-64 upgrades.
    The Army's Attack/Reconnaissance battalions are considered low 
density and high demand assets that must be fully trained and ready on 
short notice to deploy for world-wide contingencies and crisis response 
in the wake of major reductions to the Total Army end-strength and 
force structure. The divestment of OH-58D Kiowa Warriors and the 
elimination of three entire Combat Aviation Brigades (CABs) from the 
Active Component (AC) will take Army Aviation down from 37 to 20 
shooting battalions. This necessitates transferring all Apache 
helicopters to the AC in order to meet the demands of our Combatant 
Commanders. The Army simply does not have the luxury of retaining 
Apache helicopters in the Reserve Component (RC) as it is considerably 
more expensive to maintain a sufficient, available inventory of Apaches 
in the RC than it is to do so in the AC.
    When considering the most effective use of limited resources, 
National Guard Formations should be optimized with ``dual use'' 
equipment and formations that are capable of supporting States and 
Governors as well as Combatant Commanders when mobilized. We must 
develop complimentary and mutually supporting capabilities. The Army 
supports a multi-component solution for operationalizing ARNG Aviation 
Brigades in non-permissive environments. Under the Aviation Restructure 
Initiative (ARI), each ARNG Aviation Brigade will have an AC AH-64 
battalion aligned with them for training and deployment. These AH-64 
battalions will deploy with an intermediate maintenance slice to 
support AH-64 maintenance and armament. This model has proven effective 
in the past, and in fact, we have a National Guard aviation brigade 
deployed to Kuwait today with an active duty attack battalion attached.
    The Aviation Restructure Initiative (ARI) was necessary due to 
severe budget restraints. ARI is designed to achieve a leaner, more 
efficient and capable force that balances operational capability and 
capacity across the Total Army. The low-density, high-demand AH-64 
Apaches transferring out of the Army National Guard (ARNG) will be 
repurposed to replace Active Component (AC) OH-58D Kiowa Warriors that 
are being divested. The transfer will enable the teaming of Apaches 
with unmanned aircraft systems (UAS) for armed reconnaissance, filling 
a critical capability need for an Armed Aerial Scout created by the 
elimination of the Armed Reconnaissance Helicopter program. In 
addition, consolidation of Apache airframes in the AC will enable the 
Army to better meet the operational demands of our Combatant Commanders 
due to the increased operational availability as a result of the 
reduced dwell times required in the AC. The ARNG will receive 
additional UH-60 Black Hawk helicopters to optimize the ability to 
perform its mission in the homeland and deploy in support of combat 
operations.
    Necessary savings are generated by divesting three entire fleets of 
Army aircraft--the OH-58A/C Kiowas; the TH-67 training helicopters; and 
the OH-58D Kiowa Warriors--an overall reduction of 798 aircraft. The 
net effect of the reduction is a 23-percent decrease in aircraft in the 
AC with only an 8-percent reduction in the ARNG. In addition to 
procurement and modernization cost savings, the Army would also avoid 
the significant operations and sustainment costs of these aging 
aircraft fleets. ARI avoids approximately $12 billion in imminent 
costs. If the Army were to not execute ARI, we would be forced to 
retain many of our oldest and least capable aircraft while divesting 
several hundred modernized airframes. Upgrades to the Kiowa Warrior 
would cost over $10 billion. Replacing the legacy TH-67 training 
helicopter would cost another $1.5 billion. In addition, lower 
procurement rates of modernized aircraft would cost the Army 
approximately $15 billion. These costs would be unbearable for the Army 
under the current budget constraints and would risk creating a hollow 
force, with less overall capability and less investment in 
modernization.
    The Army National Guard was involved in the development and 
staffing of the aviation restructure plan during the entire process. 
The ARNG was directly involved as early as February, 2013 and had 
planners present during the development of specific details of ARI.
    Under the ARI plan, the regular Army, Army National Guard, and 
United States Army Reserve all retain combat aviation units. UH-60 
Black Hawks and CH-47 Chinooks, which are in all service components, 
accounted for the majority of hours flown in a combat environment 
during Operation Enduring Freedom and Operation Iraqi Freedom.
    It is not possible to produce AH-64s at a rate sufficient to 
replace the OH-58, resulting in a multi-year capability gap. In 
addition to this, the purchase of sufficient AH-64's would cost over $4 
billion in addition to an additional annual operations cost of more 
than $340 million.
    Question. The decision to divest the Army of the OH-58D Kiowa 
Warrior and have the AH-64E Apache assume the scout mission is not a 
permanent solution.
    Does the Army plan to proceed with a new program to produce and 
acquire an aircraft to perform the Army's scout missions? Does the 
Army, at some point, intend to proceed with the Armed Aerial Scout 
Program? Will the excess aircraft be retired or will they be 
transferred back to the National Guard?
    Answer. The Army maintains a valid requirement for the Armed Aerial 
Scout and would like to develop an aircraft in the future; however, we 
currently do not have the fiscal resources to pursue a new procurement 
program.
    A future materiel solution for the Armed Aerial Scout and the 
Future Vertical Lift will determine the required force structure to 
meet operational demands of the Combatant Commanders. Given the higher 
levels of training and resources required to maintain readiness in the 
Attack/Reconnaissance battalions, the Army believes the most cost 
effective means to maintain this readiness is in the Active component.
    Question. I have serious concerns about downsizing the Guard's 
aviation capabilities and the aviation restructuring plan. Is it true 
that the National Guard Bureau, the 54 Adjutants General and governors 
have publicly disagreed with this plan?
    I understand that the Guard has offered a counterproposal. Is the 
Army actively working with the Guard and considering their 
recommendations?
    Has the Army considered the economic impact on the States in which 
they intend to divest battalions of AH-64 Apaches and squadrons of OH-
58D Kiowa Warriors? Do you think that an estimate of $30 million per 
year and 150 jobs being lost in the affected States is an accurate 
estimate of the economic impact?
    Answer. I am aware of publically expressed concerns regarding the 
Aviation Restructure Initiative (ARI); however, the National Guard 
Bureau was involved throughout the development of the initiative. In 
fact, the Chief of the National Guard Bureau recently testified that he 
``was included in every discussion'' and provided his best military 
advice. The ``$1.7B NGB Proposal'' was considered independently by 
myself and the Secretary of Defense and was rejected because it does 
not meet the Defense Strategic Guidance without additional investment; 
it decreases fulfillment of Combatant Command contingency plans and 
steady-state operational requirements; it reduces the readiness of the 
Army National Guard; and it increases costs in comparison to the 
Department of the Army plan.
    Due to the Budget Control Act (BCA), Army Aviation's total 
obligation authority for aircraft modernization and acquisition has 
been reduced by $3 billion per year through fiscal year 2019, and 
training and sustainment dollars are reduced by 40 percent from fiscal 
year 2012 levels. These reductions make the previously approved (pre-
BCA) Aviation Force Structure and Aircraft Modernization plans 
untenable, requiring a new approach.
    Prior to the BCA, Army Aviation's modernization and force structure 
plan was to continue to grow the Active component to 13 Combat Aviation 
Brigades (CAB), continue to modernize the AH-64 Apache, UH-60 
Blackhawk, and CH-47 Chinook helicopter fleets, upgrade the OH-58D 
Kiowa Warrior (at a cost of $10 billion) and to conduct a costly 
service life extension program (SLEP) or even more costly replacement 
of the aging TH-67 training fleet. The Army National Guard and Army 
Reserves would have continued to receive modernized UH-60, AH-64 and 
CH-47 aircraft and retain all of their structure.
    To continue with the original aircraft modernization plan under BCA 
constraints (upgrade OH-58D Kiowa Warrior, continue to modernize the 
AH-64, UH-60 and CH-47 fleets, and SLEP TH-67) would require the 
deactivation of 5 Active and Reserve aviation brigades and the 
divestment of their associated aircraft (-464 aircraft). This would 
have been a significant loss of structure and numbers of modernized AH-
64, UH-60 and CH-47 aircraft, just to retain the costly legacy OH-58D 
and TH-67 aircraft. For that reason, I directed a fundamental 
reassessment of aviation structure in the Active, National Guard and 
Reserve forces. My guidance was to determine the best force structure 
and modernization balance to retain the most capabilities and capacity 
in highest demand by our Combatant Commanders and recurring civil and 
homeland defense requirements.
    The new approach, known as the Aviation Restructure Initiative 
(ARI), uses the Budget Control Act level force and does not add cost to 
the Army's budget. ARI calls for reducing and reconfiguring the number 
of Active aviation brigades from 13 to 10, which enables the retention 
of one aviation brigade per Active component division. The Reserve 
component will retain 12 Aviation Brigades, but will be restructured to 
a common organizational structure for 10 Brigades optimized for 
assault, lift, and MEDEVAC missions--most in demand for Defense Support 
of Civil Authorities (DSCA) missions.
    To execute ARI, the Army will divest 338 OH-58D Kiowa Warriors and 
use the previously designated OH-58D cockpit upgrade dollars to 
reinvest in the training base and other modernization efforts. We will 
transfer all of the AH-64s from the National Guard to the Active 
component and use the AH-64, teamed with unmanned systems, in armed 
reconnaissance squadrons to replace the loss of the Kiowa Warrior 
Squadrons in the Active component. We will transfer 159 X UH-60s from 
the Active component to convert 4 of 10 Reserve component AH-64 
Battalions to UH-60 (2 USAR and 2 ARNG). The National Guard will gain 
111 UH-60s and the USAR will gain 48 UH-60s over current structure. We 
will divest the legacy TH-67 and OH-58A/C training fleet and replace 
them with UH-72A Lakota helicopters taken from the Active component and 
100 newly procured Lakotas. In a compromise with the National Guard, 
the Office of the Secretary of Defense directed the Army to procure the 
100 new Lakotas to address concerns raised by the Guard during the 
planning process for ARI. The National Guard will retain all of their 
212 UH-72As specially equipped for the southwest border mission and 
other requirements in permissive, non-combat environments. This will 
give us a modernized, next generation glass cockpit, dual engine 
training helicopter. These aircraft will train all new Army aviators, 
regardless of component.
    Eliminating three of seven entire fleets of legacy aircraft (OH58D 
Kiowa Warrior, TH67, OH58A/C), remissioning AH-64 Apache helicopters to 
the armed reconnaissance role in addition to their traditional attack 
role, dual-purposing our UH-72A Lakota helicopters for both the 
homeland defense role and initial pilot training, and growing our lift 
helicopter fleets in the Army National Guard will allow us to retain 
the maximum force structure and modernized aircraft across the Total 
Army to meet the demand for Aviation across the Combatant Commands and 
States.
    Although the resulting rotary-wing force will be smaller by 798 
aircraft to pre-BCA levels and with cuts falling disproportionately on 
the Active component (-23 percent) versus the National Guard (-8 
percent), divesting the OH-58 and TH-67 fleets and moving the AH-64s 
from the RC to the AC allows us to preserve two additional Combat 
Aviation Brigades and improve the quality of Aviation Training while 
retaining a fully modernized aviation force across the Total Army. ARI 
saves or avoids costs associated with retaining the Kiowa Warrior and 
trainer, which total nearly $12 billion. Also, the Army estimates ARI 
will save $1.1 billion annually in operations and sustainment at full 
implementation.
    In regard to the NGB proposal, it actually increases costs. While 
the NGB proposal appears neutral with respect to the ARNG budget, it 
does not account for the significant increase that would occur to the 
$3.25 billion per year that the Department of the Army already funds 
from the Regular Army budget to support the Army Guard. Specifically, 
the NGB proposal does not account for increases of $300 million 
annually for additional end strength and structure related costs, such 
as basic combat training, specialized skill training, contractor 
maintenance support, payroll processing and officer accessions. Nor 
does it account for a $350 million annual increase in aviation 
operations and sustainment type costs and the $4 billion one-time cost 
that would result from not executing the ARI as planned.
    The NGB proposal would decrease readiness by reducing Operations 
and Maintenance funding, which is used to resource Soldier, unit and 
facilities readiness. The proposal funds only 50-to-80 percent of 
required duty military occupation specialty, functional and 
professional development training, that would result in significant 
numbers of Guardsmen assigned to units untrained in their military 
duties and leadership responsibilities. The proposal would reduce unit 
readiness, with only two Guard BCTs funded above individual-crew-squad 
level of readiness. The proposal's reductions to readiness would 
lengthen post-mobilization training that ARNG units require to respond 
to Combatant Command operational and contingency requirements, 
decreasing the Army Guard's viability as an operational reserve. The 
proposal also decreases MILCON funding by $100 million per year and 
decreases facilities sustainment funding, negatively impacting Army 
Guard infrastructure.
    The NGB proposal does not accurately capture the cost of 
turbulence. The Department of the Army estimated and budgeted 
turbulence costs at $310 million over 5 years, or approximately $62 
million per year. The NGB estimated turbulence costs at $1 billion, but 
this estimate included $275 million in costs to implement the ARI, 
which are already accounted for in the Regular Army budget; $360 
million in facilities upgrades for unit conversions that have not been 
substantiated; and $55 million in additional recruiting costs that the 
Department of the Army believes is excessive and unnecessary given the 
force is reducing in size.
    The NGB proposal also does not accurately depict the impact of 
turbulence. OSD and Army leadership have testified to their desire to 
maintain ARNG end strength at 335K as part of a 450K/335K/195K force, 
which would significantly reduce turbulence if full BCA/sequester cuts 
can be avoided. NGB turbulence projections of the Department of the 
Army plan are overstated in that they represent a highly-unlikely 
absolute-worst-case that every possible position associated with 
potential structure adjustments is impacted. Even if the worst case 
were realized, the average annual turbulence that would result during 
the 5-year period of implementation would be less than the 
approximately 15 percent annual turnover the Army Guard experiences due 
to normal attrition.
    Finally, the NGB proposal increases strategic and operational risk 
by reducing required unit readiness and operational responsiveness in 
order to preserve less-ready force structure. The proposal reduces the 
Total Army's ability to meet Combatant Commander contingency plans and 
steady-state operational requirements, extending the length of 
operations at increased risk to mission accomplishment and likelihood 
of additional casualties. Because the NGB proposal costs more and does 
not meet BCA-driven funding reductions, it would require additional 
reductions of $650 million per year to other accounts, further 
degrading readiness and equipment modernization. The NGB proposal 
decreases readiness, increases risk, costs more, and violates the 
defense strategic guidance.
    Under Budget Control Act spending caps, job losses under the ARI 
are less than would occur without ARI. Ongoing budget cuts across all 
components--Army, Army National Guard and U.S. Army Reserve--will have 
an economic impact to communities supporting installations and 
production facilities that produce, modify, or recapitalize Army 
equipment. Economic impacts will vary by State based on the final Army 
National Guard stationing decisions made by the National Guard Bureau 
that will determine personnel and equipment loses in each State and 
Territory.
    The Army's Attack/Reconnaissance battalions are considered low 
density and high demand assets that must be fully trained and ready on 
short notice to deploy for world-wide contingencies and crisis response 
in the wake of major reductions to the Total Army end-strength and 
force structure. The divestment of OH-58D Kiowa Warriors and the 
elimination of three entire Combat Aviation Brigades (CABs) from the 
Active Component (AC) will take Army Aviation down from 37 to 20 
shooting battalions. This necessitates transferring all Apache 
helicopters to the AC in order to meet the demands of our Combatant 
Commanders. The Army simply does not have the luxury of retaining 
Apache helicopters in the Reserve Component (RC) as it is considerably 
more expensive to maintain a sufficient, available inventory of Apaches 
in the RC than it is to do so in the AC.
    When considering the most effective use of limited resources, 
National Guard Formations should be optimized with ``dual use'' 
equipment and formations that are capable of supporting States and 
Governors as well as Combatant Commanders when mobilized. We must 
develop complimentary and mutually supporting capabilities. The Army 
supports a multi-component solution for operationalizing ARNG Aviation 
Brigades in non-permissive environments. Under the Aviation Restructure 
Initiative (ARI), each ARNG Aviation Brigade will have an AC AH-64 
battalion aligned with them for training and deployment. These AH-64 
battalions will deploy with an intermediate maintenance slice to 
support AH-64 maintenance and armament. This model has proven effective 
in the past, and in fact, we have a National Guard aviation brigade 
deployed to Kuwait today with an active duty attack battalion attached.
    The Aviation Restructure Initiative (ARI) was necessary due to 
severe budget restraints. ARI is designed to achieve a leaner, more 
efficient and capable force that balances operational capability and 
capacity across the Total Army. The low-density, high-demand AH-64 
Apaches transferring out of the Army National Guard (ARNG) will be 
repurposed to replace Active Component (AC) OH-58D Kiowa Warriors that 
are being divested. The transfer will enable the teaming of Apaches 
with unmanned aircraft systems (UAS) for armed reconnaissance, filling 
a critical capability need for an Armed Aerial Scout created by the 
elimination of the Armed Reconnaissance Helicopter program. In 
addition, consolidation of Apache airframes in the AC will enable the 
Army to better meet the operational demands of our Combatant Commanders 
due to the increased operational availability as a result of the 
reduced dwell times required in the AC. The ARNG will receive 
additional UH-60 Black Hawk helicopters to optimize the ability to 
perform its mission in the homeland and deploy in support of combat 
operations.
    Necessary savings are generated by divesting three entire fleets of 
Army aircraft--the OH-58A/C Kiowas; the TH-67 training helicopters; and 
the OH-58D Kiowa Warriors--an overall reduction of 798 aircraft. The 
net effect of the reduction is a 23 percent decrease in aircraft in the 
AC with only an 8-percent reduction in the ARNG. In addition to 
procurement and modernization cost savings, the Army would also avoid 
the significant operations and sustainment costs of these aging 
aircraft fleets. ARI avoids approximately $12 billion in imminent 
costs. If the Army were to not execute ARI, we would be forced to 
retain many of our oldest and least capable aircraft while divesting 
several hundred modernized airframes. Upgrades to the Kiowa Warrior 
would cost over $10 billion. Replacing the legacy TH-67 training 
helicopter would cost another $1.5 billion. In addition, lower 
procurement rates of modernized aircraft would cost the Army 
approximately 15 billion dollars. These costs would be unbearable for 
the Army under the current budget constraints and would risk creating a 
hollow force, with less overall capability and less investment in 
modernization.
    The Army National Guard was involved in the development and 
staffing of the aviation restructure plan during the entire process. 
The ARNG was directly involved as early as February, 2013 and had 
planners present during the development of specific details of ARI.
    Under the ARI plan, the regular Army, Army National Guard, and 
United States Army Reserve all retain combat aviation units. UH-60 
Black Hawks and CH-47 Chinooks, which are in all service components, 
accounted for the majority of hours flown in a combat environment 
during Operation Enduring Freedom and Operation Iraqi Freedom.
    It is not possible to produce AH-64s at a rate sufficient to 
replace the OH-58, resulting in a multi-year capability gap. In 
addition to this, the purchase of sufficient AH-64s would cost over $4 
billion in addition to an additional annual operations cost of more 
than $340 million.
    Question. Understandably, the Army is making hard decisions about 
programs and budget cuts; however, I am concerned that these decisions 
are often being made based on proportionality rather than long term 
strategy and cost. As we look at the threats we face today, and may 
face in the future, a strong and diversified force with more 
capabilities and capacity to deploy quickly makes sense. Some would say 
the only way to maintain that balance of capabilities that we need and 
what we can afford is by having a larger Reserve Component.
    Do you agree that we need to have a larger Reserve Component to 
meet our future needs?
    Answer. I believe the Reserve Component is appropriately-sized to 
meet the Army's strategic requirements, given current budget 
constraints.
    The Chief of Staff and I reviewed the needs of Combatant Commanders 
before deciding to disproportionally reduce our Active Component while 
implementing modest reductions in Army Guard and Reserve Forces. The 
Army and the Office of Secretary of Defense conducted a transparent, 
open, and highly collaborative budget formulation, force structure, and 
aviation restructure decision process that included representatives 
from all components at every level. Additionally, experts and analysts 
within the Department of Defense assessed all proposals for their 
viability, ensuring the Army could meet its defense strategy 
requirements.
    Numerous meetings of the Joint Chiefs and Combatant Commanders 
examined these proposals before a final decision was made by the 
Secretary of Defense. The result is a balanced approach that gives us 
the best Army possible, even the Budget Control Act spending caps 
continue in fiscal year 2016. The plan calls for end-strength 
reductions of 213,000 Soldiers, with a disproportionate cut of 150,000 
coming from the Active Army, 43,000 from the Army National Guard, and 
20,000 from the Army Reserve. These reductions to the active Army 
represent 70 percent of the total end-strength reductions, compared 
with 20 percent from the National Guard and 10 percent from the U.S. 
Army Reserve.
    This will result in the Total Army going from a 51 percent Active 
and 49 percent Reserve component to a 54 percent Reserve and a 46 
percent Active component mix. The Army will be the only Service in 
which the Reserve component outnumbers the Active component, and we 
believe under these fiscal constraints it's appropriate.
    The Army has relied on the Reserve Component as an integral partner 
over the last 13 years in support of world-wide contingency operations 
and they have met all assigned mission requirements. However, there are 
certain capabilities that are better suited for the Active Component 
and others, better suited for the Reserve Component. In general, 
organizations that are large and complex, such as Armored Brigade 
Combat Teams are easier and cheaper to sustain at high levels of 
readiness in the Active Component. Units that are smaller, less 
complex, and primarily composed of Soldiers with skills easily 
sustained in civilian employment, such as transportation companies or 
certain construction engineer units are far more cost effective in the 
Reserve Component. Readiness, capability, and agility are all critical 
to the success of the both the Reserve Component and the Active 
Component.
    Our Army is getting smaller. We must be more ready in all three 
components to respond to future threats. Given reduced resources, this 
plan allows us to balance end-strength, readiness, and modernization 
across the Army and sustain our critical National Guard and U.S. Army 
Reserve Forces as viable operational Reserve.
    Question. According to the Office of the Secretary of Defense's 
(OSD) Cost Assessment and Program Evaluation (CAPE) and the recent 
Reserve Forces Policy Board (RDPB) study, the National Guard is 
significantly more cost effective, saving approximately \1/3\ of the 
cost when not mobilized and approximately 80-95 percent of the cost 
when mobilized compared to active components.
    Can you discuss why you are proposing to cut the National Guard 
instead of relying on them more when they offer opportunities to save 
money and can sustain our defense readiness?
    Did you review any options to keep tens of thousands more soldiers 
in our Total Army, within the National Guard and Reserves, to help 
remain inside current cost constraints?
    Answer. The Army is committed to the Total Force Policy. In order 
to meet the reductions imposed by the Budget Control Act and achieve 
the right balance in capabilities, we directed that cuts should come 
disproportionately from the Active Component (AC) before reducing the 
Reserve Component (RC). We have made a fundamental decision that we 
will rely more on the U.S. Army Reserves (USAR) and the Army National 
Guard (ARNG). This will be necessary since we are taking a much larger 
reduction in the Active Component (AC) than in the Reserve Component 
(RC). The RC plays an important role in peace and war, and will make up 
more than 50 percent of the Total Army endstrength. Reserve formations 
are best suited to predictable, infrequent deployments, domestic 
missions, and providing operational and strategic depth to the Joint 
Force in contingency operations. Missions the RC conducts in support of 
civil authorities, such as disaster relief, reinforce the RC's 
competency to provide critical capabilities necessary for overseas 
operations. We will continue to retain the RC as an operational reserve 
and employ it as funding permits.
    We have taken cost into consideration and determined that a larger 
share of the cuts should come from the Active Component (AC) instead of 
the Reserve Component (RC). Our plan calls for cutting a total of 
213,000 Soldiers from the Total Force; 150,000 from the Active 
Component, 43,000 from the ARNG, and 20,000 from the Army Reserve. A 
full 70 percent of the total cuts will be from the AC. This will 
ultimately result in our Total Army going from a 51 percent AC and 49 
percent RC mix to a 54 percent RC and a 46 percent AC mix.
    The Army has relied on the Reserve Component as an integral partner 
over the last 13 years in support of world-wide contingency operations 
and they have met all assigned mission requirements. However, there are 
certain capabilities that are better suited for the Active Component 
and others that are better suited for the Reserve Component. In 
general, organizations that are large and complex, such as Armored 
Brigade Combat Teams, are easier and cheaper to sustain at high levels 
of readiness if in the Active Component. Units that are smaller, less 
complex, and primarily composed of Soldiers with skills easily 
sustained in civilian employment, such as transportation companies or 
certain construction engineer units, are far more cost effective in the 
Reserve Component. Readiness, capability, and agility are all critical 
to the success of the both the Reserve Component and the Active 
Component.
    The Army will continue to build Army National Guard and Army 
Reserve forces through Army Force Generation. For example, we are 
planning to send one Army National Guard Brigade Combat Team (BCT) to 
Combat Training Centers in fiscal year 2014 and two in fiscal year 
2015. These events represent a significant investment in preserving 
Reserve Component readiness and ensuring an integrated and ready Total 
Force. Pursuant to the Army Total Force Policy, the Army will continue 
to consider using Reserve Component units for steady state rotations, 
as it has in the past; however, the Army has not planned to employ Army 
National Guard BCTs for rotations to Korea because the BCTs cannot 
reach the desired level of training proficiency within their allotted 
training days.
    In general, if the Army National Guard maintains too much force 
structure, its readiness funding must be reduced. Therefore, it is 
essential that the Army National Guard reduce force structure as 
outlined in the Army's budget submission in order to preserve its 
capability as an operational force.
                                 ______
                                 
