- DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR 2017 AND THE FUTURE YEARS DEFENSE PROGRAM

[Senate Hearing 114-658, Part 3]
[From the U.S. Government Publishing Office]

S. Hrg. 114-658, Pt. 3

DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
2017 AND THE FUTURE YEARS DEFENSE PROGRAM

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

HEARINGS

before the

COMMITTEE ON ARMED SERVICES
UNITED STATES SENATE

ONE HUNDRED FOURTEENTH CONGRESS

SECOND SESSION

S. 2943

TO AUTHORIZE APPROPRIATIONS FOR FISCAL YEAR 2017 FOR MILITARY
ACTIVITIES OF THE DEPARTMENT OF DEFENSE, FOR MILITARY CONSTRUCTION, AND
FOR DEFENSE ACTIVITIES OF THE DEPARTMENT OF ENERGY, TO PRESCRIBE
MILITARY PERSONNEL STRENGTHS FOR SUCH FISCAL YEAR, AND FOR OTHER
PURPOSES

----------

PART 3

READINESS AND MANAGEMENT SUPPORT

----------

MARCH 15; APRIL 5, 12, 2016

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

Printed for the use of the Committee on Armed Services

S. Hrg. 114-658, Pt. 3

DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
2017 AND THE FUTURE YEARS DEFENSE PROGRAM

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

HEARINGS

before the

COMMITTEE ON ARMED SERVICES
UNITED STATES SENATE

ONE HUNDRED FOURTEENTH CONGRESS

SECOND SESSION

S. 2943

__________

PART 3

READINESS AND MANAGEMENT SUPPORT

__________

MARCH 15; APRIL 5, 12, 2016

__________

Printed for the use of the Committee on Armed Services

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

Available via the World Wide Web: http://www.fdsys.gov/

______

U.S. GOVERNMENT PUBLISHING OFFICE

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COMMITTEE ON ARMED SERVICES

JOHN McCAIN, Arizona, Chairman

JAMES M. INHOFE, Oklahoma JACK REED, Rhode Island
JEFF SESSIONS, Alabama BILL NELSON, Florida
ROGER F. WICKER, Mississippi CLAIRE McCASKILL, Missouri
KELLY AYOTTE, New Hampshire JOE MANCHIN III, West Virginia
DEB FISCHER, Nebraska JEANNE SHAHEEN, New Hampshire
TOM COTTON, Arkansas KIRSTEN E. GILLIBRAND, New York
MIKE ROUNDS, South Dakota RICHARD BLUMENTHAL, Connecticut
JONI ERNST, Iowa JOE DONNELLY, Indiana
THOM TILLIS, North Carolina MAZIE K. HIRONO, Hawaii
DAN SULLIVAN, Alaska TIM KAINE, Virginia
MIKE LEE, Utah ANGUS S. KING, JR., Maine
LINDSEY GRAHAM, South Carolina MARTIN HEINRICH, New Mexico
TED CRUZ, Texas

Christian D. Brose, Staff Director
Elizabeth L. King, Minority Staff Director
__________

Subcommittee on Readiness and Management Support

KELLY AYOTTE, New Hampshire, Chairman
JAMES M. INHOFE, Oklahoma TIM KAINE, Virginia
DEB FISCHER, Nebraska CLAIRE McCASKILL, Missouri
MIKE ROUNDS, South Dakota JEANNE SHAHEEN, New Hampshire
JONI ERNST, Iowa MAZIE K. HIRONO, Hawaii
MIKE LEE, Utah MARTIN HEINRICH, New Mexico

(ii)

C O N T E N T S

___________

March 15, 2016

Page

The Current State of Readiness of United States Forces........... 1

Allyn, General Daniel B., USA, Vice Chief of Staff, United States 5
Army.
Howard, Admiral Michelle J., USN, Vice Chief of Naval Operations, 10
United States Navy.
Paxton, General John M., Jr., USMC, Assistant Commandant, United 16
States Marine Corps.
Goldfein, General David L., USAF, Vice Chief of Staff, United 27
States Air Force.

Questions for the Record......................................... 71

April 5, 2016

The State of Public Shipyards to Meet Current Mission Needs and 95
Investment Strategies.

Hilarides, Vice Admiral William H., USN, Commander, United States 99
Naval Sea Systems Command.
Smith, Vice Admiral Dixon R. USN, Commander, United States Navy 103
Installations Command.

Questions for the Record......................................... 123

April 12, 2016

Military Construction, Environmental, Energy, and Base Closure 127
Programs.

Potochney, Peter J., Performing the Duties of Assistant Secretary 132
of Defense for Energy, Installations and Environment.
Hammack, Honorable Katherine G., Assistant Secretary of the Army 146
for Installations, Energy and Environment.
McGinn, Honorable Dennis V., Assistant Secretary of the Navy for 152
Energy, Installations and Environment.
Ballentine, Honorable Miranda A.A., Assistant Secretary of the 159
Air Force for Installations, Environment and Energy.

Questions for the Record......................................... 192

APPENDIX A....................................................... 203

(iii)

DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
2017 AND THE FUTURE YEARS DEFENSE PROGRAM

----------

TUESDAY, MARCH 15, 2016

U.S. Senate,
Subcommittee on Readiness
and Management Support,
Committee on Armed Services,
Washington, DC.

THE CURRENT STATE OF READINESS OF
UNITED STATES FORCES

The subcommittee met, pursuant to notice, at 10:03 a.m. in
Room SR-222, Russell Senate Office Building, Senator Kelly
Ayotte (chairman of the subcommittee) presiding.
Members present: Senators Ayotte, Inhofe, Fischer, Ernst,
Kaine, Shaheen, Hirono, and Heinrich.

OPENING STATEMENT OF SENATOR KELLY AYOTTE

Senator Ayotte. Good morning. I want to welcome our
witnesses here today, the Vice Chiefs of Staff of our Armed
Forces, and thank them for their leadership. This is a very
important hearing of the Readiness and Management Support
Committee.
As we begin this subcommittee's second hearing of the year
to receive testimony on the current readiness of our military
forces, I want to thank the Ranking Member, Senator Kaine, for
his continued leadership on defense issues and work with me in
a bipartisan manner on these incredibly important issues to the
readiness of our forces.
We're joined this morning by General Daniel Allyn, the Vice
Chief of Staff for the Army; Admiral Michelle Howard, the Vice
Chief of Staff of Naval Operations; General John Paxton,
Assistant Commandant of the Marine Corps; and General David
Goldfein, the Vice Chief of Staff of the Air Force. I want to
thank each of you for your leadership and service to our
country, and all of those who serve underneath you. We're
grateful for what they do for our country.
General Paxton, I understand that today may be one of your
last, certainly, readiness force-posture hearings, but you're
also the longest serving Assistant Commandant in the Marine
Corps in the last 100 years.
[Laughter.]
Senator Ayotte. You have been in that position since
December of 2012. I just want to thank you for your amazing
service to our country, your leadership. You are the finest.
I've appreciated getting to know you in this position, and I
speak for all my colleagues in saying that we just very much
appreciate your distinguished service to our country and all
that you and your family have done for us.
[Applause.]
General Paxton. Thank you, Chairman. Honored to serve and
to be with great battle buddies like this and to be with great
marines. Thank you, Senator.
Senator Ayotte. Thank you. Semper Fi.
On February 9th, the Director of National Intelligence,
James Clapper, said, ``In my 50-plus years in the intelligence
business, I cannot recall a more diverse array of challenges
and crises that we confront as we do today.'' When we consider
just a few developments, it is easy to understand why Director
Clapper would say that from where we even met from last year
for this important hearing.
You recently testified that there are more Sunni terrorist
group members and save havens than at any other point in
history. Russia, a country that the commander of European
Command reminds us represents an existential threat to the
United States and the NATO [North Atlantic Treaty Organization]
alliance as a whole, has invaded and annexed part of Ukraine
while conducting a major military modernization and resuming
provocative military actions that we have not seen since the
Cold War.
China has invested massively in its military capabilities,
steadily closing many of the technological advantages that the
U.S. has enjoyed for decades. Simultaneously, Beijing is
building and militarizing artificial islands in the South China
Sea, an effort that seeks to bully its neighbors and challenge
one of the pillars of U.S. and global trade: the freedom of
navigation.
Assumptions that held true a decade or two ago regarding
the absence of a peer or near-peer military competitor can no
longer be taken for granted. In North Korea, an unpredictable,
despotic, and nuclear-armed ruler has developed a road-mobile
intercontinental ballistic missile that the commander of the
Strategic Forces Command assesses is likely capable of reaching
much of the continental United States.
Iran, the world's leading state sponsor of terrorism, is
pocketing billions of dollars in benefits from the Iran deal
while supporting Hezbollah and the murderous Assad regime and
advancing Tehran's ballistic missile program to threaten our
forward-deployed troops, our allies, like Israel, and
ultimately our Homeland.
Meanwhile, as our communities confront horrible drug
epidemics, South Command struggles with a severe lack of
resources to detect and interdict drug shipments traveling to
the United States. At the same time, Northern Command and its
Federal partners confront a tremendous challenge in securing a
porous southern border that is as vulnerable to terrorists
attempting to enter our country as it is to drug smugglers.
These are just a few examples of the threats and challenges
that we face and our allies confront. Yet, as these threats
have grown, our military readiness has not kept pace. Instead,
we have seen a disturbing deterioration in the readiness of
each of our services. Many servicemembers don't have enough
time home between deployments for rest and training,
undercutting full-spectrum of readiness. The readiness of
nondeployed forces is not what it should be, depriving our
Nation of the strategic depth that we need, given the threats
that we face. Key combatant commander requirements go unmet.
Critical war plans lack the necessary resources, and key
modernization programs are delayed. In short, the gap between
the military we need and the military we have has grown, and
that gap is making--in my opinion, is a dangerous gap.
Our defense budgets must be based on our national security
interests and the threats that we face to those interests, not
artificial budget caps. A small percentage of our fellow
citizens raise their right hands, join the military, and agree
to leave their families to keep the rest of us safe. We owe
them tough, realistic training as well as modern, well-
maintained equipment. To provide them anything less is to
neglect our moral and constitutional responsibilities. By
maintaining unchallenged military superiority and preparedness,
we take care of our troops, fulfill our responsibilities and
make costly conflicts less likely. I look forward to hearing
from each of you today regarding the readiness of each of our
services and what you specifically need from Congress to ensure
that we meet our needs and that we can defend our Nation, and
that our most precious resource, our men and women in uniform
who serve below you, and you, yourself, that you can let us
know what they need to effectively do their jobs.
I also look forward to getting some specific updates that
are important to my home State of New Hampshire on the arrival
of the KC-46A at Pease Air National Guard Base. I want to also
discuss some issues that are important to the New Hampshire
Army National Guard, as well as workers at the Portsmouth Naval
Shipyard as they maintain our Nation's attack submarine fleet,
which is so important to our combatant commanders.
I would now like to call on our Ranking Member, Senator
Kaine, for his opening remarks, and thank him for his
leadership.

STATEMENT OF SENATOR TIM KAINE

Senator Kaine. Thank you, Madam Chair.
Thanks, to all the witnesses. I've enjoyed the--working
together in conversations I've had with many of you in
preparation for this hearing.
I want to extend my thanks to General Paxton. I gather
you're the longest-serving Assistant Commandant since the very
first one, Lieutenant Colonel Eli Cole, in 1915. Your penalty
for that is, you've had to do this posture hearing four times.
Your reward is, you won't have to do it a fifth time.
[Laughter.]
Senator Kaine. But, we're--again, we're very, very happy to
celebrate with you this significant accomplishment.
You know, for many years, the recurring theme from this
annual posture hearing is--remain unchanged. That is, military
is stuck at an unacceptable level on the spectrum readiness--on
readiness spectrum. Last week, I received a classified
briefing, available to all committee members, on this readiness
question. I was really shocked, and I would encourage any
member of the committee, and especially this subcommittee, to
go get that same briefing. It will really put in context this
readiness question in a way that will stun you.
Everything I'm going to say now is not from that classified
briefing. This is open, what I'm now going to say. There are
other things that I could say, but I won't.
Today, less than half of our Nation's military is ready to
perform their core wartime mission. Some critical units are in
far worse shape than this 50 percent. Fourteen years of
sustained combat, together with the Budget Control Act of 2011,
have presented the Nation with a unique readiness challenge.
It's kind of the perfect storm of two significant events. That
problem has no likely end in sight if we continue down the path
of sequestration budget caps with the increasing operational
demand that the Chairwoman described, given the state of the
world.
Today, there are no--zero--fully ready Army Brigade Combat
Teams, and there are only nine ready BCTs [brigade combat
teams] available for unforeseen contingencies.
Less than half of the Marine Corps units are ready to
perform their core wartime mission, despite having a
congressionally mandated role as the Nation's crisis-response
force.
Today, 80 percent of aviation squadrons do not have the
required number of aircrafts to train.
Less than half of our Navy's ships are ready to ship to
meet wartime plans, while deferred and unplanned maintenance
continues to delay training timelines and prolong deployments.
For example, ship deployments that used to be 6 months are now
8 to 10 months, which exacerbates the conditions of the ships
and also creating challenges for those in the extended
deployments. I look forward to digging deeper into the topic of
our shipyards. We're going to have a subcommittee hearing on
this on April 5th.
On the Air Force side, half of the Air Force aircraft are
ready, some fighter and unmanned units are in far worse
condition. This is well below the 80-percent requirement that
is necessary to execute the national military strategy.
High operational tempo and the combatant command requests
have left too many units with unsustainable deploy-to-dwell
ratios. The ratio--the rate of operational tempo is like
forcing the same five people to play an entire game of
basketball without relief from the bench.
However, we, in Congress, have to admit that we've helped
create these terrible conditions for our military. We can't buy
you time--we can't buy time to restore readiness. It will take
a while to rebuild our strategic depth. Nor can we simply buy
our way out of our readiness problem. But, we can do much
better in the way in which we provide you with resources.
Sequestration continues to be a significant challenge and kind
of a mindless menace, because it's nonstrategic. Too often,
we've given DOD [Department of Defense] unpredictable funding
levels, and even those appropriations have arrived late in the
year or in the form of last-minute continuing resolutions. The
only reason we suffer from this self-inflicted predicament is
because we were not able to come together to find a meaningful
solution to a sequestration that was artificially passed by
Congress in August of 2011. A lot of things have happened in
the world since August of 2011. That was pre-Ebola, pre-Zika,
pre-North Korean cyberattacks, pre-ISIL [Islamic State of Iraq
and the Levant], pre-Russia into the Ukraine. The world has
changed dramatically, and yet we're still living under a
significant straightjacket.
I continue to believe, as I expressed in one of my first
votes in the Senate, we need to repeal sequestration, not only
for the sake of readiness, but for the sake of our full
spectrum of national security needs. Our intelligence agencies,
law enforcement agencies, Homeland security, international
development, State Department, and domestic agencies all
require relief, and we need to work together to make this
happen.
General Allyn, I know it's a few months before your son
graduates from West Point, but I want to, as I conclude,
congratulate both you and him today. We both have sons in the
military, and we owe them, and all future generations, our
thanks. I want to congratulate you on that.
Then, Madam Chair, thanks for pulling this hearing
together. I know that we're going to have an awful lot to talk
about.
Senator Ayotte. Thank you, Senator Kaine. Appreciate your
leadership.
I would like to call on, first, for testimony, General
Daniel Allyn, the Vice Chief of Staff of the United States
Army.

STATEMENT OF GENERAL DANIEL B. ALLYN, USA, VICE CHIEF OF STAFF,
UNITED STATES ARMY

General Allyn. Thank you, Madam Chair Ayotte, Ranking
Member Kaine, distinguished members of the subcommittee. Thanks
for inviting me to testify on the readiness of your United
States Army.
We live in a dangerous world, as you've both talked about.
After more than 14 years of continuous combat, it is tempting
to hope that a respite lies just over the horizon. Instead, the
velocity of instability is increasing, and demand for Army
forces across a range of military operations is increasing.
At current end strength, the Army risks consuming readiness
as fast as we build it. Today, the Army is globally engaged,
with more than 186,000 Total Force soldiers deployed in support
of combatant commanders in over 140 countries. These soldiers
conduct combat operations, deter aggression, and assure our
allies and partners.
In Afghanistan, the Army continues to train, advise, and
assist Afghan National Security Forces to defeat the enemies of
our country. In Iraq, we build partner capacity to fight the
Islamic State of Iraq and the Levant. In Africa and throughout
the Americas, we partner to prevent conflict and to shape the
security environment. In the Pacific, more than 75,000 soldiers
remain committed, including 20,000 who stand ready in the
Republic of Korea. In Europe and Asia, Army forces reassure
allies and deter Russian aggression. At home and in every
region of the world, the Army stands ready.
This is why readiness is, and must remain, the Army's
number-one priority. Training is the bedrock of that readiness.
To provide trained and ready forces to combatant commanders,
the Army must conduct realistic and rigorous training across
multiple echelons. Realistic training demands predictable and
sustained resources in both time and money. To ensure a trained
and ready Army today, the Army is accepting considerable risk
by reducing end strength while deferring modernization programs
and infrastructure investments. These tradeoffs are reflections
of constrained resources, not strategic insight.
The Army requests congressional support to rebuild
readiness, maintain end strength, equip our soldiers with the
best systems now and in the future, and provide soldiers and
their families with quality of life commensurate with their
unconditional service and their sacrifice. With your
assistance, the Army will continue to produce the best-trained,
best-equipped, and best-led Army forces to fight as our Nation
calls them.
We thank Congress for your steadfast support of our
outstanding men and women in uniform, our Army civilians, our
families, and our veterans. They deserve our best effort.
Thank you again for allowing me to join you today, and I
look forward to your questions.
[The prepared statement of General Allyn follows:]

Prepared Statement by General Daniel Allyn
introduction
Chairman Ayotte, Ranking Member Kaine, distinguished Members of the
Subcommittee, thank you for the opportunity to testify on the
readiness of your United States Army. On behalf of our Acting
Secretary, the Honorable Patrick Murphy, and our Chief of Staff,
General Mark Milley, I would also like to thank you for your support
and demonstrated commitment to our soldiers, Army civilians, families,
and veterans.
We live in a dangerous world, and after more than 14 years of
continuous combat, it is tempting to hope that a respite lies just over
the horizon. Instead, the global security environment remains unstable
and continues to place a high demand on the Army. Instability across
Europe, the Middle East, Africa, and the Pacific, coupled with
continued threats to the Homeland, demand our Army remain an
indispensable foundation of the Joint Force while we simultaneously
build the Army for the future.
Today, the Army is globally engaged with more than 186,000 soldiers
supporting combatant commanders in over 140 countries. These soldiers
conduct combat operations, deter aggression, and assure our Allies and
partners. In Afghanistan, the Army continues to engage the enemy as we
work with Allies and partners to train, advise, and assist Afghan
National Security Forces. In Iraq, we build partner capacity to fight
the Islamic State of Iraq and the Levant. In Africa, and throughout the
Americas, we partner to prevent conflict and shape the security
environment. In the Pacific, more than 75,000 soldiers remain
committed, including 20,000 who stand ready in the Republic of Korea.
In Europe and Asia, Army forces reassure Allies and deter Russian
aggression. At home and supporting every region of the world, the Army
stands ready.
In this unstable and unpredictable world, the Army is called to
lead. We are called to lead because the Army delivers the essential
backbone that provides foundational capabilities to Joint, interagency,
and multi-national teams. America's Army remains capable of compelling
the Nation's enemies through decisive action and our Army is called to
lead because we are trusted professionals. It is the character,
competence, and commitment of our soldiers that makes our Army the
greatest land force in the world today.
To meet the demands of today's security environment and maintain
the trust placed in us by the American people, our Army requires
sustained, long term, and predictable funding. Although the Bipartisan
Budget Act (BBA) of 2015 provided short-term relief, funding levels
have not kept pace with the realities of the strategic environment. The
fiscal year 2017 Army Budget base request of $125.1 billion is $1.4
billion less than the fiscal year 2016 enacted budget of $126.5
billion. While the budget provides a modicum of predictability, it is
insufficient to simultaneously rebuild decisive action readiness and
modernize. To ensure sufficient readiness for the demands of today's
operating environment, the Army must assume risk by reducing end-
strength, delaying modernization, and deferring infrastructure
recapitalization and investment. These trade-offs mortgage future
readiness.
Absent additional legislation, the caps set by the Budget Control
Act of 2011 will return in fiscal year 2018, forcing the Army to
further draw down end strength, reduce funding for readiness, and
increase the risk of sending under-trained and poorly equipped soldiers
into harm's way--a preventable risk our Nation must not accept. We
request Congressional support of the fiscal year 2017 President's
budget request that will fund readiness, maintain end-strength, equip
our soldiers with the best systems now and in the future, and provide
soldiers and their families with quality of life commensurate with
their unconditional service and sacrifice.
Readiness: Manning, Training, Equipping/Sustaining and Leader
Development
Readiness is the Army's number one priority. The Army's primary
focus on counterinsurgency operations for the last decade shaped a
generation of leaders and imparted invaluable skills and experience
across the force. This mission focus forced us to accept developmental
trade-offs. Fourteen years of sustained counter-insurgency operations
degraded the Army's ability to conduct operations across the entire
spectrum of conflict and narrowed the experience base of our leaders.
The global security environment now demands a shift in focus to support
Joint operations against a wide range of threats in diverse
environments. The ability to conduct combined arms maneuver in support
of the Joint Force to deter, deny, compel, and defeat the threat of
hybrid warfare represents the benchmark by which we will measure our
future readiness.
A ready Army is a fully manned, well trained, well equipped, and
competently led force able to conduct Joint missions to deter and
defeat a wide range of adversaries. A ready Army enables the Joint
Force to protect our Nation and win decisively in combat.
Manning:
At today's end-strength, the Army risks consuming readiness as fast
as we build it. Today, the Army has one third fewer Brigade Combat
Teams (BCT) than it did in 2012, yet emergent demand for Army forces
across Combatant Commands has increased by 23 percent during the same
period. Reductions to end-strength below the current plan will reduce
the Army's ability to meet emerging global requirements, affecting
combatant commanders' efforts to prevent conflict and shape their
security environments.
Demand for Army forces, combined with current end-strength
limitations, will reduce the Army's capacity to support the National
Military Strategy. Of the Army's 20 Ready or Fully Ready BCTs, 11 are
already committed to Combatant Command missions around the globe,
leaving only nine to provide strategic flexibility for unforecasted
contingencies. To address this reality, manage risk, and maximize
readiness of our fighting formations, we reorganized our BCTs,
implemented the Sustainable Readiness Model (SRM), and optimized the
contributions from all components of our Total Army.
In fiscal year 2015, the Brigade Combat Team reorganization
enhanced the combat effectiveness of our fighting units by adding a
third maneuver battalion to CONUS BCTs while reducing the total number
of BCTs from 73 to 60 (32 Active Army and 28 Army National Guard) in
the Total Force. Although we cut 13 BCTs, we retained 93 of our
original 100 maneuver battalions, decreased the number of headquarters
and personnel, and retained combat power with our operational
battalions.
To ensure the highest level of readiness throughout the Army, we
initiated a Total Force effort to generate, assess, and monitor
readiness through the Sustainable Readiness Model. SRM is an enduring
process that enables the Army to clearly analyze and evaluate
readiness, optimize resources and unit activity, and minimize risk. The
end state of the SRM is to build and sustain the highest possible
readiness levels across the Total Force.
Optimizing readiness requires an appropriate mix of forces across
Active, National Guard and Reserve units. Given increasing global
demand, a smaller Active Army requires all components to increase
deployment frequency. To support Joint Force requirements worldwide
over the last 14 years, the Army increased operational use of the Army
National Guard and the Army Reserve. We will continue this trend. With
the support of Congress, the Army can maintain the appropriate force
mix capable of conducting sustained operations worldwide.
To this end, the Army appreciates the insights of the National
Commission on the Future of the Army. We are carefully assessing their
recommendations for potential implementation to increase Army
readiness, consistent with statute, policy, and available resources.
Implementation of recommendations will require a coordinated effort
across the Army's three components. The Army's ongoing analysis will
determine if implementation requires additional funding.
Training:
Training is the bedrock of readiness. To provide trained and ready
forces, the Army must conduct realistic and rigorous training across
multiple echelons. Realistic training demands predictable and sustained
resources, in time and money. To ensure a trained and ready Army today,
the Army accepts considerable risk by reducing end-strength while
deferring modernization programs and infrastructure investments. These
trade-offs are reflections of constrained resources, not strategic
insight. But, given end-strength reductions, budget constraints, and
global demand, the Army prioritized building decisive action
proficiency to rebuild readiness across the force and assure a
predictable flow of trained and ready forces for Combatant Command
requirements.
Today, less than one-third of Army forces are at acceptable levels
of readiness to conduct sustained ground combat in a full spectrum
environment against a highly lethal hybrid threat or near-peer
adversary. To mitigate this risk, the Army will continue to prioritize
readiness. In addition to fully funding CTC rotations, the Army is
establishing objective training standards, reducing non-essential
training requirements, and protecting home station training to increase
training rigor and readiness in our formations. We will build decisive
action proficiency through repeated, high quality training iterations
at home station before units attend CTC rotations, while sustaining the
readiness of our remaining forces. This strategy enables the most
effective and efficient use of training resources and focuses our
leaders to optimize readiness across the Army.
A ready Army requires highly trained units across all components.
To build sufficient operational and strategic depth, the Army is
exploring a number of initiatives to build increased readiness in our
Reserve Component units. This includes increasing the number of annual
training days to provide sufficient repetition in core tasks; building
multi-component and round-out units to enhance Total Force integration;
and expanding CTC rotations for National Guard BCTs from two to four
annually. These initiatives would provide readiness for current
operations and ensure strategic depth required for future campaigns,
and will require increased funding.
Equipping/Sustaining:
A trained and ready Army requires modernized equipment to win
decisively. This includes the equipment soldiers use in combat and the
infrastructure that supports them as they prepare, deploy, and return
from battle. Technological overmatch against our adversaries is a
hallmark of America's Army and as leaders, we have an obligation to
deploy our soldiers into combat with the best equipment our Nation can
provide.
However, an unintended consequence of current fiscal constraints is
that the Army can no longer afford the most modern equipment, and we
risk falling behind near-peers in critical capabilities. Decreases to
the Army budget over the past several years significantly impacted Army
modernization. Since 2011, the Army ended 20 programs, delayed 125 and
restructured 124. Between 2011 and 2015, Research and Development and
Acquisition accounts plunged 35 percent. Procurement alone dropped from
$21.3 billion to $13.9 billion. Given these trends, and to preserve
readiness in the short term, the Army has been forced to selectively
modernize equipment to counter our adversary's most pressing
technological advances and capabilities. These decisions increase the
time necessary to defeat an adversary, increase risk to mission, and
potentially increase casualty rates. It reflects the best of bad
options, given current fiscal constraints.
The Army developed the Army Equipment Modernization Strategy to
preserve readiness in the short term and manage risk in the mid to long
term. The strategy reflects those areas in which the Army will focus
its limited investments for future Army readiness. We request the
support of Congress to provide flexibility in current procurement
methods and to fund the five capability areas--Aviation, the Network,
Integrated Air Missile Defense, Combat Vehicles, and Emerging Threats--
to provide the equipment the Army requires to fight and win our
Nation's wars.
To provide greater Aviation combat capability at lower cost, the
Army continues to execute the Aviation Restructuring Initiative (ARI).
Today, ARI is fully underway and the benefits of our hard choices are
starting to show. The Army has already inactivated one Combat Aviation
Brigade, converted the 12th Combat Aviation Brigade, inactivated seven
Air Cavalry Squadrons, divested nearly all of the OH58D fleet, stopped
all TRADOC OH-58D training, transferred 66 LUH aircraft to Fort Rucker,
and transferred 28 UH-60Ls to the National Guard and eight MEDEVAC UH-
60s to the Army Reserve. Additionally, the Army is examining the
recommendations of the National Commission on the Future of the Army as
we work to ensure the most modern Aviation capabilities are ready now
while underwriting critical modernization efforts to build the future
Aviation force.
The Army Network provides foundational capabilities to the Joint
Force, requiring the Army to maintain a robust Network hardened against
cyber-attacks. Key investments in the Army Network are Warfighter
Information Network-Tactical; assured position, navigation, and timing;
communications security; and defensive and offensive cyberspace
operations. Given the rapid advances in the cyber warfare capabilities
of our adversaries, these investments ensure access to reliable,
timely, and secure information, enabling our Joint Force to sustain a
decisive advantage.
The Army is investing in Integrated Air Missile Defense to defeat a
wide array of threats, from micro unmanned aerial vehicles to cruise
missiles and medium range ballistic missiles. The Army will continue to
upgrade the Integrated Air and Missile Defense Battle Command System,
Indirect Fire Protection Capability, and Patriot missile system. These
investments ensure the Joint Force remains capable and ready to defeat
the most advanced adversaries in an array of contested environments.
Army improvements to Combat Vehicles focus on the Ground Mobility
Vehicle, Stryker lethality upgrades, Mobile Protected Firepower, and
the Armored Multi-Purpose Vehicle. These investments ensure future Army
maneuver forces retain the optimal capability in expeditionary
maneuver, air-ground reconnaissance, joint combined arms maneuver, and
wide area security.
Finally, the Army addresses emerging threats by focusing Science
and Technology investments on mature technologies with the greatest
potential for future use. We are investing in innovative technologies
to protect mission-critical systems from cyber-attacks, enhance active
protection systems for both ground and air weapons systems, improve
aircraft survivability, expand future vertical lift, and employ
cutting-edge directed energy, cyber, and integrated electronic warfare
weapons.
To prioritize readiness, a second area in which the Army assumes
risk is in installation modernization and infrastructure improvement.
Installations are the Army's power projection platforms and a key
component in generating readiness. To build readiness, however, the
Army has been forced to cancel or delay military construction,
sustainment, restoration and modernization across our posts, camps and
stations. Additionally, the Army reduced key installation services,
individual training programs, and modernization to a level that impacts
future readiness and quality of life. In addition to effects on soldier
quality of life, these cuts force commanders to divert soldiers from
training to perform life-support tasks. We estimate an annual burden of
at least $500 million to operate excess or underutilized facilities--an
amount that would fund an Armored BCT European Activity Set for almost
an entire year.
The deliberate decision to prioritize readiness over Army
modernization and installation improvement is an unfavorable choice. To
meet current operational requirements, however, combatant commanders
employ almost one-third of the Active Army and regularly require access
to critical Reserve component capabilities. If in the midst of these
current operations the Army is directed to support a major war plan,
the additional requirements will consume the rest of the Army--all
three components--for the duration of the conflict. This imperative
requires the Army to maximize the readiness of our remaining forces
while managing future risk as best we can.
Leader Development:
The single most important factor in delivering Army readiness, both
now and in the future, is the development of decisive leaders of
character at every echelon. In a complex and uncertain world, the Army
will cultivate leaders who thrive in uncertainty and chaos. Our
creative, adaptive, and agile leaders deliver success on the
battlefield and sustain our All Volunteer Force.
To ensure the Army retains this decisive advantage, we are
increasing funding for leader development across the force; from the
individual, unit, and institution level. This year, the Army will train
approximately 130,000 leaders from all three components in its
Professional Military Education programs. We instituted the Select,
Train, Educate and Promote process to improve leader development of
non-commissioned officers and we continue to enhance the strategic
development of our officers through broadening assignments in graduate
school, inter-agency fellowships, and training with industry. Despite
budget constraints, we will continue to fund these priority programs,
targeted to develop leaders who demonstrate the necessary competence,
commitment and character to win in a complex world.
Decisive leaders also strengthen the bond between our Army and the
Nation and preserve our All-Volunteer Force. Empowered leaders instill
the Army values in our soldiers and uphold the high standards that our
Nation expects. As Army leaders, we continue to express our enduring
commitment to those who serve, recognizing that attracting and
retaining highly-qualified individuals in all three components is
critical to readiness. This is why our fiscal year 2017 budget request
includes key initiatives that support leaders of character in
mitigating the unique challenges of military life, fostering life
skills, strengthening resilience, and promoting a strong and ready
Army.
The Army is expanding our Soldier for Life program to drive
cultural change. Our soldiers will receive the tools to succeed across
the continuum of their Service to our country, in or out of uniform. As
they return to civilian life, soldiers will continue to influence the
most talented young people to join the Army and, along with retired
soldiers and veterans, retain the vital link with our Nation's
communities. As we reduce the Army's end-strength, we owe it to our
soldiers and their families to ensure our veterans strengthen the
prosperity of our Nation through rewarding and meaningful civilian
careers and service to their communities.
Committed and engaged leadership is the focal point of our SHARP
prevention efforts. The Army's ``Not in My Squad'' program is a grass
roots initiative to develop a unit culture that prevents sexual
harassment and sexual assault. The Army instituted a SHARP Resource
Center pilot program; a ``one-stop shop'' to coordinate and support all
SHARP services on an installation. Cadet Command has 232 Reserve
Officer Training Corps programs that have signed partnership charters
with civilian academic institutions, and cadets serve as peer mentors,
bystander intervention trainers, and sexual assault prevention
advocates. Future Army initiatives will continue to focus on prevention
through the use of ``I. A.M. Strong'' and ``Not In My Squad''
campaigns. These holistic prevention efforts will shape Army culture
and enrich Army readiness.
Army leaders remain committed to building diverse teams. Opening
the Army to all qualified citizens of our Nation builds upon the best
the United States has to offer. Diversity of thought strengthens our
bonds with America and builds readiness by contributing diverse
solutions to complex problems. The Army is in full compliance with the
Department's Women in Service Review and is prepared to fully integrate
women in all occupational specialties. The Army's deliberate process
validated standards, grounded in real-world operational requirements,
and will provide our integrated professional force the highest level of
readiness and potential for mission success.
Decisive leaders are essential to maintaining a ready Army,
composed of resilient individuals and cohesive teams, capable of
accomplishing a range of operations in environments of uncertainty and
persistent danger.
closing
Today, our Army stands ready to defend the United States and its
interests. This requires sustained, predictable funding. To rebuild
readiness today and prepare for tomorrow's challenges, the Army has
prioritized decisive action readiness required to respond to current
security challenges. The difficult trade-offs in modernization and
installation improvements reflect the hard realities of today's fiscal
constraints.
The strength of the All-Volunteer Force is our soldiers, civilians
and their families, and we must do all we can to ensure they stay
ready. History provides recurring testimony to past failures to heed
this harsh reality, which ultimately falls on the backs of our
soldiers. With your assistance, the Army will continue to resource the
best-trained, best-equipped and best-led fighting force in the world.
We thank Congress for the steadfast support of our outstanding men and
women in uniform, our Army Civilians, Families, and Veterans. They
deserve our best effort.

Senator Ayotte. Thank you, General Allyn.
I'd like--I'd now like to call on Admiral Howard, the Vice
Chief of Staff of Naval Operations.

