[House Hearing, 114 Congress]
[From the U.S. Government Publishing Office]





                                     

                         [H.A.S.C. No. 114-18]

                                HEARING

                                   ON

                   NATIONAL DEFENSE AUTHORIZATION ACT

                          FOR FISCAL YEAR 2016

                                  AND

              OVERSIGHT OF PREVIOUSLY AUTHORIZED PROGRAMS

                               BEFORE THE

                      COMMITTEE ON ARMED SERVICES

                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED FOURTEENTH CONGRESS

                             FIRST SESSION

                               __________

         SUBCOMMITTEE ON SEAPOWER AND PROJECTION FORCES HEARING

                                   ON

                      AIR FORCE PROJECTION FORCES

        AVIATION PROGRAMS AND CAPABILITIES FOR FISCAL YEAR 2016

                               __________

                              HEARING HELD
                             MARCH 4, 2015

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
                                     
                                  ______

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             SUBCOMMITTEE ON SEAPOWER AND PROJECTION FORCES

                  J. RANDY FORBES, Virginia, Chairman

K. MICHAEL CONAWAY, Texas            JOE COURTNEY, Connecticut
STEVEN M. PALAZZO, Mississippi       JAMES R. LANGEVIN, Rhode Island
BRADLEY BYRNE, Alabama               RICK LARSEN, Washington
ROBERT J. WITTMAN, Virginia          MADELEINE Z. BORDALLO, Guam
DUNCAN HUNTER, California            HENRY C. ``HANK'' JOHNSON, Jr., 
VICKY HARTZLER, Missouri                 Georgia
PAUL COOK, California                SCOTT H. PETERS, California
JIM BRIDENSTINE, Oklahoma            TULSI GABBARD, Hawaii
JACKIE WALORSKI, Indiana             GWEN GRAHAM, Florida
RYAN K. ZINKE, Montana               SETH MOULTON, Massachusetts
STEPHEN KNIGHT, California
                John Sullivan, Professional Staff Member
              Phil MacNaughton, Professional Staff Member
                        Katherine Rember, Clerk
                            
                            
                            
                            
                            
                            
                            
                            
                            
                            
                            
                            
                            
                            C O N T E N T S
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                                                                   Page

              STATEMENTS PRESENTED BY MEMBERS OF CONGRESS

Forbes, Hon. J. Randy, a Representative from Virginia, Chairman, 
  Subcommittee on Seapower and Projection Forces.................     1

                               WITNESSES

Holmes, Lt Gen James M. ``Mike,'' USAF, Deputy Chief of Staff for 
  Strategic Plans and Requirements, Department of the Air Force..     2
LaPlante, Dr. William A., Assistant Secretary of the Air Force 
  for Acquisition, Department of the Air Force...................     1

                                APPENDIX

Prepared Statements:

    Courtney, Hon. Joe...........................................    17
    Forbes, Hon. J. Randy........................................    15
    LaPlante, Dr. William A., joint with Lt Gen James M. ``Mike'' 
      Holmes.....................................................    18

Documents Submitted for the Record:

    [There were no Documents submitted.]

Witness Responses to Questions Asked During the Hearing:

    Mr. Forbes...................................................    35

Questions Submitted by Members Post Hearing:

    Ms. Bordallo.................................................    42
    Mr. Forbes...................................................    39
    Mr. Larsen...................................................    41
 .
 AIR FORCE PROJECTION FORCES AVIATION PROGRAMS AND CAPABILITIES FOR 
                            FISCAL YEAR 2016

                              ----------                              

                  House of Representatives,
                       Committee on Armed Services,
            Subcommittee on Seapower and Projection Forces,
                          Washington, DC, Wednesday, March 4, 2015.
    The subcommittee met, pursuant to call, at 2:05 p.m., in 
room 2212, Rayburn House Office Building, Hon. J. Randy Forbes 
(chairman of the subcommittee) presiding.

  OPENING STATEMENT OF HON. J. RANDY FORBES, A REPRESENTATIVE 
     FROM VIRGINIA, CHAIRMAN, SUBCOMMITTEE ON SEAPOWER AND 
                       PROJECTION FORCES

    Mr. Forbes. We want to welcome everybody today to our 
hearing on the Air Force Projection Forces Aviation Programs 
and Capabilities for Fiscal Year 2016. The unfortunate thing, 
as we all know, they are going to schedule votes or have 
scheduled votes anywhere from now to maybe 2:30, so we are 
going to waive our opening remarks. Mr. Courtney and I both 
have agreed to that. And with that, we want to get right to our 
witnesses so they can make whatever comments they would like to 
make to the members. I have told them previously, Mr. Courtney 
has agreed to this, of course, that all their written remarks 
will be made part of the record. You can refer to those if you 
would like or you can just talk off the cuff, but we are just 
glad to have both of you here.
    As you know, we have Dr. William LaPlante here. He is the 
Assistant Secretary of the Air Force for Acquisition for the 
Department of the Air Force. Dr. LaPlante, thank you so much 
for joining us and for all the work you do for our country. We 
also have Lieutenant General James M. ``Mike'' Holmes, who is 
the Deputy Chief of Staff for Strategic Plans and Requirements 
for the Department of the Air Force. General, thank you again 
for your service, and to all those people who serve with you 
and below you. We appreciate their service to our country.
    And with that, Dr. LaPlante, I think you are going to start 
us off, and then we will go the General. So the floor is yours.
    [The prepared statements of Mr. Forbes and Mr. Courtney can 
be found in the Appendix beginning on page 15.]