             Question Submitted by Senator Susan M. Collins
    Question. Secretary McHugh, I understand the Army is considering 
pulling some of its financial activities out of the Defense Finance and 
Accounting Services (DFAS) office and handing them off to the Army's 
own accountants. The Army is also planning to launch a pilot program 
this spring that will involve significant changes in how it conducts 
accounting services for its soldiers at Ft. Bragg.
    Why would the Army take these services from the experts at DFAS and 
give them to an unproven pilot program when the Army is working to 
achieve an auditable budget by 2017?
    Answer. Over the last several years, the Army and the American 
people made significant investments through the deployment of 
modernized web-based enterprise resource planning (ERP) business 
systems. The deployment of these systems, when supported by 
reengineered financial business processes, afford greater opportunity 
for standardize accounting processes, and enhanced operations, which 
support Audit Readiness. The Army's Financial Management Optimization 
(AFMO) is designed to transform current Army financial operational 
process and reorganize organizational and workforce structures that are 
better aligned to the new ERP's modern capabilities. In so doing, this 
will effectively and efficiently provide for the best outcomes. The 
Army has taken a holistic approach to improving operational needs, 
resources, and FM capabilities, with numerous recommendations to 
improve and to ensure auditability.
    One of the several AFMO's recommendations was to implement command-
aligned hubs, which consolidate functions and better align workers' 
skills and numbers. The command-aligned hub focuses on standardizing 
internal Army business process, ensuring accurate capturing of data at 
the source, thereby eliminating redundancy and rework.
    To test this concept, I have approved two pilots to determine if 
the proposed standard processes and consolidation of Army processes and 
proper alignment of tasks support our FM objectives. The Army is 
currently conducting analysis, in collaboration with Defense Finance 
and Accounting Services (DFAS) and other stakeholders, to plan for and 
effectively conduct this test pilot, which will begin in October 2014 
at Fort Bragg and at Wiesbaden, Germany. The Office of the Secretary of 
Defense (OSD) Cost Assessment and Program Evaluation (CAPE) will review 
the Army's business case analysis and recommendations based on results 
of the pilot. Senior leadership from the Army and the Secretary of 
Defense will review and approve any final hub implementation decisions, 
in consultation with Congress.
    The Army will continue to rely on DFAS to provide accounting and 
payroll functions in the future; however, we must also continue to 
improve and strive for the most effective and efficient services 
possible.
                                 ______
                                 