STATEMENT OF ADMIRAL MICHELLE J. HOWARD, USN, VICE CHIEF OF
NAVAL OPERATIONS, UNITED STATES NAVY

Admiral Howard. Chairman Ayotte, Senator Kaine, and
distinguished members of the subcommittee, it is my honor to
represent the thousands of Navy sailors and civilians who
sustain operations around the globe.
I appreciate the opportunity to testify on the current
state of Navy readiness and the projected changes to that
readiness with the fiscal year 2017 budget request. This budget
submission provides the resources for our deployed forces and
supports our continued readiness recovery efforts. This
submission also contains the hard choices and tradeoffs we made
to achieve future warfighting capability. In a design for
maintaining maritime superiority, the Chief of Naval
Operations, Admiral Richardson, has challenged the Navy team to
meet the demands of our mission along four lines of efforts.
First, the readiness funding directly contributes to
strengthening naval power at and from sea. Navy readiness
organizations are actively engaged in efforts to meet the
second line of effort, to achieve high-velocity learning at
every level by investing in our sailors through new and
reinvigorated training programs. We support the third line of
effort to strengthen our Navy team for the future by employing
innovative training methodologies to accelerate productivity of
new shipyard employees. Lastly, we strive to expand and
strengthen our network of partners in order to meet our most
critical challenges. We have reached out to industry to address
our shipyard and aviation depot workload. Our budget request
supports the design, and, if executed, will result in continued
operational excellence throughout our Navy.
The demand for naval assets by global combatant commanders
remains high, and Navy continues to provide maximum sustainable
global presence. Supporting this posture requires a commitment
to protect the time and funds needed to properly maintain and
modernize our force. Full recovery of the material readiness of
the fleet is likely to extend beyond 2020. Stable funding,
improvement in on-time execution of ship and aviation depot
maintenance, and steady-state operations are required to meet
our fleet readiness goals.
As we proceed on the road to recovery for float operational
units, we continue to do so by taking conscious risk in the
maintenance of our shore infrastructure. To mitigate impacts
ashore, Navy has made difficult decisions and focused on items
directly tied to our primary missions. As a tradeoff, Navy
continues to postpone much needed repairs and upgrades for the
majority of our infrastructure.
Continued shortfalls in our facility sustainment will
eventually have effects on our sea readiness model. Failing to
plan for these necessary investments will continue to slow our
future recovery. We are still paying down the readiness debt we
accrued over the last decade, but more slowly than we would
prefer and at continued risk to our shore infrastructure.
Powered by our exceptional sailors and civilians, your Navy
is the world's finest, and we are committing to retaining our
superiority. This budget represents a margin of advantage over
our adversaries. That margin could be lost if we do not achieve
stable budgets. We can only maintain our status as the world's
greatest Navy with constant vigilance, dedication to restoring
our readiness, and a commitment to sustain forces around the
globe.
With that, I'd like to depart from my prepared remarks with
one caveat. Senator Kaine, you talked about August of 9/11 as a
milestone. For my Navy, there's another issue that's capacity
all of its own as it affects readiness. On another 9/11, I was
in the Pentagon. At the end of that timeframe, when we--when 9/
11 happened, we had 14 carriers, we had over 300 ships, and we
had 60,000 more people in the United States Navy. During this
time of conflict, we have become more efficient, we are a
smaller Navy, but we are at 272 ships, as of today. That's
ships and submarines. We are growing back to over 308 ships,
and I appreciate the support of this committee in understanding
the purpose of the Navy and helping us get back to where I
believe we need to be, in terms of capacity. We've got to have
a certain core capacity in order to achieve readiness for the
warfight.
I extend my thanks to all of you for your efforts in
continue to support.
Thank you.
[The prepared statement of Admiral Howard follows:]

Prepared Statement by Admiral Michelle Howard
Chairman Ayotte, Senator Kaine, and distinguished members of the
Senate Armed Services Subcommittee on Readiness and Management Support,
I appreciate the opportunity to testify on the current state of Navy
readiness and projected changes to that readiness with the fiscal year
2017 budget request. This budget submission provides the resources to
deliver sustainable deployed forces and supports our continued
readiness recovery efforts. The submission also contains the hard
choices and tradeoffs we were obligated to make in order to achieve
future warfighting capability.
America's security and prosperity are inextricably linked to
maritime freedom. With over 90 percent of our trade traveling the seas,
the fiscal year 2017 Navy budget submission provides a thoughtful
approach to meeting our security challenges within our budgetary means.
We have balanced capability and capacity, delivered current and future
readiness, and postured our forces to meet geographic combatant
commanders' (GCCs) missions, while rebuilding our contingency response
posture in a difficult budget environment. Although we have seen
improvements in rebuilding the workforce in both our public shipyards
and aviation depots, we have not yet recovered from the readiness
impacts resulting from a decade of combat operations. The cumulative
effect of budget reductions, complicated by four consecutive years of
continuing resolutions, continues to impact maintenance, afloat and
ashore. The secondary effects of these challenges impact material
readiness of the force, and the quality of life of our sailors and
their families.
In ``A Design for Maintaining Maritime Superiority'' the Chief of
Naval Operations, Admiral Richardson, has challenged the Navy team to
meet the demands of our mission along four lines of effort. The
readiness funding accounts directly contribute to Strengthening Naval
Power at and from Sea. In addition, Navy readiness organizations are
actively engaged in efforts to Achieve High Velocity Learning at Every
Level, by investing in our sailors through new and reinvigorated
training programs, and to Strengthen our Navy Team for the Future, by
employing innovative training methodologies to accelerate productivity
of new shipyard employees. To meet our most critical challenges, we
must also Expand and Strengthen our Network of Partners. We have
reached out to industry to meet some of our most critical challenges in
shipyard and aviation depot workload. Our budget request supports this
Design and if executed will result in continued operational excellence
throughout our Navy.
Although our readiness shows improvement, recovery is not yet
complete. Full recovery of the material readiness of the Fleet is
likely to extend beyond 2020. Stable funding, improvement in on-time
execution of ship and aviation depot maintenance, and steady state
operations are required to meet our Fleet readiness goals. As we
proceed on the road to recovery for afloat operational units, we
continue to do so by taking conscious risk in the recapitalization,
maintenance, and operation of our shore infrastructure. To mitigate
impacts ashore, Navy has made difficult decisions and focused on shore
items directly tied to our primary missions.
My testimony today will focus on the current readiness of the Navy
as set forth in our fiscal year 2017 budget submission, provide an
overview of our readiness recovery efforts to restore our contingency
response posture, and address challenges to delivering future
readiness.
current navy operations and mission readiness
The demand for naval assets by the GCCs remains high, and Navy
continues to provide the maximum sustainable global presence it can
generate to support a diverse array of GCC missions. Today, the Harry S
Truman Carrier Strike Group (CSG) is underway in the CENTCOM area of
responsibility while the John C Stennis CSG conducts operations in the
Western Pacific. The Stennis CSG will also support RIMPAC 2016 this
summer. This is the first year since 2009 that Navy has been able to
provide a CSG to PACOM while the forward deployed CSG was in
maintenance. Over the past twelve months, three CSGs conducted strike
missions against ISIS in support of Operation Inherent Resolve. Four
Amphibious Readiness Groups (ARGs) with embarked Marine Expeditionary
Units (MEUs) supported a wide range of missions including maritime
security operations, strike missions against ISIS and blockade support
off the coast of Yemen as part of Operation Restore Hope. Closer to
home, fleet ocean tug USNS Apache (T-ATF 172) embarked a deep-water
search and salvage team and successfully located the U.S. flagged
merchant vessel El Faro after her sinking off the coast of the Bahamas
during Hurricane Joaquin. Across the globe, the Navy supported other
critical GCC missions such as theater security cooperation, anti-
piracy, counter-drug, ballistic missile defense, and Intelligence,
Surveillance, and Reconnaissance. Missions such as these not only
demonstrate our responsiveness and warfighting prowess, but maintain
our sailor proficiency, a key aspect of readiness which can only be
bought with time at sea.
The Optimized Fleet Response Plan (OFRP), in conjunction with
ongoing Fleet material condition reset efforts, is designed to support
Navy's overall readiness recovery goals and maximize the employability
of our operational units for both sustainable presence and contingency
response. To date, three CSGs and four ARGs have been inducted into
OFRP. In 2016, the Dwight D. Eisenhower CSG will be the first to deploy
under the OFRP construct. Fleet implementation of OFRP for CSGs is
scheduled to be complete in fiscal year 2021 with the deployment of the
Gerald R Ford CSG. While it is difficult to pinpoint an exact readiness
recovery timeframe for each of our force elements given the array of
factors involved, we predict CSG readiness recovery will occur slightly
outside of the Future Year Defense Program (FYDP). ARG recovery will
remain constrained until we complete modernization of our large deck
amphibious ships to include the capability to operate the F-35B. Key to
our success is operating the battle force at a sustainable level over
the long term. As stated in fiscal year 2016 testimony, readiness
recovery requires a commitment to protect the time needed to properly
maintain and modernize our capital-intensive force and to conduct full-
spectrum training. Achieving full readiness also requires us to restore
capacity and throughput at our public shipyards and aviation depots,
primarily through hiring and workforce development. Successful efforts
in meeting hiring goals have been largely achieved. OFRP allows us to
recover material readiness without hindering our forward presence,
provide our sailors and their families with predictable deployment
schedules, and preserve our force structure so that it meets service
life expectations.
strengthening naval power at and from the sea
The Navy's fiscal year 2017 budget request ensures the readiness of
our deployed forces to operate and fight decisively, meets the
adjudicated requirements of the fiscal year 2017 Global Force
Management Allocation Plan (GFMAP), and supports implementation of the
Optimized Fleet Response Plan. In fiscal year 2017, Navy will stabilize
deployment length for the first time in many years. For fiscal year
2017, no Navy ship is scheduled to deploy for greater than seven
months. The establishment of this important tenet of OFRP will help
instill the predictability required for our shipyards and aviation
depots. In addition, the predictability is a positive quality of life
factor for our sailors and their families. This is a major milestone in
Navy's ongoing readiness recovery.
Ship Operations
The baseline Ship Operations request for fiscal year 2017 provides
an average of 45 underway steaming days per quarter for deployed ships
and 20 days non-deployed, and supports the highest priority presence
requirements of the combatant commanders. With Overseas Contingency
Operations (OCO) funding, ship operations are funded at 58 steaming
days deployed and 24 days non-deployed. This total funding allows Navy
to meet the fiscal year 2017 ship presence requirement, supports the
higher operational tempo for deployed forces, and provides full funding
for ships deployed or preparing to deploy. This account also supports
spare parts inventories, organizational level maintenance consumables,
and administrative and travel requirements. Because of a constrained
top line the Navy took risk. Those latter elements of the Ship
Operations account were reduced for one year to 90 percent of the
requirement. This funding reduction will have some impact on the
restocking of spare parts for non-deployed ships, but is recoverable if
addressed in the next budget cycle.
Air Operations (Flying Hour Program)
The Flying Hour Program (FHP) funds operations, intermediate and
unit-level maintenance, and training for nine Navy Carrier Air Wings,
three Marine Corps Air Wings, Fleet Air Support aircraft, training
squadrons, Reserve forces, and various enabling activities. Combined
baseline and OCO funding will be required to maintain current and
future levels of readiness for deployment. OCO funding also supports
additional deployed operating tempo to meet combatant commander
requirements above baseline funding. All Navy and Marine Corps aviation
squadrons deploy with their full entitlement of aircraft, however some
squadrons are challenged to achieve their required training readiness
levels in early phases of the operational cycle, or following
deployment due to shortfalls in available aircraft. To improve depot
throughput, the Naval Aviation Enterprise is aggressively tackling
three initiatives that include decreasing Work in Progress (WIP),
reducing cycle time, and increasing capacity which will restore combat
sustainment readiness levels.
Spares
While replenishment of ``off the shelf'' spares used in ship and
aircraft maintenance is funded through the Ship Operations and Flying
Hour Programs, the provision of initial and outfitting spares for new
platforms, systems, and modifications is funded through the procurement
appropriation spares accounts (APN/OPN). In recent years, these
accounts have been funded below requirements due to budget constraints.
fiscal year 2017 sustains sufficient funding levels to reduce the
cross-decking between units and cannibalization of parts driven by
unfilled requisitions. fiscal year 2017 starts to stabilize funding
necessary to ensure parts are available when needed. This is
complemented by Navy-wide efforts to improve execution of these
accounts, which has achieved considerable success in aviation spares by
meeting first year execution benchmarks over the last three years.
Sustaining the Force--Ship and Aircraft Maintenance
The Navy maintenance budget requests are built upon independently
certified models, reflecting engineered maintenance plans for each ship
class and aviation type/model/series. Our shipyards and aviation depots
have been challenged by emergent work beyond that expected, associated
with a decade of high tempo operations and additional wear on assets.
The workforce behind our public and private depots is no longer
sufficient for these emergent projects and is still in the midst of
rebuilding and training new workers.
Resetting our surface ships and aircraft carriers after more than a
decade of war led to significant growth in public and private shipyard
workload. The Navy baseline budget request funds 70 percent of the ship
maintenance requirement across the force, addressing both depot and
intermediate level maintenance for carriers, submarines and surface
ships. OCO funding provides the remaining 30 percent of the baseline
requirement and allows for the continued reduction of surface ship
life-cycle maintenance backlogs. For the second year, the additional
OCO request to support Navy's maintenance reset ($625 million) includes
funding for aircraft carriers (CVNs) in addition to other surface fleet
assets, to address increased wear and tear outside of the propulsion
plant. Since much of this reset work can only be accomplished in a
drydock, the maintenance schedule needs to be closely managed, as reset
is expected to continue across the FYDP.
To address the increased workload in our public shipyards and
improve on-time delivery of ships and submarines back to the Fleet, the
fiscal year 2017 budget promotes growth in our shipyard workforce,
sustaining 33,500 Full Time Equivalents (FTE) in fiscal year 2017, with
additional investments for workforce training and development.
Additionally, two attack submarine (SSN) availabilities were moved to
the private sector in fiscal year 2017 to help level load shipyard
workload.
The Fleet Readiness Centers (FRCs) and Navy's aviation depots have
been challenged to recover full productivity after hiring freezes,
furloughs, and overtime restrictions in fiscal year 2013. Through a
concerted hiring effort with the support of congressional budgetary
increases, the recovery in maintenance capability is in progress.
However, the FRCs face a significant backlog of work, particularly for
the service life extension of our legacy F/A-18 Hornets. FRCs hiring
progress returned to pre-sequestration manning levels in fiscal year
2015 and they continue to adjust hiring in order to ensure the
workforce can meet the workload demand. In an effort to improve
throughput, FRCs are increasing engineering support to address the work
required to reach 10,000 hours of service life, reallocating some of
the existing workforce, and contracting additional private sector
support. Navy has increased its number of field teams to improve flight
line maintenance and ensure there is a clear understanding of the
material condition of airframes heading to the depots. FRCs have also
developed repair kits that ensure long-lead parts are readily available
as repair parts are identified.
The Aviation Depot Maintenance program is funded to 76 percent in
baseline and 85 percent with OCO for new work to be inducted in fiscal
year 2017. This funding level supports repairs for 583 airframes and
1,684 engines/engine modules.
Navy Expeditionary Combat Forces
Navy expeditionary combat forces support ongoing combat operations
and enduring GCC requirements by deploying maritime security,
construction, explosive ordnance disposal, logistics, and intelligence
units to execute missions across the full spectrum of naval, joint and
combined operations. In fiscal year 2017, baseline funding remains
significantly improved over prior years, providing 79 percent of the
enduring requirement, with OCO supporting an additional 17 percent of
the requirement.
Shore Infrastructure
Navy's 70 installations worldwide provide the platform to train and
prepare our sailors, deploy our ships and aircraft, and support our
military families. Nevertheless, fiscal constraints over the past
several years have caused Navy to take deliberate risk in shore
infrastructure in order to sustain Fleet readiness today.
Navy's Military Construction program, which is resourced at the
lowest level since 1999, is prioritized to support combatant commander
requirements, enable new platforms/missions, upgrade utility
infrastructure, and recapitalize our Naval Shipyards. Navy is also
taking some risk in the sustainment, restoration, and modernization of
our existing buildings, piers, runways, hangars, utilities systems, and
support facilities. Our fiscal year 2017 facilities sustainment account
is resourced at 70 percent of the OSD facilities sustainment model,
which falls short of DOD's goal of 90 percent for the sixth year in a
row. Navy's fiscal year 2017 request for restoration and modernization
funding is roughly half of fiscal year 2016 levels. This is only enough
to address the most critical deficiencies for the naval shipyards,
nuclear enterprise, piers and runways, and to renovate a small portion
of inadequate barracks for our junior sailors. We are mitigating the
risk in our infrastructure sustainment by prioritizing life/safety
deficiencies and repairs for our mission-critical buildings and
structures. By deferring less-critical repairs, we are increasing risk
of greater requirements in the outyears and acknowledge that our
overall facilities maintenance backlog will increase.
Navy continues to postpone much-needed repairs and upgrades for the
vast majority of our infrastructure, including utilities systems,
waterfront structures, airfields, laboratories, administrative
buildings academic institutions, warehouses, ordnance storage, roads,
and other vital shore infrastructure. Long term underinvestment in
these facilities will take an eventual toll on our ability to support
deploying forces.
Despite these challenges, the Navy is committed to improving the
condition of our Naval Shipyards, which are critical to maintaining the
warfighting readiness of our force. The Department of the Navy will
again exceed the mandated capital investment of 6 percent across our
shipyards and depots described in 10 USC 2476 with a 7.1 percent total
investment in fiscal year 2017. We focus our shipyard investments to
address the most critical safety and productivity deficiencies in
Controlled Industrial Areas, which primarily include production shops,
piers, wharfs, and dry docks.
conclusion
The fiscal year 2017 budget submission has been carefully
structured to ensure the Navy continues readiness recovery through the
implementation of OFRP. Continued shortfalls in our facilities
sustainment will eventually have effects in our at sea readiness model,
and failing to plan for these necessary investments will continue to
slow our future recovery. We are still paying down the readiness debt
we accrued over the last decade, but more slowly than we would prefer
and at continued risk to our shore infrastructure.
Powered by the exceptional sailors and civilians I am proud to
represent today, your Navy is the world's finest and we are committed
to retaining our superiority. This budget represents a margin of
advantage over our adversaries. That margin could be lost if we do not
achieve stable budgets. We will only maintain our status as the world's
greatest Navy with constant vigilance, dedication to restoring our
readiness, and sustaining forces around the globe. I thank you for your
support.

Senator Ayotte. Thank you, Admiral Howard.
I would now like to call on General Paxton, the Assistant
Commandant of the United States Marine Corps.

STATEMENT OF GENERAL JOHN M. PAXTON, JR., USMC, ASSISTANT
COMMANDANT, UNITED STATES MARINE CORPS

General Paxton. Thank you, Chairman Ayotte, Ranking Member
Kaine, distinguished members of the Readiness Subcommittee. I
appreciate the opportunity to appear before you again today and
to report on the readiness of your United States Marine Corps.
The Marine Corps is committed to remaining our Nation's
ready force, a force that's truly capable of responding to any
crisis anywhere around the world at a moment's notice. It has
been so for 240 years, since Captain Nichols led his marines
ashore in Nassau in March of 1776. Last year, the Congress
reiterated the expectations of the 82nd Congress that the
Marine Corps continue to serve as our country's expeditionary
force in readiness, and to be most ready when the Nation is
least ready, as you mentioned just a moment ago, Senator Kaine.
I thank you for that reaffirmation, and assure you that today
the Marine Corps is meeting, and will continue to meet
tomorrow, your rightly high expectations.
Marines continue to be in high demand from all our
combatant commanders around the world. They are forward-
deployed and engaged on land and on sea for crisis response in
Africa, Europe, the Middle East, and the Pacific. Last year,
marines conducted airstrikes in Iraq and Syria, they enabled
Georgian forces operating in Afghanistan, and they conducted
lifesaving and disaster-relief operations in Nepal, among many
other issue--many other missions, all while remaining ready to
respond at a moment's notice.
Maintaining that ``fight tonight'' warfighting relevance
across all five pillars of readiness requires careful
balancing. We must constantly balance between operational
readiness and institutional readiness, between capability and
capacity, as the VCNO [Vice Chief of Naval Operations] just
said, between current and future operations, between steady-
state and between surge and between low-end and high-end
operations as well as the training that goes with them, all of
this as we face the increasing and varied demands from the
combatant commanders.
In our challenging fiscal environment, we're struggling to
maintain all of those balances. As the Commandant said in his
posture statement, the Marine Corps is no longer in a healthy
position to generate current readiness and simultaneously reset
all of our equipment while sustaining our facilities and
modernizing to ensure future readiness.
We have continued to provide the geographic combatant
commanders with operationally ready forces to execute all of
their assigned missions. In some cases, these units are fully
trained only to those assigned missions, not the full spectrum
of possible operations.
In addition to this operational--in addition to this,
operational readiness is generated at the cost of our wider
institutional readiness. This year, I must again report that
approximately half of our nondeployed units are suffering from
some degree of personnel, equipment, or training shortfalls. We
continue to prioritize modernization for the most important
areas, particularly the replacement of aging aircraft and aging
amphibious assault vehicles, but we are deferring other needs.
Our installations continue to be the billpayers for today's
readiness, putting the hard-earned gains from the past decade
and the much needed and the congressionally supported military
construction further at risk.
While our deployed forces continue to provide the
capabilities demanded by the combatant commanders, our capacity
to do so over time and in multiple locations remains strained.
Our deployment-to-dwell-time ratio continues to exceed the rate
that we consider to be sustainable in the long term. The
strains on our personnel and equipment are showing in many
areas, particularly in aviation, in communications and
intelligence. I'm prepared to talk about those, thank you.
We have already been forced to reduce the capacity
available to the COCOMs by reducing the number of aircraft
assigned to several of our aviation squadrons, and we expect to
continue those reductions throughout 2017.
While we are able to maintain steady-state operations
today, to include the ever-expanding Phase Zero operations and
to better shape theater capacity for the combatant commanders
and be focused on theater security cooperation, building
partnership capacity, and sustaining mil-to-mil [military-to-
military] engagements, our ability to surge for a crisis or for
a warfight is increasingly challenged.
Though your Marine Corps remains able to meet the
requirements of the defense strategy and to conduct high-end
operations in a major contingency response, we may not be able
to do so with a level of training and for all of our units and
along the timelines that would minimize the costs in damaged
equipment and in casualties.
These challenges in balancing provide context for the
message today. Your Marine Corps remains ready to answer the
Nation's call, but with no margin for error on multiple
missions in which failure is not an option. To win in today's
world, we must move quickly, move decisively, and move with
overwhelming force.
I thank each of you for your faithfulness to our Nation and
for your continued bipartisan support of the Department and all
of the services.
I request that my written testimony be accepted for the
record.
I thank you for the opportunity to appear before you today,
and I look forward to your questions.
[The prepared statement of General Paxton follows:]

Prepared Statement by General John M. Paxton, Jr.
On December 15, 2012 General Paxton assumed the duties of the
Assistant Commandant of the Marine Corps. Prior to his current
assignment he served as commander, United States Marine Corps Forces
Command, the commander, United States Marine Corps Forces, Europe and
the Commanding General, Fleet Marine Force, Atlantic. He has served as
the Commanding General, II Marine Expeditionary Force, and commander,
United States Marine Forces Africa; the Director for Operations, J-3,
The Joint Staff; and as the Chief of Staff for Multi-National Force
Iraq in Baghdad. Additional General Officer assignments include
Commanding General, 1st Marine Division, Commanding General, Marine
Corps Recruit Depot/Western Recruiting Region, and Assistant Deputy
Commandant of the Marine Corps, Programs and Resources (Director
Programs).
General Paxton graduated from Cornell University in Ithaca, New
York with Bachelor of Science and Master of Civil Engineering degrees.
He was commissioned into the Marine Corps in 1974 through Officer
Candidate School. A career marine infantryman, the general has
commanded marines at every level from platoon through division and has
served and commanded in all three Active Marine Divisions (1st Bn, 3d
Mar; 2nd Bn, 4th Mar; 3rd Bn, 5th; 1st Bn, 8th Mar; 1st Mar; 1st Mar
Div). General Paxton has also served as an operations, plans and
training (G3-S3) officer within Fleet Marine Force units at the
battalion, regiment, division and Marine Expeditionary Force levels.
In addition to service in Iraq, General Paxton has operational
tours supporting stability efforts in the Bosnian conflict with Landing
Force Sixth Fleet (LF6F) and in Mogadishu, Somalia as United Nations
Quick Reaction Force (QRF), both while commanding Battalion Landing
Team 1/8. Other staff and joint assignments include the Military
Assistant to the Under Secretary of the Navy, Amphibious Operations
Officer and Executive Officer Crisis Action Team (CAT) at UNC/CFC/USFK
in Korea; and in Strategic Plans Branch, Deputy Commandant Plans,
Policies and Operations, Headquarters U.S. Marine Corps. Supporting
establishment commands include Company B, Marine Barracks 8th & I as a
Captain and Marine Corps Recruiting Station New York, New York as a
Major.
In addition to The Basic School, General Paxton's professional
education includes United States Marine Corps Amphibious Warfare School
(non resident), United States Army Infantry Officer Advanced Course,
and the United States Marine Corps Command and Staff College. He was a
Federal Executive Fellow in Foreign Policy Studies at the Brookings
Institution as a Lieutenant Colonel, as well as a Military Fellow at
the Council on Foreign Relations as a Colonel. He has also been a
Marine Corps Fellow at Massachusetts Institute of Technology's Seminar
XXI.
introduction
Chairman Ayotte, Ranking Member Kaine, and distinguished members of
the Senate Armed Services Subcommittee on Readiness: I appreciate the
opportunity to testify on the current state of readiness in your Marine
Corps and on our fiscal year 2017 budget request. We greatly appreciate
the continued support of Congress and of this subcommittee in ensuring
our ability to remain the nation's ready force.
The Marine Corps has been our nation's crisis response force since
our first landing in the Bahamas in March 1776. Two hundred and forty
years ago this month the marines led by our First Commandant, Captain
Samuel Nichols, seized weapons and gunpowder for George Washington's
Continental Army. Since that day the Marine Corps has been dedicated to
being our country's expeditionary force in readiness, chartered by the
82nd Congress to be the most ready force when the nation is least
ready. I thank this Committee and the 114th Congress for their
appreciation of that vital role, which you reaffirmed in the most
recent National Defense Authorization Act (NDAA).
your marine corps today
2015 was a demanding year, much like any other for your Marine
Corps. Our expeditionary forces continue to be in demand and heavily
employed in the face of an increasingly challenging global environment.
Your marines executed approximately 100 operations, 20 of them
amphibious, 140 security cooperation activities with our partners and
allies, and 160 major exercises. In partnership with the State
Department, we employed marines at 174 embassies and consulates in 146
countries, with many posts permanently increased in size to contend
with increased threats. Our Marine Security Augmentation Units (MSAUs)
deployed 33 times from the United States for short-term reinforcement
of posts under particular threat. We remain grateful for your support
of our 61 year old mission sets in support of the Department of State
as demonstrated by your 2013 NDAA.
Our 22,500 marines west of the International Date Line continued to
play an important role in maintaining stability in East Asia, working
closely with America's treaty allies from Japan and the Republic of
Korea in the north to Darwin, Australia in the south and numerous other
allies, partners, and locations in between. III Marine Expeditionary
Force (MEF) once again demonstrated why they are the force of choice
for crisis response in Pacific Command. marines from III MEF based in
Okinawa and mainland Japan moved directly from a training exercise in
the Philippines into a disaster response mission in Nepal. Once there
they evacuated 69 casualties, flew 376 sorties totaling 1300 hours in
high mountains, and provided 1070 tons of emergency relief supplies.
Six marines gave their lives in support of that relief operation. The
Bonhomme Richard Amphibious Ready Group (ARG) and the 31st Marine
Expeditionary Unit (MEU), one of the seven MEUs that operate at sea in
support of all combatant commanders, also provided humanitarian
assistance after a typhoon struck the Commonwealth of the Northern
Mariana Islands. The ARG/MEUs in the Middle East supported our embassy
in Yemen, enabled United States special operations forces, and
conducted other training missions.
Geographic combatant commander (GCC or COCOM) operational
requirements also continue to be quickly and capably met by land-based
Special Purpose Marine Air-Ground Task Forces (SPMAGTFs). The unit
assigned to Africa Command supported the reopening of our embassy in
the Central African Republic, provided security at an operating
location in Cameroon, conducted high risk site surveys for numerous
diplomatic posts, and provided incident response forces from multiple
locations. We added a new combined arms capability to the Black Sea
Rotational Force (BSRF), supporting our nation's commitment to security
and stability in Eastern Europe. In Southern Command, a tailored unit
assisted with the reconstruction of a runway in Honduras and conducted
security cooperation in three other countries. Finally, in Central
Command (CENTCOM) our SPMAGTF complemented our MEUs and Special
Operations Force efforts across the region by reinforcing our embassy
in Baghdad. They also reinforced and in February and March assisted
with the evacuation of our diplomatic facilities in Yemen. Additionally
they conducted training in Jordan, and contributed security forces,
quick reaction forces, train, advise, and assist teams, tactical
recovery of aircraft and personnel (TRAP) support, and other
capabilities to Operation Inherent Resolve (OIR).
Seven hundred and fifty marines established and are still operating
training sites at Al Asad and Al Taqaddam Air Bases in Iraq. From there
they have been training and enabling the progress of Iraqi forces as
they combat ISIS, including their recent support to a successful Iraqi
Security Forces (ISF) counterattack at Ramadi. Marine aviation, working
from the land base and the sea base, flew over 1,275 sorties in the
CENTCOM theater, conducting 325 kinetic strikes and providing personnel
recovery assets for that air campaign. In Afghanistan, more than 100
marines continue to operate with the ISAF staff and as enablers for
forces from the Republic of Georgia. While our large-scale commitments
in Iraq and Afghanistan have diminished, today many marines still
remain in harm's way, heavily engaged in the Middle East and around the
globe to do our nation's bidding.
your marine corps from today into the future
As we continue to organize for, train for, and execute our
missions, we are concentrating our near term efforts in five
interrelated areas that are vital to the Marine Corps' future success.
Our Commandant, General Robert Neller, has directed that we focus on
five key areas: People, Readiness, Training, Naval Integration, and
Modernization. The three major themes that run throughout his guidance
are maintaining and improving the high quality people who make up
today's Marine Corps; decentralizing training and preparation for war
while adhering to Maneuver Warfare principles in the conduct of
training and operations; and modernizing the force, especially through
leveraging new and evolving technologies.
Readiness, our focus here today, cannot be considered in isolation
from the other areas, which in turn help comprise the five historic
pillars that are the foundation of our institutional readiness and
responsiveness. First, unit readiness is our most immediate concern. We
must guarantee our ability to execute the mission when called. Second,
we must have the ability to deploy, aggregate, and command and control
our expeditionary capabilities to meet the combatant commanders'
requirements. The third, strongest, and most vital pillar of our
readiness remains our marines, the product of a time tested
transformation process at our Recruit Training Depots. Fourth, those
marines and units rely on our infrastructure sustainment: our bases,
stations, and installations are our launch and recovery platforms and
must remain up to that key task. Fifth and finally, we must
continuously push forward with equipment modernization, balancing our
current and future warfighting needs.
These five pillars represent the operational and foundational
components of readiness across the Marine Corps. We know we are ready
when our leaders confirm that their units are well trained, well led at
all levels, properly equipped, and can respond quickly to the
unforeseen. Our nation's leaders may call on us for that response
today, next week or next year, but we must be ready in any case. In the
current fiscal environment we have been struggling to maintain that
balance between current readiness and projected future readiness. Our
5.6 percent reduction in Operations and Maintenance funding from fiscal
year 2015 to fiscal year 2016 makes that near term struggle even more
difficult.
While we remain grateful for the balanced budget agreement (BBA)
and overseas contingency operations (OCO) dollars, we also continue to
need a stable and predictable fiscal planning horizon. As I stated last
year the possibility of Budget Control Act (BCA) implementation
continues to loom over us all. It threatens our planning and readiness.
While all of our deployed forces have met or exceeded our readiness
standards for their assigned missions, as resources have already flat-
lined or diminished, it has been at the expense of our non-deployed
forces, and investments in other areas such as sustainment and
modernization. As the Commandant wrote in his posture statement, today
the Marine Corps is no longer in a position to generate current
readiness and reset our equipment while sustaining our facilities and
modernizing to ensure our future readiness. In order to stay ready and
to ``fight tonight'' under current budgetary outlays and constraints,
we are continuing to mortgage our future readiness.
unit readiness
We will ensure that an aviation squadron embarks on amphibious
warships for a MEU deployment or on a Unit Deployment Program (UDP)
rotation to an expeditionary base in the Pacific with its full
complement of trained personnel and ready aircraft. They must also have
a complete block of vital spare parts, which have taken on even greater
importance as we work to reset aircraft fleets flown hard over fourteen
years of conflict. In doing so that squadron may leave its sister
squadrons deficient in ready aircraft and parts as they attempt to
train for their own upcoming deployments. Those deficiencies then cut
into the number of Ready Basic Aircraft (RBA) available to train. This
in turn reduces flying hours for the squadron's pilots, making it more
difficult for them to maintain or achieve their own necessary
qualifications (eg. overall hours, flight leadership qualifications,
night flying proficiency, shipboard landing qualifications). The same
dynamic is true in other forms for some of our other units--the
communications and engineering battalions that send their best
equipment and operators out to support our MEUs and SPMAGTFs may lack
the assets to support elements remaining at home station, inhibiting
their ability to train for future deployments and be ready to execute
OPLANs or support crisis response.
That same flying squadron struggling to prepare for its next
deployment, that communications or engineering battalion with key
personnel and equipment already forward, are all a part of our
``bench''--our ready force for any crisis or contingency that exceeds
our forward deployed capacity. Some enabling units, primarily those
located in our Marine Expeditionary Force (MEF) headquarters formations
that provide functions such as intelligence and communications, are
deploying elements in support of sustained missions that were not
anticipated by past planning assumptions. The absence of those
elements, and the need to reset those elements following their
deployments, degrades the readiness of the parent unit at home station.
If the MEF were required to respond to a major crisis, they would
require augmentation of personnel and equipment to alleviate those
shortfalls. In order to retain our home station crisis response
capability as well as our surge capabilities for operational plans
(OPLANs), our rotational units must be able to quickly regain and
sustain their own readiness following brief post-deployment
degradations as old personnel depart, new personnel report, and
equipment is reset. Under our current resource levels we are accepting
prolonged readiness risks and focusing the training of some units to
their more limited rotational mission sets vice full spectrum
operations.
When our resources fail to keep pace with operational requirements
it further exacerbates these readiness problems. In the event of a
crisis, these degraded units could either be called upon to deploy
immediately at increased risk to the force and the mission, or require
additional time to prepare thus incurring increased risk to mission by
surrendering the initiative to our adversaries. By degrading the
readiness of these bench forces to support those forward deployed, we
are forced to accept increased risk in our ability to respond to
further contingencies, our ability to assure we are the most ready when
the nation is least ready. This does not mean we will not be able to
respond to the call of the nation's leadership. It does mean that
executing our defense strategy or responding to an emergent crisis may
require more time, more risk, and incur greater costs and casualties.
demand and capacity to respond
After a deliberate Marine Corps Quadrennial Defense Review study in
2014, the study identified 186,800 as the optimal force size to address
the forecast demands foreseen at that time. World events continue to
challenge the assumptions behind that forecast, both in terms of the
world situation and capability requirements such as cyber and special
operations, and we are reassessing our projected future requirements.
As shown by our operations in 2015, your Marine Corps continues to be
in high demand from our regional COCOMs. With our stabilization at an
end strength of 182,000 we will continue to satisfy many but not all of
those demands. That demand signal has not substantially abated due to
the emergence of threats in new forms, gradually increasing the strain
on our forces.
Along with adequate resourcing, our forces require time to conduct
training and maintain their equipment between deployments. We use the
term ``deployment to dwell'' (D2D) to capture the ratio of time marines
and units spend deployed as opposed to resetting for their subsequent
deployment. Our ideal D2D ratio is 1:3, which means a deployment of 7
months is followed by 21 months of time at home station. That home
station time is required for the unit to conduct personnel turnover,
equipment reset and maintenance, and complete a comprehensive
individual, collective, and unit training program across all their
mission essential tasks (METs) prior to deploying again. Today this
timeline is challenged by the increased maintenance requirements of
aging equipment, shortages in the availability of ships with which to
conduct amphibious training, ensuring personnel fills are in place, and
other factors to include school seats, training range availability and
even weather.
Those challenges are compounded by the demands on today's force,
which have many of our units and capabilities deploying with a 1:2 D2D
ratio, which translates to one third less home station training time
than we would prefer. In several fields, we are currently operating in
excess of a 1:2 ratio for entire units or individuals with critical
skills. For example, our infantry regimental headquarters elements are
currently providing command and control for our SPMAGTFs in Africa and
Central Command, which is limiting their ability to train to other core
METs in major conventional operations. While we may be able to develop
internal solutions to partially mitigate that concern, there are other
challenges that belie simple solutions. Whereas a few years ago we were
focused on our explosive ordnance disposal, engineering, and unmanned
aerial vehicle units, today our critical ground force concerns are for
our communications, intelligence, and signals intelligence battalions.
All of our intelligence and communications battalions and one of our
signals intelligence battalions would be unable to execute their full
wartime mission requirements if called upon today. While other
supporting enablers have scaled down their deployments as the overall
size of our deployed units decreased, those three areas in particular
are facing similar requirements as in the past in support of our
forward deployed crisis response forces, along with increased demands
for ``reach back'' support that further inhibits their abilities to
train and reset while at home station. Those units require specialized
equipment and highly skilled, highly trained individuals, making them
difficult to quickly scale up.
Our aviation community also has elements being stressed by a tempo
in excess of a 1:2 D2D ratio including all of our fixed wing and
tiltrotor aircraft, while our attack helicopters are being
recapitalized and heavy lift helicopters reset as they cope with
shortfalls in ready basic aircraft (RBA). Approximately 80 percent of
our aviation units lack the minimum number of RBA for training, and we
are also short ready aircraft for potential wartime requirements. We
are working hard with the Office of the Chief of Naval Operations
(OPNAV), the Department of the Navy, and the Office of the Secretary of
Defense to find solutions to the RBA issue. Our tactical fighter and
attack squadrons (TACAIR), F/A-18 A-D Hornets and AV-8B Harriers, are
suffering from shortages in aircraft availability due to increased wear
on aging aircraft and modernization delays. The average age of our
TACAIR fleet is over 22 years, over two times the average age of the
corresponding Navy TACAIR fleet. The impact of reduced funding levels
on our depot throughput and the 2013 furloughs of highly skilled
artisans resonates today and will continue to resonate into the future.
We have increased depot throughput by 44 percent in fiscal year 2015
compared to 2014, returning to pre-sequestration levels. We anticipate
continuing to increase depot productivity, but will not fully recover
our F/A-18 A-D model backlog before 2019. We have temporarily reduced
the aircraft requirement for our F-18 squadrons from 12 to 10 to allow
home station squadrons greater training opportunities. For the same
reasons, we have temporarily reduced our CH-53E squadrons from 16 to 12
aircraft and Harrier squadrons from 16 to 14. We are essentially
increasing risk in one area (forward today in support of COCOMs) to
mitigate risk in another (allow home station training for future
readiness).
Our tiltrotor MV-22 Ospreys, deployed in conjunction with KC-130J
aerial refueling aircraft, have provided previously unthinkable reach
and flexibility to our combatant commanders. Deployment demands have
also brought both communities to D2D ratios in excess of 1:2, which is
unsustainable in the long term. This is compounded as we continue to
field both aircraft. In our Global Force Management allocation proposal
for fiscal year 2017, we will reduce the number of those aircraft
assigned to two SPMAGTFs in order to move these communities closer to a
sustainable path. Our combatant commanders can mitigate this reduction
to some degree with judicious use of similar assets from our MEUs when
available, but there will be a loss in capacity forward. As we continue
to contend with constant or increasing demand, every reduction in
resources will force further difficult decisions by COCOMs and sourcing
MEF alike.
personnel
The success of our Marine Corps, the center of our readiness, and
our ability to respond to the requests of the combatant commanders and
demands of our nation's leaders rests on the high quality, character,
and capabilities of our individual marines. Those marines are the
product of a time-tested yet continuously assessed process of
recruiting, transformation at our Recruit Depots, and subsequent
military occupational specialty training that provides our units with
the trained marines they need to prepare for their collective missions.
Since the establishment of the All-Volunteer Force over 40 years ago
through the millennial generation of today, we have successfully
recruited and retained the high caliber American men and women we need
to operate effectively on today's battlefields. The steadily increasing
quality of our recruits is testimony to the solid foundation of our
recruiting system. The continual success of our tactical units on the
battlefield over the past 14 years validates our transformation and
training processes.
Despite our continued successes, we cannot take future success in
these areas for granted and must continue to seek ways to maintain and
improve the high quality people who make up today's Marine Corps. Some
of our most stressed career fields with the longest training timelines,
including aviators, intelligence, communications, and cyber personnel
are also potentially in high demand in the civilian sector. We most
closely track our ability to retain our highly qualified marines in
these areas. Our drawdown from the congressionally approved temporary
increase in end strength to 202,000 in support of Operations Iraqi
Freedom (OIF) and Enduring Freedom (OEF) to our current force of
184,000 resulted in increased competition for retention, but that
drawdown will reach its conclusion at 182,000 marines this year. We are
now re-emphasizing and re-energizing our leadership's attention on
retention to ensure that we continue to retain the requisite numbers of
the very best marines capable of fulfilling our leadership and
operational needs.
We also continue to be challenged to ensure we have the correct
small unit leaders with the right grade, experience, technical skills,
and leadership qualifications associated with their billets. As I
stated last year, our inventory and assignment policies of Non-
Commissioned Officers (NCOs) and Staff Non-Commissioned Officers
(SNCOs) has not been meeting our force structure requirements. Our
efforts to correctly draw down end-strength have included right-sizing
our NCO ranks to provide our marines the small unit leadership they
deserve and which our Corps needs. Concurrent with that right-sizing,
we have implemented a Squad Leader Development Program (SLDP) in the
infantry, our largest occupational field, to continue to improve the
tactical proficiency, the technical skills, and the leadership
qualifications of those NCOs. We are studying ways to broaden that
program into other career fields, including a deliberate effort to
identify and map all of our critical enlisted leader billets. We have
also identified approximately 500 non-structured billets for
elimination, allowing us to return some experienced Marines to
assignments where their leadership will have a greater impact. We will
execute these programs in tandem with our continuing efforts to improve
the personnel stability and cohesion in our non-deployed units, which
our current operating tempo renders difficult. Our goal continues to be
ensuring that all units have the right personnel, leadership, and
cohesion in place at the right time to conduct the collective and unit
training they need to succeed in the face of any mission and to
overcome any challenge.
We are also monitoring the implementation of two significant
personnel reforms for still undetermined impacts and potential
challenges to our personnel readiness. We are already moving ahead with
the Secretary of Defense's order of 3 Dec 2015 to implement full
integration of all qualified Marines, regardless of gender, into all
military occupational specialties (MOSs) and units. Over the past three
years we have dedicated significant resources to preparing for the
implementation of this order, including our Ground Combat Element
Integrated Task Force (GCE-ITF) research, training female volunteers at
the entry level military occupational specialty (MOS) producing schools
for the now open fields, and opening other previously restricted MOSs
and units. These lines of effort (LOEs) have provided us with the data
we needed to codify operationally relevant, occupationally specific
standards that were previously informal, unclear, or outdated. This
will help improve the overall readiness of all of our forces going
forward. We have already awarded the appropriate Additional MOSs (AMOS)
to all of the exceptional volunteers from our research efforts, and
encouraged them to consider applying to move into those combat arms
fields as their primary MOS (PMOS). We currently have female officers
training in the Field Artillery Officer Basic Course for service in
that community, and our Recruiting Command is contacting all of the
women in our Delayed Entry Program pool to inform them of their
expanded opportunities. As we move forward with our Marine Corps
Integration Implementation Plan (MCIIP), we will closely monitor the
process and progress to determine the impact on first, our combat
effectiveness; second, on the health and welfare of our individual
Marines; and third, on our ability to manage and best utilize the
talents of all the Marines in our force. These are the three lenses
through which we have assessed all of our efforts and recommendations
over the past 2-3 years. I continue to have concerns in all three
areas, but am confident that our assessment and subsequent adjustments
during implementation will help us find the best way forward for our
Marines, the Marine Corps, and the nation as we execute these changes.
The Department of Defense is also in the midst of implementing,
preparing for, or studying multiple other personnel reforms that may
have significant but as yet undetermined impacts on our ability to
afford, recruit, and retain the highest quality force. Many of these
are outlined in the Force of the Future Initiative (FotFI). The
Department's FotFI touches on nearly all aspects of military and
civilian personnel systems. In many cases the changes driven by this
initiative are welcome, often codifying what has been existing service
practices. In select other cases we continue to advocate for service
flexibility from any overly prescriptive policies or targets which may
dilute the authorities and flexibility the Service Chiefs need to
execute their title 10 responsibilities and in particular reduce our
availability of ready and trained personnel. We are preparing to
educate our current force on the retirement program changes enacted
into law by Congress last year and assess the long term consequences of
those changes both fiscally and on our personnel. Ideally those changes
will be part of a wider program of reforms including compensation,
healthcare, and retirement which collectively ensure we have an
adequate, comprehensive, and attractive plan for our force. Finally,
the Goldwater-Nichols examination being undertaken by the Congress and
the Department includes a look at our joint training, education,
assignment, and availability of our mid-grade and senior officers. We
must make haste slowly in all these areas to ensure that our attempts
to continually improve upon our current, although sometimes imperfect
system do not disrupt a system that has in fact been exceptionally
successful since 1986 at improving jointness, integration, and
warfighting capability including over fourteen years of continuous
combat.
infrastructure sustainment
Our installations and infrastructure are the platforms upon which
and from which our Marines and units live, train, launch, and recover.
They are the platforms that generate our readiness. The Marine Corps'
installations provide the capability and capacity we need to support
the force. This includes our two depot maintenance facilities, which
provide responsive and scalable depot maintenance support. Both depot
sites, which were right-sized in 2014, have been vital to our ongoing
equipment reset activities based on our past force and equipment
reductions in Iraq and Afghanistan. To date the Marine Corps has reset
78 percent of its ground equipment with 50 percent returned to our
operating forces. We anticipate the depot sites will continue to play
vital roles for the Marine Corps even after our expected completion of
our current reset efforts in 2019. As we are resetting, we are also
conducting a Corps-wide equipment review to right-size and reposition
our equipment sets for today's environment as well as future
challenges. This includes careful examination of items, such as
critical communications equipment, that are having the most significant
impacts on our readiness. We have already identified several critical
items and components and have requests to address them in our fiscal
year 2017 budget.
The Marine Corps has infrastructure and facilities worldwide that
train, house, and provide quality of life for our Marines and their
families. These facilities must be appropriately maintained to prevent
degradation of their ability to support our force and its readiness. We
are executing our Facility Sustainment, Restoration, and Modernization
(FSRM) initiative, the single most important investment in facilities
readiness to support training, operations, and quality of life. We are
accepting risk by programming at 74 percent of the funding level based
on the Office of the Secretary of Defense Facilities Sustainment Model.
We are focused on meeting the essential habitability, safety, and
quality of life requirements while deferring all other activities, to
include the demolition of outdated facilities that are no longer needed
but continue to incur safety driven maintenance costs. Our fiscal year
2017 military construction (MILCON) funding proposal decreases by $330
million from fiscal year 2016 enacted levels. This fiscal year 2017
program enables continued progress towards our long term re-alignment
in the Pacific, including projects necessary to introducing vital new
warfighting capabilities into the region such as the F-35B. We will
require future construction funding increases as some of these projects
mature, such as on Guam, and to activate additional combat staging
locations (CSLs) from which to support forward deployed forces. In
addition to these future requirements, the reductions to military
construction of the past two years and continuing shortfalls in
sustainment funding put us at risk of reversing hard-earned gains in
our infrastructure status (with thanks to Congress for their support of
our MILCON for the past 5-10 years) as our new construction most likely
ages prematurely for lack of maintenance. Left unchecked, this
degradation of our infrastructure can be expected to have negative
long-term impacts not only on quality of life, but also on our support
to training, operations, logistics, and ultimately readiness.
modernization
We are continuing to press modernization in the most essential
areas to ensure the Marine Corps remains ready and relevant in the face
of more capable future enemies. We must balance the cost of those
efforts against our current readiness. Our first operational Joint
Strike Fighter (JSF) Squadron, VMFA 121, declared its initial operating
capability (IOC) in 2015, equipped with state of the art technology in
our F-35Bs. After the second squadron becomes operational in 2016, VMFA
121 will relocate to Iwakuni, Japan in fiscal year 2017. From there
they will operate with the U.S. Air Force and our regional allies
ashore and at sea with our Navy partners. While we are still working to
achieve the full operating capabilities (FOC) of these aircraft, even
at their IOC status our F-35B squadrons are prepared to conduct combat
missions and are much more capable than the 3rd and 4th generation
aircraft they are replacing. The F-35B will have a transformational
impact on Marine Corps doctrine, providing 5th generation capabilities
to support sea control operations (SCO) with the Navy and enable joint
forcible entry operations (JFEO) by the MAGTF even in the most
contested environments. We look forward to the stand-up of our first F-
35C squadron, which will further enhance the capabilities of our Navy-
Marine Corps team and our tactical aviation integration (TAI) plan.
Our other major aviation modernization program is the CH-53K Heavy
Lift Replacement, which will be critical to maintaining the battlefield
mobility of our force, with nearly triple the lift ability of the
aircraft it is replacing. We anticipate our first detachment achieving
IOC in fiscal year 2019 and the full 200 aircraft delivery being
complete by 2029. It will be complemented within our Ground Combat
Tactical Vehicle Strategy (GCTVS) by the fielding of 5,500 Joint Light
Tactical Vehicles (JLTV) with IOC in fiscal year 2019 and FOC by fiscal
year 2022. We will bridge the sea and land with the Amphibious Combat
Vehicle (ACV) 1.1, using this year to test sixteen each of two down
selected models against each other to ensure we receive the best
possible capability even as we look forward to developing the
requirements for ACV 1.2. The development of ACV 1.2 is essential to
the nationally unique ship to shore power projection capability that
your Marine Corps provides. We are also continuing with numerous other
fiscally smaller programs that are no less vital to our warfighting
capability such as the Ground/Air Task Oriented Radar (G/ATOR) and
command and control systems such as Networking on the Move (NotM).
Programs such as these will help us continue to improve our battlefield
awareness and the dissemination of information to small and dispersed
tactical units to maximize their effectiveness. Given evolving cyber
threats, we also assess an as yet unidentified requirement to properly
encrypt all these command and control systems, be they radio, radar,
airborne, or ground mobile.
We are balancing the cost of our modernization efforts in those
essential areas against our current readiness by extending and
refreshing some of our legacy systems. Even as we look to modernize by
replacing the F/A-18, AV-8B, and CH-53E with the F-35B/C and CH-53K, we
are also working to refresh our current aircraft fleets to recover and
maintain readiness and capability during the transitions. We have
already completed independent readiness reviews (IRR) of our AV-8B
Harrier and CH-53E Sea Stallion fleets, are in the midst a review of
our MV-22 Osprey fleet, and will next examine our AH-1Z Cobra/UH-1Y
Huey squadrons and aircraft to ensure we restore and maximize the
potential readiness of our entire aviation community. With our ground
equipment, we are in the midst of a survivability upgrade (SU) to our
existing Assault Amphibian Vehicles (AAVs) to maintain essential ship
to shore power projection capability and capacity while we work to get
the ACV right and fielded. We are accepting much greater risk with our
Light Armored Vehicles (LAVs) now with an average age of 33 years, M1A1
tanks with an average age of 26 years, and other critical warfighting
assets at this time. While we judge these risks to be at acceptable
levels today, they are yet more examples of the trade-offs we are
required to make due to fiscal reductions that accompany operational
demand increases. As we have stated before, there remains the potential
for unacceptable increases in risk associated with any additional
resource reductions or erroneous assumptions, operational or fiscal.
naval and joint force integration
Amphibious warships and their embarked MAGTFs are the center pieces
of the Navy and Marine Corps' time tested and proven forward presence,
forcible-entry, and sea-basing capabilities in support of assurance,
deterrence, and contingency operations. Although our Special Purpose
Marine Air-Ground Task Forces (SPMAGTFs) have been making essential
contributions to our COCOMs, their operations have been shore based due
to the inadequate size of our amphibious fleet. This represents a
compromise of our preferred amphibious basing, with its sovereign
launch and recovery status, and of our rich heritage and strong
partnership with the United States Navy. Although the SPMAGTFs have
been sought after and very successful they are not always the optimal
method of employment of our forces. They may require greater resource
capacity to produce the same warfighting and power projection
capabilities as we achieve operating from the sea.
The availability of amphibious shipping remains paramount to
readiness and responsiveness. The nation's amphibious warship
requirement remains at a minimum of 38 ships to support a two Marine
Expeditionary Brigade (MEB) assault echelon (AE). As the Commandant and
Chief of Naval Operations have testified in past years, the number of
vessels required to meet the steady-state demands of our combatant
commanders exceeds 50 vessels. The current inventory of 30 vessels
falls short of the requirement by both measures, and that shortfall is
aggravated by recurrent maintenance challenges in the aging amphibious
fleet. The current and enduring gap of amphibious warships to
requirements inhibits ours and the Navy's ability to train to our full
capabilities, inhibits our shared ability to respond to an emergent
crisis, and increases the strain on our current readiness.
The Marine Corps whole-heartedly supports the Navy's current build
back to 34 L-class ships by fiscal year 2022, including the 12th LPD-17
class vessel this Congress has provided, the LHA-8, and the 11 ship
LX(R) program based on the LPD-17 hull form. The Marine Corps would
obviously prefer to reach at least the minimum requirement of 38
platforms as soon as feasible, but we understand the Navy's difficult
task in balancing amphibious readiness with many other national
requirements. We agree that 34 ships, with the appropriate level of
availability and surge ability, is a compromise that continues to
assume an acceptable level of risk for a brief period. This risk may be
seriously exacerbated if the Department of the Navy (DON) continues to
be obligated to fund the Ohio-class submarine replacement from within
their already pressurized total obligation authority (TOA). We also
support our continued DON effort to develop and experiment with
alternative platforms including the newly designated ``E Class'' ships.
The value of the Mobile Landing Platform, now designated the
Expeditionary Mobile Base (ESB), as an afloat forward staging base
(AFSB) is already clear. Our combatant commanders are demanding their
employment as fast as they are being fielded. The creative use of these
and other existing platforms, particularly on exercises and in
experiments, will enhance our capacity for operations in lower threat
environments. They may provide enabling support for the operation of
our amphibious warships and landing force in contested scenarios. The
modernization of our ship to shore connectors (SSCs) is equally vital
to this effort, including the programmed replacement of the Landing
Craft Air Cushioned (LCAC) and Landing Craft Utility (LCU) platforms.
Both the LCAC and LCU successor programs should provide affordable
replacements for those aging craft with incremental but much needed
increases in capability. These investments combined with our
modernization efforts such as the fielding of the F-35B will enable a
greater contribution of the Marine Corps to our overall maritime
operations, particularly for forcible entry.
While retaining dominance in our traditional domains, the Navy and
Marine Corps must also continue to move forward with integration into
the total Joint Force as we enhance our capabilities across the entire
and evolving five domain (5D) battlespace. We will begin by reinforcing
our role as a naval expeditionary force that assures access for the
Joint Force. While balancing our own resources, we must also ensure we
remain ready to leverage and enable the capabilities of the Army, Navy,
Air Force, and Special Operations Forces. This includes continuing to
develop information warfare (IW) and command and control (C2)
capabilities which are required to operate effectively against
increasingly sophisticated adversaries. Our Marine Cyber Mission Teams
(CMTs) and Cyber Protection Teams (CPTs) are already engaged in real
world operations supporting COCOM missions and enabling the
functionality of our networks in the face of persistent threats. Their
expertise has been sought more than once to conduct defensive cyber
operations in support of the Office of the Secretary of Defense and
Joint Staff. By the end of fiscal year 2018, Marine Forces Cyber
Command will have 13 Cyber Mission Force Teams with approximately 600
marines, civilians, and contractors. As we continue to develop and
assess our requirements in this area, we are challenged to balance them
within our existing force structure and resourcing. We must ensure our
networks are configured to provide world-wide access in garrison or
forward, and are deployable, digitally interoperable, and able to
support rapid advancements in technology and combat capabilities. As
our adversaries and potential adversaries continue to make advances in
the cyber domain, we must ensure Marine Corps Cyber Forces are ready to
face and respond to those threats with cutting edge capabilities as
part of U.S. Cyber Command. This may require new policies for
programmatic flexibility in manning, training, and equipping as we
contend with this rapidly changing technological environment.
concept development and experimentation
As we prepare to combat our foes in these new domains and focus on
building our maritime based operational capability, we will continue to
expand upon a robust program of experimentation embedded within our
training and exercise program to push innovation and validate new
ideas. While we have been focused and operationally committed to the
conflicts of the past decade, our enemies and competitors have been
advancing their own capabilities--technically, tactically,
organizationally, and operationally. In some cases they have developed
new capabilities which now equal or exceed our own. Global instability
has also increased in the past few years and the threats to our
national interests have evolved. We are confident that the future fight
may not be what we have experienced in the past, but will involve
rapidly changing and evolving technologies, which will force us to be
more agile, flexible, and adaptive. We must continue to push forward
and explore new warfighting and operating concepts as we must be
prepared for the future fight on the distributed and lethal
battlefields of 2025. We must also therefore balance our investment and
commitment to experimentation against our current readiness. This
creates yet another area of potential risk.
The force we need to succeed against the threats of 2025 will not
be a mirror of today's Marine Corps. We expect those threats will
require significant and yet unknown adjustments in manpower, training,
and equipment. In order to develop the force to operate in new domains
and across the electromagnetic spectrum, we may need to either grow or
to rebalance our manpower to ensure we are gaining the capability and
capacity we need in new areas while continuing to improve our existing
edge. That force may also require command and control, reach back, and
lift capabilities that exceed our current capacities. This summer
during the Rim of the Pacific (RIMPAC) exercise, we will conduct an
experiment employing the distributed operations (DO) concept, itself
developed and refined through repeated experimentation, in an anti-
access area denial (A2AD) environment. We will project a lethal
conventional force integrating unmanned technologies from the sea base
against objectives deep ashore, then sustain that force for continuous
operations. That same unit will continue to experiment with its
organization throughout its scheduled fiscal year 2017 deployment to
the Western Pacific. The results gleaned from these and subsequent
experiments will be vital as we shape the design of future force 2025
to ensure we are prepared for the next generation of threats.
conclusion
On behalf of all of our marines, sailors, and their families, I
thank the Congress and this subcommittee for affording us the
opportunity to discuss some of the key challenges faced by our Marine
Corps today and providing us the support and resources to win on the
battlefield of the future as well as of today. With your continued
support, we will strive to carefully and correctly balance readiness
with risk in today's force and the force of tomorrow, and to articulate
what we require to guarantee our warfighting capability and capacity as
we improve our balance across all five pillars of readiness today and
into the future. We will continue to answer the nation's call to arms,
meet the needs of the combatant commanders and national leaders who
depend on us, and be prepared to respond to any crisis or contingency
that may arise. Your Marine Corps will continue to do as the 82nd and
114th Congress directed: ``to be the most ready when the nation is
least ready.''