 STATEMENT OF DR. WILLIAM A. LAPLANTE, ASSISTANT SECRETARY OF 
   THE AIR FORCE FOR ACQUISITION, DEPARTMENT OF THE AIR FORCE

    Dr. LaPlante. Thank you, Chairman Forbes, and thank you, 
Ranking Member Courtney, and the rest of the distinguished 
ladies and gentlemen of the committee. I appreciate the work 
you do and support you give us in the Pentagon and to the 
warfighter. And what you do is very important. And we hope we 
can answer all your questions and have a good discussion today.
    General Holmes and I both have a joint prepared statement 
that we submitted for the record. I am not going to go through 
that statement here. I will just make a few remarks and then 
turn it over to General Holmes. I will start by saying that, 
you know, the challenge we have in our jobs in an acquisition 
and programming strategy is quite simple. It is that we have 
got these two competing problems. We have modernization, that 
is, that is the airplanes, in your case, the mobility 
airplanes, the bombers, that we are using today, and literally 
using in the fight today. And the pilots flying these airplanes 
are flying airplanes that are older than they are and keeping 
that going. At the same time, we have to modernize for the 
future.
    Those two are linked, of course, because if we mess up the 
modernization, then we just put more at risk, those pilots 
flying those airplanes. So that is our challenge is between 
those two things. And our job every day, General Holmes and I, 
the Chief, the Secretary, our whole team, is keeping that all 
together, keeping it together with a strategy. Oh, and by the 
way, in a budget that is, to say the least, very, very 
challenging. So all our discussions we have is about the trades 
between those two categories, and then making sure that we keep 
the modernization programs, the KC-46, the next tanker, the 
next bomber, that we keep those programs on track and don't 
lose our eye on the ball while we keep the modernization going. 
And it is a difficult trade, but that is what--what we are here 
to talk to you about. I look forward to your questions.
    I will just stop at this point and then let General Holmes 
give his remarks.
    [The joint prepared statement of Dr. LaPlante and General 
Holmes can be found in the Appendix on page 18.]
    Mr. Forbes. General.

  STATEMENT OF LT GEN JAMES M. ``MIKE'' HOLMES, USAF, DEPUTY 
CHIEF OF STAFF FOR STRATEGIC PLANS AND REQUIREMENTS, DEPARTMENT 
                        OF THE AIR FORCE