                Question Submitted by Senator Roy Blunt
    Question. Given the critical nature of high quality batteries used 
to power military wheeled and tracked vehicles in combat environments, 
I'm concerned with the safety risks caused by the use of ``flooded'' 
batteries originally designed in the 1960's, specifically to Soldiers' 
eyes and face. ``Flooded'' batteries have a history of leaking liquid 
sulfuric acid when broken or tipped onto the battery's side, causing 
damaging corrosion to equipment and risk to personnel. I understand the 
Army has increased its use of Absorbed Glass Mat (AGM) batteries over 
the last 5 years due to the improved performance and extended life 
characteristics displayed by AGM batteries in tactical environments. 
Can the Army reduce these risks to Soldier safety by using newer, more 
advanced AGM batteries rather than older, ``flooded'' model batteries?
    Answer. The Army reduced risks to Soldier safety by replacing the 
1960s style batteries with ``maintenance free'' batteries in our 
vehicles, generators and other tactical systems. Military Performance 
Specification governs all safety and performance requirements for three 
different 6T lead acid battery types: 6TL, 6TMF, and 6T AGM (Absorbed 
Glass Mat).
    The Army no longer uses the 1960s era 6TL flooded lead acid battery 
that required the operator to add distilled water. The 6TMF is also a 
flooded lead acid type of battery that is sealed and considered 
``maintenance free.'' The 6T AGM lead acid battery is also a 
maintenance free battery.
    6TMF and 6T AGM batteries are qualified for safety and performance 
and both batteries are in field use. The Army will continue to provide 
our Soldiers high quality batteries that power our tactical vehicles on 
the battlefield and ensure the safety of our Soldiers.
                                 ______
                                 