Senator Ayotte. Thank you, General Paxton.
I would now like to call on General Goldfein, the United
States Air Force Vice Chief of Staff.
Thank you.

STATEMENT OF GENERAL DAVID L. GOLDFEIN, USAF, VICE CHIEF OF
STAFF, UNITED STATES AIR FORCE

General Goldfein. Thank you, Chairman Ayotte, Ranking
Member Kaine, and distinguished members of the subcommittee, on
behalf of our Air Force Secretary and Chief of Staff. It's an
honor to be with you today, and a privilege to be here with my
fellow Vice Chiefs.
I request my written statement be placed in the record.
Just as you have heard from my colleagues, your airmen work
side by side with their fellow soldiers, sailors, marines, and
coastguardsmen to defend U.S. interests here in the Homeland
and across the globe. As an example, it's still winter in
Minot, North Dakota, Malmstrom, Montana, and F.E. Warren Base
in Wyoming, and early this morning, a number of airmen drove
the equivalent of Philadelphia to D.C., and now stand watch
over the most destructive force on the planet as they provide
strategic nuclear deterrence for our Nation and our allies. At
the same time, airmen are providing top cover and precision
fires for our joint and coalition teammates in Iraq, Syria,
Afghanistan, Korea, Africa, and Europe, all while our Air
National Guardsmen provide 24/7 defense of the Homeland in
support of U.S. Northern Command. From moving critical supplies
and people to every corner of the map to managing 12
constellations in space to defending our critical cyber
networks to executing lifesaving personnel recovery and Special
Operations missions, I could not be prouder to represent the
more than 660,000 Active Duty, Guard, Reserve, and civilian
airmen who put the power in airpower.
However, 25 years of continuous combat coupled with budget
instability and lower-than-planned top-lines have made the Air
Force one of the smallest, oldest, and least ready in our
history. To put our relative size, age, and readiness in
perspective, in 1991 we deployed 33 of our 134 combat-coded
Active, Guard, and Reserve fighter squadrons in support of
Operation Desert Storm. We were 946,000 airmen strong. On
average, our aircraft were 17 years old, and 80 percent of the
fighter force was ready for full-spectrum conflict. Today, we
have just 55 Total Force fighter squadrons, and our Total Force
is 30 percent smaller, at 660,000. The average age of our
aircraft is 27 years, and less than 50 percent of our combat
Air Force is ready for full-spectrum operations.
Couple this significant readiness decline with a rising and
more aggressive China, recent Russian actions in eastern Europe
and Syria, continued Iranian malign influence, North Korean
nuclear and space ambitions, and our ongoing fight to deliver a
lasting defeat to ISIL, and you understand my concern with this
dangerous trajectory.
The fiscal year 2017 budget reflects our best effort to
balance capability, capacity, and readiness under the top-line
we received. We made difficult trades between readiness today
and the critical investment required to modernize for the
future against potential adversaries who continue to close the
technological gap. Air Forces who don't modernize eventually
fail. When the Air Force fails, the joint team fails. I look
forward to discussing these trades and their impacts in today's
hearing.
Madam Chairman, decisive air, space, and cyberspace power
is fundamental to American security, and it underpins joint
force operations at every level. The 2017 President's Budget
and the flexibility to execute the resources as we have
recommended is an investment in the Air Force our Nation needs.
America expects it, the combatant commanders require it, and,
with your support, airmen will deliver it.
On behalf of our Secretary and our Chief of Staff and our
airmen who give our service life, thank you for your tireless
and continued support. I look forward to your questions.
[The prepared statement of General Goldfein follows:]

Prepared Statement by General David L. Goldfein
introduction
Today's national security challenges come from a combination of
strong states that are challenging world order, weak states that cannot
preserve order, and poorly governed spaces that provide sanctuary to
extremists who seek to destabilize the globe. The world needs a strong
American Joint Force, and since our establishment in 1947, the Air
Force remains an agile responder in times of crisis, contingency, and
conflict. In fact, the Joint Force depends upon Air Force capabilities
and requires Airpower at the beginning, the middle, and the end of
every Joint operation.
America's Air Force must be able to disrupt, degrade, or destroy
any target in the world, quickly and precisely, with conventional or
nuclear weapons, to deter and win our Nation's wars. Undoubtedly,
decisive air, space, and cyberspace power--and the ability to command
and control these forces--have become the oxygen the Joint Force
breathes and are fundamental to American security and Joint operations.
Whether in support of global counter-terror operations or near-peer
deterrence, your Air Force remains constantly committed, as we have
without respite for the past 25 years.
However, 25 years of continuous combat operations and reductions to
our Total Force coupled with budget instability and lower-than-planned
funding levels have resulted in one of the smallest, oldest, and least
ready forces across the fullspectrum of operations in our history. The
Budget Control Act (BCA) further degraded our readiness, and there is
simply no way to recover without time, money, and people. While the
Bipartisan Budget Act of 2015 provides some space to recover readiness
and continue modernization efforts, your Air Force needs permanent
relief from BCA, consistent, flexible funding, modestly increased
manpower, and time to recover readiness.
impact of the budget control act and sequestration
In 2013, sequestration abruptly delayed modernization and reduced
both readiness and the size of the Total Force. Specifically,
sequestration forced the grounding of one-third of our combat fighter
squadrons for three months. It is important to understand the
cumulative effect on readiness when the Air Force stops flying. We
delay aircrew proficiency and progression, suspend aircraft
maintenance, create months of maintenance backlog, and defer major
depot inspections and overhauls on our aging fleet. Sequestration also
postponed maintenance, repair, and upgrades on our ranges, which
degraded high-end training for our combat forces. Furthermore, we
canceled partnership-building exercises and could not support multiple
Army combat unit certification missions. Half of non-combat joint
airlift and air refueling requirements were unsupported. Further,
sequestration halted investment in infrastructure repairs cancelling or
delaying military construction and facility restoration and
modernization projects across the Air Force.
Even worse, we broke faith with our airmen. We furloughed
approximately 180,000 civilian airmen, froze their pay, and released
all temporary and term employees. Professional military education and
development of our airmen stopped, some base facilities closed, and
airmen and family services halted. Approximately 20,000 experienced
airmen separated from the Air Force under force management programs and
our accession targets were decreased to meet reduced end strength caps.
Our airmen's trust, loyalty, and confidence, an essential aspect that
underpins the effectiveness of our force, eroded during this time.
Bottom line-when an Air Force does not fly, readiness atrophies across
the enterprise with impacts that cannot be reversed in the time it took
to lose it.
The Air Force entered fiscal year 2014 in a government shutdown
with fiscal planning focused on a second year of sequestration. We
remain grateful for the modest, temporary relief from sequestration in
2014 and 2015. This relief enabled the Air Force to fly to capacity,
resume critical aircraft and facility maintenance, invest in our
Nuclear Force Improvement Program, fund our training ranges, purchase
munitions, and invest in the KC-46, F-35, and LRS-B. Despite this
relief, we still made some very tough choices. We attempted to reduce
force structure, carried risk in base infrastructure support and
military construction, and sacrificed near-term readiness for future
modernization.
After submitting our fiscal year 2015 budget, our Secretary of
Defense outlined five threats that factor into our National security
calculus: China, Russia, Iran, North Korea, and the ongoing fight
against global terrorism. As a result, the demand for Air Force
capability and capacity increased. We made necessary adjustments to
balance near-term readiness with future modernization in our fiscal
year 2016 budget, but our readiness remains at a near all-time low due
to continuous combat operations, reduced manpower, an aging fleet, and
inconsistent funding. For the last two years, instead of rebuilding
readiness for future, high-end conflicts, our airmen have responded to
events across the globe, leading and in support of the Joint Force.
Although we remain the world's greatest Air Force, a return to
sequestration would exacerbate the problem and delay our goal to return
to full-spectrum readiness.
state of the air force
Today, the demand for Air Force capabilities continues to grow as
airmen provide America with Global Vigilance, Global Reach, and Global
Power. Airmen are engaged defending U.S. interests around the globe
with approximately 200,000 airmen directly supporting combatant
commander requirements from home station. Your Air Force has deployed
20,000 airmen worldwide, and another 80,000 are permanently stationed
at overseas bases. In this past year, more than 35,000 airmen protected
our national interests and those of our Allies by ensuring a safe,
secure, and reliable nuclear deterrent. We flew nearly 1.7 million
flying hours, equal to 194 continuous years of flying. We delivered a
staggering 1.2 billion pounds of fuel, 345,000 tons of cargo, and
evacuated over 4,000 patients. We also conducted over 8,000 cyberspace
operations and prevented network intrusions. American airmen performed
nearly 20,000 Intelligence, Surveillance and Reconnaissance (ISR)
missions around the world and enabled 25 space missions supporting
national security objectives while simultaneously tracking over 23,000
objects orbiting the earth. All this was accomplished with a force
almost 33 percent smaller than in 1991.
To put our reduced size in perspective, in 1991, during Operation
Desert Storm, we deployed 33 fighter squadrons into our first conflict
since Vietnam. At that time, we had 134 combat-coded fighter squadrons,
946,000 Active Duty, guard, reserve, and civilian airmen, and 80
percent of the fighter force was ready for fullspectrum operations.
Today, we have just 55 combat-coded fighter squadrons, approximately
660,000 Total Force Airmen, and less than 50 percent of our Air Force
is ready for full-spectrum operations-a 30 percent reduction since
Operation Desert Storm. While the extraordinary success of Operation
Desert Storm shaped the world's perceptions of American Airpower, our
near-peer adversaries responded by modernizing their forces with
systems specifically designed to neutralize our strengths.
As our Secretary of the Air Force and Chief of Staff highlighted,
for the first time in a generation, adversaries are challenging
America's freedom of maneuver in air, space, and cyberspace in
contested regions and near our Allies' borders. The Air Force continues
to lead the global response against ISIL in the Middle East while still
heavily engaged in Afghanistan. A resurgent Russia now supports Assad
in the skies over Syria and has announced their intent to modernize
their nuclear forces. In addition, we watched North Korea conduct a
space launch and an illegal nuclear test, and we see worrisome military
activity in the South China Sea. We also have other growing threats in
both space and cyberspace. Our adversaries are closing the capability
gap in space and cyberspace while also fielding advanced air defenses
and fifth-generation aircraft. Our strategic capability advantage over
competitors is shrinking, and our ability to project strategic
deterrence is being challenged.
To meet the full requirements of our Defense Strategic Guidance and
current operation plans, we require 80 percent of our combat squadrons
to be full-spectrum ready. We define full-spectrum readiness as the
right number of airmen, properly led, trained and equipped, to
accomplish our Air Force mission in support of the Joint Force in both
contested and uncontested environments.
We measure full-spectrum readiness through our five levers of
readiness: critical skills availability, weapons system sustainment,
training resource availability, flying hour program, and operational
tempo. If airmen are not ready for all possible scenarios, especially a
high-end fight against a near-peer adversary, it could take longer to
get to the fight; it could take longer to win; and it could cost more
lives. To maintain the advantage the Air Force provides to the Joint
Force, we need sufficient, predictable funding, increased manpower in
critical skills areas, and improved deployto-dwell time. To achieve
balance across our five levers of readiness, the following highlights
our state of readiness and where Congressional support for this budget
request is needed.
state of the air force--global nuclear power
As we emphasized last year, the Air Force represents two-thirds of
our Nation's nuclear triad, and the nuclear enterprise remains our
number one priority. With both nuclear and conventional forces, the Air
Force provides a range of options for America's leaders, but the
effects of age are beginning to limit Air Force nuclear capabilities.
While our nuclear forces remain safe, secure, and effective, this
budget provides significant investment needed to ensure nuclear
readiness and unrivaled deterrence for the 21st century. Today's
bombers were built in the 1960s and are approximately 55 years old. On
average our facilities are now approximately 40 years old, with many
facility systems operating well past their 20-year designed life span.
Currently, all of our weapons storage areas are operating with waivers
and deviations from our high standards. Although these storage areas
are uncompromised, safe and secure, in order to address the
recommendations identified in our Nuclear Enterprise Reviews for
facility and weapons sustainment, we require the resource levels
requested in this budget.
To ensure a reliable nuclear deterrent for the Joint Force, this
budget request includes modernizing nuclear command and control,
replacing some outdated and unsupportable components of Minuteman III
ICBM equipment, while also making initial investments in the Ground
Based-Strategic Deterrence Program. Our National Airborne Operations
Centers provide critical, survivable Nuclear Command, Control, and
Communications but they are 35 years old. We must recapitalize this
fleet in order to maintain our Command and Control advantage in times
of crisis or nuclear conflict. To support the Joint Force, we must
ensure our mobile Command and Control systems are able to withstand
attacks from space and cyberspace and are sufficiently resilient to
function if prevention fails. Additionally, we reorganized our Nuclear
Enterprise and established Air Force Global Strike Command as our Air
Force lead to ensure continued, sustained, and secure Nuclear Command,
Control and Communications. We managed to sustain Air Launched Cruise
Missiles and Minuteman III platforms within our resources. We are
developing the Long-Range Standoff weapon to provide the Joint Force
with a survivable air-launched weapon capable of destroying otherwise
inaccessible targets in any conflict zone. This budget request includes
the resources to address those critical challenges.
state of the air force--global conventional power
Air Superiority is the critical prerequisite for every military
operation to ensure freedom of action for the Joint Force and the
Nation. Our F-22s are in high demand in the Central, Pacific, and
European Commands. Our F-15Cs provide primary support for Homeland
Defense and to both the European and Pacific theaters. These platforms
secure the high ground and have prevented American ground forces from
attack by enemy air strike since 1953. Today, our six F-22A squadrons
are in high demand. Therefore, we are continuing last year's
investments to modernize advanced air-to-air weaponry, requesting
additional funding for sensor and tactical and seeking electronic
warfare protection and modern sensor suites for our remaining F-15C
fighters. To develop airmen properly trained to meet the combatant
commanders' demand signals, we funded flying hours to their maximum
executable level and are continuing to invest in full-spectrum combat
exercises like Red Flag and Green Flag. We have properly resourced
these readiness components in this year's budget and request
Congressional support for these critical requirements.
We also testified last year that weapons system sustainment is a
key component of readiness. Weapons system sustainment costs continue
to increase due to the complexity of new systems, the challenges of
maintaining old systems, operations tempo, and increasing demand for
maintenance personnel. We fly all of our aircraft to their full service
life and beyond. The longer we extend the service life of our legacy
aircraft, the more investment, preventive maintenance and manpower they
require.
This year's budget continues investment in modernizing and
sustaining the three combat-coded B-1 squadrons with additional
precision weapons, digital data links, and other improvements aimed to
negate diminished manufacturing resources. Similar to last year, we
will also invest in extending the B-1 service life to maintain this
strategic capability against evolving threats. We are approaching our
second service life extension on F-16s. Our F-15Cs and F-15Es, which
are in high demand, are experiencing structural fatigue and require the
sustained, consistent funding requested in this budget for repairs to
remain effective.
Since Operation Inherent Resolve in 2014, we have expended over
28,000 munitions worth $1.2 billion, and continue to deplete our
inventories in Iraq and Syria. Our Hellfire expenditures in Operations
Inherent Resolve, Enduring Freedom, and Freedom's Sentinel increased
nearly 500 percent since 2012, but procurement did not keep pace.
Therefore, in this budget we will fund munitions to capacity to support
current operations and start the process to replenish current
inventories.
Similar to last year, we're seeking support in this budget
submission to increase our capacity to provide airmen with increased
high-end training against realistic scenarios and threats. Regrettably,
investments in aging critical infrastructure such as ranges, airfields,
facilities, and even basic infrastructure like power and drainage
systems, have been repeatedly delayed, and the problem was
significantly exacerbated by sequestration. Every year that we delay
these repairs affects operations and substantially increases
improvement costs. Even with the world's most advanced technology, our
airmen are at a disadvantage without conducting realistic combat
training exercises involving the Joint Force, our Allies, and our
partners. Red Flags, and other similar training exercises, built the
foundation for our success in air campaigns during the past 25 years.
We need your support for this budget request to continue investment in
computer-aided live, virtual, and constructive training to provide
opportunities to train against the world's most capable threats,
provide routine training at lower costs, and achieve the full-spectrum
readiness that is vital for our national defense and to safeguard U.S.
interests abroad.
state of the air force--global vigilance
Our global security environment drives an insatiable demand for
integrated ISR. Today, the Air Force continues to sustain 60 Combat Air
Patrols through crossdomain synchronization. With 74 percent of our ISR
forces operating in direct support of combat operations, limited time
remains for training and recuperation. The high demand impacts our
ability to train and retain this critical skill set. Currently less
than one third of our Rivet Joint linguists re-enlist, and our
Intelligence career fields are critically manned.
This critical reduction of experience, coupled with the insatiable
demand for Collection Management, Targeting, Expeditionary Signals
Intelligence, and Airborne ISR Operators drove heavy reliance on
contract personnel. While contract personnel fill a just-in-time
requirement--and perform admirably--this solution does little for the
long-term health of the ISR Enterprise.
To improve the quality of mission for our ISR community, the budget
includes funds to create a dedicated launch and recovery MQ-1/9
squadron, increase training, and restore two MQ-9 operations squadrons.
Additionally, the budget funds training for enlisted operators to fly
the RQ-4 Global Hawk and funds a basing study to provide options to
eventually fly RPAs on a schedule more conducive to steady-state
operations.
Equally strained are the more than 7,000 airmen working in our
Distributed Common Ground System. These airmen supported over 29,000
ISR missions, analyzed more than 380,000 hours of full motion video and
disseminated 2.6 million images to our warfighters in the last year.
They have now operated at these surge levels for over a decade.
Therefore, this budget continues to invest in our ISR Enterprise to
provide globally integrated ISR that supports multi-domain, actionable
intelligence for the Joint Force.
As we testified last year, space and cyberspace threats continue to
grow. In space, our Global Positioning System provides the world's gold
standard, supporting citizens across the globe every day. Fortunately,
our 40 existing Global Positioning System satellites remain healthy,
but they are exceeding projected service life. To maintain this
capability and to build readiness for any potential conflict, we are
requesting support to improve anti-jamming and secure access of
military Global Positioning Systems. We also continue to partner with
the Joint Force on the Space Security and Defense Program and the Joint
Interagency Combined Space Operations Center to develop options for a
more resilient National Security Space Enterprise.
Our cyberspace capabilities are essential to every Airman,
platform, and mission in our portfolio. Therefore this budget request
makes strategic investments in our cyberspace capabilities. For
instance many of our weapons systems were developed prior to the
emergence of the rapidly evolving cyber threats existing today. A cyber
intrusion could significantly impact our ability to project vigilance,
reach, and power anytime, anywhere. To improve offensive and defensive
cyber readiness, we plan to grow our 26 Cyber Force Mission Teams to 39
fully operational teams by fiscal year 2019 and continue our
investments in the Joint Information Environment.
Turning to command and control, this is the glue that enables Joint
Force operations and provides the essential link between our Joint
Force Air component commander and all Joint Forces working for
combatant commanders. The ability to understand changing battlefield
conditions and command friendly forces is central to an effective,
agile combat force especially as we face more threats that are
transregional and span from traditional state adversaries to non-state
unconventional forces. At any of our Air Operations Centers, located in
every combatant commander's area of responsibility, you will find
airmen providing the backbone and expertise to integrate effects from
every warfighting domain. The budget also includes funds to upgrade
legacy equipment to open architectures to ensure critical security
improvements. Our E-8 Joint Surveillance Target Attack Radar System
(JSTARS) is 47 years old and will begin to reach the end of its service
life next year. The E-3 Airborne Warning and Control System (AWACS) is
35 years old and requires multiple upgrades to keep this capability
ahead of emerging threats. We need your support for this budget to fund
mature communications, sensors, and Battle Management Command and
Control system technologies to recapitalize our JSTARS and AWACS.
state of the air force--global reach
Airmen perform the Rapid Global Mobility mission every day in areas
of peace and conflict, and provide our Nation the ability to move the
Joint Force rapidly to any point on the globe. Flexibility allows
airmen to deliver bombs and bullets to the Joint Force in Iraq and
Afghanistan, as well as blankets and bundles of life-saving relief
supplies. Following last year's devastating earthquake in Nepal, C-130s
and C-17s, refueled by KC-135s, accomplished over 150 missions
delivering more than 800 tons of cargo. This core mission was also
exemplified in March 2011 when we executed more than 300 airlift and
combat sorties in a single day. During that time, every combatant
commander had a Priority 1 mission, and the Air Force accomplished each
one without fail. We simultaneously delivered humanitarian relief to
tsunamiravaged Japanese cities, established and enforced a no-fly zone
over Libya with Operations Odyssey Dawn and Unified Protector, surged
forces in Afghanistan for Operation Enduring Freedom, and supported
Presidential airlift.
Today, airframes have aged significantly and some of the same
tankers refueling aircraft over Iraq and Syria were present over
Vietnam. In fact, the Air Force's oldest flying KC-135, assigned to the
190th Air Refueling Wing at Forbes Field, Kansas, was refueling
aircraft when some Vietnam-era pilots were still in elementary school.
This year's investments begin to recapitalize refueling capabilities
with the KC-46A and are essential to combat operations in anti-access/
area denial environments. It also accelerates the C-130 Avionics
Modernization Program and funds modernization to sustain our
approximately 40-year-old MC-130 and AC-130 fleet, which support our
Special Operations Command.
state of the air force--people and infrastructure
Full-spectrum readiness cannot be achieved without investing in our
Total Force Airmen. Maintaining our strategic advantage necessitates
reaching, recruiting, retaining, and developing the broadest and most
talented All Volunteer Force our Nation has to offer. To improve
mission quality in fiscal year 2016, we are increasing accessions and
expanding our retention programs to bring our inventory from 311,000 to
317,000 Active Duty airmen to address a number of key areas, including
critical career fields such as intelligence, cyber, maintenance and
battlefield airmen. In the aircraft maintenance field, we are short
approximately 4,000 aircraft maintainers. Our maintainers must keep our
existing aircraft flying at home and in combat, while simultaneously
fielding the F-35. Due to an ongoing shortage of Active Duty aircraft
maintainers, this budget request will fund contract maintenance
personnel to fill the gap at select non-combat A-10, F-16, and C-130
units allowing our Active Duty maintainers to transition to the F-35.
This allows us to strike the best balance between meeting today's
demand while modernizing for the future.
As stated previously, we project airpower from our bases, and our
infrastructure must keep up with modernization and recapitalization to
sustain a ready force. To consolidate management, reduce overhead
costs, and increase efficiencies, we centralized installation
management under the Air Force Installation and Mission Support Center.
This new command structure consolidates installation support
requirements from the headquarters, major commands, and multiple field
operating agencies. This budget request prioritizes readiness and
modernization over installation support. With this decision we focused
investments on a ``mission critical, worst first'' philosophy, funding
projects with the most mission impact. Today the Air Force maintains
infrastructure that is in excess of our operational needs. We have 500
fewer aircraft today than we had 10 years ago, yet they are spread
across the same number of bases. This arrangement is inefficient with
aging, unused facilities consuming funding that should be used for
readiness and modernization. A reduction and realignment of Air Force
infrastructure would best support Air Force operational needs,
therefore we support another round of base realignment and closure.
future state of the air force
The Air Force, in consultation with combatant commanders, academia,
and think tanks, developed a 30 Year Strategic Plan to make our forces
more agile to effectively respond to future global conflicts. The plan
provides for increased capability across all mission areas,
specifically Adaptive Domain Control, Globally integrated ISR, Rapid
Global Mobility, Global Precision Strike, and Multi-domain Command and
Control. Yet, budget uncertainty has complicated our ability to execute
this plan. Furthermore, the Air Force faces a modernization bow wave
over the next 10 years that requires funding well beyond the BCA caps--
this includes critical programs necessary to meet our capacity and
capability requirements across all mission areas. Although we are
grateful for the Bipartisan Budget Act relief, we still face great
uncertainty for fiscal year 2018 and beyond. Without the funding
requested in this budget, we cannot meet current demand for Air Force
capability and capacity without sacrificing modernization.
As our potential adversaries employ increasingly sophisticated,
capable, and lethal systems, your Air Force must modernize to deter,
deny, and decisively defeat any actor that threatens the Homeland and
our national interests. Without the resources requested in our fiscal
year 2017 budget, we will delay F-35 and C-130H recapitalization, defer
some fourth-generation aircraft modifications, slow our planned end
strength growth and take even more risk in Air Force infrastructure. A
return to Budget Control Act funding levels would necessitate delays to
modernization efforts. It would also further erode the already
shrinking capability gap between America and our adversaries, and it
would defer critical investments in space and cyber.
A return to Budget Control Act funding in fiscal year 2018 would
force us to revisit actions taken during fiscal year 2013's
sequestration--actions that devastated readiness and broke faith with
our airmen. We would be forced to divest force structure, disrupt
readiness recovery, delay modernization efforts, defer investments in
space and cyber, and triage maintenance on infrastructure and aircraft.
It would continue to degrade base infrastructure, delay airmen growth,
and limit critical skill set recruitment and retention resulting in a
less ready, less capable force. Air Force readiness depends on your
support of this this budget and your support for repeal of the Budget
Control Act to remove the threat of sequestration--permanently.
conclusion
In the face of a dynamic, complex, and unpredictable future, your
airmen provide a strategic advantage over America's rivals. They are
educated, innovative, and motivated. Our airmen's ability to see
threats, reach threats, and strike threats is a powerful deterrent
against America's enemies. These courageous airmen, when properly
trained, effectively equipped, and emboldened by the trust of their
leadership, will ensure the Air Force continues to outwit and outlast
opponents in Joint and Coalition operations and defend the United
States from any who would do us harm.
As our Army and Marine Corps get smaller, they do not want less
airlift; they want it to be more responsive. As combatant commanders
look toward battlefields of the future, they do not want less ISR; they
need more persistent, capable, and agile ISR. We have the
responsibility to assure air superiority so American soldiers and
marines keep their eyes on their enemies on the ground rather than
concern themselves with enemy Airpower overhead.
The fiscal year 2017 budget request--and the flexibility to execute
it as we recommended--is an investment in the Air Force our Nation
needs. The global developments remind us that America's Air Force must
have the capability to engage anytime, anywhere, and across the full
spectrum of conflict, all while providing a reliable strategic nuclear
deterrent. America expects it; combatant commanders require it; and
with your support for this budget request, our airmen will deliver it.