    General Holmes. Thank you, Dr. LaPlante. Chairman Forbes, 
Ranking Member Courtney, gentlemen and ladies of the committee, 
thank you for your continued support to the United States Air 
Force, our airmen, and their families. Our Air Force remains 
the most globally engaged air force on the planet, and we 
continue to do our best to deliver global vigilance, global 
reach, and global power for America every day. Our Air Force 
today is the smallest in our history, and we see no end to the 
incredible demand for the capabilities that we deliver. This 
demand, coupled with an increasingly challenging global 
situation and an uncertain budget environment, drives us to 
make some very difficult choices.
    The 2016 President's budget took some steps to improve our 
situation, and it allowed us to maximize the contributions to 
the total force, to reinforce investments in nuclear deterrence 
and space control, to emphasize our long-range and global and 
non-permissive capabilities, and to preserve our top three 
procurement programs: the F-35, the KC-46, and the Long Range 
Strike Bomber, two of which fit into your committee's 
portfolio.
    The President's budget added money above the BCA [Budget 
Control Act] caps because the administration believes 
additional spending is necessary to meet the requirements of 
the strategy, and it gives us the ability to halt reductions in 
our total force end strength, to continue our efforts to regain 
full-spectrum readiness, and to lay the groundwork for future 
innovation with some seed investments. However, we face 
shortfalls in our ability to meet all the requirements of the 
strategy even at those levels.
    In shortfalls in capacity first. I will talk about 
capacity, readiness, and modernization. Shortfalls in capacity 
mean we must accept some risk in our ability to meet all the 
requirements of the strategy. Shortfalls in readiness are 
driven by previous funding levels and a continued high ops 
[operations] tempo and demand for Air Force forces which 
exaggerate the effect of the capacity shortfalls. And then 
shortfalls in modernization mean potential adversaries, who 
have had 20 years to watch the way the American military does 
business and take steps to address it, are closing the 
capability gaps that separated the U.S. military from potential 
foes. This narrowed gap adds future risk to both mission and 
forces. When forced to choose on where to take the risk and to 
spread our dollars, the Department of Defense directed us and 
all the services to take risk in our current capacity in order 
to preserve readiness and the investments required to be ready 
in the future.
    As we look at the forces that we bring to you in this 
committee, primarily our bomber, tanker, and transport forces, 
I think that our bomber investment portfolio is in pretty good 
shape. There are about $3 billion invested to make those 
airplanes both compliant, to let them keep working in the 
airspace system, and then to modernize them and make sure they 
continue to do the things we require until the Long Range 
Strike Bomber is brought on board in the numbers that we need 
there.
    On the tanker side, although we have a very old fleet, the 
investments are in place there to keep those systems compliant 
and keep them out there, and the KC-46 program is in place to 
replace them. Bringing me then to the airlift side, the C-17, 
we thank Congress and the committee for your tireless efforts 
to get us that modernized airplane. It is one of our greatest 
airplanes, and it is in shape for the future. We have some 
investment in 2016 to make sure that we protect that investment 
in the airplane. And then the C-5 modernization program is 
coming to an end, and we are very happy with the results there.
    So what I am left with and that I am most concerned about, 
and I know that many members of the committee share that 
concern, is our C-130 fleet as we advance into the future. How 
do we make sure those airplanes remain safe, that they are 
compliant with the requirements of both the national and the 
international airspace system, and then that we modernize them 
to last through the service life that we need, particularly the 
H models, to exist.
    We know that we have had years of discussion with you and 
with the committee on the best way to go forward. We have 
reached the position now that I am concerned that we will not 
be able to keep the aircraft compliant to meet the deadlines 
that the FAA [Federal Aviation Administration] has set 
basically by the end of this 5-year defense plan. And if I was 
going to put all the money required into the AMP [avionics 
modernization program] program to get it done in time to get 
those airplanes compliant, I see the bill as coming to about 
$2.8 billion over the 5-year defense program.
    And Mr. Chairman, that $2.8 billion is kind of equivalent 
to retiring the KC-10 fleet for the FYDP [Future Years Defense 
Program], or retiring the C-5 fleet over the FYDP, or retiring 
about 150 KC-135s. On the combat Air Force's side, it is 
equivalent to the A-10 retirement that we had to take, or the 
entire B-1 fleet, or a reduction, and a significant reduction 
in 40 or so F-35s. So what we hope to do is to be able to work 
with the members and with the committee to be able to move out 
and to provide the compliance capability that those airplanes 
need. We think that we need to move out quickly to provide them 
with the radios that are required, 8.33 kilohertz radios with 
cockpit video recorder and a digital flight recorder with ADS-B 
[automatic dependent surveillance-broadcast] Out with enhanced 
Mode S [mode select] and with an enhanced Traffic Alert and 
Collision Avoidance System. We think we can do that for about 
$2.5 million per airplane, and that we can get that done, if 
not by 2020 but shortly after 2020 if we can gain concurrence 
with you to move forward.
    Now, we know that leaves us a modernization piece, and we 
know those airplanes have to be modified. We know that you have 
restricted us from pursuing modification if it is not the AMP 
program. And what we hope to do is work with you to lay out the 
details of a more affordable modernization program that we can 
afford to buy over multiple FYDPs, but that will make those 
airplanes able to continue to do their mission in an 
increasingly challenging environment into the future.
    Thank you again for the support that you have given the Air 
Force, for the support you give our airmen and families. Thank 
you for taking the time and inviting us to come speak to you 
today. The world is not becoming less safe or less stable. We 
think the world will continue to require on the capabilities 
that your committee manages and that the Air Force provides, 
and we thank you very much for being here. We are happy to take 
your questions.
    [The joint prepared statement of General Holmes and Dr. 
LaPlante can be found in the Appendix on page 18.]
    Mr. Forbes. Thank you, General and Secretary. The ranking 
member and I have decided to defer our questions so we can get 
as many member questions in as possible. I have no right to ask 
you to do this, but I am going to do it anyway. If you can keep 
your questions to about 3 minutes, as short as possible, just 
so we can get as many member questions in as possible. And with 
that, I recognize the gentlelady from Missouri for 5 minutes.
    Mrs. Hartzler. Thank you, Mr. Chairman. Thank you, 
gentlemen. I appreciate the tough job that you have. Quickly, I 
appreciate all you are doing and have done for the B-2 Stealth 
Bomber. Certainly the modernization program and everything is 
very, very important. You mention in your testimony that you 
are going to continue to pursue a number of sustainment 
initiatives to improve aircraft supportability, increase 
aircraft availability. I know that is something that I have 
been visiting with you all about as part sustainability and 
how--can you expand on some of the things that you are doing 