           Questions Submitted to General Raymond T. Odierno
            Question Submitted by Senator Richard J. Durbin
    Question. Secretary McHugh and General Odierno, the Subcommittee 
has been concerned about the health of the combat vehicle industrial 
base for several years, and the termination of the Ground Combat 
Vehicle (GCV) program in fiscal year 2014 has only added to this 
concern. The engineering workforce that is essential to these efforts 
is seemingly at risk, and once gone is difficult and expensive to 
replace. With the termination of GCV, the Armored Multi-Purpose Vehicle 
(AMPV) is seen as vital to the combat vehicle industrial base.
    How did the Army evaluate the requirements for AMPV, particularly 
regarding the relative capabilities of tracked vs. wheeled vehicles? 
How does the Army evaluate the cost to operate a tracked vs. wheeled 
vehicle?
    Given the Ground Combat Vehicle termination, what is your plan for 
maintaining the workforce necessary to design and produce the next 
generation of fighting vehicles?
    Answer. The Army conducted a detailed Analysis of Alternatives in 
2011 to identify the most cost-effective solution for replacing the 
M113 while reducing technical, schedule and cost risk. The Analysis of 
Alternatives identified five mission roles that the M113 vehicle 
performed within the Armored Brigade Combat Team: General Purpose; 
Medical Treatment; Mission Command; Medical Evacuation; and Mortar 
Carrier. The study then identified 115 vehicles, both foreign and 
domestic, that were viable candidates to fulfill the five mission 
roles. All candidates were evaluated against four screening categories: 
Mission Equipment Package suitability; rough-order-of-magnitude average 
procurement unit cost; initial performance analysis on mobility; and 
initial performance analysis on protection attributes compared against 
the base M113.
    The study identified four candidates for further consideration: a 
turret-less Bradley Fighting Vehicle; a Mobile Tactical Vehicle Light 
with added force protection; the Caiman Multi-Terrain Vehicle; and a 
Stryker Double-V Hull. Additionally, the Analysis of Alternatives 
informed the requirements process and validated the capabilities needed 
of the replacement system that were further validated by the Joint 
Requirement Oversight Council in 2013.
    An AMPV solution, whether tracked or wheeled, needs to have the 
mobility required to perform to the same abilities of the primary 
combat vehicles in a formation. An AMPV must be able to traverse 
complex slopes in several directions (up, down, sideways). An AMPV must 
be able to conduct very wide Gap Crossings of trenches in forward and 
reverse. An AMPV must also be able to execute a controlled 360 degree 
left or right turn within 1.5 times the vehicle length. This allows the 
vehicle and unit commanders to negotiate and quickly maneuver in cross 
country and urban terrain, particularly during Mounted Operations in 
Urban Terrain environments where tight turning radius is particularly 
necessary. The Analysis of Alternatives analyzed different types of 
vehicles to see which were able to meet the aforementioned mobility 
requirements.
    In determining operating costs for programs in the acquisition 
process, the Army considers such major cost elements as consumable 
spares: reparable parts; petroleum; oil; and lubricants; ammunition; 
personnel (crew); and depot maintenance. Early in the acquisition life 
of a system, a cost estimate is developed by determining the closest 
analogous system(s) and/or component(s). Actual historical costs are 
acquired for use in these analogies. Then, these historical costs are 
adjusted based on such known characteristics as weight, reliability, 
and power. Per-mile metrics for repair parts and spares are valuable in 
making comparisons between wheeled and tracked vehicles due to the 
apparent cost deltas that exist between these vehicle types. 
Historically, tracked vehicle repair parts and spares cost per mile, 
and fuel costs have revealed higher operational costs than wheeled 
vehicles. This is mostly due to the additional weight and complexity of 
tracked vehicles.
    The Army evaluates contractor's estimated operating costs of a 
proposed system during Source Selection Evaluation Boards (SSEBs) prior 
to contract awards. During SSEBs, the Army determines how well system 
proposals meet defined Key System Attributes (KSAs) as specified in 
requirement documents, e.g., Capability Development Documents. The 
Sustainment Key Performance Parameter includes the Operations & Support 
Cost KSA alongside Reliability, Availability (both material 
availability and operational ability) and Maintainability in order to 
ensure that the entire lifecycle cost is captured and considered.
    The Army shares concerns regarding the Defense industry's combat 
vehicle intellectual industrial base and its ability to maintain an 
adequate level of engineering skills and personnel to design and 
develop combat vehicles in the future. To address these concerns, the 
Army has developed a strategy that will explore and refine future 
combat vehicle concepts and requirements, as well as leverage its 
robust Science & Technology (S&T) investment for the next generation 
infantry fighting vehicle while keeping the combat vehicle engineering 
industrial base engaged.
    Under this strategy the Army will leverage the current Ground 
Combat Vehicle program prime contractors' technology development 
designs to facilitate the maturation and integration of advanced 
technology into a variety of advanced combat vehicle concepts, which 
will keep the intellectual industrial base engaged. Additionally, the 
combat vehicle primes will support our assessment of Army S&T 
technology maturation initiatives and their effects on current and 
potential vehicle designs. This will enable the Army to build a 
knowledge base to inform Future Fighting Vehicle requirements by 
assessing design and cost tradeoffs and reduce risk. These efforts will 
support a Future Fighting Vehicle program of record when resources 
become available.
                                 ______
                                 