Senator Ayotte. Thank you, General.
I would like to start by asking each of you, What is your
leading readiness concern as we think about where we stand?
Appreciate the testimony that you've given, but if you can tell
me, What are the things--what is the thing that keeps you up at
night, readiness-wise?
General Allyn. Thanks, Madam Chair.
For the United States Army, our number-one readiness risk
is sequestration. We must have sustainable and predictable and
sustained funding to deliver the readiness that our combatant
commander requires--require to meet the missions that continue
to emerge. Elimination of sequestration is our greatest risk to
future readiness.
Admiral Howard. Madam Chair, I would echo those comments. I
was at the fleet when we actually sequestered. We ended up
canceling deployments, shifting maintenance periods to meet the
savings required to meet the new budget top-line. It--the
ripple effect of that goes through the years. You not only lose
the maintenance time, but you lose qualification time for
people in that experience that can never be bought back,
because you can't get the time back. Particularly for us, as a
capital-intensive force, having a stable budget, being able to
procure and maintain our ships with certainty allows us to
maintain a ready fleet.
Thank you.
Senator Ayotte. Thank you.
General Paxton. Thank you, Chairman.
I concur with both the VCA--Vice Chief of the Army and the
VCNO. The continued impacts of sequestration are felt over
multiple years. We have not had a stable fiscal planning
environment for 3 years now. We are--we continue to make hard
tradeoffs, and we mortgage our future readiness, because we're
trying to fight today's fight. I have concerns about capacity
and future readiness. Everything we do is trade space, and we
need some top-line relief, ma'am.
Thank you.
General Goldfein. Ma'am, and I'll just continue the same
dialogue. When we stopped flying in--when we were sequestered,
we shut down and grounded 31 fighter squadrons. When an Air
Force stops flying, it's actually felt across the enterprise,
because not only is it the aircrew that stop training, it's the
air traffic controllers that stop training, it's the folks that
actually all participate in producing airpower, and it extends
into the depots that all work towards becoming our readiness
engine. For us, we're still climbing out of the impacts of
sequestration.
I would just add, one point is that we also broke faith
with our airmen, especially our civilian airmen. When they were
furloughed, we lost a number of them who decided that if the
company was not invested in them, they were not going to stick
with the company. For us, repeal of sequestration is job one.
Thank you.
Senator Ayotte. Thank you all.
General Goldfein, I wanted to have you provide us an update
on the KC-46A and where they stand with the delivery to Pease.
I saw, in the Air Force request, that you've requested funding
in 2017 for a KC-46A fuselage trainer at Pease. Is that
important training resource as we base the KC-46A at Pease?
General Goldfein. Yes, ma'am. Right now, the KC-46 is on
track to meet both their required aircraft availability
delivery date, which is 18 aircraft in August of 2017. We have
had some testing delays. The impact of that is that, in a
normal schedule, we would have aircraft, you know, be produced,
we would induct them into the Air Force, we would do the
maintenance and the testing on those. What's happening is, even
though we believe they're going to be able to meet their
required aircraft delivery date, we're going to get a number of
aircraft all at once. As we work our way through that, we
believe that we're going to be able to absorb that in the first
two bed-downs, which is Altus and McConnell. By the time they
actually get to Pease Air Force Base, we believe that we'll
actually be back on track. We're watching that very closely.
We have had some issues lately with some boom axial loads,
but we think we actually have the software fix in place, so
we're on track, we believe, to meet the IOC dates.
Senator Ayotte. Excellent. Appreciate it. I know that our
airmen and all at Pease are anxiously waiting and ready, so we
appreciate it--the update. Keep us updated on where things
stand there.
I wanted to ask, Admiral Howard--you and I talked about the
Virginia-class submarine. Of course, you've been to the
shipyard, and I appreciate your visit there. Right now, are we
able to meet all the combatant commanders' requests for support
from our attack submarine fleet?
Admiral Howard. Ma'am, thank you for that question.
Across our entire fleet, we're not able to meet the
combatant commander requests. Generally, their accumulated
requests are--is about three times higher than the force that
we have. Our SSNs and their multimissions are very important to
the combatant commanders.
Senator Ayotte. As you talked about in your opening
testimony, the size of the fleet, it--obviously, our attack
submarine fleet's phenomenal, but presence is very important,
especially as we think about the Asia-Pacific region and also
the Middle East and various areas around the world that we have
to cover.
As I look at--right now, under the Navy's current plan--you
and I talked about this, but--by 2021, we're at one--producing
one Virginia-class submarine a year, versus two. I know that
Secretary Stackley had testified that he would be open to the
idea of, if you were able to have enough--achieve enough
savings in the Ohio-class replacement program, that he would
like to see you purchase two in 2021.
Now, I understand you can't answer that question now until
you know what the planning is, and investment in the Ohio-class
program, going forward. But, do you agree with Secretary
Stackley that, if--obviously, if this were something that you
were able to achieve the savings and we were to give you the
certainty that you needed, that there is an urgency and
importance to making sure that we continue to build up and
strive for the two production of Virginia-class submarines from
2021, going forward?
Admiral Howard. Yes, ma'am, I do. Yes, Senator, I do.
In our last force-structure assessment, we believe we need
about 48 SSNs. As we've been buying two a year, then, as the
older ones start to reach the end of their lifecycle, we will
be down to 48 in 2024, and then we continue to drop in numbers
until we get into this bathtub in the 20s. In order to make
sure we don't get to that bathtub, we're going to have to
continue to build two, and we're going to have to figure out
how to get there.
In terms of the Ohio replacement, one of our issues will be
whether or not we will have to manage that funding for that
asset. It's a strategic asset. I certainly appreciate this
group's work on the strategic deterrence fund, but if we have
to fund Ohio replacement within our budget top-line, that will
affect all of shipbuilding and actually affect the rest of the
conventional force, as well.
Senator Ayotte. Excellent. Thank you, Admiral Howard.
I would now like to call on Senator Kaine.
Senator Kaine. Thank you, Madam Chair.
Thanks, to the witnesses.
General Allyn said something. I just took it down quickly.
I think I got the quote right, ``Sequestration is the greatest
risk to future readiness.'' I believe that that's true.
Sequestration was driven by a reality that we also have to
acknowledge, which is, we do have an increasing debt that we
have to manage. The deal that was struck, the BCA [Budget
Control Act of 2011] cap deal on August of 2011, basically
punished a lot of our operations, discretionary spending, and
defense spending, as a way of forcing the effort to find a
deal. The deal was, basically, supposed to be a deal that dealt
with the costs of Medicaid and Medicare, on one hand, and the
escalating tax expenditure suck out of the revenues, on the
other hand. We haven't done that deal. You know, just bluntly,
Democrats generally are loathe to get involved in Medicaid and
Medicare reform, and Republicans are loathe to get into tax
reform. But, if we don't do that deal at some point, we can't
just say the deficit doesn't matter. Because it does. The
sequester is going to stay on.
The need to release sequester is going to demand of us a
willingness to show backbone and find some reforms in these
areas that, in the past, has been difficult to do. But, I
really pray that, as a U.S. Senator, I'm going to get to cast a
vote on a big tax reform and spending reform package that will
enable us to just put sequester in the dustbin, where it
belongs.
The--I'm going to ask this question for the record. Senator
McCain has written a letter to the Service Chiefs in--asking
for fiscal year 2017 unfunded requirements priorities list.
Chatted with you about some of that. Some of the material is
starting to come over to the committee. The unfunded
requirements and priorities are not, themselves, prioritized.
For the record, I'm going to ask that the Service Chiefs'
submissions, in fact, be prioritized, because it will help us,
if we decide, can we do some additional resources, to know how
those would be applied by the services. I'll ask that question
for the record.
[The information referred to follows:]

General Allyn. The Army Staff conducted a fair and in-depth
assessment of the Army's fiscal year 2017 budget request; the fiscal
year 2017 Unfunded Requirements (UFR) list prioritizes the shortfalls
and related impacts to the Army's ability to address security
challenges identified by our national leadership. The UFR list has been
prioritized and identifies top Army operational requirements totaling
$1.0 billion and Military Construction requirements totaling about $300
million. The prioritized UFR list does not displace what was already
submitted as part of the President's Budget. Instead, these items would
increase the Army's funding topline for fiscal year 2017 and reduce
risk. Critical Tier I funding priorities include the following: the
National Commission of the Future of the Army (NCFA) recommendations,
which are a strategic assessment of the capabilities and capacity of
the future force and emerging strategic environment; strategic
mobility, which includes the maintenance support costs for
prepositioned equipment sets and war reserve ammunition shortfalls to
support deterrence activities in Europe; operational shortfalls in
support of combatant commanders in support of critical near-term
readiness including many key Intelligence, Surveillance and
Reconnaissance (ISR) assets, which will provide ISR support and
intelligence products for analysts to answer commander's priority
intelligence requirements; capability upgrades to Vehicle Protection
Systems, which provide enhanced protection and survivability in order
to retain a technological edge; and high priority readiness
requirements to include funding for home station training, ground
operational tempo, training ammunition, improvements to our Combat
Training Centers program, emergency deployment readiness exercises,
range support, individual skills training and Second Destination
Transportation which impact the Total Force.
Providing funding for the prioritized requirements on the UFR list
would enhance the readiness of the nation's land forces and should only
come as an additive increase to the Army's fiscal year 2017 topline.
The complete prioritized UFR list was provided directly to the
Congressional office.
Admiral Howard. Attached is the Navy's fiscal year 2017 unfunded
priorities list below.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

General Goldfein. The Air Force's fiscal year 2017 Unfunded
Priority List provided in March is presented in priority order. The
first five requirements listed are our highest priority requirements.
These top requirements focused on the tough choices we made in fiscal
year 2017 to stay within the 2015 Bipartisan Budget Act topline. Beyond
those tough choices, the Air Force focused on Modernization, Readiness,
and Installation Support; which directly support the SecAF's three
priorities . . . taking care of people, striking the right balance
between readiness and modernization, and making every dollar count. The
requirements give our airmen the equipment they need, the training to
meet readiness requirements, and the facilities to work and enhance
quality of life.
General Paxton. Please see the attached prioritized Unfunded
Priority List for the Marine Corps below.

Senator Kaine. General Paxton, let me ask you about a
couple of items with respect to the marines on aviation. The
goal of the Osprey readiness is 87 percent, but it's about 60
percent today. About one-third of the Sea Stallion helicopters
you need to train are ready today. Last year's hearing, you
talked about the extensive backlog of requests for legacy model
F/A-18 Hornets. Tell us a little bit about how we can help you
best on this aviation readiness shortfall that you've
described.
General Paxton. Thank you for the question, Senator Kaine.
We continue to have challenges in our aviation communities,
writ large. If I were to say--if you needed an exemplar of the
impact of continued sequestration or the readiness dollars, I
would tell you that the pacing indicator in the Marine Corps is
our aviation community. Within that community, we are
struggling to get F- --B-22 parts to keep them online, and we
are struggling for maintenance for the F/A-18s. We have some
challenges in our depot maintenance. Some of that was
exacerbated by the loss of skilled craftsmen and the loss of
money during the sequestration, 3 years ago. We have a
continued rebound there.
The plan to regenerate F-18 capability is behind schedule
on a monthly and on an annual basis. We continue to chip away
at that, sir.
It is a mix of three component pieces. It's the ability to
get the aircraft off the line, to get it in to be ready to
maintain, which means you're going to strip away a frame that
pilots would be training on. It's also the need to have the
wrench-turner, be it a uniformed military or a civilian. Then
it's the money available to continue to do the maintenance and
to bring that offline.
We have to sync all of those up together, sir. We have a
demand signal for--particularly for our F-18s right now, until
we get the F-35s online. We're flying the wings literally off
the F-18s right now. That is probably the biggest pacing item
for us, sir. The depth-to-dwell is below 1-to-2. We continue to
source them to two of our Special-Purpose Marine Air-Ground
Task Forces [MAGTFs] in support of CENTCOM [Central Command]
and AFRICOM [African Command]. There's a demand signal, and
we're trying to meet the ``fight tonight'' capability, as I
said. We're doing it at the expense of both the sustainment and
the modernization, Senator.
Senator Kaine. Can I follow up on the point you made about
the Special Purpose MAGTFs? You've got two, and they're
assuming a greater role in crisis response in the regions that
you discuss. I understand the Marine Corps is looking at even
increasing forward presence to ensure that one-third of Active
operating forces are immediately available for use for
contingencies. How do you, kind of, position forward and at the
same time deal with some of the home base readiness issues that
the marines are experiencing?
General Paxton. Thanks, Senator Kaine.
We are committed, as you know and the committee knows, I'm
aware, and as I said in testimony, to answer the ``fight
tonight'' requirements from the geographic combatant
commanders, which is why we have the two Air-Ground Task Forces
forward-deployed. We have, in the last year, as we did our
global force allocation--we have had to reduce the density of
aircraft available to those Special Purpose MAGTFs, in at least
one case. That's because we reached the point where we had to
change our depth-to-dwell model. We had to change our
maintenance. We had to actually induct aircraft back into the
line, back here in the States, and we had to keep sufficient
aircraft at home to train pilots. We're answering the
geographic combatant commander's demand signal, but we have
asked him to reduce that demand signal a little bit. We had to
strike that balance, again, between ``operate tonight'' and
``ready for tomorrow,'' Senator.
Senator Kaine. General Goldfein, I want to move over and
ask about an Air Force issue that we talk about a lot in the
committee, but I didn't fully grasp, til recently, that it was
not a platform issue; it was really kind of a readiness issue.
This is--we debate, on the committee, about A-10 versus F-35.
We have been. If dollars were no object, we might not be having
the debate. But, dollars are an object, and so there's been
kind of a tug-o-war of this.
I thought that was a--essentially, a debate about the
viability or the effectiveness of one platform versus another.
But, what I find, for example, as I've dug into it more, the
Air Force was intending, in the phase-down of the A-10, to take
the A-10 maintainers and move them over and have them become F-
35 maintainers. If we don't phase down the A-10, suddenly
there's about 4,000 maintainers that you need for the F-35 that
you don't have. This is really a readiness question on the
maintenance side. How do you deal with that maintenance gap on
the F-35 side? Because that's a sizable crew of people that you
need to make sure the F-35 are effective.
General Goldfein. Yes, sir. Thanks for the question.
Because we actually are all in the same boat on this one,
in that we don't have excess capacity to bring on new while we
maintain the old.
Senator Kaine. Yeah.
General Goldfein. Actually, I could not give you a better
example of the impacts of sequestration than the A-10
discussion we're having, because it came directly out of the
sequestration discussion. I mean, in 2015, we were given an $8
billion math problem to solve under the sequestered budget. In
2013, just as the Chairwoman said in the opening comments, you
know, a lot of the--the world was relatively stable as we
looked to the forward. We were coming--we were out of Iraq, we
were coming out of Afghanistan, Russia was not active. We had a
relatively stable environment we were looking forward to. We
had to solve an $8 billion math problem.
We went to the combatant commanders and said, ``Of those
missions that we do for the Nation and for your combatant
commands, we have got to find an--a weapon system that we can
take offline to be able to harvest the dollars to pay the bill
and the manpower to bring on the new weapon system. Here are
the options. Take out the B-1, take out the F-15E, take out 400
F-16s, or take out the A-10.''
As you know from working budgets, the easy answers are gone
pretty early in the discussion, and what you're left with is a
series of bad options, and you try to pick the least bad one,
which was the A-10. We have 100-percent concurrence with the
combatant commanders that, given those options, the A-10 is the
weapon system that we would take offline and retire, because we
do have a mitigation--not a one-for-one replacement, not a
platform that can step in for the A-10, but jointly across all
of our aviation capabilities, we have a way to mitigate the
shortfall of the A-10. When the combatant commanders looked at
that, versus other options, they chose that.
We are going through a number of steps to be able to
mitigate that. When we came back to Congress and delayed the
retirement, it was based on the reality that the world changed
since our assumptions were made.
Senator Kaine. This is not to really get back into--members
of the committee have strong feelings about A-10 versus F-35--
--
General Goldfein. Sir.
Senator Kaine. I'm actually not interested in arguing that
right now. But, the thing that I hadn't fully grasped is, by
keeping the A-10 alive, we had made a decision to move the
maintainers over, and so now we have a maintenance gap on the
F-35 side, which is pretty critical. That's a readiness
question.
General Goldfein. Sir.
Senator Kaine [presiding]. These issues do tie together
tightly.
My time is up. Senator Inhofe is next.
Senator Inhofe. Okay, thank you, Senator Kaine.
I think one thing we're getting out of this, so far, is
that General Hawk Carlyle was right when he was talking about,
``We have more mission than money, manpower, and time.'' That
refers not just to the Air Force, but across the board. I know
that's the situation we're in right now. It's very disturbing.
Secretary James and General Walsh were before this
committee last--I think it was 2 weeks ago--and they said,
prior to 1992, the Air Force procured an average of 200 fighter
aircraft per year. In the two and a half decades since,
curtailed modernization has resulted in procurement of less
than an average of 25 fighters yearly. Now, that's--General
Goldfein, that is pretty disturbing. How are we--did we have
too many before? Explain how we got to this situation.
General Goldfein. Yes, sir, thanks.
Over the last 15 years, while the Nation has been very
singularly focused, in many ways, on the violent extremism
threat and fight in the Middle East, each service has made
strategic trades, based on demand signals, on what we provide
to the joint team. For the Air Force, the demand signal has
been primarily in space, cyber, ISR [intelligence,
surveillance, reconnaissance], and the nuclear enterprise.
You'll see in our budget that we invest in those. When you're
trying to balance against those, there's only two places you go
to balance, and that's people and conventional airpower.
Senator Inhofe. Yeah. We're talking about fighter squadrons
there.
General Goldfein. Sir.
Senator Inhofe. I can remember, not too many years ago, I
think they, through necessity, did away with 17--or stood down
17 fighter squadrons. I remember, at the time, we were making
statements, and I did, before the general committee, that it
costs more to reinstate those than anything that is saved in
that short period of time by standing down those fighter
squads. Do you agree with that?
General Goldfein. Yes, sir, I do.
Senator Inhofe. We had the actual figures of that, and it's
pretty astounding, that----
General Goldfein. Yes, sir.
Senator Inhofe. Then, talking--and I would also mention the
Chairman of the committee, Senator Ayotte, talked about what's
happening over there, what our competition is doing. As we find
ourselves in a situation where we are downgrading, China and
Russia are not standing still. I see this gap closing. The J-
20--I guess they were the--yeah, J-20 in China, and the T-50 in
Russia. They are--they're closing in on us. China's J-20, it's
my understanding, would be a real competitor to our F-35 and F-
22. We have those problems.
When you talk about failing--and we all said that it's
modernization that is paying the bill for a lot of this stuff.
We're not preparing for the future. I can remember--and I'd
direct this at our Army and our Marine Vices. Are you aware
that my last year on the House Armed Services Committee, before
I came to the Senate, we had people testifying that, in 10
years, we would no longer need ground troops? Remember that?
Yeah. Well, I guess what I'm saying is, when you're talking
about modernization, you have two problems. One, modernizing
equipment. The other is on your mission--modernize your
mission. If we were to sit here right now--you guys are all
smart--and determine what are our needs going to be 10 years
from today, you're going to be wrong. The only way, if we are
going to try to reinstate our position of superiority, is to go
ahead and do what's necessary in all the possible scenarios
that might be taking place in--10 years from now, or 20 years
from now. You have to stop. You can't wait 8 years and then
determine what to do.
I would hope that you'd consider that to be a major problem
that we need to address, in that we don't know what our needs
are going to be. The American people out there, they don't know
that we don't already have--aren't already superior in every
possible scenario, put together. I think that's something----
Now, I don't disagree with Senator Kaine, although let's
keep in mind that, when we were testifying--I think it was
General Walsh or--but one of them said that, in 1964, we spent,
total--52 percent of our total expenditures on defense. Today
it's 16. Now, when you read further, you do find the culprit in
there is in the entitlements that we're going to have to
address. I would agree that we're going to have to get there.
But, nonetheless, whether it's entitlements' fault or anybody
else's, we're still down there to a small fraction of what we
considered to be the priorities to defend America at that time.
Did we find--Mr.--General Goldfein, when we talked about
the--we brought this up when we had your boss in here and
talked about the fact that we, today, have 33--he said 34 at
that time; this was just last week--fighter squadrons into our
first conflict since Vietnam, or today. But, in 1991, we had
134 combat-coded fighter squadrons. Would you say that we--
again, asking you kind of the same question that we did
before--did we have too many at that time? How can we justify
this kind of degrading, in terms of the numbers of fighter
squadrons?
General Goldfein. Yeah, thanks, sir.
I would say that we did not have too many. We had,
actually, what we needed to go. That was a result of the vision
of the Vietnam generation who built our force back after
Vietnam and gave us the force we needed when we wanted to go
in.
Our challenge today is that for an Air Force--and we all
build and sustain readiness a little bit differently, but I'll
tell you, for an Air Force, when we say that we require the
force to be--80 percent of the force to be ready, it's because
if you take a look at the timelines of the operational plans
that the combatant commanders rely--approximately 80 percent of
the Air Force is forward within 120 days. We have to have that
capacity to be able to meet the defense strategic guidance.
Senator Inhofe. Yeah. Okay.
Lastly, in this morning's--one of the publications, they
kind of relived what happened to our Harrier that caught fire,
here, just the other day. I think it was the--yeah, it was
General Neller said that he raised the question as to whether
readiness shortfalls had contributed to what has become a 5-
year high in aviation mishap rate. That's really astonishing. A
5-year--it affects all you guys--a 5-year high. What--now that
you've had some time to think about it, what do you think about
that, in terms of, What could have been the cause of the
Harrier with the fire accident that--just a few days ago?
General Paxton. Yeah, thank you, Senator Inhofe.
We are concerned about the safety of the aircraft. We're
not concerned--let me rephrase that, sir. That's incorrect.
We're not concerned about the safety of the aircraft. The
aircraft are well-designed, well-built, well-maintained, and
well-flown by great pilots.
Senator Inhofe. Been around, though, since 1985.
General Paxton. But, we are concerned about an increasing
number of aircraft mishaps and accidents. We are--although that
particular one is under investigation, Senator, we're looking
to see if there's a linear correlation. We know, historically,
that if you don't have the money and you don't have the parts
and you don't have the maintenance, then you fly less.
Senator Inhofe. Sure.
General Paxton. We call it ``sets and reps.'' You need set
and repetitions to keep proficiency up there. We truly believe
that if you fly less and maintain slower, there's a higher
likelihood of accidents. We're worried.
Senator Inhofe. Your schedule now is--I think that's--
they're ultimately going to be replaced by the B-35Bs. Is that
correct? The date for ultimate--for ultimately replacing all of
them would be 2025. Am I--is that information correct?
General Paxton. That is correct, Senator.
Senator Inhofe. Do we have enough Harriers to last that
long?
General Paxton. We have sufficient inventory, sir. We have
to keep up the maintenance on them.
Senator Inhofe. Okay.
General Paxton. Absolutely.
Senator Inhofe. Thank you.
Thank you, Mr. Chairman. Madam Chairman, not Mr. Chairman.
Senator Ayotte [presiding]. Thank you, Senator Inhofe.
I'd like to call on Senator Heinrich.
Senator Heinrich. Thank you, Madam Chair.
General Goldfein, Senator Kaine brought up the issue of--
with keeping the A-10s flying, the maintainer challenges that
we have. That's something that's been impacting my home State
of New Mexico, as well. Some of that gap has been filled with
contractors. Why haven't we looked at using the Air National
Guard to help fill that maintainers gap?
General Goldfein. Sir, actually, we have. It's--what's an
interesting part of your Air Force today is that you can jump
on a C-17, walk up into the cockpit and ask, ``Okay, who's
Guard, who's Active, who's Reserve,'' and all three hands will
go up. We're that integrated.
We actually have used, and are continuing to use, the Air
National Guard as we look at resolving the maintenance
challenges we have as we, right now, maintain the A-10 and
bring on the F-35. It's a complete one-Air Force solution that
we're going down.
You mentioned contractors. What we've done is, we've
actually looked at those locations where squadrons don't
deploy, and we're using contractors. That's where you see the
replacement training units and the aggressor squadrons. But,
that's a short-term fill, because eventually we've got to get
back into blue-suit maintenance for those units.
Senator Heinrich. Yeah. I would just encourage you along
those lines. I think that's a really good role for our Air
Guard. As we work through those challenges, I think that's one
of the solutions that I'm certainly most attracted to.
I wanted to bring up something that came up here when we
did the NDAA [National Defense Authorization Act] last year. As
you know, this committee provided a pay incentive specifically
to encourage RPA [remotely piloted aircraft] pilots to enter
into and stay in that field. In the end, the Air Force decided
against providing that incentive pay. The justification or the
rationalization for that was to main parity across Air Force
platforms, but it ignores the underlying issue, which is the
Air Force RPA pilots are leaving the service in high numbers,
as you know, and creating very serious training challenges.
It's--it seems to be a pretty insatiable demand right now for
those capabilities overseas. Some have said that the RPA is
literally--community--is literally at a breaking point. That's
why I think you saw this committee authorize that.
If RPA pilots fly more hours--and I've seen estimates
around 900 per year--shouldn't their bonus structure reflect
that increased demand?
General Goldfein. Yes, sir, thanks.
The reality of the RPA--remotely powered aircraft--business
in ISR is, it's been on an exponential growth really ever since
2001, when we had zero caps, then we grew up to--all the way to
65 caps. What happened along the way is, we continued to try to
mature that weapon system. A mature weapon system, as we define
it, is enough individuals in the weapon system to do the
primary mission, plus go to school, plus do staff, plus serve
as interns here, and do all those things that we can
communicate that portion of the Air Force across the
enterprise.
What's happened in the business of RPA is that every time
we try to stabilize, three more caps were added. The question
came to the Air Force, ``Can you?'' Our answer was always,
``Yes, if.'' ``Yes, if--yes, we can add three more caps if we
delay maturing the weapon system.'' Everyone we had in the
weapon system was doing mission.
This year is the first time we've actually had a chance to
stabilize. We've got--we've got 140 initiatives now that we're
actually able to execute, that have been on the books for
years, actually, that can now improve, not only the manning we
need to be able to get the weapon system to be mature, but also
improve the quality of life for these folks that you mentioned.
One of those is the pay that you authorized.
When we looked at the critically--the, you know, low-
density, high-demand weapon systems across the Air Force,
personnel recovery, you know, some of our other weapon systems,
we want to make sure that we target all of them. While it's a--
it may come across as an issue of fairness and equity; it's
really a matter of making sure that we target. We're doing that
the first year, with 25,000. We're going to come back to you
this next year and, as we've taken a look at the impact, and
perhaps come back for the full 35.
Senator Heinrich. Can you talk a little about, aside from
the bonus issue, what steps you're taking just to recruit and
train more quickly?
General Goldfein. Yes, sir.
First, the most important thing we've done is, we've
increased our instructor pilot force that you've seen at
Holloman----
Senator Heinrich. Right.
General Goldfein.--up to 80 percent, where we were sitting
about----
Senator Heinrich. Yeah.
General Goldfein.--60 percent. That's really----
Senator Heinrich. Huge change. It's----
General Goldfein.--increased its throughput.
Senator Heinrich.--very----
General Goldfein. That's going to get us that 10-to-1 crew
ratio that we've got to build to mature the weapon system.
The other thing we're doing is, we're actually working to
add a squadron to each wing that we have. Because the way we
are operating now is, every squadron is in full combat
operations. There's no relief. We want to add another squadron
so that you have one squadron that's in training, the one
squadron that's doing, you know, all of their additional work
that they have to do, while the other two are engaged in combat
operations. You rotate through the wing the way we do in other
mature weapon systems.
The other thing we're looking to do is add a base. We'll do
that transparently through the basing process so that we don't
have the option of essentially going between Holloman and
Creech as the only two locations for that enterprise.
Senator Heinrich. Great. I appreciate your attention to
that.
General Allyn, the National Commission of the Army appeared
to take a pretty pragmatic approach when considering the
tradeoffs that you've talked about between readiness and
modernization. The Commission recognized the need to preserve
the Army's level of readiness, but also provided a pretty
scathing critique of the lack of investment for next-generation
Army platforms. The Commission concluded that the consequences
for modernization were regrettable, and warned that the long-
term risk to force and mission would be significant. What are
your thoughts on what needs to be done differently, in terms of
the acquisition or the requirements process, so that the Army
can pursue the testing, evaluation, and procurement of those
next-generation weapon system, as well as investing in the
ranges to actually test them?
General Allyn. Thank you, Senator.
I mean, you put your finger on the issue that affects all
of our services, and that is this struggle that we have to
maintain balance between delivering the force that's required
today while building the force for the future and taking care
of our people. What you see us having to do is make a very hard
decision and a poor choice, but the best choice we have within
the resources that we have. While acquisition reform is
essential to make sure that we get the best value for every
dollar that we put into procurement and acquisition efforts,
the problem in delivering capability is not because of
acquisition reform, it's under-funding. All right? We have
eroded our procurement----
Senator Heinrich. You will get----
General Allyn.--funding by 35 percent.
Senator Heinrich.--I think, no argument from us on that
fact. I think, as you heard from Senator Kaine, in particular,
that, until we address sequestration, I don't think any of us
are under the misinterpretation that we're going to be able to
fix the gross overall problem.
General Allyn. But, we are absolutely committed, Senator,
to taking not only actions within the service to address
acquisition reform, because it's absolutely vital that we
deliver the right equipment at the right time for the best
value for the Nation, and we're committed to that, but we also
have got to put more funding into future readiness, because
we're mortgaging it right now.
Senator Heinrich. Thank you.
Senator Ayotte. Senator Ernst.
Senator Ernst. Thank you, Madam Chair.
Thank you, ma'am, gentlemen, for your great years of
service.
General Paxton, especially to you, thank you so much for
your many, many years of service. I think General Allyn would
also thank you for your service, as well.
General Allyn. For the record, he wasn't there 100 years
ago when the first ACMC [Assistant Commandant of the Marine
Corps] went on duty, contrary to popular opinion.
[Laughter.]
Senator Ayotte. He came right after that?
[Laughter.]
Senator Ernst. You have a good friend in General Allyn,
sir.
General Allyn, I'd like to start with you and thank you for
your hospitality yesterday, as well. I appreciate your time and
effort in these matters.
But, over the past year, we've had a number of combatant
commanders that have told us they are either lacking
capabilities or they're not--just barely able to adequately
meet demands. I would like to hear from you how comfortable you
are with the Army's ability to respond to the combatant
commanders' requirements currently, and then also, Do you think
that you have adequate capacity to respond to the combatant
commander current requirements as well as if we have an
unforeseen crisis that comes up in the near future? If you
could expand on that, please.
General Allyn. Thank you, Senator.
Let me probably hit a target that everyone at this table is
wrestling with. You've heard it from each of us, that we are
absolutely committed to delivering trained and ready forces in
support of our combatant commanders. That is job one for us.
For the United States Army, we delivered 91 percent of what our
combatant commanders asked for, in terms of known requirements,
for this past year. That sounds good. Ninety-one percent.
That's an A in many schools across the country. But, that 9-
percent gap is unacceptable to a combatant commander, and we
recognize that.
In addition to that, the Army has delivered 64 percent of
the emerging requirements that came out during this past year,
of their total requirements. Sixty-four percent of what they
asked for that was unpredicted at the beginning of the year, we
delivered. Of course, the problem with that is, that came out
of our surge capacity build. While we're trying to generate
surge capacity for contingencies, we must continue to answer
the emerging requirements that are validated by the Chairman of
the Joint Chiefs and the Secretary of Defense. The end result
of that is, I do not have a level of comfort that we are ready
for a contingency of a major scale against our peer
adversaries; and therefore, I am very uncomfortable with the
trajectory of our drawdown right now, and I do believe it's
time for a strategic review of, is that what is best for our
Nation?
Senator Ernst. General Paxton, do you have any thoughts on
that, as well? Do you have capacity?
General Paxton. Thank you, Senator Ernst.
I know this will shock you, but my battle buddy and I are
pretty aligned here, ma'am. We will continue to always meet
geographic combatant commander demand signals. Even within
those requirements, as General Allyn just talked about, there
is a prioritization on the Joint Staff. We delude no one in
knowing that Pacific Command and Central Command are resourced
at a much higher capacity than AFRICOM or SOUTHCOM [U.S.
Southern Command]. That is of some concern, certainly to those
two geographic combatant commanders, but also to the services.
In the case of the Marine Corps, when we say ``fight
tonight,'' we have an equally high pride factor and ability
factor to source ``fight tonight'' forces. As you just heard me
explain to Senator Kaine, we've had to already chip into that
by saying, ``We're going to resource you and send it over, but
you're not going to get quite as many aircraft in the next
round of doing that.'' We do all of that at the expense of our
bench strength. We have ``tonight'' forces, which are ready,
``tomorrow night,'' which is ready, then everything else is at
some degraded state of readiness, whether it's personnel,
training, leadership, equipment. That is not only mortgaging
the future, but that's mortgaging the surge capability to fight
an operations plan against a known adversary, where we're
banking to have good indications and warning, adequate lift,
and right time. I worry about the capability and the capacity
to win in a major fight somewhere else right now.
Senator Ernst. Okay. Very good. Thank you, General Allyn
and General Paxton.
General Paxton, if we could just continue the conversation
about personnel readiness. You--the Marines are a small force
already. Yet, you continue to downsize. As we look at the pool
of ready applicants that are coming into the Marine Corps, we
really do want those quality individuals. Can you talk a little
bit about how the Marine Corps is facing these challenges in
recruiting and retention? Also, how do you deal with the
challenges of keeping qualified senior leadership in your
ranks?
General Paxton. Yeah, thank you very much, Senator Ernst.
Two great questions.
All the services, I think, are vitally interested in
quality applicants. The amount of high-quality young men and
young women in the United States, that pool continues to
dwindle when you look at physical characteristics, you look at
academic performance, you look at morals, and things like that.
We continue to have a challenge to identify interested and
propensed individuals from a smaller and smaller pool.
In the particular case of the Marine Corps, we are not
having a problem now at all. We have not had a problem for
many, many years attracting high-quality individuals, officer
and enlisted, regular and Reserve, to come into the Marine
Corps. We're very, very proud of our recruiters, our recruiting
force, our recruit trainers, and our entry-level pipeline. We
do not have a problem with reenlisting officer and enlisted
first-term, too.
The challenge we see, as you said, to continue to maintain
a high-quality force over time. There are certain leading
indicators in our second-term reenlistments. Forces--there is a
high demand signal for them to train a lot. Forces where we
need--we have the authorities for bonuses, but we may not have
the money for the bonuses. There's a demand signal out in the
civilian economy.
I think all the services right now are wrestling with the
cyberworld. We know that we need better defensive cyber
capabilities. We know that, at some type, we need offensive
cyber capabilities. It takes a long time to train those
individuals. Once you train them and you get them the security
clearance, they are highly marketable, and the civilian
establishment is making money off of us, because we qualify
them, we train them, we give them security clearances, and then
we need to keep them around. Cyber operators, special
operators, there's a handful of folks--pilots--I think all four
services will wrestle with the long-term retention of those
critical skills, Senator.
Senator Ernst. Thank you very much.
I just want to echo that. I know it's true in the Army, as
well; I'm sure in the other services. I struggled, as a
battalion commander, once we found those soldiers that had
those special skills, keeping them employed within our units
without losing them to other civilian occupations.
Thank you very much, ma'am, gentlemen. Thank you for your
time here today. Appreciate it.
Thank you, Madam Chair.
Senator Ayotte. Thank you, Senator Ernst.
Senator Hirono.
Senator Hirono. Thank you, Madam Chair.
Thank all of you for being here.
General Goldfein, adversary air is an important part of
keeping readiness levels of our pilots at their desired levels.
Because there are no convenient aggressor aircraft available in
a nearby State, the Hawaii Air National Guard's F-22s are
forced to conduct exercises against each other, which eats up
very valuable and expensive airtime of these advanced fighter
aircraft. I've introduced legislation in the past encouraging
the Air Force to look at a wider range of solutions to this
problem. For Hickam, are you considering having--basing some
aircraft that can be used as aggressors, looking at commercial
aggressor services, for example? Can you tell me where the Air
Force is in trying to solve this problem?
General Goldfein. Yes, ma'am.
In a--couple of jobs ago, I served as the A3, the Director
of Operations for a combat command, and we built a fleet of T-
38As, much older aircraft that were no longer in use in
Training Command. We currently use those in three locations in
the United States, in the CONUS [continental U.S.], for
training the F-22, for exactly what you're talking about,
because the cost per flying hour is much less and we're able to
replicate at least a portion of the threat when we fly these
against them.
Within our current top-line, we continue to look at
commercial alternatives while we can contract some of those. We
do, in some our exercise, already do that. The services do, as
well. Right now, I know of no initiative that we're looking at
specifically for Hawaii, but I'll go back and ask and get back
to you.
[The information referred to follows:]