there to try to ensure that we have the parts we need for the 
B-2?
    Dr. LaPlante. Well, in general, in sustainability, what we 
are recognizing even more so is that, in fact, a lot of the 
money we can save in acquisition is actually in the sustainment 
part. So we are keenly, keenly interested in that. The B-2 
case, you know, we continue to have the program to bring--do 
cost-effective maintenance of the airplane, particularly in 
the, for lack of a better word, the materials area, and you 
know what I am talking about. So that is a very important 
program for the B-2, because in fact, one of the biggest 
contributions to the availability challenge is for that 
airplane is maintenance of that--those materials. That is 
actually something that is going in the right direction. The 
availability of that airplane is actually getting better 
because of that work, so that I would call out that specific 
initiative, and I think it is very important.
    The other thing that we are doing, as you indicate, is we 
are modernizing the B-2. An important program for the B-2, and 
I would like this committee to recognize this, is a program 
that is really a defensive military systems program, DMS is the 
acronym, but the thing what it does is that B-2, we think of it 
as an advanced weapons system, which it is, but in fact, if we 
don't do DMS, it is not going to be--have the capabilities to 
operate in a modern contested environment. We have to do that 
program. It is funded, as General Holmes said. So those are two 
things I would call out, but you know, the B-2 is a very, very 
important program.
    Mrs. Hartzler. Just to follow up on the computer software 
program that I understand is being developed, be able to 
project the parts that would be needed to help them in advance 
be able to get in, do you have an update on that?
    Dr. LaPlante. I don't have an update on that specific 
program. Do you?
    General Holmes. No, ma'am, I don't. I know we are pursuing 
about 20 projects that help us manage the signature and the 
parts supply and that help us increase the availability rate on 
the airplane, but we will have to respond to you----
    Mrs. Hartzler. Sure.
    LT Gen Holmes [continuing]. On that one.
    Dr. LaPlante. Be happy to look into that and get back to 
you on that.
    Mrs. Hartzler. Thank you for all that you do. I yield back.
    Mr. Forbes. I thank the gentlelady. The gentlelady from 
Guam is recognized for 5 minutes.
    Ms. Bordallo. Thank you very much, Mr. Chairman. And 
Secretary LaPlante and General Holmes, thank you for your 
testimony today. As we proceed with the engineering development 
of the LRS-B [Long Range Strike Bomber], what are some of the 
strategies that have gone into developing the $550 million 
average procurement needed cost cap that you have set? Are you 
expecting to pursue an arrangement similar to the KC-46, 
utilizing a fixed price procurement vehicle?
    And though the program is one of the Air Force's top three 
acquisition priorities, in fiscal year 2016 you have requested 
approximately $1.2 billion for development. What effects would 
we see to this program if Congress does not repeal 
sequestration?
    Dr. LaPlante. Let me answer the last point first. The 
effects of sequestration on all these programs is there. We in 
the Air Force have done our best, and so far we have been 
successful. Even in the sequester years that we have had, we 
protected, for the most part, F-35, the tanker, KC-46A, and 
LRS-B. We will continue to do it, but I will say this: I think 
the sequester happens, a lot of these programs, once again, are 
going to be put under tremendous stress. The munitions programs 
will be put under tremendous stress. But we try our best to 
protect those big three, but we can't promise that they will be 
protected.
    Let me get at some of the other parts of the LRS-B. The one 
question that you asked essentially was in the development, we 
are in the development, or about ready to start the development 
part of that program, are we going to go for a fixed price 
development program like the tanker, or not? I think the short 
answer is, and now I am going to talk generically in 
acquisition theory, if you can bear with me. The theory behind 
when you do fixed price and say development versus cost plus, 
which is kind of the classic thing, tends to come down to how 
confident are you in the technologies you are developing, and 
it--fundamentally, you are cost estimating on those 
technologies. To be very simple, if you are developing 
something that is very cutting edge, it is very hard to 
estimate how much it is going to cost because you are actually 
developing something cutting edge. That is why we tend to go 
cost plus.
    If you are developing something that is based heavily on, 
say, a commercial item, something we have high confidence that 
we know how much it should cost, then we feel much more 
comfortable going to fixed price development. Now, here is why 
it matters. If you are in a fixed price contract, it is really 
important to have a good estimate of what you think it is going 
to cost. If you get--if you are wrong on that, let's say you 
are wrong 50 percent one way or the other, somebody is going to 
really get hurt, right? If you are wrong, if the contractor 
ends up 50 percent over in a fixed price, they are very hurt, 
they may not survive. The program may not survive. The 
opposite, we would get rightfully criticized to say why are you 
giving a windfall buying something for twice the price that it 
cost.
    So you really want to have a good idea on the cost estimate 
in development. So the question then comes down to, for KC-46, 
the government made a decision that said, look, this is based 
as much on a 767. We think we have a pretty good idea on what 
the cost estimate should be. We are going to go a little--we 
are going to do a fixed price. That is not--it is actually 
unusual. Most development programs are cost plus. Okay. My 
belief on the LRS-B is it is going to be more traditional in 
the sense that we are doing a little bit more cutting edge. It 
is not based upon a commercial item, and so I think more likely 
it is going to be in the cost plus regime.
    But here is the important point. You brought up the $550 
million number, and there has been some in the press on this. I 
would like just to make a couple of points on this. The first 
thing is, there's been a lot of studies on why acquisition goes 
wrong. What they constantly come down to are some very much 
fundamental principles you have to do at the beginning to do it 
right. The first is you have to fix your requirements, 
understand the requirements and fix them, don't change your 
requirements, number one. Number two, it has often been said 
why isn't cost built in as a requirement when you start a 
program? Why do we always say, well, maybe we will have a 
target? Number three, what we also see when programs don't do 
well, is we typically try to put too much into the program, and 
the program usually gets slid to the right, more then gets put 
in, and you end up in this circle.
    So what we have done with our LRS-B--and it wasn't me or 
General Holmes, it was our predecessors--back in 2010, they set 
the program up to exactly address all of those issues. Number 
one, they said we are going to make the cost a requirement. We 
are going to make the cost a requirement. We are going to pick 
a number after analysis, $550 million, the document was signed 
in 2010, that is why it is 2010 dollars, and people say, well, 
you didn't take into account inflation. You can go to the 
Internet, run an inflation calculator and find out that $55 in 
2010 is $57 or $58 today, so we know that. But we put it in as 
a requirement. To build 100 airplanes, it is going to cost $550 
million. What that does is, that drives the design. Industry 
has to design to that number, and we are going to assess 
against that number. That is why we did it.
    And the second thing is we are building an adaptable 