              Questions Submitted by Senator Mark L. Pryor
    Question. How many active duty Brigade Combat Teams can you move 
with current available airlift/sealift in the first 60-90 days of a 
conflict?
    Answer. This information is classified, but we would be pleased to 
provide it to you in an appropriate forum.
    Question. Did you factor the Reserve Forces Policy Board into the 
Active Component/Reserve Component ratio decision for fiscal year 2015? 
If so, explain how the Reserve Forces Policy Board supports your 
position. If not, why?
    Answer. No. The Army did not rely on the Reserve Forces Policy 
Board (RFPB) study when making decisions on fiscal year 2015 AC/RC 
force mix. The RFBP is, by law, a Federal advisory committee within the 
Office of the Secretary of Defense. As mandated by Congress, it serves 
as an independent adviser to provide advice and recommendations 
directly to the Secretary of Defense on strategies, policies, and 
practices designed to improve and enhance the capabilities, efficiency, 
and effectiveness of the reserve components.
    Question. Under the 335,000 end strength scenario, it has been 
proposed to reclassify and retrain Soldiers. What will it cost to 
reclassify/retrain Soldiers who will be moved to a different type of 
unit and how will the budget reflect that change? (ex. Field Artillery 
Battalion is replaced by a Military Police Battalion Headquarters and 
two Military Police Companies)
    Answer. We do not have an exact number yet. As we built the fiscal 
year 2015 Budget, we did not identify the specific units that would be 
transitioning from one type to another. As units are identified for 
transition, the Human Resources community will identify the Military 
Occupation Skills for realignment. We will adjust the published Army 
Program for Individual Training accordingly and apply the funds as 
available to meet this mission. We anticipate reduced unit readiness 
for transitioning units and will realign the Army National Guard and 
Army Reserve units within the Army Force Generation Model to give 
Commanders' sufficient time and resources to build personnel readiness 
for these new organizations. If Budget Control Act spending caps remain 
in play in fiscal year 2016 and beyond, rebuilding personnel readiness 
within all units may take longer, depending on the limited availability 
of funds.
                                 ______
                                 
              Questions Submitted by Senator Thad Cochran
    Question. General Odierno, in the fiscal year 2015 budget request, 
the Army Guard is not funded for rotations at Combat Training Centers, 
which as you know are important for collective training events and unit 
readiness. What is the impact on the total force?
    Answer. The fiscal year 2015 President's budget request contained 
transportation funding for Army Guard Brigade Combat Team (BCT) 
participation in two rotations at maneuver Combat Training Centers 
(CTCs); however, the request provided no increased funding for pay to 
allow them to do so. In early May, a revised budget request will be 
forwarded to SAC-D providing the additional Pay and Allowances and 
Operation and Maintenance funds needed by two Army Guard BCTs to 
participate in maneuver CTC rotations.
    Question. General Odierno, in fiscal years 2013 and 2014, Overseas 
Contingency Operations funds were nearly 30 percent of the total Army 
budget, yet the request for 2015 for this vital budget component of 
Army operations has not been provided to Congress. General, how 
important is Overseas Contingency Operations funding to the Army's 
ability to perform it assigned missions? What will be the impact to the 
Army and our National Security, if these funds are not provided at the 
beginning of the upcoming fiscal year?
    Answer. Overseas Contingency Operations (OCO) funding is vital for 
the Army to support Operation Enduring Freedom and other contingency 
missions in defending the Nation and its interests.
    If OCO funding is not provided by the beginning of the fiscal year, 
the Army will be forced to cash flow war expenditures out of the base 
budget. Extracting cash for war requirements out of the base budget 
would cause immediate and lasting degradation to readiness across the 
Army. Army readiness built through training requires steady and 
predictable funding to ensure home station preparatory training and 
Combat Training Center exercises are scheduled. The interruption to 
planned funding that would occur in a diversion of funds to pay for the 
higher priority theater operations would force the cancellation of 
training. Once cancelled, lost training cannot be easily bought back; 
it must be carefully planned in order to synchronize all affected units 
(Brigade Combat Teams and enablers) toward training activities.
                                 ______
                                 
              Questions Submitted by Senator Daniel Coats
    Question. How can the Army afford to procure a land-based 
conventional prompt global strike capability that is a lot less 
survivable than the Navy's prompt global strike capabilities in this 
current fiscal environment?
    Answer. The Army is not planning to procure a prompt global strike 
capability. To enable the development of joint capabilities, the Army 
has assisted Department of Defense technology efforts with both 
engineering and test facility support.
    Question. The Department of Defense uses both annual contracts and 
Multi-Year contracts when acquiring goods and services. Under annual 
contracts, DOD uses one or more contracts for each year's worth of 
procurement of a given kind of item. Under Multi-Year contracts, DOD 
uses a single contract for two to 5 years' worth of procurement. The 
Multi-Year contract: (1) results in supplier price breaks for larger 
quantity purchases, (2) eliminates repeat labor and bureaucracy by 
buying only once, and (3) provides the stability of a set number of 
years' worth of production. In fiscal year 2013, when a 5-Year Multi-
Year contract was signed for the CH-47 Chinook helicopter, the savings 
were $810 million--or over 19 percent--when compared to 5 single-year 
contracts.
    The intent of the Army is to execute a Multi-Year procurement 
contract in fiscal year 2017 for the AH-64 Apache, the Army's multi-
role attack helicopter. What efficiencies and cost savings could we 
expect by using a Multi-Year contract to acquire upgraded Apaches?
    Answer. A Multi-Year contract will: provide more capability at a 
lower cost via quantity-based price concessions; stabilize future 
prices for the government and future workload for industry; and 
increase efficiency by eliminating start-up and repeat labor costs both 
in the production of the Apache and the government contracting process. 
The Apache Program Office is currently preparing the Business Case 
Analysis (BCA) to estimate the cost savings of Multi-Year Apache 
procurement.
                                 ______
                                 