We are pursuing a range of options to satisfy the Hawaii F-22
Raptor Adversary Air training requirements to include exercises,
partnerships with the contracting organization at Nellis Air Force
Base, Nevada, and long term solutions for stationing adversary air
assets in Hawaii.
Currently, Sentry Aloha remains the sole and best opportunity to
meet Hawaii F-22 adversary air training. Sentry Aloha is a large-scale,
peer-to-peer fighter exercise hosted at Joint Base Pearl Harbor-Hickam.
The exercise allows Hawaii F-22s to accomplish valuable Dissimilar Air
Combat Training (DACT) requirements by bringing Air National Guard and
Active Duty flying units to Hawaii for exercises. It is a mutually
beneficial enterprise, as visiting units conduct valuable force
integration and DACT training in world-class airspace and year-long
favorable weather conditions. The National Guard Bureau supports Sentry
Aloha with both funding and manpower to run the DACT events.
We are also working with the 99th Contracting Squadron at Nellis
Air Force Base, Nevada on avenues to access their contract for
adversary air, and believe this will be a viable option under Phase II
of their contract.
Finally, the T-38 has been researched as a possible adversary air
solution for Hawaii F-22s, and was deemed financially unviable by Air
Combat Command. Additionally, there are currently no available T-38
assets. We continue to explore options for stationing adversary air
assets in Hawaii should assets become available.

Senator Hirono. Can you take a look at that?
General Goldfein. Yes, ma'am.
Senator Hirono. Because if you can locate some of these T-
38s in Hickam, for example, that would definitely release the
F-22s from that particular part of training.
Admiral Howard, I was happy to see, in your written
testimony, that you remain committed to improving the
conditions of our Navy shipyards, of which, of course, Pearl
Harbor Naval Shipyard is a large facility. Can you elaborate on
the importance of maintaining our shipyards, including, of
course, Pearl Harbor Naval Shipyard? Do you believe that the
funding allocated in the fiscal year 2017 is adequate to meet
your needs in this area? I know that you've testified that, you
know, we're really putting aside--postponing the needed repairs
and upgrades of all of our facilities. That includes the
shipyard facilities. But, can you just elaborate a bit more on
whether the fiscal year 2017 budget meets your commitment to
maintaining our shipyards?
Admiral Howard. Ma'am, at this point, the budget does
maintain our commitment to the shipyards. Overall, the amount
of money we've put into facility sustainment across all of our
installations is less, and our MILCON [military construction]
is less. But, we understand the importance of our shipyards. I
mean, those are the incubators and the lifeblood for us to
produce ships. We've exceeded a 6 percent investment the last
few years into the shipyards. We're probably going to hit about
8.1 percent investment of upgrades in the shipyards. Then, for
2017, we're at 7.1 percent investment, continuing to upgrade or
modernize the infrastructure. In a budget where we have fewer
dollars allocated to infrastructure support, we prioritize the
shipyards to make sure that they continue to provide us
excellent work.
Senator Hirono. I think that, as you focus on issues such
as the productivity at our shipyards--and, at one time, that
was an issue at Pearl Harbor, and I would think probably at the
other shipyards--modernization and just keeping the equipment
up to par, all of that, totally impacts productivity. Also the
fact that our ships are out longer when they come back to--for
repair and maintenance, it takes our workers longer. That
recognition should be reflected in what you consider
productivity numbers.
Another question for General Paxton. You mentioned, in your
written testimony, that the number of amphibious warship
vessels required to meet the demands of the combatant
commanders exceeds 50 vessels. Furthermore, while the minimum
requirement is 38 vessels, you currently only have 30 in your
inventory. That's page 16 of your testimony. Can you elaborate
on what efforts and duties you are unable to perform as a
result of this inadequate number of vessels? Does the Marine
Corps have a current plan to increase the number of vessels to
fulfill necessary requirements and missions?
General Paxton. Thanks for that question, Senator Hirono.
Work very closely with my shipmate on my right here,
because this is a joint problem. The VCNO alluded, earlier in
her statements, about the overall size of the Navy. Then,
secondly, she also indicated the pressures of funding the Ohio
replacement program within the Department of the Navy top-line,
because this is what actually pressurizes all of the accounts,
not only the shipbuilding account, which affects amphibs for
us, but service combatants, destroyers, carriers, everything
for the Navy, but it also pressurizes our joint aviation top-
line, too. It--because it's just a big bill.
To your specific two questions, Senator. Number one is, the
50 and the 38 are measured against two different metrics. Of
course, the 50, which both General Dunford and Admiral Greenert
testified to last year, reflects the steady-state demand signal
around the world if we were to answer all of those combatant
commander demands. The 38 reflects the war plans and if we had
the requirement to take two marine expeditionary brigades and
move them simultaneously to two major conflicts. Those are the
metrics that we measure against. The Navy-Marine team agreed,
several years ago, that if the funding was available, if the
maintenance of the ships was available, we could handle 34
amphibious ships, provided they were surge-ready to get to the
fight. As we both know, we're at 30 today. We have not been
above 30 for the last 11 years, since 2006. We are interested
in building more amphibs, given the fiscal constraints that the
Department operates under. Right now, we have, thanks to the
good offices of the Congress, the ability to build a 12th LPD,
and we have a plan to take the 12th LPD and move it into the
LXR, a common hull form. We have a plan to get better, ma'am,
but it's contingent on the money.
Senator Hirono. Everything is contingent on the money. We
start, first and foremost, by lifting the threat of sequester,
going forward.
Considering that all of--everyone who comes to testify
says, ``Get rid of sequester,'' and you notice we haven't done
it yet. I would say that that should be a top priority for our
committees and our subcommittees.
General Allyn, you mentioned, in your written testimony--
oh, I'm running out of time.
Madam Chair, I--perhaps I'll submit some of these questions
for the record.
Thank you.
Senator Ayotte. Thank you, Senator Hirono.
Senator Shaheen.
Senator Shaheen. Thank you.
Thank you, to each of you, for testifying today and for
what you do every day to ensure the security of this country
and for your service to America.
I would like to start talking about energy in the upcoming
budget, because I am very interested in hearing about the
efforts to continue to leverage alternative energy use and
energy efficiency. I think there is a perception in some
quarters that this is being done in the military because people
are being told to ``go green.'' Actually, I think it's more
about our combat effectiveness and how we address our
vulnerabilities because of our dependence on energy for so much
of what we do and how we can be more effective using that
energy. I'm sure that everybody here is very aware of the
impact in Afghanistan and other conflicts with needing to
continually convoy energy use--or oil and other resources for
energy use.
Can you all update me on what you're thinking as you're
looking at this upcoming budget, and where you are with energy
use?
General Allyn. I'll go ahead and start, give my teammates a
chance to reflect.
I'll give you two examples, Senator Shaheen, where this is
playing out exactly as you described. We did a significant
amount of work to reduce energy expenditure on our forward
operating bases in Afghanistan. On those bases where we were
able to put energy-efficient generators to operate all of our
facilities, we were able to reduce monthly fuel convoys from
five to two. Every convoy that stays off the battlefield is one
less target in a very IED [improvised explosive devices]-rich
environment. It's about, actually, force protection as much as
it is about saving fuel expenditure and reducing weight for
what has to be brought into the theater.
In terms of what we're doing for future warfighting
development at our NIE [network integration evaluation]
exercises out in Fort Bliss, Texas, and White Sands Missile
Range, New Mexico, we are assessing smart technologies to
reduce the number of generators it takes to run our mission
command centers, particularly for our brigade and our battalion
task force--tactical operations centers. This does many things
for us. Number one, it reduces the signature for these mission
command nodes on the battlefield. Number two, it makes these
entities much more expeditionary. We can reduce from multiple
airframes to bring them into a combat environment, to a couple
of airframes. That's substantial over the--a major conflict, in
terms of strategic lift requirement reduction for the United
States Air Force and the United States Navy.
We have already seen huge gains, in terms of smart power
generation and onboard power generation, where many of our
medium tactical vehicles, and now some of our--even our small
tactical vehicles, will have power generation capacity that can
be outported to run mission command systems and reduce the need
to even bring trailers and fuel haulers and generators. It's--
--
Senator Shaheen. And----
General Allyn.--it's got great long-term effects.
Senator Shaheen. Can you speak to the importance of that,
in terms of readiness for----
General Allyn. Well, in terms of readiness for the
combatant commander, if I can deliver a brigade combat team
with three or four less C-17s, he's able to use those aircraft
to bring additional capability that he needs. Because it's all
about--in a no-notice fight, every single piece of equipment is
prioritized. If you reduce equipment, you enable more capacity
for a smaller consumption of strategic lift. That is absolutely
critical to us.
Senator Shaheen. Admiral Howard?
Admiral Howard. Senator, thank you for the question.
For us, energy independence is directly tied to our
warfighting effectiveness. The Navy has to be completely self-
sufficient at sea. We carry all the fuel for our conventional
ships, and then we carry the fuel for the aircraft. The more
efficient we use fuel at sea means we can stay on station
longer, it means we have to go alongside another ship less
times. Every time you're alongside another ship to receive
fuel, you're not doing your primary mission, whatever it is.
Then, for us, I once heard a admiral say, years ago, a
captain of a ship is least important when the ship is in port.
Mobility is intrinsic to who we are as a Navy. But, then, also
for us, there are security issues that you're also most
vulnerable when you're in port. Speed is life. If you're
static, that's when you're most likely to be a target. An
ability to be energy independent of host nations is important
to our warfighting effectiveness.
For us, we've been doing different things. We've been
looking at our actual propulsion plans for new design, making
sure we have hybrid electric drive. We're backfitting a couple
of our destroyers with hybrid electric drive. Then, when you
look at our shore infrastructure, when you look at critical
infrastructure and utilities, it is to our benefit to be energy
independent as much as we can, even stateside.
Then, in the end, it helps us be good stewards of the
taxpayers' money. If we are not paying high utility bills to
power a ship that's pier-side stateside, that's better use of
that dollar to something else.
Thank you for the question, Senator.
Senator Shaheen. Thank you.
General, either of you like to comment, as well?
General Paxton. Very quickly. Thank you, Senator Shaheen.
Of course, being marines, we're partway between the Army
and the Navy, here. If I could give you just two more examples,
though, of the benefits of this.
General Allyn talked about reducing the number of
generators, or the size of the generators. When you talk about
your core marines being expeditionary, that reduces one of the
five fingerprints of lift. When you look at that cubic foot,
square foot available space on the ships, then we take less.
That means we can put more on the ship, so we become more agile
and mobile, out moving around the seaspace and the battlespace.
The second one that General Allyn alluded to was in terms
of fuel consumption, too. As you know, with our O&M [operations
and maintenance] dollars, we pay to train. We now have the
capability to meter vehicles, and you can figure out at what
point the idling is no good and it's time to shut it down, and
the fuel consumption is actually better then, and you figure
out when you start it back up, as opposed to having a marine or
a soldier let it idle too long. That saves money, which allows
us to train longer and get more bang for the buck out of the
training dollar.
Thank you, ma'am.
Senator Shaheen. Perhaps you should share that information
with the vehicle fleets that the government maintains,
because--the rest of government--because I think that's--we
have a--awful lot of idling vehicles out front.
General? Just to finish up.
General Goldfein. Ma'am, very quickly. I'll just give you
one example.
In the business of remotely piloted aircraft intelligence,
you've got to simultaneously have access to assured energy for
the aircraft that are flying overhead that bounce off the
satellite to go back to command and control, that go into the
process exploitation dissemination. Part of what we're working
with, with an energy task force, is to ensure that we have
uninterrupted access to that energy and electricity so we don't
have mission failure, which impacts readiness, based on
vulnerability to cyberattack. That's where we're putting a lot
of our effort.
Senator Shaheen. Thank you.
Senator Ayotte. Thank you, Senator Shaheen.
Admiral Howard, I wanted to follow up an issue that you and
I had talked about in my office, but one of the things that the
workers at the Portsmouth Naval Shipyard do is, they're often
deployed to share their expertise at other shipyards to help
make sure that we've got good maintenance and we're all working
together. One of the issues that we put in the 2016 NDAA was a
concern that the new long-term TDY [temporary duty] policy may
be discouraging excellent, excellent workers from going to
other shipyards because of the cost of it and also, you know,
putting a burden on them that doesn't allow them to stay
similarly situated if they had stayed homeside. This is
something that I'm worried about--just worried about, because
I--we want to share our expertise. Our shipyard workers do a
great job with this. I know Admiral Hilarides has raised some
issues about this, as well. I just wanted to say, is this
something that you can look at to make sure that these concerns
are addressed?
Admiral Howard. Yes, ma'am, absolutely.
Admiral Hilarides' concerns have now reached the Department
of Navy secretariat, and then we'll be looking more deeply into
it and forwarding a recommendation to OSD [Office of the
Secretary of Defense].
There's a couple more aspects I think we need to think
about. One, the policy was created to help save money----
Senator Ayotte. Right.
Admiral Howard.--and to help all of us be good stewards of
the taxpayers' money. In the end, unless we have volunteers, we
can only compel shipyard workers to spend a certain amount of
time TAD [temporary additional duty], so we may end up--as they
reach the end of that 4-week cycle, we may have more turnover
than we like. Then we end up----
Senator Ayotte. Would cost us more money, right?
Admiral Howard. It ends up--in the end, the policy may be
costing us more money. We are working through to get those
details with NAVSEA [Naval Sea Systems Command]. Obviously, a
policy that had exactly the opposite effect is not one we
should stay committed to.
But, there's another principle here that we need to think
about. One is the commitment to these artisans and their
skillsets----
Senator Ayotte. Right.
Admiral Howard.--and that, as a government, we should be
providing just compensation to our people. If it's true that,
based off the per diem rates and then the actuality of the
functioning of how we have these people working, they are
paying money out of their pocket, then that sort of violates
many principles of----
Senator Ayotte. Right.
Admiral Howard.--leadership and government. We are working
with NAVSEA to get to the facts of what's going on, and then we
can make a good recommendation to OSD.
Senator Ayotte. Well, we really appreciate your
consideration and really careful view of this, because--I just
want to say, for the shipyard workers at the Portsmouth Naval
Shipyard, I know they want to go and help the other shipyards.
We just want to make sure that they're treated fairly and are
able to do that. I appreciate your looking at this policy.
Thank you.
General Goldfein, I wanted to ask you, How are the A-10s
performing in--against ISIL? The Secretary of Defense has said
they've been performing superbly. How are they doing?
General Goldfein. Superbly, yes, ma'am. I would align with
that.
Senator Ayotte. Okay, appreciate it.
I wanted to follow up--I--on the maintenance issue that was
raised earlier. The Air Force told Congress that it had had to
place A-10s on XJ or set-aside status to free up maintenance
personnel moved to the F-35. I think this may have been raised
earlier in the hearing. You've discussed the maintenance
shortfall in your prepared testimony. Yet, my office has
learned that at least five A-10 crew chiefs from Davis-Monthan
have--were not moved to the F-35, but, rather, to the Azores to
conduct basic aircraft transient alert activities that can be
done by any maintenance personnel. Are you aware of this? If
not, can you look into it for me?
General Goldfein. I'm not, and I will. Yes, ma'am.
Senator Ayotte. I appreciate it. Because I want to make
sure that, if this is the claim on the maintenance personnel,
that it is--that we're maximizing and properly using the
maintenance personnel. I want to know, for the record, that the
Air Force has told our office previously that it couldn't use
contractors to solve a short-term maintenance shortfall. But, I
know, in this budget request, it will--the request will fund
contractor maintenance personnel to fill gaps at select
noncombat A-10, F-16, and C-130 units, following our Active
Duty maintainers to transition to the F-35. I've gotten
different stories on the maintenance issue. One thing I would
appreciate, overall, is if you could provide my office--since
the claim is that we need the A-10s maintainers to assist the
F-35, I'd like to know a--what's happening with the A-10
maintenance personnel, and to have a list of the last 2 years
of where they're moving and how they're performing.
[The information referred to follows:]

The Air Force has an overall shortfall of 4,000 aircraft
maintainers, to include legacy and F-35 requirements. This shortfall
widely impacts the experience level of maintainers as well as aircrew
mission readiness levels across all Combat Air Forces (CAF) platforms.
New accessions require five to seven years to become fully qualified
aircraft maintainers. In addition to the F-35 Initial Operational
Capability manpower requirements, there are key legacy (i.e., F-16, F-
15 and A-10) maintenance manpower requirements that need to be
addressed to maintain experience levels and readiness.
As a result of the conversion of 18 A-10s to Backup Aircraft
Inventory (BAI) status in fiscal year 2015, the Air Force retrained 110
A-10/U-2 crew chiefs and 30 A-10/U-2 avionics technicians to F-35
units. These 140 personnel were assigned to Nellis, Hill, Eglin, Luke
and Edwards Air Force Bases. Below is a breakdown of the locations they
were assigned:

F-35 crew chiefs F-35 avionics (total =
(total = 110): 30):
Nellis--8 Nellis--3
Hill--58 Hill--11
Eglin--12 Eglin--6
Luke--26 Luke--8
Edwards--6 Edwards--2

Over the last 6 overseas assignment cycles (2 years), the Air Force
Personnel Center assigned two 2A353E (A-10/U-2 crew chiefs) to Kadena,
and one to Lajes to support A-10 Transient Alert missions for a total
of three personnel. Kadena and Lajes Transient alert operations support
enroute aircraft deployment requirements, including A-10s that deploy
overseas, so these individuals are still working on the A-10. All of
the remaining 321 2A3X3E personnel remained at A-10/U-2 units to
sustain continued operations on those platforms. Note: The A-10 and U-2
share the same Air Force Specialty Code (AFSC) at the 3/5-level.
As for 2A3X4A (A-10/U-2 avionics), no A-10 maintainers were
reassigned except between A-10/U-2 units. A-10 units include: Osan,
Moody, Davis-Monthan, Nellis, and Whiteman (Active Associate Unit); U-2
units include: Beale and Osan.
In response to your contract maintenance question; the Air Force
could not implement contract maintenance during the fall of 2014 and
move approximately 500 Active Duty maintainers to Hill AFB in 2015 in
time to meet F-35 IOC requirements by August 2016. However, over the
next three years, the Air Force will implement contract maintenance
initiatives from 2017-2020 to support F-35 bed-down requirements until
Active Duty end strength and maintenance accessions fill the 4,000
maintainer shortfall to meet Air Force manning and experience
requirements. Readiness levels across the CAF are dependent on
addressing total manning and experience requirements.

Senator Ayotte. My concern about the A-10 continues to--and
I think it's exemplified by the letter that I received from
other TACP [Tactical Air Control Party] Association that
represents roughly 1300 Active Duty, Air National Guard, and
Reserve JTACs [Joint Terminal Attack Controller] and 2,000
former JTACs who have written me and said, ``We believe F-15s,
F-16s, and B-1s cannot replicate the CAS [close air support]
capabilities of the A-10. We know from combat experience that
the elimination of the A-10 before a viable replacement
achieves full operational capability will cost American
lives.'' That's been my focus from the beginning, and my
concern about this particular platform.
I do also--you and I have gone round and round about this--
but, I also want to follow up on the wing issue that you and I
have talked about. As I understand it right now, that, under
the current plan, if there's not a reprogramming request
submitted for A-10 wings, that 13 A-10s will be grounded in
2018 due to the need for new enhanced wing assemblies. Part of
it is, they're being used right now, right, a lot against the
fight against ISIL? Is that--is my understanding correct for
that? Am I right to say that, for the record, without a
reprogramming request for additional action, not only the 13
retired in fiscal year 2018, the Air Force will--also told me
that 28 A-10s would be grounded in 2019, 42 in 2020, and 47 in
2021. Is that true?
General Goldfein. Partially, ma'am. The aircraft in 2018
are actually going to be grounded, but the--even if we were
able to buy new wings, those wings won't show up until 2019, so
they actually will not affect the 2018 numbers that will be
grounded. Our plan right now is to take those out of the BAI
[Backup Aircraft Inventory] aircraft so it won't affect,
actually, those combat-coded aircrafts that we send forward to
a combatant commander, so we'll manage those 10 in 2018. The
wings, if, in fact, we come forward and are approved for a
above-threshold reprogramming by the committees that approve
that, if that's approved and the Secretary comes through with
that, those wings will start showing up in 2019. That's when
they'll start being refitted.
Senator Ayotte. Well, I--and I would--as you and I have
talked about, I would urge the Secretary to come forward,
because obviously time is of the essence. We know that this
platform is working well against ISIL. I really would
appreciate the Secretary--and I know that Chairman McCain
shares my concerns about this.
Thank you.
I would like to call on Senator Kaine.
Senator Kaine. Thank you.
Admiral Howard, we talked a bit in my office about an issue
that's related to the workforce issue that Chairwoman Ayotte
was discussing. We are going to have a shipyard workforce
hearing in this subcommittee in early April, so I don't need to
go into it in depth, but I just wanted to focus on it for a
second.
The shipyard workforce is public shipyards who do repairs,
private shipyards who do construction and repairs, and in many
different locations around the country. Now we also do some
significant ship repairs in foreign countries when our ships
are posted there; in Spain, for example, I know at Rota we do
some repairs. One of the concerns that I'm hearing from my
ship-repair community, private ship-repair community in Hampton
Roads, is kind of the challenge they have sort of knowing
what's coming down the pike. Now, some of that is on us,
Congress. Budgetary certainty is a significant generator of
uncertainties. But, they also feel like they don't really know
who to go to, to try to find out what the likely future
schedule is. If we--if we're balancing work between public
shipyards, private shipyards, and some shipyards overseas, and
some of the way we balance it is, in the public shipyards, by
moving people around, then the private ship-repair community
often feels like they're the last ones to know, and it creates
challenges with them having to staff up, layoff, some people
move to other areas. Then there's a kind of a surge. We need
more, and it's more difficult to staff up.
One of the issues I'd kind of like to dig into, and I would
just like any general thoughts you have about, Are there points
of contact that would be better for the industry to be able to
kind of reach out to, to get some sense of how this work will
be apportioned and allocated down the road? Again, we have to
own our portion of it on the budget-certainty side, but I'd
love to have you talk about that for a bit, and then we'll dig
into it more in early April.
Admiral Howard. Senator, thank you for the opportunity.
In particular, this last year, when the issue was brought
up, NAVSEA and fleet went into dialogue with the private
shipyards, and one of the things that--we tend to look at the
schedules in terms of producing operational ships, but then
there generally is some fungibility in the schedule. They were
able to work with the private yards and move the start of when
some of those availabilities would be, and then that allows the
private yards to get more long-term endurance, in terms of the
number of workers they need to employ.
I think, one, we need to continue that dialogue with NAVSEA
and the fleet and the private yards, not just in our fleet
concentration areas, but, in some cases, in other areas where
we more rarely use them. But, it's the same sort of thought
process, allowing them to understand what our schedules are
going to be and then working through so that they can more
optimally support us.
Then, for us, our type commander, Vice Admiral Rowden, has
started to take this on, because there is a Navy portion to
this, in terms of the planning and getting to a better
definitized of what the repairs need to be before we even send
a proposal out for everybody to bid on. I will, right now,
commit to working with the fleet, NAVSEA, and Admiral Rowden in
making sure that one of them says, ``I want to be the
integrator of all of this,'' and continue this dialogue and
make sure that the folks who are helping us keep our ships
going are also optimized. Because, in the end, that's probably
going to cost us less money. If they're not having to hire and
fire, then that means the continuity will help us get to the
best return on investment.
Thank you, Senator.
Senator Kaine. Thank you all for your testimony.
Senator Ayotte. Senator Shaheen.
Senator Shaheen. Thank you.
I wanted to follow up on the discussion about the
shipyards, because obviously, like Senator Ayotte, I share an
interest in the Portsmouth Naval Shipyard. I was very pleased,
Admiral Howard, to hear your commitment to the Shipyard
Modernization Program, and very pleased to be see that the
President put in even more than the 6-percent target in this
budget. I hope that we can continue to ensure that we make the
investment, the capital investment that we need to make in our
shipyards, and appreciate your commitment to that.
I want to also follow up on the question that Senator
Ayotte raised about the travel regulations. Because one of the
things that I have heard from shipyard workers is that many of
the people who are--who have been there the longest, who have
the highest skills, are some of the people who find the new
regulations the most difficult. When I have people say to me
that, on the per diem that they get under the new regulations,
that they can't afford to go out for dinner, and they--because
they're working such long hours, it's really hard to cook in
the facilities that they're in. I think that creates a real
challenge for people. I appreciate your willingness to look at
this issue and also your recognition that it's really the
skills of our employees who make such a difference, and that it
could have the ironic impact of actually costing us more money
than saving money. Thank you. I hope you'll be willing to let
us know soon what NAVSEA sees with respect to the information
around what we're seeing with those travel regulations.
Admiral Howard. Yes, ma'am. I'll make sure we get you
feedback.
Senator Shaheen. I wanted to ask one other question. That
has to do with the 2014 NDAA that we passed that says that it's
DOD policy to eliminate the fielding of service-specific combat
uniforms so that we adopt and field a common combat uniform for
all members of the Armed Services. Can anyone tell me what the
status is of the effort to have our Military Services working
together on joint clothing and combat--joint combat uniform?
Because, as we think about where are areas that we can
cooperate and save money, it seems to me that this is one.
I appreciate everyone's interest in being identified as--
with their branch in the military, but it seems to me, when
we're talking about combat uniforms, since, before 2002,
everybody wore the same combat uniforms, that it's--we should
think about whether that policy should be changed. I don't know
if anybody wants to comment on that.
General Goldfein. Ma'am, I'll jump on that one. We meet
routinely on all issues relative to, really, personnel actions,
whether force of the future or women in service, all those kind
of things. I won't speak for all of us, but I will tell you,
this issue hasn't come up in the last 6 months, in terms of any
of the dialogues we're having. However, you know, we have been
operating in a single combat uniform deployed in the OCPs
[Operational Camouflage Patterns], and all of us tend to wear
that same uniform, and then we change the tape, you know, that
actually has our service on it. We went to that, some years
ago. As far as any of the dialogues we've been in, I've not--
that has--topic has not come up.
General Allyn. I'll just add one point to leverage on the--
continuing to use the OCP. That's the uniform we're going to as
we transition away from the Army combat uniform. We're going to
the combat variant that we're using so that we save resources
and don't create a new requirement. We're trying to leverage
all of the contingency stocks that we have purchased to ensure
that, as we go forward, we're being good stewards of the
resources you provide us.
Senator Shaheen. General Paxton?
General Paxton. Yeah, thanks, Senator Shaheen.
The question did come up. I don't believe it was last year.
I believe it was the year before, when we discussed it. Last--
--
Senator Shaheen. Yes. 2014.
General Paxton. Then last year, we did take it for a
question in the House. I know the concern of the committee and,
rightfully so, the American taxpayer is not excess money. There
is a commitment among the four of us and all four services to
always share our RDT&E [research, development, test, and
evaluation]. If we figure out that, in a pixilated pattern,
where if, in a uniform, itself, that there is a best practice
there, we'll share that with each other.
The way I recall this when we left it, 2 years ago, was
that we had all--we were freeze-framed in our current plan
right now, and there was an obligation to continue to share
that information, because I thought the sense of the committee
and the sense of the Congress was not to invest further R&D
[research and development] money in that. I know, in the case
of the--particularly the Marine Corps, we had two uniforms that
we developed, a woodland pattern and a desert pattern, that
were actually developed pre-9/11, and that's what we've
continued to use for the entirety of the last 14 years. I know
some of the pattern that we have, even though it is trademarked
and patent-righted, and it was when we did this, we share it
with Special Operations units, and they strip off the Marine
things and put on--as General Goldfein said, they put on their
own identification and patches like that. There is a high
degree of sharing, here. I thought the commitment was not to
expend R&D monies in the future without sharing best practices,
ma'am.
Senator Shaheen. I don't know, Admiral, do you want to
comment on this?
Admiral Howard. Ma'am, the Navy and Marine Corps have been
together a long time. When we put our corpsmen in docks with
the marines, as long as they pass the PFT test, they're allowed
to wear the Marine Corps uniform. We've been saving money that
way. We do have our own camouflage, but we have not been
looking at a new camouflage uniform, so this has not come up.
Senator Shaheen. You think things are progressing, then, in
the way that the 2014 NDAA legislation envisioned? Is that what
I'm hearing everybody say?
General Paxton. Yeah. I mean, again, Senator, it hasn't
come up in 2 years. I thought we understood the legislation. We
were all compliant with the paths that we were taking, and it
was just an issue of no further investments. But, you know,
happy to take that for the record and go back and make sure we
understand exactly what the obligations were in the language,
Senator.
Senator Shaheen. I guess my understanding was a little bit
different, so that would be helpful. We can submit a question
for the record, if that's helpful to everybody.
Admiral Howard. Yes, ma'am, it is. Thank you.
Senator Shaheen. Thank you all.
[The information referred to can be found in the Questions
for the Record portion of this transcript.]
Senator Ayotte. Thank you, Senator Shaheen.
I do have a couple of brief followups, and they relate to
end strength.
I want to--obviously, you all can weigh in on it, but
particularly, General Allyn, General Paxton, as we think about
our ground forces--would like to ask you, General Allyn, where
our Army size is right now. How many of those men and women in
uniform who have served or deployed combat missions on our
behalf are receiving involuntary separations? What are--as we
look at the potential for--if we were called to a major
conflict, what our capacity is. I would like to, obviously, get
General Paxton to comment on the Marine Corps, as well, because
I think it's important for people to understand where we are,
vis-a-vis the size of our force, the force structure, versus
what we really need for size of force.
General Allyn?
General Allyn. Thank you, Madam Chair.
The--to your first point, the size of our Army today is
about 1.03 million in the Total Force. We're headed in this
program toward a----
Senator Ayotte. What's the Active Duty component of that?
General Allyn. We are at about 482 today, headed to 475,000
by the end of this fiscal year, and toward a program force of
450,00 in the Active Force. As I mentioned, with 186,000
deployed on a daily basis in 140 countries, you understand my
discomfort with trying to continue to meet emergent demands and
current operations with a force that is getting smaller, and
what that means, in terms of our ability to build surge
capacity in a time when the contingencies are becoming ever
more real as we face them.
We have done a number of things internally to try to
address that risk. We've gone to a sustainable readiness model,
a goal of which is to deliver two-thirds of our force ready at
any moment in time for an unforeseen contingency. Frankly, at a
980,000-soldier Total Force, that's the only way that we can
make the math work for a major contingency against a peer
competitor. We're sitting at about a third of the Total Force
ready today sufficiently for combined-arms maneuver against a
near-peer competitor.
It's not where we need it to be, and I am absolutely
uncomfortable with a force that gets smaller as the demands for
our forces continue to grow and the contingency requirements
escalate in multiple theaters around the globe.
Senator Ayotte. How many are--I know this isn't of your
desire to do this, so--how many of our men and women who have
deployed--and I know--understand many of them deployed more
than once--are receiving involuntary separations as we downsize
the force, even though it's not consistent with what we need to
do to defend the Nation?
General Allyn. I apologize, Senator Ayotte, for not
answering that part of your question.
The bottom line is, if we continue on the path toward a
program force, we will have to involuntarily separate another
14,000 soldiers, 10,000 of which are officers. On this last
round of involuntary reductions, over 50 percent of those that
we were asking to separate involuntarily had two or more combat
deployments. These are all soldiers that have answered the call
of the Nation, they have served admirably, and, because of the
program force structure, we must separate them. It's not
something we want to do. Frankly, we're doing everything that
we can to ensure, through our Soldier for Life Program, that
we're providing them a seamless transition. We're also ensuring
that our Army Reserve and our National Guard leadership have
the first shot at accepting these seasoned soldiers into their
ranks. Frankly, it has really helped our Reserve component save
dollars by taking experienced soldiers into the ranks and not
having to retrain them. That has been a positive benefit of
this unfortunate drawdown. But, it's still a situation that we
should not find ourselves in.
Senator Ayotte. Right. I would say that this is one where I
really am concerned that we're not keeping faith with them, if
they have deployed multiple times and we're going to give them
an involuntary separation. I hope that's something we think
about. But, also, the threats we face, given what we need to
do.
General Paxton, I wanted to get your thought on this, as
well. Because we've talked about it in prior hearings. We used
to build for two conflicts, right? Then we went down to a one-
and-a-half-conflict strategy. As I understand where we are now,
if we got called to one major conflict, we're all-in. Can you
help us understand that, from the ground perspective? I know we
have naval and Air Force issues, as well, but in terms of the
first in for us.
General Paxton. Thank you, Madam Chair.
I'll try and work in reverse, given your last question. We
were originally, many years ago, a two-MCO [Marine Corps order]
force, and then we reduced from there, and we are now at a--in
a--defeat-deny is the strategy. The DSG [deployment support
group] has not changed since 2012. I think the shared concern
of the members here in the committee is, if you're all-in on
the defeat piece, what is left for the deny somewhere else. If
the deny grows exponentially, we may not have the indications
and warnings we need for lead time, we may not have the
strategic lift by sea or air. We may not have the--either the
capability or the capacity to respond in time to keep the other
one in either deny or impose costs. As we are commonly wont to
say, capacity has a quality all its own.
To your original questions, Senator Ayotte, if I may, the
Marine Corps at peak strength was 202,000. We knew, when we
were asked for that authorization, that that was only going to
be a 3- or 4-year authorization. This was pre-sequestration. We
are--we have done three specific studies on optimal end
strength of the Marine Corps. All three of those were completed
before Senator Kaine's point about--this was pre-ISIL, pre-
Ukraine, pre-South China Sea, pre-cyber, pre-Snowden----
Senator Ayotte. Pre-all of the obvious----
General Paxton.--pre-all of that.
Senator Ayotte.--threats we face.
General Paxton. As we came down from 202, Senator, we knew
that the optimal strength of the Marine Corps was supposed to
be 186-8. We are, today, en route to 182,000 by the end of this
fiscal year. We are below where we would optimally like to be.
Again, that study was based on previous--unknown previous
conditions.
To your second point, we have not had to involuntarily
separate anyone. We would obviously prefer not to break faith.
I know the challenges that the larger and the other services
have there. We continue to have, you know, 66 percent of the
force on the first-term enlistment. It's a fairly young force.
Most of them come in for 4 to 6 years, and then they separate.
Our challenges are a little different.
We do worry, as I said earlier, under question, about the--
some of the critical skills, Special Operations, cyber
operations, pilots, and how we retain them.
Then, ma'am, just as an indicator, the combat capability
that we have lost going below 186/8--when we went from 202 to
186/8 to 182--we have lost three infantry battalions, six towed
artillery companies--excuse me--batteries. Three battalions,
six batteries, four tank companies, and five AAV [assault
amphibious vehicle] companies. That's conventional capacity
that we have offered up because we had to pay for cyber, for
space, for nuke, for third offset strategy, and those things
that we know are national priorities. But, that has been the
trade space, in terms of conventional capability.
Thank you.
Senator Ayotte. I want to thank all of you for being here.
I want to thank you for your leadership and important positions
of defending our country and serving our country with such
distinction. I want to thank all of the men and women who serve
underneath you for the incredible work that they do making us
proud every day and defending our Nation, and especially what
we've learned today with the gaps in capabilities that we have.
This is a real issue for us, and I really appreciate your
coming forward and testifying. Thank you for being here.
[Whereupon, at 11:56 a.m., the hearing was adjourned.]