architecture as well to address some of these other issues. And 
final point, we have not changed the requirement on it.
    Ms. Bordallo. General, my time is up. I do have a question, 
if I could place it on the record.
    Mr. Forbes. Certainly can, and submit it for the record.
    Ms. Bordallo. Thank you. Yield back.
    Mr. Forbes. The gentleman from Oklahoma is recognized for 5 
minutes.
    Mr. Bridenstine. Just out of curiosity, they called votes; 
is that correct?
    Mr. Forbes. That is correct, and so we only have minutes 
left.
    Mr. Bridenstine. Okay.
    Mr. Forbes. And we will have--get your question in because 
I don't think our members will be coming back----
    Mr. Bridenstine. Okay.
    Mr. Forbes [continuing]. After this, so yours will be the 
final question.
    Mr. Bridenstine. I will try to be brief. For Dr. LaPlante, 
did Congress authorize an appropriate funding for the C-130 
Avionics Modernization Program in fiscal year 2012?
    Dr. LaPlante. Yes.
    Mr. Bridenstine. And were those funds obligated in fiscal 
year 2012?
    Dr. LaPlante. As far as I know.
    Mr. Bridenstine. They were not.
    Dr. LaPlante. 2012 they were not.
    Mr. Bridenstine. They were not.
    Dr. LaPlante. Not in 2013 or 2014 either.
    Mr. Bridenstine. Okay. So in fiscal year 2013, as you 
mentioned, it was authorized and appropriated by Congress, and 
those funds were not obligated----
    Dr. LaPlante. That is correct.
    Mr. Bridenstine [continuing]. In 2013.
    Dr. LaPlante. Or 2014.
    Mr. Bridenstine. Or 2014.
    Dr. LaPlante. That is correct.
    Mr. Bridenstine. Where it was authorized and appropriated 
but not obligated in 2014.
    Dr. LaPlante. That is correct.
    Mr. Bridenstine. And in 2015, is it authorized and 
appropriated for 2015?
    Dr. LaPlante. Well, with the--I believe----
    Mr. Bridenstine. The answer is yes. The question is----
    Dr. LaPlante. With----
    Mr. Bridenstine [continuing]. Do you intend to obligate 
those funds this year?
    Dr. LaPlante. Oh, yes. Our plan is--if we get the approval, 
our plan is to take the money that has been obligated that we 
have and obligate it by the end of this fiscal year.
    Mr. Bridenstine. To the AMP program?
    Dr. LaPlante. Our plan is to do it towards the compliance 
items that General Holmes described.
    Mr. Bridenstine. So did you read section 134 of the fiscal 
year 2015 NDAA [National Defense Authorization Act]?
    Dr. LaPlante. We all have seen that language, yes.
    Mr. Bridenstine. Did you read the report language as well?
    Dr. LaPlante. Yes.
    Mr. Bridenstine. The report language says, ``We are 
specifically directing the Secretary of the Air Force not to 
transfer or repurpose funds authorized and appropriated for the 
AMP program to execute such additional modernizations unless 
the modifications are included as a part of the AMP program of 
record.'' Are you going to authorize the funds as part of the--
are you going to obligate the funds as part of the AMP program 
of record?
    Dr. LaPlante. We are not--I think as I said, we are going 
to obligate those funds towards the compliance items that 
General Holmes described.
    Mr. Bridenstine. No, but the AMP program of record is 
what--that is specifically the report language in the NDAA from 
fiscal year 2015.
    Dr. LaPlante. We have a different--we have different 
interpretations of what that language means.
    Mr. Bridenstine. Okay. Well, Congress is clear. The Air 
Force can do ADS-B Out, as you indicated.
    Dr. LaPlante. Right.
    Mr. Bridenstine. But it cannot take the money from AMP. 
That has to be within the AMP program. The Air Force can do 
CNS/ATM [communications, navigation, surveillance/air traffic 
management] or other program----
    Dr. LaPlante. Correct.
    Mr. Bridenstine [continuing]. In CNS/ATM, but it has to be 
part of the AMP program of record. Are you aware of the 
limitation placed on the Secretary of the Air Force's budget in 
section 134?
    Dr. LaPlante. Yes, and Congressman, let me make sure I am 
understanding. I think--I think we are doing exactly what you 
are saying. We are--we are using the money for this--CT--ATM/
CNS, we are using it for the ADS-B Out and the radios as 
General----
    Mr. Bridenstine. As part of the AMP program of record?
    Dr. LaPlante. It is going to be that money, yes.
    Mr. Bridenstine. Okay. So it needs to be part of the AMP 
program of record by law.
    Dr. LaPlante. I am not sure what that means, but--well, I 
am not sure what the--maybe we are doing exactly what you are 
saying. We are taking that money and we are going to buy those 
items.
    Mr. Bridenstine. So you are familiar with this. I just 
read--it was the fiscal year 2015 President's budget request, 
C-130, CNS/ATM program. It looks like you guys have changed the 
name of it to the VAAP [Viability and Airspace Access Program] 
program, Increment 1; is that correct? Are you familiar with 
this, the VAAP program, Increment 1?
    General Holmes. Yes, sir.
    Mr. Bridenstine. Is that what you intended? Did you change 
the name or are you changing the program and how is this 
working? Because the law is pretty clear.
    General Holmes. Sir, our lawyers believe that when 
certified by the Secretary of Defense, and the Secretary of 
Defense delegated that to Mr. Kendall, that when Mr. Kendall 
says it is necessary for us to spend money from those accounts 
that were previously obligated----
    Mr. Bridenstine. A couple of things. I get that. I 
understand in 134 there is that out, but also in section 134, 
it fences 15 percent of the Secretary of the Air Force's money 
until the Air Force obligates fiscal year 2015 and prior years' 
funds to the AMP program of record. There is no exception made 
to this limitation provision. There is no limitation. So if you 
want to say that we are going to go forward with a different 
program under a different name, that means you are saying that 
we are going to cut 15 percent of the Secretary of the Air 
Force's operations and maintenance budget. Are you--do you 
understand that is what you are doing? That is in the law.
    General Holmes. Yes, sir, it is, and we have--our lawyers--
--
    Mr. Bridenstine. Are you going to follow the law is my 
question?
    General Holmes. We are going to follow the law as 
interpreted by the general counsel.
    Mr. Bridenstine. And for the chairman of this committee, if 
we follow the law and you go forward under the program that I 
understand you are going forward with in the President's budget 
request, you are, in essence--we on this committee are required 
to make sure that the Secretary of the Air Force uses 15 
percent of her operations and maintenance budget.
    Now, this--this is in the law. I just want to make sure 
everybody here understands this.
    Dr. LaPlante. Yeah. And Representative, we hear you. I just 
want to make sure that we have to do what our legal experts 
read the law tell us we can do and so----
    Mr. Bridenstine. So you tell me. You can't make it any more 
clear. It is written----
    Dr. LaPlante. Well, I am not a lawyer, but yes.
    Mr. Bridenstine. Sure. A couple of other things. In the 
2014 NDAA, you know, section 133 prohibits the Air Force from 
using any funding to initiate----
    Mr. Forbes. I am sorry to cut the gentleman off, but we 
have votes we have to go to, as time has expired. So if you 
would like to follow up with any written questions, we can do 
it.
    General, we also would like for you to respond, if you 
could, on the details of that modernization program. I 
apologize to everybody that we have only got a couple of 
minutes left for this vote.
    [The information referred to can be found in the Appendix 
on page 35.]
    Mr. Bridenstine. Sure.
    Mr. Forbes. But with that, Mr. Courtney has agreed we are 
adjourned, and we will follow up with any written questions. 
And if you would be so kind as to answer them for the record, 
we would appreciate it. With that, we are adjourned.
    [Whereupon, at 2:25 p.m., the subcommittee was adjourned.]