               Questions Submitted to General Frank Grass
              Questions Submitted by Senator Mark L. Pryor
    Question. Under the 335,000 end strength scenario, it has been 
proposed to reclassify and retrain Soldiers. What will it cost to 
reclassify/retrain Soldiers who will be moved to a different type of 
unit and how will the budget reflect that change? (ex. Field Artillery 
Battalion is replaced by a Military Police Battalion Headquarters and 
two Military Police Companies)
    Answer. Approximately $237 million. The precise actual cost of 
retraining will vary somewhat from this estimate based on many factors, 
some of which we do not know at this time.
    Explanation: The reduction in end strength and the associated 
reduction in force structure will cause the restructuring, reorganizing 
and elimination of some existing units. These changes to force 
structure will result in displacing 40,402 Soldiers from the position 
for which they are currently trained. This equates to requiring the 
reclassification training of approximately 241 company-sized elements. 
In our cost estimate we used the cost to retrain an infantry company to 
a military police company. The retraining cost is $985,000 per company 
of Soldiers, or $237.3 million for 241 company-sized elements. The cost 
includes the students' pay and allowances, as well as the cost to 
operate the school house. The estimate only takes into account 
retraining costs. It does not include other costs associated with 
converting one type of unit to another, such as equipment purchase or 
transfer expenses.
    Question. While the Army National Guard prepares for its future 
years defense spending plan, there will be several funding scenarios. 
In the more severe funding plans wherein the Guard may propose reducing 
Brigade Combat Teams (BCT) how will the Army National Guard determine 
which BCTs to cut?
    Answer. National Guard Bureau senior leaders, in consultation with 
senior leaders in the 54 States, Territories and the District of 
Columbia, developed three main criteria to inform their decision to 
inactivate brigade and Brigade Combat Team structure: look to reduce 
structure in States with multiple brigades and BCTs; quantify readiness 
rankings of brigades and BCTs; and avoid reducing more than one 
brigade/BCT in a State unless replacement structure is provided.
    Question. There is concern that the National Guard Bureau (NGB) 
will use Unit Identification Codes that specify certain brigades 
instead of data-driven analysis based on readiness, numbers and types 
of brigades, etc. Please outline how the NBG makes their future year 
assessments regarding potential BCT cuts in a sequestration-type 
funding assumption plan.
    Answer. The Army National Guard will use readiness, training, and 
strength metrics over time along with State mobilization rates and 
identification of States with multiple BCTs to ultimately determine 
which BCTs will be considered for reduction. During the evaluation, 
control measures will be used to ensure unit readiness data cannot be 
correlated to a State or specific unit.
    Question. If the Army National Guard begins to develop courses of 
action for the reduction of Brigade Combat Teams, will the courses of 
action for force structure reduction use the agreed upon Force 
Management Unit Review Board?
    Answer. Due to the compressed timeline the ARNG was under this 
April to produce a list of units for reduction, it was impossible to 
employ the Force Management Unit Review Board (FMURB) process and still 
meet the Army's deadline. However, if given the time, the ARNG intends 
to use the FMURB in the future to develop courses of action for force 
structure reductions. Using the FMURB can be a time-consuming process, 
especially given the large amount of force structure that would have to 
be eliminated or rebalanced among the States in order to accommodate a 
cut from 350,000 to 335,000 or 315,000 in end strength.
    Question. Will the National Guard Bureau and Army National Guard 
look at the Unit Assessment Tool data for fiscal year 2016 in order to 
determine what force structure changes are needed based on the most 
recent data?
    Answer. The Army National Guard will recalculate the Unit Analysis 
Tool annually in order to account for performance and readiness changes 
in its units. This will ensure that senior leader decisions are fully 
informed with the most recent data.
                                 ______
                                 
              Questions Submitted by Senator Thad Cochran
    Question. General Grass, in your testimony, you stressed the 
importance of relevant training to maintain readiness across the Guard. 
More and more, the threats we face here at home are across the cyber 
domain. How are you training our citizen-soldiers to protect our 
critical infrastructure against this evolving threat?
    Answer. The Army and Air National Guard will be an integral part of 
our cyber defense. The National Guard Bureau is closely collaborating 
with Army Cyber Command (ARCYBER), Headquarters Department of the Army, 
and leadership from the 54 States and Territories and the District of 
Columbia to develop ARNG cyber forces to support and are responsive to 
Joint, Army, and domestic cyber requirements. ARNG cyber forces, while 
they are principally defensive in nature, may conduct both defensive 
and offensive cyberspace operations under the appropriate authorities, 
as well as cyber security missions in support of local and national 
missions.
    The ARNG is building 11 Cyber Protection Teams (CPT) to provide 
operational and surge capability to ARCYBER and US CYBER COMMAND while 
establishing critical regional cyber capabilities for homeland defense 
and civil support missions. The Secretary of the Army approved 429 
Soldier authorizations for the ARNG as must-resource emerging growth in 
Total Army Analysis (TAA) 16-20; 390 authorizations will be equally 
split to create ten Title 32/M-day CPTs, with an additional 39 
authorizations for a Title 10 ARNG CPT that will serve in a Federal 
active duty status. The ARNG will follow the US CYBER COMMAND standard 
for CPT structure outlined in the Cyber Force Concept of Operations and 
Employment v3.3.
    The ARNG cyber integration strategy rests on four guiding 
principles: (1) The desired end state is to have joint training, 
certification, and integration of ARNG cyber forces in the Army Cyber 
mission force; (2) Emerging ARNG cyber forces will be developed in 
phases beginning in fiscal year 2014 and allocated against current 
Joint and Army priorities; (3) ARNG cyber forces will focus on 
foundational training and certification requirements that do not 
require Joint-level training facilities prior to fiscal year 2017 due 
to limited training capacity. Priority of effort for resources 
(facilities, training, infrastructure) shifts to ARNG upon completion 
of initial Cyber Mission Force build in fiscal year 2017; and (4) ARNG 
forces will train and certify to meet immediate un-resourced Army cyber 
requirements.
    The Air National Guard is working with USCYBERCOM and the Air Force 
to build a total of 12 Cyber Operations Squadrons (CyOS) to support 
Cyber Mission Force and AFCYBER missions. Within this construct, the 
Air National Guard will effectively double the number of operational 
cyber experts to support an enduring USCC mission beginning in fiscal 
year 2016, and provide additional cyber protection assessment 
capability for up to 30 or more AFCYBER missions per year. One of these 
units, the 262nd Network Warfare Squadron in Washington State, also 
maintains a functional area of expertise in Industrial Control Systems. 
The 262nd will be available for assessments on Critical Infrastructures 
as well as training the other CyOS in the ANG and U.S. Air Force. 
Additionally, each of the Cyber Protection Teams will have imbedded 
organic Red Team elements, nearly doubling that critical area of 
expertise as well. The ANG also remains unit equipped which will allow 
operations from home station, providing the maximum of cost-
effectiveness for our Nation, but they will present a sizeable surge 
force capable of supporting major events in cyber.
    Question. I was recently told that the 155th Brigade Combat Team 
was on the divestiture list. The 155th Brigade from my home State of 
Mississippi has deployed twice to Iraq. In 2005, they served alongside 
the Marines and conducted full spectrum missions in Najaf, Karbala, 
North Babil and Eastern Al Anbar. They performed admirably at a 
critical time and should be commended for their service. I know the 
history of this unit, and I also know that this brigade is the most 
modernized brigade in the entire Army National Guard. The unit just 
underwent new equipment training and fielded for the new M1A2 SEP 
Abrams Main Battle Tank, the new M2A3 Bradley fighting vehicles and 
they have some of the latest digital communications equipment in the 
Army. Does it make sense to invest substantial resources into a unit 
and then turn around and disassemble it?
    Answer. No decision has been made to inactivate the 155th Armored 
Brigade Combat Team at this time. The National Guard Bureau was 
directed to plan for reductions in Army National Guard force structure 
with end strengths of 335,000 by fiscal year 2017 and 315,000 by fiscal 
year 2019. The preliminary plan to inactivate units across the Army 
National Guard including brigade and Brigade Combat Team structure is 
based on analysis of multiple readiness factors over a 5 year period. 
While the 155th Armor Brigade Combat Team is one of two armor brigades 
in the Army National Guard with the most modern equipment, it scored 
low in the aggregate of readiness reporting over time. When any unit 
inactivates, the equipment is redirected to continue modernization 
throughout the Army National Guard. In the end, the decision on the 
number of Brigade Combat Teams that the Army National Guard inactivates 
is dependent on the scope of sequestration and guidance received from 
the Chief of Staff of the Army. Under current budget restrictions the 
Army National Guard will be reduced to 335,000 personnel and by two 
Brigade Combat Teams by fiscal year 2017. If full sequestration limits 
the Army National Guard to 315,000 personnel, then two additional 
Brigade Combat Teams will have to be inactivated by fiscal year 2019.
    Question. General Grass, Unmanned Aerial Vehicles play an 
increasing role in our national defense; particularly during a time of 
strategic transition and fiscal austerity. In January, Senator Wicker 
and I sent a letter to the DOD and the FAA urging the optimization of 
Special Use Airspace for National Guard testing in support of military 
and civil purposes. Can you speak to the expanding role UAVs play in 
support of your Title 32 requirements?
    Answer. Unmanned Aircraft Systems (UAS) provide a critical and 
proven war-fighting capability for our forces when deployed. These same 
UAS assets have a great but largely untapped potential for emergency 
support within the United States for both natural and man-made 
disasters. This is true regardless of whether our UAS are used in a 
Title 10, Title 32, or State Active Duty status. Within the National 
Guard inventory the Army National Guard has small-size UAS's (Raven) 
and medium-size UAS's (Shadow), and the Air National Guard has large-
size UAS's (Predator & Reaper).
    The National Guard has the capability on-hand, but the focus now is 
on how to properly and efficiently employ this capability during 
domestic incidents. While the pace of progress within the Department of 
Defense and the Federal Aviation Administration toward workable 
procedures for rapid-response solutions has increased, work still 
remains to be done. There are currently two major approvals that we 
must receive in order to employ UAS assets for an incident in the 
United States. The first requirement is to obtain Secretary of Defense 
approval prior to any use of UAS for Defense Support to Civil 
Authorities. The second approval is from the FAA to operate the UAS in 
the specific portion of the National Airspace System affected by the 
disaster or emergency. While both DOD and the FAA have now established 
standard procedures for the submission, evaluation, and decisionmaking 
on such requests, our practical experience to date is too limited to 
know if we will be able to obtain approvals as expeditiously as they 
may be needed in order to assist State and local officials in the 
earliest stages of a response. We already have experience with this 
process when we received approval from the Secretary of Defense to use 
a UAS from the California Air National Guard to monitor the California 
Rim Fire in August of 2013.
                                 ______
                                 