[Questions for the record with answers supplied follow:]

Questions Submitted by Senator Kelly Ayotte
close air support report
Senator Ayotte. Section 142 of the fiscal year 2016 NDAA requires
the Air Force to submit to Congress no later than September 31, 2016,
an independent and detailed assessment of the required aircraft
capabilities to replace the A-10.

1. General Goldfein, what is the status of the independent
assessment required by the fiscal year 2016 NDAA?
General Goldfein. The RAND Corporation is supporting this
independent assessment, which will include direct and detailed
responses to Fiscal Year 2016 National Defense Authorization Act
language. While it is too early to provide any specific findings or
recommendations, we expect to deliver this report to Congress on time.
a-10 versus f-35 fly off
2. Senator Ayotte. General Goldfein, does the Air Force support the
Director of Test and Evaluation's (DOTE) plans to conduct a CAS fly-off
between the F-35A and the A-10 to ensure there is no degradation in CAS
capability for our ground troops?
General Goldfein. The Air Force fully supports the Director of Test
and Evaluation's efforts to validate the operational effectiveness of
the F-35A through a robust and rigorous Initial Operational Test and
Evaluation period at the end of the System Development and
Demonstration phase of the baseline program. These efforts, to include
comparative testing of the F-35A's operational capabilities, will help
ensure the air system will be able to successfully accomplish the
required mission sets in the expected range of combat conditions.
time at home between deployments
3. Senator Ayotte. General Allyn and General Paxton. What type of
Army and Marine Corps units have the least time at home between
deployments?
General Allyn. High operational tempo is one of the greatest
challenges to the Army's ability to recover the readiness needed to
meet contingency requirements. The types of units most affected by high
operational tempo and that spend the least amount of time at Home
Station are Division Headquarters, Combat Aviation Brigades, Patriot
Battalions, and Brigade Combat Teams.
General Paxton. Since the conclusion of Operation Enduring Freedom,
USMC forces have been reconstituting and regenerating readiness with
positive results. However, Operations Freedom Sentinel and Inherent
Resolve continue to levy significant demand across our human
intelligence (HUMINT), signals intelligence (SIGINT), communications,
and tactical aviation (TACAIR) capabilities.
Although the Marine Corps' TACAIR Deployment-to-Dwell (D2D) ratio
has improved over the past year from 1:1.7 to 1:1.8, stress on both
airframes and personnel continues. The personnel operating tempo for
TACAIR (F/A-18 and AV-8B) and Aerial Refueling (KC-130) maintenance
personnel has reached levels similar to that experienced by the SIGINT,
HUMINT, and communications communities; as low as 1:1.5 for select
MOS's.
CMC has implemented measured and deliberate actions to further
reconstitution and readiness recovery (i.e. MV-22/KC-130 forward
presence decreases and reductions in VMFA flight line entitlements from
12 to 10) while ensuring combat effectiveness is not compromised in the
process. Additionally, modification to the fiscal year 2017 Global
Force Management Allocation Plan will further assist in managing
stressed communities across the force and provide a baseline for fiscal
year 2018 Global Force Management sourcing actions.

4. Senator Ayotte. What is their current dwell time between
deployments?
General Allyn. Currently, Regular Army forces are not meeting the
1:3 deploy:dwell ratio goal. Most affected by this are: Division
Headquarters at 1:1, Combat Aviation Brigades at 1:1.7, Patriot
Battalions and Brigade Combat Teams are less than 1:2. These rotation
ratios exclude forces assigned to combatant commanders. The continuing
high operational demands for Army Forces from a shrinking Army is
driving us to not meet the desired deploy:dwell ratio goals.
General Paxton. The average dwell time for units across the Active
Component (AC) is 1:1.9. As I indicated in my written statement and in
my answer to your previous question, some communities and specific
occupational specialties are deploying at faster rates.
Our ideal deployment to dwell (D2D) ratio is 1:3, which means a
deployment of 7 months is followed by 21 months of time at home
station. That home station time is required for the unit to conduct
personnel turnover, equipment reset and maintenance, and complete a
comprehensive individual, collective, and unit training program across
all their mission essential tasks (METs) prior to deploying again.
Today this timeline is challenged by the increased maintenance
requirements of aging equipment, shortages in the availability of ships
with which to conduct amphibious training, ensuring personnel fills are
in place on time, and other factors to include school seats, training
range availability and even weather.
Those challenges are compounded by the increasing demands on
today's force, which have many of our units and capabilities deploying
with a 1:2 D2D ratio, which translates to one third less home station
training time than we would prefer. This challenges the ability of our
units train to their full list of core missions and degrades our home
station crisis response capability.
air force munitions
Senator Ayotte. DOD has said that the Pentagon is starting to run
low on smart bombs and guided missiles. Consequently, this year's
budget request includes $1.8 billion for munitions.

5. General Goldfein, can you discuss any potential munitions
shortage?
General Goldfein. The ongoing operations against ISIS are expending
many more weapons than planned for a contingency operation.
Consequently, some direct attack smart munitions and Air-to-Ground
missiles (Hellfire) have current and forecasted inventory shortfalls.
Mitigating these shortfalls will not begin to occur until fiscal year
2018 (FY18). Reprogramming actions and resources in the fiscal year
2016 and fiscal year 2017 budgets will replenish current operations
expenditures, but do not address meeting the inventory objective.

6. Senator Ayotte. General Goldfein, to what extent are coalition
partners in the fight against ISIS helping to fund the munitions that
the U.S. Air Force is expending in the air campaign against ISIS?
General Goldfein. The coalition partners are not helping to fund
the munitions the Air Force is expending in the air campaign against
ISIS.

7. Senator Ayotte. General Goldfein, to what extent are weapons
shortages affecting prepositioned munitions inventories, and
consequently readiness to address other potential conflicts around the
globe?
General Goldfein. The increased expenditures of certain munitions,
along with known budgetary constraints since the August 2014 start of
Operation Inherent Resolve (OIR) have resulted in reallocation of some
munitions stocks from pre- and forward-positioned locations to the
point of need. Replenishment of those stocks will occur through
existing Air Force munitions prioritization and positioning
governances.
The Air Force is below its inventory objective for almost all
Precision Guided Munitions (PGMs). Due to low inventory numbers,
Hellfire and laser Joint Direct Attack Munitions are only available for
the U.S. Central Command Area of Responsibility. The Air Force is able
to meet the OIR requirement in the near term but inventory levels for
PGMs will continue to decline until new production increases.
national commission on the future of the army--army duplication?
Senator Ayotte. On January 28th of this year, the National
Commission of the Future of the Army delivered its report to Congress,
which was an effort driven by the fiscal year 2015 National Defense
Authorization Act.
While there were dozens of recommendations made by the Commission,
Recommendation 39 states that the Secretary of the Army should
consolidate marketing functions under the authority of the Army
Marketing Research Group (AMRG). The function currently resides in the
Army Recruiting Command.

8. General Allyn, why, unlike other services, does the Army have
two different directorates, which are at two different physical
locations, in charge of branding, recruiting and marketing the Army?
General Allyn. The Assistant Secretary of the Army for Manpower and
Reserve Affairs, through the Army Marketing and Research Group (AMRG),
is responsible for the Army Brand and the Army's national marketing
program. AMRG activities support Regular Army and Army Reserve
recruiting activities for officer, enlisted, and civilians; U.S. Army
Recruiting Command is responsible for Regular Army and Army Reserve
enlisted, warrant officer, and officer candidate recruiting.
Marketing and recruiting are separate functions, and, per best
business practice, marketing is an executive (Headquarters, Department
of the Army) function. For the Army, marketing is the means by which we
communicate to, connect with, and engage our target audiences to convey
the value of the Army. Successful marketing builds advocacy, dispels
misperceptions, increases willingness to support and propensity to
join, and sets the conditions for recruiting success. This approach of
separating marketing from recruiting enables the Army to better
maintain a unified Army Brand that underpins outreach to future
soldiers and officers for the Active Army and the U.S. Army Reserves.
The National Guard Bureau is currently responsible for all National
Guard marketing; the National Commission on the Future of the Army
Recommendation 39 concludes that, to the maximum extent feasible, the
Army's marketing function should be managed as one Army. If approved,
this legislative change would further unify the marketing of the Army
brand by giving the Secretary of the Army responsibility for Army
National Guard marketing as well.
port security barriers
9. Senator Ayotte. Admiral Howard, what action is the Navy taking
to resolve the vulnerability of the inadequate Port Security Barriers
(PSBs) in use to protect our national Fleet assets?
Admiral Howard. Waterside security barriers were deployed by the
U.S. Navy in response to the October 2000 USS Cole terrorist bombing.
The first waterside security barriers deployed were the commercially
available Dunlop Boat Barriers developed by Dunlop GRG Holdings,
Trelleborg, Sweden. In order to eliminate both vulnerability and
reliability issues with this system the current Navy Port Security
Barrier (PSB) was designed and fielded beginning in 2003.
The Navy's PSB was designed to defeat a wide range of small craft
threats and has performed well for more than a decade. In 2008 the
Assistant Secretary of the Navy for Research, Development, and
Acquisition (ASN-RDA) recognized the Navy design team for developing an
improved PSB which met operational capability requirements while
reducing both acquisition and sustainment costs.
Naval Facilities Engineering and Expeditionary Warfare Center
(NAVFAC EXWC) has continually used lessons learned to modify the PSB
design in order to improve operational capability and reduce life-cycle
costs. Examples of these efforts include:

Switching from steel to composite materials to reduce
maintenance costs and extend service life
Changing the barrier gate latch from a machined stainless
steel design to a simpler and more robust chain latch design
Changing primary barrier connection from a pinned design
to a bolted flange design that reduces life-cycle costs
Following industry's lead to replace wire rope mooring
components with synthetic line to improve service life
Use of improved materials for `heavy wear' components in
high energy environments to improve service life and reduce cost
Use of a more capable capture net to improve high speed
vessel stopping capability
Extension of service life for capture nets to reduce
replacement costs
Use of new metal coatings to improve service life and
reduce costs
Use of anti-wetting coating to prevent ice adhesion to
improve performance in icing conditions

In addition to continuing efforts to implement system improvements
based on lessons learned, the Navy is aggressively looking for new
water barrier system designs/technologies that are capable of providing
increased levels of protection and reduce annual sustainment and
operating costs.

10. Senator Ayotte. Admiral Howard, in terms of force protection,
what is the difference between the PSBs the Navy is currently utilizing
and PSBs commercially available? Please provide a detailed plan to
close the gap between the two.
Admiral Howard. After conducting a worldwide market study of
waterside security barriers, the Navy selected seven waterside security
barrier offerings to test in an operational environment under mission
conditions. Although industry changes in designs and materials used by
private ventures increased the options available as compared to when
the PSB was first fielded, the majority of the designs were very
similar or licensed copies of the PSB system currently used by the
Navy.
One notable exception was the HALO Maritime Defense System. This
system is essentially a floating double wall that utilizes surrounding
water to absorb the force of local impacts and environmental conditions
(wave and wind impact). The system appears to meet operational
requirements. While the initial cost appears higher than the current
PSB, this system may have a lower lifecycle costs due to improved
design, materials and an automated ship gate feature.
To determine if the HALO system design could provide the Navy
increased capability the Navy has executed or is planning the following
actions:

In 2012, Navy Installations Command conducted a
developmental test of the HALO waterside security barrier at the
Aberdeen Test Facility in Aberdeen, MD
In 2014, the Navy Physical Security Enterprise and
Analysis Group conducted an Integrated Waterside Security technology
demonstration in San Diego, CA
In 2015, Naval Facilities Engineering Command began an
eight-month In-Situ test of a semi-automatic ``Guardian'' gate onboard
Naval Station Norfolk, VA
In 2016, a followon test project onboard Naval Station
Norfolk, VA will be awarded to determine the feasibility of a fully
automated gate for the HALO system
In 2017, a roll out of the full system at a location yet
to be determined is planned to determine the feasibility of a full
scale roll out
In 2018 the Navy will develop the acquisition strategy
for a Low Rate Initial Procurement

The analyses and results from the In-Situ test will be utilized to
develop future waterside security barrier performance specifications
and an acquisition decision of a NEXGEN Type II water barrier.
The projected total life-cycle cost of replacing the currently
deployed U.S. Navy PSB with a next generation maritime security barrier
is projected to cost in excess of $350 million.
While the evaluation of newer systems continues, Naval Facilities
Engineering and Expeditionary Warfare Center will carry on efforts to
improve the performance and durability of the current PSB system.
advanced armor
11. Senator Ayotte. General Allyn and General Paxton, with the
increased focus on full spectrum operations, what is your service doing
to keep their advantage over peer and near-peer potential adversaries
when it comes to advanced armors--including increasing survivability
while reducing weight?
General Allyn. In the early 2000s, the Army reacted superbly to
equip our soldiers with life-saving body armor to defeat the relevant
threat. The result was soldiers having an array of protective
capabilities that were individually developed, such as body armor and
combat helmets that protect against multiple threats associated with
ballistic, blast, and blunt force events. This led to the development
of an integrated protective capability for a complete Soldier
Protection System (SPS) to provide soldiers with modular, scalable, and
mission tailorable protection to reduce weight and increase mobility
while also optimizing protection and remaining vigilant of adversary
threats.
SPS is the Army's next generation Personal Protection Equipment
system. SPS will improve the level of mobility, form, fit, and function
for all soldiers (male and female) at a reduced weight compared to
legacy body armor systems. Based on the combination of hard and soft
body armor SPS systems that entered into Low Rate Initial Production,
the body armor's weight alone will be reduced by about 15 percent,
representing 6.5 pounds for a size medium soldier. These results were
achieved through more ergonomic and better integrated designs and the
use of advanced materials.
The SPS program represents the near-term investment in improving
mounted and dismounted soldier survivability. The Army continues to
invest in research and development for lighter, stronger, and more cost
effective solutions in body armor. Research in advanced and emerging
materials and manufacturing processes is ongoing and will continue to
ensure that U.S. soldiers have the best protection available.
General Paxton. The Marine Corps is employing a two-pronged
approach to increasing survivability and reducing weight by looking at
advances in armor technology as well as looking at vehicle protection
systems (VPS), which are inclusive of both hard kill and soft kill
technologies. Hard kill systems typically employ an explosive
countermeasure to disrupt, redirect, and/or destroy an inbound threat
munition. Soft kill system typically disrupts the threat munition
guidance system causing the rocket or missile to miss its intended
target.
We are taking a proactive approach by examining the feasibility of
various VPS's. We have a Deliberate Universal Needs Statement (D-UNS)
for VPS as a means of defeating advanced generation Rocket Propelled
Grenades (RPG) and Anti-Tank Guided Missiles (ATGM). We are looking to
develop VPS capability with an eye to expanding our thinking beyond
single vehicle protection, such as armor, to cooperative networks of
systems that complement one another's capabilities to improve
lethality, communication, command and control, and protection of the
force. Ultimately, there is no single solution to the tactical
challenges we face on the battlefield. Our VPS approach is three-fold:

U.S. Army Expedited Active Protection Systems (APS)
Effort: We assess these efforts as the most effective and efficient
means for the Marine Corps to learn about the state of several mature
hard kill systems via demonstrated performance and to best set the
conditions to integrate and employ such systems when they are
sufficiently developed and readied for service in combat. In close
coordination we are looking to outfit a USMC M1A1 with APS while the
Army looks at M1A2, Stryker, and Bradley options.
Department of the Navy: We are also exploring rapid
prototyping opportunities within the Department of the Navy (i.e.
Office of Naval Research) to further develop soft kill technologies.
Leveraging Navy expertise in electronic warfare and a robust warfare
center capability, we view this avenue as one with strong potential to
advance the capability and set the conditions for further development
and eventual fielding.
MAPS: We are maintaining a positive link with ongoing
U.S. Army science and technology work within their Modular APS (MAPS)
program.

Additionally, within our Amphibious Assault Vehicle (AAV)
Survivability Upgrade (SU) program we are applying an improved armor
package. This upgrade is derived from the need for an operationally
effective amphibious armored personnel carrier capability bridge until
the future amphibious portfolio of vehicles reaches full operational
capability. The AAV (SU) provides increased survivability and force
protection while retaining water and land mobility performance. With
the AAV (SU), we will be fielding a new buoyant applique armor package,
which replaces the old applique system, provides better ballistic
protection, and increases the buoyancy of the upgraded AAV. The old
applique armor system brought with it a significant weight penalty that
detracted from the water mobility performance of the vehicle. In
contrast the new system improves the water mobility performance of the
vehicle by making the AAV float more efficiently.
improved isr
12. Senator Ayotte. General Goldfein, what steps is the Air Force
taking to develop and procure advanced technologies for aircraft, ISR
payloads, and orbiting platforms that will provide improved performance
and lower weight?
General Goldfein. The Air Force is investing in Science and
Technology (S&T) areas for platform, sensor, and payload capabilities
which demonstrate improved performance with reduced size, weight, and
power (SWaP) requirements.
To enable the reduction in energy demand in future combat aircraft,
the Air Force is investing in the development of adaptive turbine
engine technologies that have the potential to reduce fuel consumption
by 25 percent, provide higher thrust/sustained supersonic operation,
and significantly enhance vehicle thermal management capability. We are
also developing and demonstrating materials and processes technologies
for air vehicle and subsystems to enhance lift, propulsion, low-
observable performance, power generation management and affordability.
Our research in ceramic, ceramic matrix composite, and hybrid materials
technology will provide performance and supportability improvement in
propulsion systems and high temperature aerospace structures.
Our investments in Space Electronics Technology focus on 3-D
techniques to increase throughput while reducing SWaP, and also
benchmarking tools to assess the ability of emerging satellite
electronics technologies to lower SWaP. Cold Atom gyroscope efforts
focus on reduced size and weight to expand GPS-free navigation to a
large number of Air Force platforms. Elements of the S&T portfolio
examine: lighter weight structures for space platforms; higher
efficiency cryo-coolers; and higher efficiency solar cells to be used
in spacecraft vehicles. In addition, S&T continues to mature these
technologies for scheduled flight experiments and transition to
acquisition programs of record.
We have advanced sensor and imaging technology to see farther than
ever before without increasing SWaP, extending range by up to 40
percent, especially in low visibility conditions. Our Optoelectronics
and Photonics portfolio, which has been supporting work on silicon
photonics, uses light to transfer information versus electrons in
traditional integrated circuits for a significant reduction in SWaP,
while increasing performance and reliability.
__________
Questions Submitted by Senator James Inhofe
threats vs resources
13. Senator Inhofe. General Allyn, how would you assess the future
operations tempo of each of our services based on the assessment that
former SecDef Gates made about aggressors, terrorists, revanchists, and
expansionists half a world away are always interested in us?
General Allyn. The Army has sufficient readiness, capability, and
capacity to conduct counterterrorism and combat violent extremist
organizations at current operations tempo. The Army is less than ready
to conduct high-intensity ground combat against modernized aggressors,
revanchists, and expansionists. Future operations tempo remains
uncertain but the Army must be prepared to address all five challenges
highlighted by former SecDef Gates' assessment.

14. Senator Inhofe. All, would each of you agree that budget
constraints have forced each service to prioritize near-term readiness
at expense of capacity, capability, modernization, and infrastructure?
How does that impact long-term readiness?
General Allyn. Yes, budget constraints have forced the Army to
prioritize near-term readiness at the expense of capacity, capability,
modernization, and infrastructure.
Current operational tempo, growing global instability, and lack of
consistent and predictable funding over time will challenge the Army's
ability to regain and sustain the combined arms proficiency needed for
future contingencies. A return to sequestration will further delay
modernization, disrupt full spectrum training plans, and prolong the
Army's readiness recovery by three to five years. The Army already has
minimal trade space to generate additional surge operating forces, and
continuing fiscal turbulence will challenge the Army to meet the
simultaneous requirements of the National Military Strategy.
Admiral Howard. Similar to our sister services, the Navy's
readiness continues to be challenged in a fiscally constrained
environment. The fiscal year 2017 Navy budget submission provides the
resources needed to deliver sustainable forward presence and supports
our continued readiness recovery efforts for long-term readiness. The
budget also reflects tough choices made, including taking deliberate
risks in shore infrastructure, to provide a balanced approach to
meeting our security challenges. Should budget constraints continue, we
will impact all aspects of the fleet; capacity, capability,
modernization, and readiness, both ashore and at sea.
General Paxton. Current budget constraints have required the Marine
Corps to prioritize near-term readiness at the expense of long-term
modernization and infrastructure investment. For instance, in order to
protect the readiness of our deployed and next-to-deploy forces and to
meet current overseas commitments, the Marine Corps is accepting risk
to the readiness of our home station units. These units constitute the
ready ``bench'' of forces that would surge to meet an unexpected crisis
or major contingency. Such a posture incurs additional risk in our
ability to simultaneously meet current operational demand and respond
to a major contingency. Achieving a ready bench--one capable of meeting
major contingency requirements and effectively responding to the
unforeseen--requires a force resourced with sufficient numbers of
marines who are properly trained and equipped to operate across the
full range of military operations.
The current environment has also required us to adopt a fiscally
constrained end strength of 182,000 in fiscal year 2017. At this level,
we will accept deployment-to-dwell ratios of 1:2 and 1:4 for our Active
and Reserve components, respectively. This is less than our goal of 1:3
for the Active component and 1:5 for the reserves, placing added stress
on our marines and marine families. Some types of Active component
units did not achieve even these reduced dwell time goals in fiscal
year 2015. This reduced end strength will also exacerbate the
imbalances in readiness described above.
We are already balancing the cost of modernization efforts
necessary for long-term readiness against near-term readiness by
focusing on essential areas, including the F-35, CH-53K Heavy Lift
Replacement, the Joint Light Tactical Vehicle (JLTV), and Amphibious
Combat Vehicle (ACV) 1.1, as well as smaller programs such as Ground/
Air Task Oriented Radar (G/ATOR) and Networking on the Move (NotM). At
the same time, we are investing resources in refreshing or upgrading
legacy equipment we must continue to rely upon, including the
survivability upgrade of our Assault Amphibian Vehicles. The longer we
continue to rely upon such aging systems, including those such as the
over 33 year old Light Armored Vehicle fleet and 26 year old M1A1 tank
fleet for which we do not yet have funds to program replacements, the
more resource intensive those systems become to maintain. Any further
constraints on our budget may actually increase these costs, having an
even greater negative impact on both long and short term readiness.
Finally, we have had to assume risk in our Facilities Sustainment,
Restoration, and Modernization (FSRM) accounts, funding facilities
sustainment at approximately 74 percent of the requirement in fiscal
year 2017. Though this level allows us to maintain our facilities at an
average condition of ``Q2,'' or ``fair,'' it precludes further
improvements. Restoration and modernization projects will be limited to
those that address potential life, safety, and health requirements, as
well as investments in mission critical facilities. Such a strategy,
while necessary in the short term, risks reversing the gains we have
realized over the last six years from investments and recapitalization
of barracks, child development centers, and various operational,
training, and support facilities. Furthermore, inadequate facilities
maintenance for sustained periods of time will lead to more costly
repairs, ultimately driving up the cost of future FSRM.
General Goldfein. Yes, due to budget constraints, the Air Force has
been compelled to take risk in capacity, capability, modernization and
readiness. These constraints, combined with a consistent high
operational tempo, have negatively impacted the service's ability to
affect a readiness recovery inside the next decade. The fiscal year
2017 budget request prioritizes capacity and readiness ahead of
modernization.
The Air Force cannot effectively sustain its current force
structure and at the same time sustain the current level of operational
demand. We are too small for the requirements. Additionally, the Air
Force has not been allowed to divest cold war assets (discontinued
BRAC, directed retention of legacy systems). To sustain existing force
structure and meet operational requirements, the Air Force has been
compelled to take risks in nearly every area to include acquisition,
legacy sustainment, and readiness.
In the short-term, the Air Force is forced to fund some key
readiness accounts below the minimum requirements. These short-term
decisions impact long-term readiness by delaying the Air Force's
ability to begin the path to recovery. Readiness recovery takes time
and consistent attention to each of the Air Force's readiness levers.

15. Senator Inhofe. All, is the current defense budget sufficient
to simultaneously rebuild the readiness of each of your services and
modernize the force for the future while continuing current operations
around the globe?
General Allyn. No, the Army's PB17 budget request is minimally
sufficient to meet our needs. The Chief of Staff of the Army has
testified we are assuming high military risk. This budget strikes the
best balance possible between readiness, modernization, and end-
strength. Soldier readiness is our number one priority; in order to
meet current operational requirements, funding for near-term readiness
is prioritized at the expense of modernization and end-strength. The
budget request provides sufficient capacity, capability, and readiness
to respond to a changing global security environment. The President's
Fiscal Year 2017 Budget request, in conjunction with stable and
predictable funding in the future, will rebuild Army readiness for
large-scale, high-end, ground combat in order to protect national
security interests.
Admiral Howard. The Navy's readiness continues to be challenged in
a fiscally constrained environment. Navy's fiscal year 2017 budget
submission provides resources needed to deliver sustainable forward
presence and funds our continued readiness recovery efforts. This
budget reflects tough choices made under current fiscal constraints to
provide a balanced approach to meeting our security challenges.
Balancing capability and capacity, delivering current and future
readiness, providing naval presence to the geographic combatant
commanders, while rebuilding our contingency response posture in a
difficult budget environment, has required hard choices and tradeoffs.
General Paxton. No, our current budget is not sufficient to address
these issues simultaneously. In fact, to meet current operational
requirements, the Marine Corps is forced to prioritize the readiness of
our deployed and next-to-deploy forces. In the current fiscally-
constrained environment, the Marine Corps accepts risk in our current
home station readiness--the ready ``bench'' that would surge to meet a
major crisis or contingency--and our future modernization.
General Goldfein. Our fiscal year 2017 budget request prioritizes
capacity and readiness ahead of modernization. However, despite relief
from the Bipartisan Budget Act, the Air Force was still forced to make
sacrifices as a result of sequestration. Our combat air forces remain
at below 50 percent readiness for full spectrum conflict, and we were
also compelled to defer F-35 acquisition this year and across the
Future Years Defense Program. Continued fiscal uncertainty and spending
cap restrictions will make our balancing efforts even more difficult,
culminating in a modernization bow-wave beginning in 2022.
procurement delays and `bow wave'
16. Senator Inhofe. All, what is the impact of delaying
modernization on each of your services ability to conduct full-spectrum
operations?
General Allyn. Delaying modernization will exacerbate capability
gaps against evolving threats. Lack of modernization risks the Army's
ability to conduct ground operations of sufficient scale and ample
duration to achieve strategic objectives or win decisively at an
acceptable cost against a highly lethal hybrid threat or near-peer
adversary in the unforgiving environment of ground combat.
Admiral Howard. Modernization programs upgrade existing systems and
introduce new systems, delivering improved readiness and enhanced
capabilities to the fleet. This is vitally important to the Navy and
our nation as we seek to maintain our robust power projection advantage
over our adversaries. For example, the DDG modernization program
provides those ships the advanced combat and weapons systems essential
to defeat emerging technologically advanced threats, and the mid-life
modernizations of our big-deck amphibious ships provides Joint Strike
Fighter integration and continued interoperability in our amphibious
fleet.
Delaying modernization degrades Navy's ability to conduct full-
spectrum operations by reducing capability, interoperability, and
operational availability. Any delay also imposes increased maintenance
costs to sustain legacy equipment. For example, delaying the Submarine
Warfare Federated Tactical System (SWFTS) shipset installations results
in more equipment failures and ultimately lost operational time.
Readiness degradation is also evident in the modernization of the
tactical air force. When aircraft such as the F/A-18A-D and AV-8B reach
the end of service life before replacement aircraft are delivered into
service, Navy faces significant challenges in strike fighter inventory
management.
Modernization programs provide the best balance of capability and
capacity to the fleet by enhancing near-term readiness while ensuring
long-term relevance. In the years ahead, we will need adequate funding
levels and predictability to fully pay back our readiness debt from
over a decade at war. Navy will continue to work with Congress to fund,
develop, and execute vital modernization programs.
General Paxton. The fiscal year 2017 President's Budget request
provides the nation with a Marine Corps that is forward deployed and
ready to meet today's challenges. However, this readiness comes at a
steep price. Maintaining the readiness of these forces during a period
of high operational tempo amid the current fiscal uncertainty comes
with ever-increasing operational and programmatic risk that must be
addressed at some point. As resources diminish, we will continue to
protect the near-term operational readiness of our deployed and next-
to-deploy forces at the expense of equipment maintenance, facilities
sustainment, and investments in our equipment and infrastructure.
Today I would highlight our tactical aviation (TACAIR) fleet as an
example of the impact of delayed modernization. The average age of our
TACAIR fleet is over 22 years, and as I testified we are experiencing
challenges in maintaining sufficient Ready Basic Aircraft (RBA) to
execute necessary training and fulfill operational commitments.
While we are working to recover the readiness of our existing
airframes, modernization through the introduction of the F-35 is the
long term solution to that challenge. Our first F-35B squadron declared
Initial Operating Capability in 2015. It will re-locate to a forward
location in Japan in fiscal year 2017 after the stand-up of the second
squadron. The continued and timely fielding of the F-35 will not only
improve our ability to conduct full spectrum operations, but also have
a transformational impact on Marine Corps doctrine, providing 5th
generation capabilities to support sea control operations (SCO) with
the Navy and enable joint forcible entry operations (JFEO) by the MAGTF
even in the most contested environments. This essential warfighting
capability is experiencing delays and under constant fiscal pressure to
``slide right'' or ``reduce buys'' in our current fiscal environment.
General Goldfein. The impact manifests itself in eroded capability
and closure of the capability gap between us and potential adversaries.
Our legacy fleet is not as capable against advanced integrated air
defense capabilities, and space and cyber domains are now contested.
Our modernization efforts focus on addressing these concerns. Further
delaying our modernization efforts puts airmen, the Joint Force,
coalition partners and mission success at greater risk.

17. Senator Inhofe. All, is there a procurement `bow wave'--pushing
out and flattening procurement of critical modernization programs, all
with growing budget demand, because they will not fit into the current
budget topline?
General Allyn. Yes, there is a procurement ``bow wave'' of critical
modernization programs. This bow wave differs from funded requirements
in that the bow wave contains quantities that can be delayed with
tolerable risk in the near term but jeopardizes our ability to defeat
and deter enemies in the future.
The bow wave is caused by reduced budget caps that have forced the
Army to decrease procurement quantities and research and development
spending. These reductions allowed us to protect our number one
priority, readiness and future modernization, through science and
technology investments.
Admiral Howard. Navy continues our commitment to modernization
through investments in critical programs such as CG, DDG, and LSD-class
modernization and legacy F/A-18 service life extension. We are
concurrently adding new capabilities through such priority programs as
the Ohio Replacement, Joint Strike Fighter, P-8 procurement, and the
development of unmanned systems. The budget request delivers current
and future readiness and postures our forces to meet geographic
combatant commanders' missions. However, in order to rebuild our
contingency response posture in the difficult fiscal environment, we
have accepted risk in the modernization and maintenance of our shore
infrastructure, including piers, runways, hangars, utility systems, and
other support facilities. Long term underinvestment in these facilities
will take an eventual toll on our ability to support deploying forces.
General Paxton. The recapitalization of our force--through
investments in aviation, ground combat vehicles, command and control,
and digitally interoperable protected networks, as well as the reset of
our ground equipment--is critical to our future readiness. With
Congress' support, we have been able to protect our investments in key
equipment modernization programs such as the Amphibious Combat Vehicle,
the Joint Light Tactical Vehicle, and the RQ-21 Unmanned Aerial System,
as well as our blue-dollar F-35 and CH-53K programs while incurring
acceptable risks in other areas such as our decades old Light Armored
Vehicle and M1A1 tank fleets. In addition, we have reset over three
quarters of our ground equipment that was employed in Iraq and
Afghanistan and returned approximately 50 percent to the operating
forces. For these reasons, under current fiscal conditions, we do not
anticipate a procurement `bow wave' of unfunded requirements within the
Marine Corps' critical modernization programs. Further reductions to
our topline may impact our ability to maintain this stability within
these programs.
I do have a concern, however about the larger Department of the
Navy (DON) modernization requirements, specifically in regards to the
Ohio-class Replacement Program (ORP). If the DON continues to be
obligated to fund that program from within our already pressurized
total obligation authority (TOA), it will crowd out other vital
shipbuilding programs. I am particularly concerned about the impact on
amphibious shipbuilding. As I stated, we have a minimum requirement of
38 platforms to support the nation's forcible entry requirement and
steady state demand exceeds 50 vessels. We have accepted an inventory
of 34 ships, with appropriate availability, as a short term risk, but
the ORP has the potential to seriously exacerbate and extend that risk.
We currently have both an inventory and availability issue with
amphibious shipping.
General Goldfein. Yes, the Air Force is facing a `bow wave' that is
now making contact with the Future Years Defense Program. The bow wave
is made significantly more difficult by the large cost of
recapitalizing the nuclear enterprise. Secretary Carter estimates it
will cost $18 billion per year for fiscal years 2021-2035 for all three
legs of the triad. The Air Force is attempting to reduce the impact of
the bow wave by sequencing programs over time. This has forced the Air
Force to reduce or delay procurement of systems such as F-35, T-X,
Combat Rescue Helicopter (CRH), GPS III, and JSTARS recapitalization.
This has also driven the Air Force to extend legacy airframes to
compensate for delayed recapitalization.

18. Senator Inhofe. All, if yes, how does this `bow-wave' impact
future costs as well as cost to operate and maintain its legacy
systems?
General Allyn. The bow wave is created by costs that had to be
deferred to the future to stay under the spending caps. The deferred
spending reduces procurements per year and increases the time required
to buy out required quantities, both of which drive costs up.
Delayed procurements also create capability gaps, forcing the Army
to slow the divestment of older equipment to prevent the capability gap
from widening. These older systems cost more to sustain as they
approach the end of their economic useful life, which will result in
increased field and depot level maintenance costs.
The Army needs sustained modernization to efficiently provide
capabilities to our soldiers and to avoid rapidly procuring equipment
at premium prices to modernize deploying forces when a conflict occurs.
Efficient modernization paves the way for next generation systems and
achieves lowest unit costs and shortest procurement timelines. It
reduces sustainment costs by allowing the Army to divest older obsolete
equipment while increasing operational readiness to support strategic
deterrence, depth, and responsiveness.
Admiral Howard. A delay to the procurement of critical
modernization programs could lead to a Navy that can't meet warfighting
requirements. In addition, this would put pressure on future budgets to
recapitalize the Navy's force structure in several programs
concurrently, as we are presently experiencing with the Virginia-class,
Ohio Replacement, and Joint Strike Fighter. While the Navy continues to
effectively modernize and extend the service life of many of our in-
service platforms, such as DDG 51, CG 47, LSD-class ships, and legacy
F/A-18 aircraft, eventually the cost to operate and maintain these
legacy systems exceeds the cost of replacements.
General Paxton. As I stated in my response to the previous
question, we do not anticipate a procurement `bow wave' of unfunded
requirements within our critical modernization programs.
However, while we have been able to protect our near-term readiness
while modernizing, our home station (non-deployed) readiness, as well
as our infrastructure sustainment and investment accounts, have borne
the burden of our ongoing fiscal challenges. Roughly half of our non-
deployed force is insufficiently resourced, in terms of having both the
level of required and trained personnel and equipment, to achieve
readiness levels needed to execute wartime missions, respond to
unexpected crises, and surge for major contingencies. The return of
reset equipment from Iraq and Afghanistan to the operating forces has
relieved some of these shortages, but continued cuts to Operation and
Maintenance (O&M) accounts will reverse these gains and exacerbate
challenges to our non-deployed readiness, placing us at risk in the
event of major contingencies.
Our infrastructure accounts have also become a bill payer for our
deployed units. The Marine Corps has spent over $9 billion in
facilities investments over the past six years to repair or
recapitalize barracks, child development centers, and various
operational, training, and support facilities, raising the average
``Q'' rating of our facilities from Q3 (Poor) to Q2 (Fair). Now, recent
decreases to facilities sustainment funding have accelerated the rate
of infrastructure degradation and precluded further improvements. In
addition, fiscal year 2017 restoration and modernization will only
address potential life, safety, and health requirements. Such a
strategy drives up repair, restoration, and new construction costs over
the long term.
General Goldfein. Procurement reductions and delays are forcing the
Air Force to extend legacy airframes. Extending legacy airframes is
becoming increasingly expensive due to service life extension program
costs, modification requirements to maintain viability in the evolving
threat environment, and parts obsolescence.
force structure
19. Senator Inhofe. All, how much of each of your service's
capacity is consumed by day-to-day, steady-state operations?
General Allyn. Combatant commanders continue to request Army forces
to address current and emerging challenges to global security.
Currently, the Secretary of Defense has ordered the assignment or
allocation of all three Army Corps HQs, six of ten Regular Army
Divisions, and 20 of the 59 Regular Army and Army National Guard BCTs
in support of combatant commander requirements. In total, over 187,000
soldiers are supporting contingency operations, efforts to deter
adversaries and assure allies, and shape today's security environment.
Today's demand for forces strains the Army's ability to sustain current
readiness levels, recover readiness for the future, and respond to
future contingencies.
Admiral Howard. On average, 90-100 ships Navy ships are deployed or
forward stationed at any given time. This follows Navy's model that, in
general, one third of the fleet is underway, one third of the fleet is
training to deploy or maintaining surge, and one third of the fleet is
in maintenance.
General Paxton. Generally, a third of the Marine Corps' Operating
Forces are forward deployed. The allocation of the Service's capacity
remains in alignment with priorities as outlined in the current
Guidance for Employment of the Force (GEF).
Overall, the majority of steady state activity executed in support
of the Combatant Commands is conducted by forces that are assigned or
allocated in support of SECDEF priority missions. In many cases, these
steady state activities contribute to both the achievement of combatant
commander campaign objectives and the readiness of the force to execute
operational requirements.
General Goldfein. Over 24,000 airmen are currently deployed
supporting combatant commander requirements with an additional 80,800
Active, Guard, and Reserve stationed overseas. Thus far in fiscal year
2016, the Air Force has flown over 500,000 flying hours with
approximately 110,000 in support of overseas contingency operations.
Our Mobility Forces have passed 130 million + pounds of fuel, airlifted
more than 25,000 passengers and over 15,000 short tons of cargo.
Approximately two thirds of Air Force fighter squadrons are engaged on
a day-to-day basis. This includes units deployed/allocated to CENTCOM/
PACOM/EUCOM, forces forward-stationed in EUCOM/PACOM, Air National
Guard units supporting NOBLE EAGLE ACL-5 requirements, and units who
are prepared to rapidly deploy in support of the Global Response Force.