      
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                            A P P E N D I X

                             March 4, 2015

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              PREPARED STATEMENTS SUBMITTED FOR THE RECORD

                             March 4, 2015

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 [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]     
      
   
      
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              WITNESS RESPONSES TO QUESTIONS ASKED DURING

                              THE HEARING

                             March 4, 2015

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              RESPONSE TO QUESTION SUBMITTED BY MR. FORBES

    General Holmes. The Air Force continues to work towards the safety, 
compliance and modernization of our legacy C-130 fleet. Because of the 
cost and time required to conduct the modernization of the legacy C-130 
fleet, we believe, and DOD has certified, that we need to fund the 
airspace compliance modifications first. The Air Force intends to 
follow the Fiscal Year 2015 National Defense Authorization Act guidance 
and we want to work with the Congress and our Total Force partners to 
develop an affordable C-130 modernization program.   [See page 10.]

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


              QUESTIONS SUBMITTED BY MEMBERS POST HEARING

                             March 4, 2015

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

      
                   QUESTIONS SUBMITTED BY MR. FORBES

    Mr. Forbes. Knowing that the KC-46 tanker contract is fixed-price, 
how important is it to maintain funding stability for the program and 
what are the risks to the program if funding gets interrupted?
    Dr. LaPlante. Funding stability is extremely important to the 
success of the KC-46 program. Funding stability ensures the Air Force 
fulfills its contractual obligations required for Boeing to deliver 18 
operationally-ready aircraft by August 2017 (Required Assets Available 
(RAA)). The fixed-price contract caps government Engineering & 
Manufacturing Development liability at $4.9B and provides 13 planned, 
on-contract procurement lots at Firm-Fixed Price or Not-To-Exceed 
levels. While these planned procurements provide a range for variable 
order quantities, a variation in production quantity affects the lot-
to-lot pricing.
    Additionally, while the government and Boeing have successfully met 
all contractual obligations to date, the program is entering its most 
challenging part in flight test. For these reasons, RDT&E funding 
stability remains important to ensure necessary funds are available to 
address remaining program content, as well as program risks that may 
materialize. Production funding stability remains important to enable 
Boeing's achievement of RAA and ensure the government does not pay 
additional per aircraft costs due to quantity variations. Any 
government-induced issues or delays could lead to a Boeing request for 
equitable adjustment and potentially re-open the contract.
    Mr. Forbes. In the past year, Boeing has experienced wiring 
problems in building the first two KC-46 tankers which has delayed the 
development schedule. What impact will this delay have on initial 
operational capability in August 2017?
    Dr. LaPlante. Internal Boeing schedule events have shifted due to 
the delays in the first flights of the Engineering & Manufacturing 
Development aircraft. However, the final contractual milestone, 
Required Assets Available (RAA), has not shifted. RAA will still 
require Boeing to deliver 18 operationally-ready aircraft by August 
2017. These delays eliminate the margin Boeing built into their 
original schedule, to include all schedule margin to the RAA 
contractual milestone date.
    Mr. Forbes. A recent draft GAO report noted that the original KC-46 
schedule planned to have 13 months of testing on two aircraft before 
the October 2015 low-rate initial production decision. Now, due to 
delays resulting from wiring problems, the program will have only one 
aircraft in test for a three-month period before the October 2015 low-
rate initial production decision. How will the Air Force ensure that 
key aerial refueling capabilities are demonstrated before the October 
2015 low-rate initial production decision?
    Dr. LaPlante. Development testing required for the Milestone (MS) C 
Low Rate Initial Production (LRIP) decision consists of a combination 
of ground and flight testing, both which have commenced. Ground testing 
began in November 2014 and flight testing began with EMD #1's First 
Flight on 28 December 2014. The flight testing required for MS C is 
modest and can all be executed on one aircraft. The other three EMD 
aircraft will be used throughout the remainder of the program for full 
requirements verification and operational testing, both which are 
required for the Full Rate Production decision in CY2017. Finally, MS C 
is an event-driven milestone, the program continues to make measurable 
progress each and every day toward a successful MS C, and the AF will 
not ask the Defense Acquisition Executive for a decision to enter LRIP 
until all pre-coordinated entrance criteria are complete.
    Mr. Forbes. The Air Force has ignored congressional intent for the 
past three budget cycles and does not plan to obligate the $47.0 
million in funding authorized and appropriated in fiscal year 2014 for 
the C-130 Avionics Modernization Program (AMP), The Air Force has sunk 
$1.5 billion in developing and successfully testing this program, but 
now plans to shelve that investment. If the Air Force does not intend 
to utilize AMP, can you explain how the Air Force intends to address 
the growing obsolescence and diminishing manufacturing sources (DMS) of 
the C-130H fleet?
    Dr. LaPlante. The Air Force continues to work towards the safety, 
compliance and modernization of our C-130H fleet. Because of the cost 
and time required to conduct the modernization of the C-130H fleet, we 
believe, and DOD has certified, that the AF must primarily address 
airspace compliance modifications. The Air Force intends to comply with 
the FY15 NDAA and work with Congress and Total Force partners to 
address avionics modernization efforts for the C-130H fleet.
    Mr. Forbes. USTRANSCOM has stated a requirement for 567 aerial 
tankers to meet its steady-state and contingency surge requirements, 
yet the Air Force only has an inventory of 454 tankers. What risk is 
the Air Force incurring by not having the sufficient number of tankers 
in the inventory to meet USTRANSCOM's requirements?
    General Holmes. The Air Force is incurring significant risk with 
the current fleet of 455 aerial refueling tankers. KC-46A deliveries 
improve risk to ``moderate'' once the fleet reaches the USTRANSCOM 
amended requirement of 479 aircraft (aligning with the Mobility 
Capability Assessment-2018 (MCA-18) analysis in their 2 February 2015 
report to Congress on ``KC-10 Aerial Refueling Aircraft Force 
Structure''). This will match the level required against the updated 
scenarios, strategies, concept of operations, assumptions, and 
capabilities determined by the MCA-18.
    Mr. Forbes. If the Air Force is required to execute fiscal 
resources at Budget Control Act sequestration levels, what operational 
risk do you incur by having to divest the entire KC-10 tanker aircraft 
fleet? What other programmatic options would you have to execute if 
Congress prohibited the retirement of KC-10 aircraft?
    General Holmes. The KC-10 represents 13 percent of our tanker fleet 