            Question Submitted by Senator to Lamar Alexander
    Question. From your own analysis, would the Army's aviation 
restructuring plan save money?
    The Army testified that there would be approximately $12 billion in 
savings in cost avoidance. Can you explain that figure? Would it save 
more money by retaining AH-64 Apaches in the Army National Guard? How 
much will be saved by divesting the OH-58D Kiowa Warriors?
    Answer. Yes, the Department of the Army Aviation Restructure 
Initiative (ARI) will save money, principally through cost-avoidance as 
the Army foregoes upgrades to legacy OH-58 and TH-67 aircraft. 
Retaining AH-64s in the Army National Guard (ARNG) will still enable 
those cost savings and allow the Army to keep significantly more 
aircraft in operational units than if all Apaches are moved to the 
active component.
    Tangible ARI savings of about $1.1 billion in Operations and 
Support (O&S) annual costs are due to the reduction of three aviation 
brigades in the active component (AC) and about two brigades in the 
ARNG. These savings begin as soon as the aviation units are inactivated 
and are not part of the quoted $12 billion savings/cost avoidance.
    As we understand it, the $12 billion savings/cost avoidance 
(actually $11.94 billion) results from cancellation of the OH-58D 
Cockpit and Sensor Upgrade (CASUP) [$3.36 billion], cancellation of the 
OH-58D upgrades and Service Life Extension Program (SLEP) [$6.96 
billion], and the decision not to buy a replacement training aircraft 
for flight school [$1.43 billion] and not to SLEP the TH-67 trainer as 
a bridge until a new trainer was fielded [$.19 billion]. Only $1.46 
billion of the CASUP funds was programmed in the fiscal year 2015-2019 
Program Objective Memorandum (POM). The remaining $10.48 billion was 
either programmed for OH-58D CASUP and SLEP after the POM or was 
recently estimated as the cost to replace the current training fleet, 
but never programmed.
    The $1.46 billion in CASUP savings that had been programmed during 
the POM period have been reprogrammed from OH-58D CASUP to Apache and 
Unmanned Aircraft Systems (Shadow, and Grey Eagle), thus eliminating 
those savings. In addition, the Office of the Secretary of Defense 
modified the ARI plan in January to procure about 100 more UH-72 Lakota 
aircraft for flight school with additional ``topline'' funding, rather 
than transfer the aircraft from the ARNG. The $800 million that is 
programmed for UH-72 procurement in fiscal year 2015 and fiscal year 
2016 further reduces the overall ARI savings or cost avoidance by that 
amount.
    The ARI plan directly links the OH-58D divestiture (which saves 
money) with the transfer of all ARNG AH-64s to the active component 
(which costs money). ARI grows the active component from 17 Attack-
Recon Battalions (ARB) to 20 ARBs and creates a robust AH-64 spares 
account--helicopters without trained pilots or crews to fly and 
maintain them. Alternatively, retaining 72 AH-64s in three ARNG ARBs, 
rather than transferring them to the active Army, would save $115 
million in annual O&S costs. As of 27 May 2014 the annual O&S cost for 
a full-time AC ARB is about $69 million, while that cost for a part-
time ARNG ARB is about $30.5 million, according to the Forces Cost 
Model maintained by the Deputy Assistant Secretary of the Army for Cost 
and Economics (DASA-CE) (($69 million - $30.5 million)  3 = $115 
million).
    Efficient use of the total Attack-Recon force with no loss of 
support to Combatant Commanders can be achieved by retaining six ARNG 
ARBs, growing one more AC ARB (18 total), and reducing the AH-64 spare 
aircraft account. This would provide 24 total manned, deployable ARBs 
(vice 20 under ARI) at an annual cost of about $45 million more than 
ARI (6  $30.5M - 2  $69 million = $45 million).
    Divesting the OH-58D fleet and standing down the nine AC Air 
Reconnaissance Squadrons and one ARNG Air Cavalry Squadron (less the 
UH-60 Assault Troop) saves $523 million annually (9  $55.4M plus 1  
$25 million = $523 million) according to the DASE-CE cost model. OH-58D 
divestiture also avoids the $8.86 billion in post-POM costs for the OH-
58D CASUP and SLEP discussed earlier.
    The Army's plan saves money annually due to structure reductions 
and avoids future costs due to cancellation of OH-58D upgrades and 
replacement of part of the training fleet with existing Army aircraft. 
The National Guard Bureau alternative restructure plan with six ARNG 
ARBs that was offered several months ago also saves more than $1 
billion annually and includes the $12 billion in cost avoidance from 
the HQDA ARI plan, while keeping more ARB capacity.
                                 ______
                                 