20. Senator Inhofe. All, what is each of your service's capacity to
provide additional ``surge'' forces to respond to a major contingency?
General Allyn. The Chief of Staff of the Army recently stated ``We
risk the ability to conduct ground operations of sufficient scale and
ample duration to achieve strategic objectives or win decisively at an
acceptable cost against a highly lethal hybrid threat or near-peer
adversary.'' Less than one-third of the Army has achieved acceptable
readiness levels to conduct sustained ground combat. The Brigade Combat
Team is the Army's primary fighting formation, and only 20 of 59 (34
percent) BCTs are ready. Of those: 11 (18 percent) are Assigned or
Allocated--committed--to Combatant Commands. The remaining nine (15
percent) belong to the Army, forming the backbone of current surge
capability.
Admiral Howard. Navy's capability to provide additional ``surge''
forces in response to a major contingency varies by major force element
and depends on the specific requirements and timelines of the
contingency plan being executed.
As we rebuild our readiness due to prior year over utilization,
Navy is challenged across a variety of force elements to meet the
``surge'' requirements, in both quantity and timeline, of our most
demanding operational plans. In cases where we can provide initial
contingency response, we remain challenged to provide follow-on forces
in accordance with plan timelines. This stems from the overconsumption
of our Naval Forces for the last 15 years, deferring required
maintenance and modernization, and the lingering effects of
sequestration.
Navy and the Department of Defense remain intensely focused on
recovering the readiness of its fighting forces. Navy is recovering
readiness ``in-stride'' through implementation of the Optimized Fleet
Response Plan (OFRP). OFRP allows Navy to continue to provide a
baseline level of global presence while we work through a backlog of
ship and aircraft maintenance, conduct required modernization, increase
the efficiency of our processes, and better align our ships, manning,
and command and control structures.
For Navy, readiness recovery does not necessarily correlate to an
increase in global presence for a particular force element, but rather
builds surge capacity. Over time, OFRP will increase the ready forces
Navy has ``on the bench'' and available to respond to contingency.
General Paxton. The Marine Corps is Congressionally mandated to be
the United States most ready fighting force. As such it stands ready to
rapidly deploy in order to protect national interests. The Marine Corps
metric of force capability is not the individual or unit, but the
Marine Air-Ground Task Force (MAGTF). The MAGTF comprises a command
element (CE), ground combat element (GCE), aviation combat element
(ACE), and logistics combat element (LCE) to win battles and fight the
nation's wars. These MAGTFs and scalable and expeditionary. The Marine
Corps organizes, trains, and equips to routinely provide combat ready,
amphibious MAGTFs. Your Marine Corps today is a one-Major Contingency
Operation (MCO) force and would be all-in to defeat an adversary in an
MCO. ``Surge'' forces available for an MCO would be all forces not
currently deployed to support combatant commander theater campaign
plans or engaged in operations overseas.
Marines are ready to deploy, but our own Marine Corps' Active
component surge availability to respond to an MCO is currently limited
by aviation and command element readiness as well as by joint aviation,
amphibious shipping and strategic lift availability. Reserve unit
availability is dependent on funding and appropriate authorities to
mobilize and deploy reserve forces.
Ready units are trained in mission essential tasks (MET) and
certified by the Service to have the necessary competencies to complete
missions designated for that unit type (e.g. ``Ready'' Infantry
battalions are offense, defense, security, and amphibious operations
qualified). MCO execution could call for immediate deployment through
reduced or non-training of a specific MET, partial unit employment
(i.e. artillery batteries versus a full artillery battalion), or
additional time to prepare. This comes at increased risk to force, risk
to mission and risks surrendering the initiative to our adversaries.
General Goldfein. If required, the Air Force is postured to provide
nearly 100 percent of its combat force in response to a major
contingency; however, surging to that contingency may involve
disengaging from existing steady-state operations. While less than 50
percent of Air Force units are currently full-spectrum ready, the Air
Force can surge forces at less than full-spectrum readiness; however,
if airmen are not ready for all possible scenarios, especially the
high-end, contested fight, it could take longer to get there, it could
take longer to win, and potentially cost more lives.

21. Senator Inhofe. All, given the current and projected threat
environment and the increased demands being placed on your force
structure, are each of your services sized to meet increased
operational requirements? If not, what is the right force structure
size for each of your services?
General Allyn. The Army at 980,000 (450,000 Active Component,
335,000 Army National Guard, 195,000 United States Army Reserve) is at
the edge of its ability to meet the strategy to defeat an adversary in
one major combat operation while simultaneously denying the objectives
of an adversary in a second theater. Over 180,000 soldiers are
supporting combatant commanders around the world today. The National
Military Strategy (NMS) calls for a fully resourced total force of
about 1.2 million. But, given the current lack of sufficient funding to
maintain a force of this size, the Army must make the most effective
use of available forces. The Chief of Staff of the Army testified that
for the Army to reduce military risk to a moderate level we require an
Army Total Force of 1.2 million to meet the needs of the NMS.
Admiral Howard. Navy sources current rotational and emergent
combatant commander (CCDR) force requirements as directed by the
Secretary of Defense (SecDef) in the Global Force Management Allocation
Plan (GFMAP). SecDef orders are the result of a Joint Staff-led Global
Force Management (GFM) process that balances competing CCDR demands
with available resources and strategic objectives. GFM allows SecDef to
make risk-informed decisions to align U.S. Military forces and
capabilities against current priority requirements. Through the GFM
process, Navy meets the critical elements of Asia-Pacific rebalance
while still supporting operations in other theaters, such as Europe or
the Middle East.
Navy's 2014 update to the 2012 Force Structure Assessment (FSA)
identified a 308 ship combatant force as the minimum required to meet
Defense Strategic Guidance missions. The 308 battle force is the right
mix of ships, by quantity and type, with the requisite capability and
capacity to fulfill all of the Navy's essential missions at an
acceptable level of risk based on mission and threat projections, based
on CCDR input and verified by the Navy's analytic process.
General Paxton. After a deliberate Marine Corps Quadrennial Defense
Review study in 2014, the study identified 186,800 as the optimal force
size to address the forecast demands foreseen at that time. World
events continue to challenge the assumptions behind that forecast, both
in terms of the world situation and capability requirements such as
cyber and special operations, and we are reassessing our projected
future requirements. For example, Ukraine, South China Sea, and
counter-ISIL in Iraq and Syria have all occurred or significantly
expanded in scope since our 2014 review. As shown by our operations in
2015, your Marine Corps continues to be in high demand from our
regional COCOMs as well as the State Department at our diplomatic posts
overseas. With our stabilization at an end strength of 182,000 we will
continue to satisfy many but clearly not all of those demands. That
demand signal has not substantially abated due to the emergence of
threats in new forms, gradually increasing the strain on our current
force level. It is clear that an 186,800 force is closer to a minimum
sized Marine Corps for today's world situation.
General Goldfein. Our fiscal year 2017 (FY17) budget prioritized
capacity and readiness over modernization. As such, the Air Force
maintains the appropriate force structure to meet the current
requirements of the Defense Strategic Guidance, but at greater overall
risk to the nation as a result of increased warfighter demand and
continued fiscal constraints. In order to rectify this situation, the
Fiscal Year 2017 President's Budget increases Active component end
strength to support A-10 force structure, stand-up of F-35 units to
sustain fighter capacity of 54+1 Total Force fighter squadrons. It also
increases maintenance capacity to begin improving readiness, and the
expansion of training capacity to meet the needs of additional end
strength.

22. Senator Inhofe. All, can you comment on the current deployment
to time at home ratio, retention, and the morale of each of your
services?
General Allyn. While the Active Component (AC) Army is currently
exceeding the overall deployment to home goal ratio of 1:3 for larger,
named operations, and the Reserve Component (RC) is likewise exceeding
its overall deployment to home goal of 1:4, certain Regular Army Forces
are challenged to meet these ratios for all operational deployments
because of high demand for their capabilities. Regular Army forces that
are not meeting the 1:3 deploy-to-dwell ratio for all operational
deployments are: Division Headquarters at 1:1, Combat Aviation Brigades
at 1:1.7, Patriot Battalions and Brigade Combat Teams at 1:2.
The number of soldiers deploying in support of combat operations is
less than 20 percent of the number who deployed in the mid and late
2000's. This has allowed the Army to surpass its dwell goals despite
high operational demand for certain capabilities.
The Army continues to retain soldiers at high levels, which is a
testament to the patriotism of our soldiers, support of our Families,
and the quality of leadership within our ranks. Active and RC
Noncommissioned Officer (NCO) and Officer satisfaction with operational
tempo increased between 2008 and 2012, and has remained stable since
then. Over the last few years, the percentage of Active junior enlisted
soldiers and officers planning to stay in the Army until retirement has
remained above the historic average. The percentage of Active NCOs
planning to stay markedly increased between 2012 and 2015 (from 59
percent to 70 percent).
Admiral Howard. While extended deployment lengths have historically
had a negative impact on retention, it is difficult to conclude that
retention rates are significantly affected by longer deployments alone
since many other factors influence a sailor's retention decision.
Aggregate retention remains strong and there is no indication that
sailor morale has been negatively impacted by longer deployment
lengths. Our Optimized Fleet Response Plan (OFRP) establishes
deployment lengths (six to seven months, depending on the particular
platform) designed to provide greater stability and predictability for
sailors and their families.
General Paxton. Based on the fiscal year 2016 and fiscal year 2017
Global Force Management Allocation Plans (GFMAP) and a force structure
of 182,000 marines, the Active Component (AC) has maintained a Depth-
to-Dwell (D2D) ratio of 1:2 or better for some portions of the force.
However, infantry battalions, communications battalions, MV-22 Osprey,
tactical aviation (TACAIR) and KC-130J (VMGR) squadrons have fallen
short of the 1:2 D2D ratio due to global demand requirements and
aviation type/model/series transitions. Additionally, Operations
Freedoms Sentinel and Inherent Resolve continue to levy significant
demand with respect to personnel tempo across our human intelligence
(HUMINT) and signals intelligence (SIGINT), capabilities. The Reserve
Component (RC) will continue to maintain an overall Deployment-to-Dwell
(D2D) no less than 1:4.
An fiscal year 2016 mid-year assessment was conducted to determine
the Marine Corps' progress toward meeting the new prescribed end
strength target of 182,000. The Marine Corps has adjusted its First
Term Alignment Plan (FTAP) and Subsequent Term Alignment Plan (STAP)
boat spaces accordingly and does not foresee any issues with meeting
its FTAP and STAP retention goals. The Service assesses it will
complete its fiscally driven drawdown to 182,000 by the end of this
fiscal year.
The current morale in the United States Marine Corps remains high
in every clime and place, despite protracted engagements across the
globe. History has shown, in fact, that marines enlist and reenlist in
order to deploy and fight and execute our nation's most critical
missions. We recognize that initiative, endurance, and patriotism. Our
solemn obligation is to provide them the time and resources to properly
train pre-deployment, and then the best of equipment and fullest
manning when they deploy. Marines have, are, and will continue to be
professional maintaining the good order, discipline and teamwork
necessary to sustain our readiness in peace and guarantee our success
in the future operational environment.
General Goldfein. The Air Force has recognized that the evolving
geopolitical situation continues to place significant demands on the
force and we recognize the increased strain this places on our airmen.
The Air Force's capacity to reach the SECDEF's goal of 1:2 deploy-to-
dwell ratios is dependent on both its End Strength and the number of
airmen the Air Force must deploy (Operational Tempo). As a result, the
Air Force has embarked on a growth strategy to address key capability
gaps in the nuclear, maintenance, cyber, intelligence, surveillance and
reconnaissance, and support career fields, adding roughly four thousand
in end strength across these enterprises. As warfighter demands
persist, the fiscal year (FY) 2017 budget cycle sought to carry forward
fiscal year 2016 end strength levels of 317 thousand to stabilize the
force and posture for future manpower increases in order to address
maintenance capacity shortfalls, additive F-35 bed-downs, expanded
training capacity requirements, and systemic unit under-manning.
The Air Force is also retaining experience through robust and
expanded incentive programs, like Selective Reenlistment Bonuses
(increased from 40 specialties in fiscal year 2015 to 117 in fiscal
year 2016/17); bringing on prior service accessions; utilizing Reserve
Active Duty tour opportunities; and implementing High Year of Tenure
extensions (increased from 38 specialties in fiscal year 2015 to 122 in
fiscal year 2016/17). These programs target our shortfalls across the
board with specific emphasis on battlefield airmen, maintenance,
Intelligence, Surveillance and Reconnaissance, support, nuclear, Air
Liaison Officer, Intel, Remotely Piloted Aircraft pilots, and Cyber
career fields.
But we are concerned. The Air Force is smaller, older and busier
than it has ever been. We need Congress' support for increased end
strength to get after our capability and readiness challenges including
deploy to dwell.
depots, shipyards and ammunition plants
23. Senator Inhofe. All, are your depots, shipyards and ammunition
plants adequately funded to ensure your weapon systems are meeting
current operational requirements or do you have shortfalls? Are they
driven by budget or other factors?
General Allyn. Presently, the depots and ammunition plants are
adequately funded to meet operational requirements. This has been
possible primarily due to Overseas Contingency Operations (OCO) funding
in support of the Reset efforts and deployments. As OCO funding is
eventually discontinued, Base Program funding must be increased to meet
enduring requirements. Manufacturing arsenal funding in the Base
Program continues to present a challenge for the Army due to of
workload (low) to workforce (high) imbalance.
Admiral Howard. The Navy maintenance budget requests are built upon
independently certified models, reflecting engineered maintenance plans
for each ship class and aviation type/model/series. Our shipyards and
aviation depots have been challenged by emergent work beyond that
expected, associated with a decade of high tempo operations and
additional wear on assets.
Resetting our surface ships and aircraft carriers after more than a
decade of war led to significant growth in public and private shipyard
workload. The Navy baseline budget request funds 70 percent of the ship
maintenance requirement across the force, addressing both depot and
intermediate level maintenance for carriers, submarines and surface
ships. OCO funding provides the remaining 30 percent of the baseline
requirement and allows for the continued reduction of surface ship
life-cycle maintenance backlogs.
The Fleet Readiness Centers (FRCs) and Navy's aviation depots have
been challenged to recover full productivity after hiring freezes,
furloughs, and overtime restrictions in fiscal year 2013. Through a
concerted hiring effort with the support of congressional budgetary
increases, the recovery in maintenance capability is in progress.
However, the FRCs face a significant backlog of work, particularly for
the service life extension of our legacy F/A-18 Hornets. FRCs hiring
progress returned to pre-sequestration manning levels in fiscal year
2015 and they continue to adjust hiring in order to ensure the
workforce can meet the workload demand.
The Aviation Depot Maintenance program is funded to 76 percent in
baseline and 85 percent with OCO for new work to be inducted in fiscal
year 2017. This funding level supports repairs for 583 airframes and
1,684 engines/engine modules. A $34 million funding shortfall to
achieve the executable level of aviation depot maintenance has been
identified in the Chief of Naval Operations Unfunded Priorities Letter
and we will continue to monitor the impacts.
General Paxton. The depot and field-level maintenance accounts
supporting equipment readiness in forward-deployed/operational
environments, home station, and reset have kept pace with requirements
over the last decade. However, current fiscal realities require
difficult decisions across all pillars of readiness, to include
maintenance. Through baseline and OCO funding, our fiscal year 2017
depot maintenance program is sufficient to meet all current operational
and reset requirements but results in risk to home station maintenance.
We anticipate an enduring need for OCO funding in support of forward-
deployed operations, to include maintenance accounts. To ensure
operational requirements are met and mitigate this risk in execution,
we use a complex depot maintenance model which optimizes funding to
maximize readiness and warfighting capability. Validated warfighting
values associated with equipment readiness drivers are key variables in
the optimization model computation. This risk is manageable in the
short term, but if sustained, will impact ground equipment readiness in
the long term.
I do have and continue to voice concerns over the inventory and
availability of amphibious shipping (naval shipyard issues) as well as
the availability of ready basic aircraft (RBA) on our flightlines
(aviation depot issues.) Our current budget puts additional fiscal
strain on the already reduced capabilities and negatively impacts our
warfighting readiness, particularly in responding (``surge'') with home
station forces.
General Goldfein. The Fiscal Year 2017 President's Budget Weapon
Systems Sustainment depot maintenance baseline funding maintains the
delicate balance between capability, capacity and readiness. This level
of funding supports the most critical aircraft depots/engine overhauls
with no anticipated maintenance backlog.

24. Senator Inhofe. All, what is the current status of investment
across your depots, shipyards and ammunition plants? Is it meeting
mandated capital investment of 6 percent as described in 10 USC 2476?
General Allyn. The Army has budgeted to meet the 6 percent
investment requirement for fiscal year (FY) 2016 and fiscal year 2017
as reflected in the Fiscal Year 2017 President's Budget request. The
Army is committed to continuing to invest in the Organic Industrial
Base in accordance with 10 U.S. Code 2476.
Admiral Howard. The Department of the Navy will again exceed the
mandated capital investment of 6 percent across our shipyards and
depots described in 10 USC 2476 with a 7.1 percent total investment in
fiscal year 2017. This equates to $376.9 million at Naval Shipyards,
$114.3 million at Fleet Readiness Centers and $15.7 million at USMC
depots.
General Paxton. Based on the Fiscal Year 2017 President's Budget
(PB), the current status of the investment for the Marine Corp (MC)
Depot is as follows:

------------------------------------------------------------------------
PB17 FY15 FY16
------------------------------------------------------------------------
% Executed/Projected 5.9% 3.9%
------------------------------------------------------------------------

The MC Depot is not meeting the mandated capital investment of 6
percent.
In accordance with 10 U.S. Code 2476, subsection (a)--Minimum
capital investment for certain depots, it states that ``each fiscal
year, the Secretary of a military department shall invest in the
capital budgets of the covered depots of that military department a
total amount equal to not less than six percent of the average total
combined maintenance, repair, and overhaul workload funded at all the
depots of that military department for the preceding three fiscal
years.''
While the MC Depot strives to meet the 6 percent threshold at the
command level through multiple operational variables and investment
into modernization of equipment and facilities, the investment may fall
below the goal due to the relatively smaller Depot operation as
compared to other services. The 6 percent minimum capital investment
for covered depots is mandated at the Department of the Navy (DON)
level.
General Goldfein. The Air Force has a robust capital investment
program that provides the depot complexes equipment, minor
construction, and software for new workloads while modernizing and
recapitalizing aging equipment and facilities. Yes, the Air Force has
always met the mandated capital investment of 6 percent as described in
10 USC 2476, and projects continued compliance. For example, in fiscal
year (FY) 2017, the procurement equipment investments will support the
activation of the organic depots to support F-35 and KC-46A. In fiscal
year 2016 and fiscal year 2017, MILCON investments support the KC-46A
depot bed-down at the Oklahoma City Air Logistics Complex.

25. Senator Inhofe. All, we are working with OSD to help facilitate
the timely hiring civilians at our depots, shipyards and ammunition
plants. The Office of Personnel Management has a goal of 80 days which
is unacceptable. What is the impact on readiness if we cannot hire
require civilian personnel into our depots, shipyards and ammunition
plants in a timely manner?
General Allyn. Readiness can be negatively impacted. Our workforce
however is committed to their mission and has continuously sustained
the warfighter as required. Through use of surges in the workforce,
such as five day/ten hour work week, three shifts per day, or limited
use of contract services, our depots', arsenals', and ammunition
plants' workforce can flex to meet the readiness requirements of our
Army. Hiring managers will continue to work through the federal hiring
process to strive to get the right worker into the right job in a
timely manner.
Admiral Howard. Navy readiness is not significantly impacted by the
length of time needed for civilian hiring actions at Navy aviation
depots and shipyards. These activities routinely plan hiring well in
advance of workload increases due to the extensive training required
for their unique and highly skilled workforce. While not directly
impacting readiness, the Navy is working on reducing the hiring
timelines at the aviation depots and shipyards to get new personnel
into training and the production workforce faster. Further, the
Department of the Navy has seen significant improvements in the hiring
process through the concentrated joint efforts of the Human Resources
and Comptroller communities in the last two years. Operation Hiring
Solutions, which expands best practices and streamlines processes
throughout the Department, is improving our ability to get people
onboard more efficiently. The aviation depots and shipyards are
benefiting from these programs as well.
General Paxton. Although the goal of OPM is 80 days, our analysis
shows that the actual wait time for hiring civilian employees and
having them in place averages 149 days in the Civilian Human Resource
Office--Southeast (CHRO-SE) Region. This excessive wait time has a
significant impact to both production and financial execution goals.
The depots are Working Capital Funded (WCF) activities, which must
generate revenue through the execution of Direct Labor Hours (DLH) to
recover costs. Based on the standard 80 day wait time, the depots would
lose approximately 55 productive days waiting for a civilian to be
hired and report to work. An 80 day wait time equates to $40K in
revenue and 400 DLH's that would be lost per employee and with the
hiring process taking almost twice that amount of time, the impact is
even greater.
To offset the wait times for hiring civilian employees, the depots
currently leverage labor contracts to fill skill gaps and civilian
workforce deficiencies as a temporary mitigation strategy.
General Goldfein. As of March 21, 2016, there were 1,762 vacant
positions in critical skills within the Air Force Sustainment Center
(AFSC). AFSC expects the critical need to exist until March 31, 2017.
Immediate shortages with extensive lag times in hiring,
particularly in critical aerospace skills, drives high overtime rates
and creates the inability to meet delivery deadlines. The unfinished
work must transfer into the next fiscal year. As the workload moves to
the out years, it directly impacts the ability to support warfighter
needs within required timelines. The inability to meet AFSC commitments
ultimately leads to the potential of Air Logistics Complex customers
seeking other sources to perform the necessary workload.
Air Force Materiel Command (AFMC) is working closely with the Air
Force Personnel Center to break down barriers that result in lengthy
hiring timelines. Significant progress has been made, and AFMC is
continuing to look for other opportunities to improve.
pilot shortfall
26. Senator Inhofe. All, are each of your services experiencing
shortages in the pilot manning?
Admiral Howard. Our aggregate pilot inventory meets current
authorizations. However, pilot manning among lieutenant commanders (O4)
in three carrier-based fixed wing type/model/series aircraft,
specifically the Electronic Attack (VAQ), Strike Fighter (VFA) and
Early Warning (VAW) communities, is projected to decline over the next
five years. This will necessitate increased incentive power to mitigate
a critical pilot inventory shortfall at the department head level.
Accordingly, we support the Administration's proposal to increase
statutory caps on aviation pays to ensure we retain a competitive edge
as we work to retain highly-trained and experienced pilots.
General Paxton. No. On average, Marine Aviation is not experiencing
pilot shortages. Within HQMC Aviation, various metrics are used to
track pilot manning. Some metrics measure by rank/grade and others by
duty location (e.g. fleet squadrons, supporting establishments,
training commands). In the majority of our Type/Model/Series (T/M/S),
these metrics show our target goals are exceeded; however, in our newer
T/M/S (e.g. F-35 and MV-22), deficiencies are shown. This is due in
part to wait times within Chief of Naval Air Training (CNATRA) training
pipelines to build up our newer T/M/S inventories. Another area of
deficiency is shown in our junior officer grades/ranks within our
operational squadrons, specifically F/A-18. That was primarily due to a
lack of inventory of available F/A-18 aircraft to train and meet
operational commitments. We have prioritized all our Fleet Replacement
Squadrons (FRS) training squadrons for available aircraft and now are
producing the numbers we need, but in some year groups we remain short
of company grade officers in F/A-18.
General Goldfein. Yes, the Air Force is experiencing a shortage of
pilots. Currently the Air Force is 641 pilots short of our total
requirement, and expecting to be over 750 pilots short by the end of
fiscal year (FY) 2016. Over the last three years, we have noticed a
decreasing trend in pilot retention. Since fiscal year 2014, yearly
losses have exceeded the Air Force's annual production capacity. While
many of the separating pilots have affiliated with the Reserve
Components (RC), the RC is also experiencing a pilot shortage in full
time positions. Overall, the pilot manning shortage is most critical in
our fighter community, where we are more than 511 pilots short as of
the end of fiscal year 2015, and the trend is worsening. The Air Force
expects to be over 700 fighter pilots short by the end of fiscal year
2016.

27. Senator Inhofe. All, are you starting to see any indications of
an increasing number of military pilots leaving your services?
Admiral Howard. Aggregate Navy pilot retention has declined in each
of the last three years against the backdrop of an improving economy
and increased airline pilot mandatory retirements. Recent studies
forecast that, based on industry growth and mandatory retirements,
airline and cargo pilot hiring-demand will grow to 4,000 pilots per
year by 2020. A 2006 Center for Naval Analyses study postulated that
for every 1,000 airline hires, Navy would experience a 2.4-2.6 percent
decline in pilot retention.
General Paxton. Not at this time, but we anticipate we may in the
near future. Statistical data shows a 26-year average attrition rate at
7.2 percent for marine aviators and fiscal year 2015 attrition rates
were below the 26-year average. However, we have reduced pilot
populations due to our drawdown, and the growing commercial and airline
shortfalls will drive a demand for pilots from the military. The Bureau
of Labor Statistics (BLS) indicated on 17 December 2015 a 7 percent
(faster than all occupations) pilot demand until 2024 due to the
current pilot population aging out. BLS noted ``military and
experienced pilots will have a [hiring] advantage over applicants whose
flight time consists only of small piston-driven aircraft.'' Airline
industry insiders are now hiring Tiltrotor (V-22) pilots, especially
given the FAA changes in the wake of the Colgan air crash and this
increases the USMC's aviation population at risk.
We believe our current lowered state of aviation readiness (ready
basic aircraft, RBA) and resultant reduced flying hours (flying hours
program, FHP) combined with industry's pilot demand will generate a
retention problem. Although our statistics, looking backward, indicate
we are within historic norms, the aviation industry demand has the
potential for reducing our pilot population below required levels. On a
side note, we are also watching and concerned about retention of our
highest qualified aviation maintenance Marines. They too are in high
demand in the commercial world. We will continue to monitor closely to
ensure we don't re-learn the lessons in the 1990's where pilot
shortfall required Navy pilot volunteers to change service to the USMC
because bonuses came too late.
General Goldfein. Yes. Over the last three years we have noticed a
decreasing trend in pilot retention and the Air Force is experiencing a
shortage of pilots. Currently the Air Force is 641 pilots short of our
total requirement, and expecting to be over 750 pilots short by the end
of fiscal year (FY) 2016. For fighter pilots, fiscal year 2014 was the
largest single year drop in Aviation Retention Payment (ARP) take rate
in 14 years. This corresponds to the last major significant airline
hiring in 1999-2000. Overall, the Air Force desires retention bonus
take rates between 65-70 percent. For the past 2 years (fiscal year
2014 and fiscal year 2015), we have experienced retention bonus take
rates between 55-59 percent, and the trend is worsening. To date, the
Air Force has experienced as many separations in the first six months
of fiscal year 2016 as it did in all of fiscal year 2015.

28. Senator Inhofe. All, what steps are each of your services
taking?
Admiral Howard. Navy applies both monetary and non-monetary
incentives to retain pilots who possess the requisite qualifications
and demonstrated leadership to maintain our preeminent operational
aviation force. Non-monetary incentives include graduate education
opportunities, spouse co-location, geographic assignment stability, and
participation in the Career Intermission Program. Monetary incentives
include a monthly Aviation Career Incentive Pay (ACIP) and Aviation
Career Continuation Pay (ACCP). ACCP is comprised of two separate
bonuses. The first is targeted at mid-grade Active Duty aviators, and
designed to retain them in the Navy to serve as squadron department
heads. The second, a command retention bonus, is designed to retain
squadron commanding officers through 22 years of commissioned service
(YCS).
As we work to retain the number of pilots needed to meet
operational requirements and against the backdrop of increasing
commercial aviator hiring and compensation, we support the
Administration's current proposal to increase ACIP and ACCP statutory
caps to ensure we retain a competitive edge.
General Paxton. While on average, our current inventory of pilots
is sufficient as we have already described in Questions 26 and 27, we
are still concerned about our pilot populations. Given the overall
shortfalls in Marine Aviation readiness, we have seen a reduction of
flight hours per pilot across every platform. This long term readiness
problem and the career opportunities in the commercial aviation sector,
give us pause. While we do not see broad retention issues today, we are
concerned that this could become a problem in the future and do not
want to get caught behind it. Headquarters Marine Corps actively
conducts surveys to seek insights into current motivations of our
pilots, their intentions, and perceptions. This enables us to be
proactive and ensure we sustain the pilot population depth and breadth,
and ensure that corrective action, if needed in the future, will be
applied in a timely manner.
General Goldfein. In September 2015, General Welsh initiated the
Fighter Enterprise Redesign, an Air Force effort investigating
initiatives to reduce fighter pilot requirements and increase the
production and retention of pilots. Regarding requirements, the Air
Force is reviewing developmental education policies to determine
whether changes in existing policies can provide some relief to current
requirements. With respect to production, the Air Force is currently
reviewing available options for standing up additional fighter pilot
training capacity. To prepare for this, we assessed additional
maintenance manpower in fiscal year (FY) 2015 and 2016 to increase our
ability to produce experienced pilots, as well as increase combat
readiness. In an effort to retain more pilots, the Air Force is looking
at addressing high operations tempo, home station quality of life, and
Total Force integration. Lastly, regarding retention, we are exploring
improvements to the officer developmental process, and developing a
more agile and accommodating assignment management policies to help
retain skilled pilots. Additionally, in the Fiscal Year 2017
President's Budget, the Air Force advocated for increases in Aviator
Retention Pay. If commercial airline hiring and pay increases continue
beyond current levels, the Air Force may need to revisit additional
bonus increases.
__________
Questions Submitted by Senator Jeanne Shaheen
combat uniforms
29. Senator Shaheen. Section 352 of the fiscal year 2014 NDAA
established that it is DOD policy to eliminate the fielding of service-
specific combat uniforms in order to adopt and field a common combat
uniform for all members of the Armed Services. This committee has
always strived to improve efficiencies and the multitude of service-
specific combat uniforms even made the top of GAO's list of duplicative
DOD issues not long ago. Given this committee's potential look at
Goldwater-Nichols reform, the combat uniform issue has potential for
improvement.
Given the DOD policy and the fact that the Military Services all
wore the same combat uniform prior to 2002, what is the status of the
Military Services working together on the Joint Clothing and Textiles
Governance Board to develop and field a joint combat uniform?
General Allyn. The Army's ongoing fielding of Army Combat Uniforms
in the Operational Camouflage Pattern has been in full compliance with
section 352, with the enactment of the Fiscal Year 2014 National
Defense Authorization Act.
The Services have consistently worked together on the Joint
Clothing and Textiles Governance Board (JCTGB) to address the topic of
a common combat uniform. The Army also participates in the JCTGB
Advisory Group and the Cross-Service Warfighter Equipment Board (CS-
WEB). The JCTGB Advisory Group meets two to four times a year to
discuss policy and to review items to be presented at the JCTGB. The
CS-WEB meets three to four times a year and is the forum where the
Services brief current and planned development efforts and
opportunities for collaboration.
Admiral Howard. The Navy participates as a member of the Joint
Clothing and Textiles Governance Board (JCTGB); the next JCTGB meeting
is planned for June 2016 and the topic of a joint Service combat
uniform is on the agenda. The Navy is in compliance with section 352 of
the fiscal year 2014 NDAA as well as DODI 4140.63, Management of DOD
Clothing and Textiles (Class II). These documents provide the current
guidance for combat uniforms for acquisition and procurement that the
Services must follow. Combat uniforms have evolved since 2002 with the
Services' missions and operational responsibilities. The Navy ensures
personnel safety by utilizing uniforms appropriate to the theater and
environment. As an appropriate efficiency measure, Navy Service
personnel adopt the Services' requisite combat uniform when assigned as
Individual Augmentees to Army or other Service units.
General Paxton. Section 352 of the fiscal year 2014 NDAA contained
a provision which stated, ``The Services are not prohibited in the
continued fielding or use of pre-existing service-specific combat
uniforms as long as the uniforms continue to meet operational
requirements.'' Since the establishment of the provisions contained in
this section, the Marine Corps has not had any changes to the
requirements of our current, service developed and patented combat
uniforms as they continue to meet our operational needs. The Marine
Corps participated in the drafting of Joint criteria via the Joint
Clothing and Textiles Governance Board for a future combat utility
uniform. The Marine Corps continues to fully cooperate and share with
all of the other services in the pursuit of technology improvements for
current and future combat utility uniforms.
General Goldfein. Threats to our Military Service members and the
roles they are required to assume have evolved since 2002. For example,
airmen have assumed joint service ground support roles that exposed
them to what two decades ago would have been considered uncommon
threats. As a result, the Air Force recognized the need for fire
retardant, ground combat uniforms, and partnered with the Army in
October 2010. The Air Force adopted the Army's Operation Enduring
Freedom Camouflage Pattern combat uniform as a joint service solution
that minimized those emerging threats to our airmen.
The Air Force continually supports collaborative efforts and has
representatives, who routinely act as advisors to principal members of
the Joint Clothing and Textiles Governance Board, as well as its
subsidiary, the Cross-Service Warfighter Equipment Board (CS-WEB).
__________
Questions Submitted by Senator Mazie Hirono
readiness
30. Senator Hirono. Admiral Howard, you stated in your written
testimony that full recovery of the material readiness of the Fleet is
likely to extend beyond 2020. What are the implications of a Fleet that
won't achieve readiness for another four years at the least? What areas
are suffering from a lack of support? Which areas are most concerning
to you?
Admiral Howard. The President's Budget for fiscal year 2017
provides sufficient funding to needed areas for continued support of
our readiness recovery efforts. My concerns remain having stable
funding, improvement in on-time execution of ship and aviation depot
maintenance, and steady-state operations. The main implication of
recovering full readiness beyond 2020 is the impact to our contingency
force posture during the readiness recovery period. In the near term,
we are confident in our ability to provide presence, but surge capacity
has been diminished.

31. Senator Hirono. General Goldfein, your written testimony stated
that the Air Force is ``currently one of the smallest, oldest, and
least ready forces across the full-spectrum of operations in your
history.'' Can you please explain the implications of reduced readiness
and the impacts on morale and retention? Does the Air Force have a plan
to increase readiness in future years?
General Goldfein. Reporting indicates that the longstanding, very
high operational tempo has negatively affected Air Reserve Component
and Active Duty retention and invariably a reduction in combat
capability. One example involves the departure of 60 air refueling
crews from our Reserve Component in the last eight months, which we
attribute partially to the high ops tempo our personnel endure.
The Air Force continues to pursue its readiness recovery goal of 80
percent ready. Unfortunately, the conditions required to rebuild
readiness have not yet been set. Demand for Air Force capabilities has
created an environment where readiness is being consumed faster than we
can build it. The Air Force's plan provides the resource foundation
(starting with end strength increases) from which to begin rebuilding
readiness in fiscal year 2020, if deployment conditions improve and
global force management reforms show promise in achieving this end. We
will regularly analyze actual conditions and adjust the resource plan
accordingly, but the readiness enterprise depends on consistent,
predictable funding.