and 30 percent of our air refueling capacity. If held to Budget Control 
Act level funding, we will be compelled to divest the KC-10 across the 
Future Years Defense Plan. According to the Mobility Capability 
Assessment-2018, divesting the 59 KC-10s would delay achieving a 
moderate risk level force structure by three years (from Fiscal Year 
2018 (FY18) to FY21).
    If forced to retain the KC-10 without the funding associated with 
its operations, the Air Force would have to find other sources to 
offset $2.8 billion--the equivalent of roughly 150 KC-135s, which 
represents 30 percent of our tanker fleet and 33 percent of our air 
refueling capacity.
    Mr. Forbes. Knowing that the KC-46 tanker contract is fixed-price, 
how important is it to maintain funding stability for the program and 
what are the risks to the program if funding gets interrupted?
    General Holmes. Funding stability is extremely important to the 
success of the KC-46 program. Funding stability ensures the Air Force 
fulfills its contractual obligations required for Boeing to deliver 18 
operationally-ready aircraft by August 2017 (Required Assets Available 
(RAA)). The fixed-price contract caps government Engineering & 
Manufacturing Development liability at $4.9B and provides 13 planned, 
on-contract procurement lots at Firm-Fixed Price or Not-To-Exceed 
levels. While these planned procurements provide a range for variable 
order quantities, a variation in production quantity affects the lot-
to-lot pricing.
    Additionally, while the government and Boeing have successfully met 
all contractual obligations to date, the program is entering its most 
challenging part in flight test. For these reasons, RDT&E funding 
stability remains important to ensure necessary funds are available to 
address remaining program content, as well as program risks that may 
materialize. Production funding stability remains important to enable 
Boeing's achievement of RAA and ensure the government does not pay 
additional per aircraft costs due to quantity variations. Any 
government-induced issues or delays could lead to a Boeing request for 
equitable adjustment and potentially re-open the contract.
    Mr. Forbes. The Air Force is required by law to maintain a B-1 
combat-coded inventory of 36 aircraft, for which the Air Force is 
complying with. However, the subcommittee understands that for three of 
those 36 aircraft, they do not have the same crew ratio or flying hours 
programmed against them as the other 33 B-1 combat coded aircraft. Can 
you explain to the subcommittee the reason for this difference, and 
what risk do you incur in meeting combatant commander requirements if 
all 36 combat-coded B-1 aircraft were required to meet presence and 
operational requirements?
    General Holmes. Since 33 aircraft meets current combatant commander 
requirements, the Air Force reduced flying hour and manpower funding on 
the three aircraft to fund other higher priorities. If combatant 
commanders' presence and operational requirements necessitates the full 
fleet of 36 aircraft, the Air Force will satisfy this requirement by 
using other combat-ready aircrews/maintainers as required to man/
maintain the remaining three combat-coded aircraft under reduced 
manning. Aside from potential increased risk in training operations, 
the Air Force expects no increased risk in meeting combatant commander 
requirements.
    Mr. Forbes. New START treaty requires a reduced number of deployed 
nuclear weapons, which in turn, will require the Air Force to decertify 
a certain number of B-52 aircraft. What is the projected number of B-52 
aircraft that you will decertify in order to meet New START 
requirements? And, are these aircraft modifications reversible if ever 
needed to increase nuclear bomber capability in the future?
    General Holmes. The Air Force will modify a total of 42 B-52H 
aircraft to a conventional-only role by permanently removing the 
nuclear code enable switch and associated equipment, and installing 
tamper-resistant blocker panels where the equipment used to reside. Of 
the 42 aircraft, 30 are Active Duty/AF Reserve B-52H's and the 
remaining 12 B-52H's are currently parked at the Aerospace Maintenance 
and Regeneration Group (AMARG) B-52 located at Davis-Monthan AFB. Once 
a B-52H is converted to a convention-only role, it is not reversible.
    Mr. Forbes. FY16 PB proposes to cut the number of C-130s from 358 
today to 308 by the end of FY20. Can you tell us what that number is 
based on and what kind of risk it poses?
    General Holmes. Pursuant to the language in the Fiscal Year 2013 
(FY13) National Defense Authorization Act, the Air Force conducted an 
analysis of mobility assets to determine the appropriate number of 
aircraft required to fulfill contingency, humanitarian and homeland 
defense missions. This analysis, presented in the Mobility Capabilities 
Assessment (MCA) study determined ``there is no surge scenario 
associated with the current defense strategy--even one in which a 
significant homeland defense event occurs concurrently with two 
warfights--that requires a fleet of 358 C-130s.'' Rather, the analysis 
concluded the C-130 fleet size requirement ranges between 248 and 320 
aircraft.
    Driven by fiscal constraints, yet recognizing the important role of 
intra-theater airlift in homeland defense and disaster response, the 
FY15 President's Budget (FY15 PB) reduced the C-130 fleet to 328 
aircraft by FY19. This force structure continued to exceed the MCA's 
recommended level. Secretary of Defense Chuck Hagel stated in July 2013 
that ``the Air Force could reduce tactical aircraft squadrons--
potentially as many as five--and cut the size of the C-130 fleet with 
minimal risk.'' In order to reduce excess capacity in the C-130 fleet 
and improve allocation of scarce resources, the Air Force made the 
decision to more closely align the C-130 fleet structure with the 
findings and recommendations of the MCA.
    The FY16 PB reduces the C-130 force structure to 300 total 
aircraft, balancing operational requirements and the realities of 
Budget Control Act constraints. These reductions allow the Total Force 
to invest in the remaining C-130 force and other requirements to 
counter existing and emerging national security threats.
    A fleet size of 300 presents a moderate risk force that can 
accomplish the operational requirements defined in the MCA.
    Mr. Forbes. Last year, the Air Force began a new program to upgrade 
the C-130 fleet called the Viability and Airspace Access Program, also 
known as ``VAAP.'' We understand the VAAP is currently planned for two 
increments with Increment 1 modifying 172 C-130Hs with new radios, 
updated transponders, and an updated cockpit voice recorder and digital 
flight recorder. VAAP 2 is undefined at the point. What viability and 
airspace access programs are planned for VAAP 2? Will the VAAP keep the 
C-130H fleet viable to 2030 and beyond?
    General Holmes. The Air Force continues to work towards the safety, 
compliance and modernization of our legacy C-130 fleet. Because of the 
cost and time required to conduct the modernization of the legacy C-130 
fleet, we believe, and DOD has certified, that we need to fund the 
airspace compliance modifications first to include new radios, updated 
transponders, and an updated cockpit voice recorder and digital flight 
recorder. The Air Force intends to follow the Fiscal Year 2015 National 
Defense Authorization Act guidance and we want to work with the 
Congress and our Total Force partners to develop an affordable C-130 
modernization program.
                                 ______
                                 