      Questions Submitted to Lieutenant General Jeffrey W. Talley
              Questions Submitted by Senator Mark L. Pryor
    Question. The Army Reserve is experiencing a reduction in the 
institutional training programs as a consequence of a shrinking defense 
budget. How does the Army Reserve plan to adjust to the current fiscal 
environment while maintaining a high level of readiness?
    Answer. The Army Reserve is extremely challenged in maintaining a 
high level of readiness under a constrained budgetary environment. The 
increasing complexity of the operational environment requires more (not 
less) training time and money. New requirements like countering cyber 
attacks and Congressionally mandated classes require additional time 
added to Initial Entry Training (IET), Military Occupational Skills 
(MOS), Additional Skills Identifier (ASI), and Professional Military 
Education (PME) training programs for all ranks.
    Army Reserve mitigation strategy to minimize readiness impacts from 
budget cuts include:
  --Scrutinize all Training Requirements Analysis System (TRAS) 
        documents; Course Administrative Documents (CAD) and Program of 
        Instructions (POI) for cost increase, redundant instruction, 
        and tasks added above those identified in the Critical Task 
        Site Selection Board (CTSSB) process.
  --Prioritize individual training courses based on most to least 
        critical requirements.
  --Work with Human Resources Command (HRC) to ensure that any Active 
        Component (AC) Soldier seeking transition to the Army Reserve 
        completes all required branch transfer MOS training prior to 
        leaving active duty.
  --Continue to promote Electronic Based Distance Learning (EBDL) 
        compensation to encourage completion of course prerequisites 
        and subsequent use of current training quotas.
  --Take full advantage of building individual proficiencies at Army 
        Reserve centers using Mobile Training Teams, distributed 
        learning, virtual, constructive, gaming capabilities, and 
        ``blackboard'' capabilities.
  --Leverage partnering with private industry for select skills 
        training e.g., medical equipment repair.
  --Restructuring Generating Force to regionally aligned training sites 
        (east, west and central locations) to maximize the use of 
        instructors, class sizes, and training resources.
    Question. Describe how cuts to NGREA funding will affect the Army 
Reserve's ability to maintain an operational force. What do you 
perceive to be the most substantial deficiencies in the NGREA accounts?
    Answer. Reducing National Guard and Reserve Equipment Appropriation 
(NGREA) funding will adversely affect Army Reserve efforts to procure 
priority items not funded in the base budget. Not procuring priority 
equipment will reduce the ability of the Army Reserve to stay 
operationally trained and ready on the latest equipment and add costs 
to move new equipment around according to the force generation cycle. 
Additionally, cutting NGREA limits the Chief of Army Reserve's 
flexibility to supplement the base budget to procure items immediately 
impacting readiness.
    The Army Reserve appreciates the generous support of Congress 
through NGREA that has improved equipment modernization and reduced 
existing funding gaps. Although today's Army Reserve is better equipped 
and modernized than at any point in history, the current fiscal 
environment is forcing the Army to make difficult equipping 
prioritization decisions. As an enabler centric force, the Army Reserve 
is disproportionately affected by an Army equipping strategy that 
places greater emphasis on the Brigade Combat Teams (BCTs). NGREA is a 
key component in the Army Reserve's ability to close modernizations 
gaps and sustain momentum gained in transitioning to a viable 
operational force.
    As future Army budgets decrease, the Army will become more reliant 
on the Army Reserve as an affordable solution in providing unique 
enabling capabilities in support of contingency operations, Homeland 
Defense (HD), and Defense Support of Civil Authorities (DSCA), while 
maximizing resources in a fiscally constrained environment. With 
reduced budgets, the need for NGREA will impact operational readiness, 
interoperability, training, and reduce the flexibility to modernize 
unique enabling systems in support of Army Force Generation 
requirements. Sustaining the Army Reserve as an operational force 
during a period of fiscal austerity only requires a modest investment 
compared to the total force.
    The most substantial deficiency in NGREA accounts is the 
inconsistency in yearly guidance. The Army Reserve's NGREA acquisition 
plans are developed and refined based upon Army funding guidance and 
program prioritization. Internal procurement guidelines are not always 
consistent from one fiscal year to another. Enacting a well-defined set 
of business rules would prevent changes to procurement plans that lead 
to disruptions such as losing space within existing Army procurement 
contracts.
                                 ______
                                 
               Question Submitted by Senator Thad Cochran
    Question. Lieutenant General Talley, the Army Reserve flight 
training budget increases from fiscal year 2014 to fiscal year 2015 by 
almost 70 percent in this budget request. What is the reason for this 
increase?
    Answer. The Army Reserve flight training budget increase from 
fiscal year 2014 to fiscal year 2015 is actually 44.6 percent. Divide 
the increase from fiscal year 2014 to fiscal year 2015 (1943 - 1344 = 
599) by fiscal year 2014 budget (599 / 1344 = 44.6 percent).
    The reason for the budget increase is due to cost factors and new 
training requirements. The following Rotary Wing (RW) aircraft cost 
factors increased:
  --AH-64D: $467.00 increase per hour
  --CH-47D: $66.00 increase per hour
  --CH-47F: $71.00 increase per hour
  --HH-60M: $143.00 increase per hour
  --UH-60L: $72.00 increase per hour
    The rotary wing program will be going through a transition as we 
turn-in the Fort Knox Battalion's AH-64D Apache aircraft for the UH-60L 
and the flight crews will have to be trained on the new aircraft for 
fiscal year 2015. The Texas Apache Battalion will transition in fiscal 
year 2017. Additionally, beginning in 4th Quarter fiscal year 2014 the 
Army Reserve will start fielding the CH-47F to replace the CH-47D.
                                 ______
                                 
           Questions Submitted to Major General Judd H. Lyons
              Question Submitted by Senator Mark L. Pryor
    Question. What are the specific metrics used to determine the 
readiness of an Army National Guard Brigade Combat Team?
    Answer. The Army National Guard uses Army metrics to determine 
overall readiness of Brigade Combat Teams, including personnel, 
equipment on-hand, equipment readiness, and training. Like the active 
component, Army National Guard BCTs report their readiness through the 
Defense Readiness Reporting System (DRRS). The Defense Readiness 
Reporting System, in turn, informs the Unit Status Report (USR). Army 
Regulation 220-1, Army Unit Status Reporting and Force Registration--
Consolidated Policies, dated 15 April 2010, is the policy that 
encompasses this methodology.
                                 ______
                                 
               Question Submitted by Senator Thad Cochran
    Question. Major General Lyons, in fiscal year 2015 the Army Guard 
is not funded for any rotations at Combat Training Centers, which as 
you know are important for collective training events and unit 
readiness. What was the reason for not budgeting for these events and 
what is the impact to Guard readiness?
    Answer. While the Army and the Army National Guard (ARNG) view 
Combat Training Center (CTC) rotations as important, decisions made by 
the Army initially precluded CTC funding for ARNG BCTs in fiscal year 
2015. CTC rotations, as with all programs, compete for funding. 
Overall, the ARNG experienced a $93 million reduction in NGPA and a 
$826 million reduction in OMNG funding between the fiscal year 2014 
budget and the fiscal year 2015 President's budget submission. After 
the fiscal year 2015 President's budget was submitted, the Army 
confirmed scheduling of two CTC rotations for the ARNG. The Army and 
the Army National Guard budget offices have included $45 million in 
ARNG personnel and $23 million in ARNG operations funding that supports 
these activities in the Unfinanced Priority List.
    CTC rotations are the Army's premier collective training event, key 
to developing the next generation of Army leaders, and facilitate the 
dissemination of doctrine throughout the Army. CTCs provide commanders, 
staffs, and units an operational experience focused on unit readiness 
and leader development requirements. CTC rotations are the only venue 
for ARNG Brigade Combat Teams to achieve company live fire/battalion 
maneuver proficiency in order to meet Army Force Generation aimpoints.

                          SUBCOMMITTEE RECESS

    Senator Durbin. I want to thank the Secretary and Generals 
for joining us today as well as those who've accompanied them. 
It goes without saying, it has become a clichee, but I mean it 
from the heart, thank you for your service to our country each 
and every one of you.
    And this meeting of the subcommittee stands adjourned.
    [Whereupon, at 11:49 a.m., Wednesday, April 30, the 
subcommittee was recessed, to reconvene subject to the call of 
the Chair.]