                   QUESTIONS SUBMITTED BY MR. LARSEN
    Mr. Larsen. The FY16 proposed budget shows an increase to $1.246B 
in funding for LRS-B. Does the increase reflect additional costs, an 
effort to shorten the program schedule, a combination of both or 
something else?
    Dr. LaPlante. The FY16 budget request reflects the schedule for the 
development phase of the program. There have been no cost increases to 
the program and the overall schedule remains on track.
    Mr. Larsen. It is my understanding that Boeing is actively 
marketing the KC-46 to allies. Does the Air Force have a view on this 
activity?
    General Holmes. ``The USAF is constantly educating our allies on 
the importance of establishing and maintaining certain capabilities, 
such as airborne refueling. We encourage our allies desiring an 
airborne refueling capability to purchase the KC-46 in order to 
provide: the best receiver air refueling platform, an increase in 
airlift capability, an airframe of improved force protection and 
survivability, multi-point air refueling, capable of both day and night 
operations, while providing rapid, global capability and 
interoperability between U.S., Joint, Allied, and Coalition forces.''
                                 ______
                                 
                  QUESTIONS SUBMITTED BY MS. BORDALLO
    Ms. Bordallo. Where do we stand on the development of the concept 
of operations for employing the LRS-B? Should we expect a similar 
basing arrangement for the LRS-B as our current bomber fleet?
    General Holmes. The LRS-B Concept of Employment has been developed 
at the classified level and has been approved by Air Force senior 
leadership. Basing decisions for LRS-B have not yet been made; however, 
the Air Force anticipates going through the traditional staffing and 
approval processes for these decisions and will start this activity at 
the appropriate time to allow for any needed infrastructure changes.

                                  [all]