32. Senator Hirono. General Goldfein, you mentioned in your written
testimony that our adversaries are challenging our competitive
advantages and closing the gap with regard to capability. What must the
Air Force do to regain our competitive advantages? What specific areas
require additional attention?
General Goldfein. Our potential adversaries are keenly aware of the
importance of air superiority to our Nation's way of war. The threats
we will have to face continue to evolve in technology and complexity.
Potential adversaries are acquiring advanced fighters on par with or
better than our legacy fleet, developing sophisticated and networked
early warning radar surveillance systems, and fielding surface to air
missile systems with increasing range and lethality.
To address these challenges, we must improve capability and
capacity to allow us to maintain our competitive advantage across the
full spectrum of operations and readiness. Investment in the re-
capitalization and modernization of our fighter and bomber fleets,
incorporating improvements in Electronic Warfare, advanced weapons
inventory, cyber security, and interoperability will allow us to
operate and survive in the higher threat environments. In addition, we
are reviewing options to provide for affordable and sustainable
rotational capacity that can help us preserve readiness across the full
spectrum of operations. Lastly, we must accelerate the implementation
of acquisition reform in order to increase our agility and
responsiveness in order to develop and field new technologies to
counter rapidly advancing threats.
energy
33. Senator Hirono. General Allyn, Admiral Howard, General Paxton,
and General Goldfein, the national security of our country is greatly
dependent on the implementation of energy security efforts. By
decreasing our energy footprint, we enable our forces to more efficient
and lessen our dependence on fuel. Can you please provide an update on
how the fiscal year 2017 budget reflects your efforts to reduce
consumption, use alternative clean sources and increase U.S. energy
security?
General Allyn. All Army energy investments are focused on enhancing
mission effectiveness, building resiliency of our energy
infrastructure, and containing or reducing costs.
To reduce consumption and increase efficiency on Army
installations, the Army's fiscal year (FY) 2017 budget request is for
$164 million in energy efficiency improvements. In addition to this
amount of direct investment, the Army plans to partner with the private
sector for an additional $180-$220 million in investment through energy
savings performance contracts (ESPCs). The Army is the largest user of
ESPCs in the Federal Government. Since 1992, we have leveraged over
$2.2 billion in third party investments for energy efficiency
improvements, including over $500 million in the last two years alone.
Since 2010, the Army has saved more energy through ESPCs than is
consumed in a year at Fort Bragg, our largest installation.
In response to risks posed to our vulnerable energy grid, the
Army's budget request reflects our efforts to improve the resiliency of
Army installations and increase energy security through the use of on-
base renewable sources of energy. Our fiscal year 2017 budget requests
funding for the Office of Energy Initiatives (OEI), which helps to plan
and develop third party-financed renewable energy projects. The Army
currently has 159 mega-watts (MW) of renewable energy generation
capacity installed on our installations, of which 40.5 MWs of this
amount was installed in the past twelve months. These projects produce
power equivalent to 12 percent of the Army's total consumption. The
Army is developing a further 400MWs of projects, representing over $800
million in private sector investment. All of these projects are at or
below conventional electricity costs, and are expected to save the Army
$250 million.
The Army's fiscal year 2017 Operational Energy (OE) budget request
of $1.28 billion recognizes that improved use of energy enhances
mission capabilities. The bulk of this request, $1.084 billion, is for
Equipment Procurement, which funds energy efficient equipment that will
reduce physical and logistical burdens on our soldiers. A portion of
this budget will fund the Army's Improved Turbine Engine Program, which
will develop a new engine for the medium helicopter fleet with 50
percent more power, 25 percent improvement in fuel efficiency, 35
percent decrease in maintenance costs, and 20 percent longer engine
life.
Admiral Howard. Energy security is fundamental to executing Navy's
mission both afloat and ashore. Reliance on petroleum-based fuels poses
critical strategic vulnerabilities and creates operational constraints.
The Navy's investments in energy efficiency and alternative fuels
increases energy security by extending range and endurance, shortening
the length of the logistics tail, and reducing supply chain
vulnerabilities.
I. Operational Energy Investments
Navy's PB17 investment in Operational Energy initiatives aims to
enhance combat capability and effectiveness through innovative
technologies, operational procedures, culture change initiatives, and
the qualification of advanced alternative fuels for Fleet-wide use.
These initiatives focus on strengthening our Naval Power and providing
the warfighter with the tools to continue taking the fight forward.
Energy efficient technologies and procedures enhance our warfighting
capability by extending our combat range, `on station' time, and
mission endurance, while also netting some savings.
II. Shore Energy Investments
Navy is making investments to reduce energy consumption, increase
the use of alternative energy resources and improve energy security for
our installations. To reduce our energy consumption, Navy is investing
in facility upgrades, smart energy analytics, and utility system repair
projects. These investments help improve energy security, energy
management and provide advanced capabilities like demand response and
load shedding.
Navy remains highly committed to improving our energy security
posture. We are focused on improving our utility infrastructure
backbone of our installations and ensuring reliable, resilient power
for our mission-critical assets. In addition to improving resiliency
and reducing consumption, Navy is working closely with its private
sector partners for advances in this area.
General Paxton. The Marine Corps is addressing operational energy
from multiple avenues in order to holistically develop sustainable
expeditionary solutions. These avenues include analysis of operational
energy risk to identify current and future capability gaps, development
of technology solutions, and adoption of changes to behavior at both
the operational and tactical level to better use the energy we are
consuming. Specifically, we will accomplish this by:

Operational Energy Risk Analysis--USMC is conducting
wargaming and experimentation to inform future capability needs and
assess projected shortfalls in these capabilities. USMC is also
coordinating with geographic combatant commanders to conduct exercises
and OPLAN energy risk analysis to identify energy-based risks to war
plans and assess possible mitigation options. Insights from these
exercises and analyses will inform planning and enable more effective
use of energy and maximize the operational effectiveness.
Advanced Technology Development--USMC is working closely
with the Research and Development offices within Department of Navy,
Department of Army, and Office of the Secretary of Defense to develop
technology solutions to address expeditionary energy capability gaps.
We are pursuing solutions in the areas of energy efficiency, energy
harvesting, energy storage, and consumption management. Technologies
include advanced vehicle power train systems, high performance
photovoltaic energy generation, wearable kinetic energy harvesting, and
sensors that monitor energy usage.
o The Office of Naval Research Fuel Efficient Medium Tactical
Vehicle Replacement (FEMTVR) program is developing the technology to
improve fuel efficiency of the Marines' most ubiquitous truck. FEMTVR
will demonstrate efficiency gains of over 15 percent which equates to
the ability to drive over 90 miles further on a tank of gas.
o The Joint Infantry Company Prototype (JIC-P) is a wearable
energy system that integrates human borne energy harvesting with
personal power management and central power storage. JIC-P will
increase the electrical energy sustainment capability of dismounted
warfighters in austere environments and extend the time between
resupply from 36 hours to multiple days.
o The Energy Command and Control project is a system of
networked tactical fuel consumption, distribution, and capacity sensors
combined with analytics that provides energy information to the MAGTF
common operational picture. This actionable information is critical for
planning at the operational level and has been demonstrated to enable a
Marine unit to travel 190 miles further on the same fuel.
Behavior Change--While the development and deployment of
advanced technology to reduce energy use is required, it alone is not
sufficient to maximize combat advantage and meet USMC goals.
Technological capabilities must be combined with changes in behavior.
o The sensors being developed in the Energy Command and Control
project to monitor energy usage will be used to provide real-time
feedback to operators on their fuel usage enabling them to reduce fuel
consumption by changing their driving habits (i.e. idle time).
o The USMC is conducting a behavioral analysis to discover and
document energy related behavior and identify behavior modification
options that could significantly increase operational reach of Marines
by reducing ground vehicle fuel usage. In addition, the operational
energy risk analyses are identifying possible changes in doctrine at
the operational level that will reduce energy-related risk to
completing the mission.

General Goldfein. The Air Force is focused on enhancing mission
assurance through energy assurance, and is optimizing our capabilities
in order to maximize combat readiness and reduce mission risks. As part
of its approach, the Air Force is aggressively pursuing clean facility
energy projects, which can serve as critical investment building blocks
to resilient energy systems, and is looking at both direct and third-
party financing options to develop energy projects and optimize its
energy demand. In February 2016, the Air Force established the Air
Force Office of Energy Assurance (OEA), a central program office
dedicated to the development, implementation, and oversight of
privately-financed, large-scale renewable and alternative energy
projects. The OEA, which will leverage partnerships with the Army and
Navy, will take an enterprise-wide approach to identify and facilitate
energy projects that provide resilient, cost-effective, cleaner power
to Air Force installations.
The Air Force is also investing in a broad spectrum of operational
energy initiatives impacting the way airmen behave, weapons platforms
are maintained and modernized, and processes are enhanced. Improving
the energy productivity of our weapon systems and installations will
increase capabilities, provide the Air Force with strategic energy
agility, and mitigate the mission, geopolitical, financial, and
environmental risks posed by a reliance on specific resources. Included
in the fiscal year 2017 budget request is more than $600 million for
projects that will improve current and future operational capabilities.
One such project is the work the Air Force is doing with advanced
adaptive engines. This research and development effort may provide up
to 30 percent more range, 25 percent better fuel efficiency, and a 10
percent increase in thrust. The Air Force is also looking at process
improvements. For example, Air Mobility Command has implemented
multiple process improvements, such as smart cargo loading, which have
resulted in a cost savings of $500,000 per day. These efforts are
leading to improved capabilities for our warfighters and have improved
aviation energy productivity by 6 percent over the last five years.
funding
34. Senator Hirono. General Allyn, you mentioned in your written
testimony that the fiscal year 2017 Army Budget base request is $1.4
billion less than the fiscal year 2016 enacted budget. What specific
areas suffer from this lesser budget number? How does this impact your
readiness and ability to execute your missions?
General Allyn. In the near term, the fiscal year (FY) 2017 budget
builds operational readiness for potential major combat operations
while also ensuring deploying units are ready for ongoing contingency
operations. However, because it is $1.4 billion less than fiscal year
2016 enacted, the prioritization of Army readiness comes at the expense
of modernization and installation sustainment. The Army is forced to
reduce investments in procurement, purchasing lower quantities of
equipment than previously planned. Funding for facility sustainment
accounts is also reduced, causing an increased backlog in facility
maintenance. The funding levels constrain the Army's ability to achieve
the desired balance between near term readiness for the current
environment, and long term modernization required for future security
challenges. Without additional funding, the Army will continue to make
trade-offs to best implement the defense strategy and address emerging
requirements with limited resources available.
modernization
35. Senator Hirono. General Allyn, Admiral Howard, General Paxton,
and General Goldfein, modernization and readiness are often at odds
with each other: Funding that is used for readiness, which is an
immediate need, is often used at the expense of modernization. Can you
talk about the importance of modernization in your respective commands?
Are you finding a balance between modernization and readiness? Which
areas requiring modernization are most concerning to you?
General Allyn. You are correct that we have had to delay
modernization in order to support near-term readiness because of budget
reductions. We have been doing so since 2011, and the longer we have to
stay at reduced modernization levels, the farther behind we will fall
to future adversaries. A trained Army requires modern equipment to win.
While we are deliberately choosing to delay several modernization
efforts to stay within our budget constraints, we do have priorities:
Aviation, the Network, Integrated Air Missile Defense, Combat Vehicles,
and Emerging Threats. In the area of emerging threats, we are looking
for innovative technologies focused on Active protection systems (both
ground and air), aircraft survivability, future vertical lift, directed
energy weapons, cyber, and integrated electronic warfare.
Admiral Howard. Modernization of our fleet that builds on current
capabilities as well as introduction of new systems that enhance our
future capabilities is vitally important to the navy as we seek to
maintain our robust, power projection advantage over our adversaries'
ever improving A2/AD posture. Our investment in modernization also aims
to achieve Defense Planning Guidance's tenet of developing a smaller
yet highly capable ready force that meets future, emerging challenges.
Achieving this objective through smart investments also enables the
navy's balanced superiority in Air, Surface and Submarine warfare areas
over our adversaries in a complex, maritime threat environment. To that
end, we are continuing in our commitment to modernization through
investments in priority programs like the Joint Strike Fighter, legacy
F/A-18 service life extension, P-8 procurement, DDG/CG modernization,
Ohio Replacement Program and the development of unmanned systems.
Finding the balance between modernization and readiness is a
challenge on which the navy is principally focused in a pressurized
budget environment. Investments we have made in readiness over the last
couple of budget cycles have raised capacity in naval shipyards and
aviation depots. However, we have also experienced requirements
increase resulting from continued high operations tempo, increased need
for combating cyber security threats, costs associated with
prepositioning forces forward and additional training requirements for
newly hired artisans in our depot, maintenance activities. To achieve
the balance between modernization and readiness in this austere
environment, the navy is looking into innovative solutions beyond just
financial investments. One of the ways is through achieving high
velocity learning in every level of the naval service. This concept is
outlined in the CNO's ``Design for Maintaining Maritime Superiority''
and leverages on building a culture of innovation and creativity and
institutionalizing the rapid adoption and implementation of best
concepts, techniques and technologies to achieve personal and
organizational performance objectives without additional resources.
Another example of innovative solutions is our approach to making smart
investments in modernization. More than we have in the past, the navy
is taking a systematic approach by analyzing every phase of the kill
chain to focus on most effective delivery methods and investing in most
vulnerable phases to achieve kill chain wholeness. This methodology is
allowing the navy to make the most out of our modernization dollars and
move toward balancing readiness and modernization.
One concern the Navy has with modernization is maintaining
continuity of capabilities in the near-term (current FYDP) through the
long-term (into 2030 and beyond) to sustain superiority in all naval
warfare areas. In some instances, on a case-by-case basis, the navy
will have to make risk-based, priority decisions to either lean toward
near-term capabilities over the long-term or vice versa. In terms of
modernization investment areas that are of most concern, the navy is
currently placing emphasis on 15 key warfare and 2 force generation
mission areas including the undersea leg of the strategic deterrent
triad, which is foundational to our survival as a nation, the defense
against long-range precision strike and cyber resiliency, to name a
few.
General Paxton. We must constantly balance between operational
readiness and institutional readiness; between capability and capacity;
between current and future operations; between steady-state and between
surge; and between low-end and high-end operations as well as the
training that goes with them. We constantly seek these balances as we
face simultaneously increasing and varied demands from the combatant
commanders.
In our current challenging fiscal environment we are struggling to
maintain all of those balances. The Marine Corps is no longer in a
healthy position to generate current readiness and simultaneously reset
all of our equipment while sustaining our facilities and modernizing to
ensure future readiness. We have consciously and properaly prioritized
near term readiness in order to meet COCOM demand. We have continued to
provide the geographic combatant commanders with operationally ready
forces to execute all of their assigned missions, not the full spectrum
of possible operations.
In addition to this, operational readiness is generated at the cost
of our wider institutional readiness. This year I must again report
that approximately half of our non-deployed units are experiencing some
degradation in personnel, equipment, or training readiness. We continue
to prioritize modernization for the most important areas, particularly
the replacement of aging aircraft and amphibious assault vehicles, but
we are deferring other needs. Our installations continue to be the
bill-payers for today's readiness, putting the hard-earned gains from
the past decade and much-needed military construction further at risk.
While our deployed forces continue to provide the capabilities
demanded by the combatant commanders, our capacity to do so over time
and in multiple locations remains strained. Our deployment-to-dwell
ratio (currently 1:2 average) continues to exceed the rate that we
consider to be sustainable in the long term, 1:3. The strains on our
personnel and equipment are showing, particularly in aviation,
communications, and intelligence communities.
We have already been forced to reduce the capacity available to the
combatant commanders by reducing the number of aircraft assigned to
several of our squadrons, e.g. F/A-18s and those of the deployed MAGTFs
like SPMAGTF-Crisis Response Africa. We expect to continue those
reductions throughout 2017. While we are able to maintain steady-state
theater security cooperation, build partnership capacity, and sustain
mil-to-mil engagements, our ability to surge is increasingly
challenged.
Furthermore, a return to BCA-level spending/full sequestration
would significantly exacerbate institutional readiness imbalances. More
tradeoffs would be made in acquisitions of needed equipment, essential
training, living and work spaces, and end strength to protect the
Marine Corps' performance of its statutory obligations. Sequestration
impacts on key modernization programs will have catastrophic effects on
achieving desired capabilities to defeat emerging threats and will
place an unacceptable burden on legacy ground combat tactical vehicle
(GCTV) programs such as the Assault Amphibian Vehicle (AAV, 40 + years
old), the HMMWV (out of productions since 2012), The Light Armored
Vehicle (LAV, average age 33 years), and M1A1 tank (average age 26
years).
These challenges in balancing readiness and modernization provide
context for today's budget environment. Your Marine Corps remains ready
to answer the nation's call, but with no margin for error on multiple
missions in which our indicators and warning are diminished, our
response time is strained, and within which failure is not an option.
General Goldfein. Our fiscal year (FY) 2017 budget prioritized
capacity and readiness over modernization. We are currently facing a
modernization bow wave. The modernization efforts in the Air Force are
critical to our ability to gain and maintain control of the air and
space domains to support the joint force. With the proliferation of
advanced technologies/capabilities, the gap between our capabilities
and those of potential adversaries is closing.
In the mid-term (fiscal year 2022-2027), the Air Force will be
unable to meet modernization requirements, recover from below 50
percent readiness levels for full spectrum conflict, and maintain
National Defense Authorization Act-required force capacity. The two
biggest areas of concern to the Air Force are the nuclear enterprise
and our fighter force. With the recapitalization of the nuclear
enterprise and our conventional fighter force all taking place in the
2020s, the Air Force will not be able maintain readiness and capacity
within current fiscal constraints if the present strategic environment
changes. While we are able to meet operational requirements in the
present strategic environment, this will all change if there are
increased operational demands put on the Air Force; especially if the
current fiscal environment does not change.
rebalance
36. Senator Hirono. Admiral Howard, in terms of the Rebalance and
given our current threat environment and the actions of China and North
Korea in the Asia-Pacific, do you see Hawaii as a strategically
important area in terms of readiness? How important is it to have an
Active and ready force prepositioned in Hawaii?
Admiral Howard. Without question Hawai'i's geo-strategic location
is vitally important in terms of readiness due to the tyranny of
distance from the West Coast to the distant Indo-Asia-Pacific operating
areas. Located 2000 miles closer to these operating areas, Hawai'i
enables the Navy to stay on station longer and respond faster. These
great distances from CONUS underscore how indispensable Hawaii is to
Navy's readiness. Hawai'i's location and defense infrastructure offset
this tyranny of distance.
Having an active and ready Naval force prepositioned in Hawaii is
an essential element of Navy's readiness. Hawaii is home to U.S.
Pacific Fleet and the preponderance of Navy's non-CONUS based ships,
and is ideally suited to support the Asia-Pacific rebalance.

DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
2017 AND THE FUTURE YEARS DEFENSE PROGRAM

----------

TUESDAY, APRIL 5, 2016

U.S. Senate,
Subcommittee on Readiness
and Management Support,
Committee on Armed Services,
Washington, DC.

THE STATE OF PUBLIC SHIPYARDS TO MEET CURRENT MISSION NEEDS AND
INVESTMENT STRATEGIES

The subcommittee met, pursuant to notice, at 2:31 p.m. in
Room SR-222, Russell Senate Office Building, Senator Kelly
Ayotte (chairman of the subcommittee) presiding.
Committee members present: Senators Ayotte, Fischer,
Rounds, Ernst, Shaheen, Hirono, and Kaine.

OPENING STATEMENT OF SENATOR KELLY AYOTTE, CHAIRMAN

Senator Ayotte. Good afternoon. This hearing of the
Subcommittee on Readiness and Management Support will come to
order.
I want to thank Ranking Member Senator Kaine for his
continued leadership on defense issues and eagerness to work
together in a bipartisan manner on behalf of our men and women
in uniform.
I am very pleased to have our witnesses here today. We are
joined this afternoon by Vice Admiral William Hilarides,
Commander of the United States Naval Sea Systems Command; and
Vice Admiral Dixon Smith, Commander of United States Navy
Installations Command. I want to thank both of you for being
here and for your leadership and service to the country.
As we prepare for the committee markup of the National
Defense Authorization Act, the focus of today's hearing is on
our Nation's four public shipyards: Norfolk, Pearl Harbor,
Puget Sound, and the Portsmouth Naval Shipyard. These four
public shipyards and the skilled Department of Defense
civilians who work at these shipyards are major national
security assets for our Navy and our Nation, performing
mission-critical depot and intermediate-level maintenance,
modernization, and repair on our Nation's naval fleet.
In order to protect our economic and national security
interests, our Nation needs the world's most capable, well
maintained, and combat-ready fleet. To ensure we have such a
fleet, our Nation looks to the Navy and the Navy looks to the
thousands of Department of Defense skilled civilian artisans
who work at our public shipyards.
To fulfill this critical national security role, our public
shipyards must have a fully trained and supported workforce
that is appropriately sized, as well as modernized
infrastructure, including dry docks, piers, production shops,
and wharfs. That is what more than 33,000 skilled shipyard
workers deserve and what our national security interests
require.
I have been fortunate to witness the excellence of our
shipyards at the Portsmouth Naval Shipyard, where many of my
constituents work. The week before last, I was privileged to
attend and speak at the Portsmouth Naval Shipyard's trade
apprentice program and worker skills progression program
graduation. I was so impressed by the comprehensiveness of the
training, as well as the quality of the more than 180
individuals who graduated from the program. The graduates
actually logged thousands of hours of on-the-job training,
trade theory and academic training, honing their trade and
sharpening their skills.
Portsmouth is known for programs like this and others that
promote labor-management collaboration, empower the workforce,
and create a culture that values high standards and continuous
learning. In fact, this subcommittee highlighted these efforts
and Portsmouth's dedication to improving its workforce in a
hearing that we had before this committee last July, and in
that hearing, Mr. Paul O'Connor testified at the hearing. I am
so pleased to see Paul here today in the audience.
In part because of these programs, Portsmouth has
solidified its reputation as the Navy's Center of Excellence
for fast attack nuclear-powered submarine maintenance,
modernization, and repair. These are not just words. Portsmouth
Naval Shipyard consistently proves it by completing submarine
maintenance ahead of schedule and under budget. Last year,
Portsmouth executed the fastest engineering overhaul of a Los
Angeles-class submarine in history, completing the work on the
USS Alexandria 2 weeks ahead of schedule and $9 million under
budget. We are not too proud. We have seen similar top-notch
performances at Portsmouth with the USS Springfield,
California, Topeka, and Dallas.
The challenge before us is to ensure Portsmouth and the
other three public shipyards have the resources that they need
to improve performance even further. Our sailors, our combat
commanders, and our country depend on our public shipyards.
These civilians perform a vital national security mission, and
we should avoid policies that make their jobs harder or fail to
reflect the importance of their work like sequestration,
government shutdowns, and misguided TDY [temporary duty]
policies.
This subcommittee is also particularly eager to discuss at
the hearing with both of you today the performance of the
public shipyards, including areas of excellence and areas that
we need to continue focusing on, current and projected
workload, and the personnel and infrastructure capacity of the
public shipyards necessary to execute that workload, the
importance of investing in infrastructure facilities and
equipment, and why the projects requested in the 2017 budget
request are needed, plans for the dry dock modernization at all
four shipyards, apprenticeship and training programs like the
one that I referenced at the Portsmouth Naval Shipyard, and
efforts to codify and share best practices among all of our
shipyards.
Before we hear from our witnesses, I want to touch, in
particular, on one area we will discuss, which is long-term TDY
policies that negatively affect the civilian shipyard workers
across the country. This is something that I have heard quite a
bit from our shipyard.
As both of you point out in your joint prepared statement,
on any given day, hundreds of naval shipyard workers are on
travel to conduct critical maintenance of our Navy ships. That
travel is central to maintaining our naval readiness and to
sharing expertise and resources. As the Senate Armed Services
Committee stated in its report on the national defense
authorization last year, we must ensure that workers conducting
long-term TDY for off-yard work are fully supported and
encouraged.
Admiral Hilarides, based on your January 19th letter, I
look forward to hearing why you believe that the long-term
temporary duty policy for shipyard civilians is having a,
quote, negative impact on the naval shipyards' ability to
effectively and efficiently conduct Navy ship maintenance and
actually, quote, has the potential to increase the end cost of
projects.
I look forward to the testimony of our witnesses and to
continue our work together to ensure the skilled men and women
at our public shipyards have what they need to continue their
work which is so vital to our naval readiness and our national
security.
I thank our witnesses again for coming here to testify this
day and for your service to our country.
I would now like to call on my ranking member, Senator
Kaine, for his opening remarks. Senator Kaine?

STATEMENT OF SENATOR TIM KAINE

Senator Kaine. Great. Thank you, Chairwoman Ayotte.
Thanks to our witnesses for being here today. I so much
enjoy working on this committee with our chair and we have had
a number of hearings bearing upon the workforce that builds the
largest items manufactured on the planet earth that are so
important to our Nation's defense. I look forward to your
testimony today.
We have to recognize the collective condition of our
shipyards, both the workforce and the infrastructure, and the
ways that we can improve that to do our job better in the
future. Age and the deterioration and even the design of the
shipyard infrastructure can negatively impact the work that we
do. GAO [Government Accountability Office] found for fiscal
year 2010 to fiscal year 2013, there were 96 ships that were in
maintenance availabilities whose maintenance was affected
because of inadequate infrastructure, either obsolescent
because it was designed a long time ago or needing significant
maintenance.
I am very happy to see that the Navy's proposal is to
exceed the minimum 6 percent capital investment threshold for
shipyards as required by law with a 7.1 percent investment in
fiscal year 2017 proposed.
However, for an awful lot of the public shipyard workforce,
the unfortunate effects of the RIFs, reductions in force, in
the 1990s have come home to roost in the workforce. I just have
a couple of exhibits on the table I think before the witnesses
and also before all the staff members and all the committee
colleagues.
Chart 1 shows an age demographics bathtub which resulted
from workers being let go in the 1990s, and the compounding
effect of sequestration has deepened this bathtub effect of
worker experience. If you look at chart 1, you see significant
numbers of the public shipyard employees in the 26- to 30- and
31- to 35-year-old age range, but then you see this dip in the
kind of more experienced upper level workers because of that
RIF policy in the 1990s.
We have a second chart, and it shows that currently one-
third of all public shipyard employees have less than 5 years
experience, and the average level of experience of the entire
workforce is only 8 years. The Navy has, I think, a desired
goal that that should be between 12 and 15 years, and at 8
years, we are a little bit short on the experience side,
obviously. It is going to take a number of years to make a
significant change and bring that average up to 12 to 15 years.
But there is some good news and it is the last chart. It
shows what the hiring has been--hiring efforts and training
investments in the shipyards with the target manning level of
33,000 by fiscal year 2016. You can see how it has ramped up as
we have tried to fill in that bathtub that was left by the RIF
policies.
But if the sequester comes back full force, some of these
best laid plans of getting back to where we ought to be are
really in jeopardy. I want to echo the comments that were made
by the chair about that.
I also represent a State with a wonderful public shipyard
in Norfolk but also one that has a lot of private shipyards
too. This is a hearing about the public shipyard workforce, but
I do want to say I am pleased that the Navy continues to
grapple with how to kind of structure the entire level of work
and provide as much predictability and balance as possible
across the public and private shipyards.
For example, I understand that the Navy shifted three
attack submarine availabilities to the private sector in fiscal
year 2016 and for 2017 in addition to increasing private sector
contracting opportunities in an area to try to even out the
workforce. The whole cycle of hirings and RIFs, even if they
are temporary, can put uncertainty into the shipyard workforce
that does the work that we need.
I will conclude by just saying I also am really interested
in talking about an issue that the chairwoman mentioned, which
is best practices on the apprenticeship side. I think these are
some of the best workforce programs that we have in the United
States. I think if you look broader than just the issue of the
day, we have tended to, you know, maybe for a couple of
generations really promote college education and demean,
downgrade, or kind of put at second class apprenticeship,
career, and technical education opportunities when we know from
experience these are great jobs that you feel patriotic doing
every day, that you can be employed for a very long time. We
need to do the work to let the public know how high quality
these are.
I am encouraged by the induction of nearly 1,000 first-year
apprentices into the program and the hiring of over 650 nuclear
and non-nuclear engineers in fiscal year 2016 and the
apprentice school at Newport News, which is a private program
which is going to celebrate its 100th anniversary here within
the next couple of years. These core principles of
craftsmanship, leadership, and scholarship in service of the
Nation, in service of our Nation's defense, and also in service
of setting the example of the American manufacturing might is
something that we can be proud of.
Madam Chair, thanks for holding this hearing today, and I
look forward to asking questions and learning from our
witnesses. With that, I will turn it back to you.
Senator Ayotte. Thank you so much, Senator Kaine.
I would now like to call on Admiral Hilarides.

STATEMENT OF VICE ADMIRAL WILLIAM H. HILARIDES, USN, COMMANDER,
UNITED STATES NAVAL SEA SYSTEMS COMMAND

Admiral Hilarides. Madam Chair, Ranking Member Kaine,
distinguished members of the committee, thank you for inviting
me and us here today to be part of this hearing. I am really
honored to be here.
Vice Admiral Smith and I have submitted our full joint
statement to the committee, which we ask to be made part of the
hearing record. We would now like to provide a brief opening
statement.
Senator Ayotte. Yes, please.
Admiral Hilarides. Over the past several years, our four
public naval shipyards, Portsmouth, Norfolk, Puget Sound, and
Pearl Harbor, have dealt with some difficult challenges, as you
noted, a government shutdown, a hiring freeze, furloughs, aging
infrastructure, in the face of an increasing workload, which
has led to an imbalance in our capacity and our requirements.
I am pleased to say that we are well down the road to
recovery. The Navy's fiscal year 2017 budget request includes
funding to staff our shipyards to 33,500 full-time employees so
that we can execute our peak workload.
However, having the right number of workers on board is the
right first step, and over the last 3 years, our shipyard
workforce has grown by roughly 4,000 full-time employees. When
you combine that with natural attrition, we have hired more
than 10,000 people in the last 3 years, and that is reflected,
Senator Kaine, by the graph that you pointed out.
Now training is our top challenge. Our shipyards have shown
a talent for innovation when it comes to training, whether it
is revolutionizing training of today's new hires to get them on
the job site faster, taking tanks off decommissioned submarines
to use as real-life trainers for our sandblasters and painters,
or utilizing 3D printing to create models to allow for proper
planning of difficult evolutions. We have changed the way we
train the next generation of shipyard workers who, not
surprisingly, learn differently than previous generations, as
our shipyards continue their innovative efforts to share their
lessons with each other so that all may benefit.
Once our newly hired and trained personnel reach the
waterfront, they quickly realize they are part of something
special. Working on our Navy's most complicated and powerful
warships makes them part of our Navy. They do not wear uniforms
but they do know their work directly impacts global events.
Without them, our Navy could not be forward deployed. They take
great pride in their work, and this sense of duty has a lasting
effect that I believe is the primary reason why people stay at
our shipyards so long.
In reading the committee's invitation letter, I was pleased
to see we share an interest in science, technology,
engineering, and math [STEM]. I will tell you the Naval Sea
Systems Command [NAVSEA] is committed to sharing our passion
for STEM with students of all ages, and our four naval
shipyards are leaders in this area. They have provided hands-on
support to a number of national and local fronts, everything
from first robotics, sea perch, underwater vehicle pool
challenges, STEM fairs, going to schools to talk about what
they do, and hosting students at the facilities to see what a
STEM career looks like. I am exceptionally proud of the men and
women who volunteer to take their time to be part of these
great efforts.
As this is likely the last time testifying before Congress,
I would like to take the opportunity to recognize the nearly
70,000 government civilians, including more than 33,000 naval
shipyard employees who work at NAVSEA. Over my tenure, I
visited all of NAVSEA's 30-plus facilities to see firsthand the
remarkable accomplishments. NAVSEA's workforce is a national
treasure. There is no other organization in the world that can
do what they do. These unsung Americans allow the United States
to have the greatest Navy in the world. As I approach
retirement this summer, I would like to state publicly it has
been my honor to serve with them.
Thank you for the opportunity to say a few words, and I
look forward to answering your questions.
[The prepared statement of Admiral Hilarides and Admiral
Smith follows:]

Prepared Statement by Vice Admiral William H. Hilarides and Vice
Admiral Dixon R. Smith
Chairman Ayotte, Senator Kaine, and distinguished members of the
Senate Armed Services Subcommittee on Readiness and Management Support,
we appreciate the opportunity to testify about the Naval Shipyards'
role in meeting Navy operational requirements. We are here representing
the more than 33,000 hardworking, dedicated and patriotic
professionals--both civilian and military--who work in the Naval
Shipyards. Our Naval Shipyards have been challenged by an increasing
workload and the effects of hiring freezes and overtime restrictions
that have contributed to some ships being delivered late out of their
availabilities. To address this workload-to-workforce imbalance, we
increased the size of our workforce and enhanced training and
apprenticeship programs to improve productive capacity. Further, we
continue to recapitalize our infrastructure to improve workflow and
better align the shipyard layout and tooling. The men and women,
military and civilian, who work at our Naval Shipyards are right now
undertaking these initiatives and tackling these challenges every day.
overview
The four public-sector Naval Shipyards (Portsmouth, Norfolk, Puget
Sound, and Pearl Harbor) are wholly government-owned. As the owner of
the Naval Shipyards, the Fleets provide the funding and task the Naval
Sea Systems Command to oversee their operation. The Naval Shipyards
provide the essential organic capability to perform depot- and
intermediate-level maintenance, modernization, refueling, emergency
repair work, and inactivations on nuclear-powered aircraft carriers and
submarines. They also maintain the specific core capabilities to
support conventional surface ship maintenance.
Our Naval Shipyards must operate at peak efficiency. Accomplishing
this requires correctly predicting the ship maintenance required;
optimizing schedules with operational requirements; properly sizing the
workforce; embedding the correct critical skillsets in the workforce;
and enabling our people by equipping them with the right tools,
facilities, and processes.
While work is primarily performed onsite at the Naval Shipyards,
significant depot work is done off-station in Yokosuka, Japan, and San
Diego, California. Maintenance and repairs are also performed underway
and around the globe in Guam, Diego Garcia, and elsewhere. Our
workforce will go wherever and whenever needed to execute repair work.
On any given day, hundreds of Naval Shipyard workers are on travel to
conduct critical maintenance on Navy ships.
workload-to-workforce imbalance
The Navy had an increased workload and a less experienced workforce
over the past three years. In fiscal year 2015, the Naval Shipyards
executed 4.9 million mandays of workload which is 200,000 more mandays
than fiscal year 2014 and well below the Navy's projected peak workload
of 5.4 million mandays in fiscal year 2018. This steady rise has been
caused in part by SSBN refueling, 688 major overhauls, introduction of
the Virginia-class as well as evolving fleet composition, high
operational tempo, and extended deployments.
Looking back over the past three years, hiring freezes and overtime
restrictions had a significant impact on the Naval Shipyards.
Additionally, we have seen a surge in retirements over the last several
years and a rise in early career attrition. Combining retirements and
attrition, our shipyards lost 2,125 people in fiscal year 2013, 1,931
employees in fiscal year 2014 with 2,235 in fiscal year 2015 and 911 to
date this year.
To address productive capacity, we are focusing our efforts on four
specific areas:

One, hiring to meet increased workload demand and higher-
than-average retirement rates;
Two, developing our new workforce through mentoring,
trade and skill training, and leadership/management training;
Three, recapitalizing and modernizing the Naval
Shipyards' infrastructure; and
Four, implementing modern solutions to information
technology systems to address cybersecurity vulnerabilities and improve
productivity.
hiring
In fiscal year 2013, the Naval Shipyards staffing levels were about
29,000 full-time employees. With the impact of budgetary constraints, a
hiring freeze, and increased workload, accelerated hiring has been
necessary. We continue to aggressively hire apprentices and experienced
workers to support the increased workload. We are on track to meet our
2016 goal of an average of 33,500 direct and indirect full time
employees by the end of the year. These new workers need extensive
training, and we continue to invest in the required workforce training
and development. In conjunction with increased hiring to meet workload
demands, we have increased contracting with the private sector and
deferred some non-critical work.
apprenticeship programs
The Naval Shipyard Apprenticeship Programs are some of the best in
the country and have been recognized by the U.S. Department of Labor as
model programs. These programs seek to produce highly skilled trades
people who are capable of executing the Naval Shipyards' technical and
complex maintenance needs. They are a critical investment in workforce
development that builds a quality workforce for the ship repair
industry today, and lays the foundation of a longer term investment in
our future leaders. In fiscal year 2015, we inducted nearly 1,100
apprentices, will bring in nearly 1,000 new apprentices in fiscal year
2016, and plan to add nearly 900 more in fiscal year 2017.
productivity program initiatives
The Naval Shipyards continue to invest in the following major
productivity program initiatives:

Continuous Training and Development, which uses practical
hands-on training with learning centers and mock-ups to accelerate
production-worker skill and proficiency development. These methods
create an environment where it is safe to fail--meaning that the
workers have a simulated environment where it is okay to make mistakes
and to learn from them. The training method is dynamic in that it is
given to new employees, mid-level mechanics, and journey-level workers
for critical skills proficiency and qualifications to accelerate and
leverage knowledge transfer from subject matter experts to our newly
hired workforce. Continuous Training and Development improves our
ability to get work right the first time.
Industrial Processes Corporate Communities of Practice
bring multi-disciplined, multi-yard groups together and create
opportunities to stimulate innovation, promulgate best practices, and
significantly expand knowledge sharing to improve performance. These
communities have the involvement of engineering and production
organizations that are aligned to similar work products and processes.
Continuous Process Improvement efforts are focused on
Lean Principles, which maps processes to identify and eliminate waste
in order to improve throughput and cycle time to drive efficiency. In
addition, a Cumbersome Work Practice Task Force is helping the Naval
Shipyards challenge requirements to maximize efficiency and
effectiveness while minimizing cost. New technology insertion is used
to keep abreast of technology changes and evaluate them for
incorporation into Naval Shipyard industrial processes for improvements
in safety, quality, and cost performance.
Integrated Work Teams responsible for planning and
executing work with the use of Lean principles are being implemented to
improve work coordination and efficiency. Project management specifies
what work is required to be accomplished and when, and the integrated
work teams determine who does the work and how it is accomplished.
Efficiencies are created as the work teams perform the same type of
work across multiple projects or availabilities. By creating stable
work teams, the execution of work is improved and waste is eliminated.
infrastructure
Naval Sea Systems Command and Commander Navy Installations Command
continue to prioritize the sustainment and recapitalization of the
Naval Shipyards' infrastructure. Investments are focused on mission-
critical facilities in the Controlled Industrial Area, which primarily
include production shops, piers, wharfs, dry-docks, and supporting
utility systems. Other investments maintain and upgrade industrial
plant equipment capabilities that are integral to performing ship and
submarine maintenance. Naval Sea Systems Command is also focused on the
Naval Shipyards' information technology systems. These systems are
outdated and a challenge to support as we push to meet new
cybersecurity standards. To address this issue, Naval Sea Systems
Command is implementing solutions to the maintenance information
systems which focus on improving workforce productivity and
cybersecurity vulnerabilities. Overall, facility investments are
prioritized to address the most critical capability, safety, and
productivity deficiencies associated with mission-critical facilities.
In concert with Commander, Navy Installations Command, Naval Sea
Systems Command is prioritizing military construction projects and
continues to invest in Naval Shipyard facilities sustainment,
restoration, and modernization at a level above the Navy facility
average. The fiscal year 2017 military construction funds of $58
million will recapitalize infrastructure in the Naval Shipyards by
improving utility system resiliency and reliability, aircraft carrier
and ballistic missile submarine maintenance facility capabilities and
efficiencies, and production shops. Restoration and modernization
projects will mitigate seismic vulnerabilities, maintain dry-dock
certification, improve utility system reliability, repair aged and
failing facilities in the worst condition, improve energy efficiency
and reconfigure shipyard layout to improve efficiencies. The capital
investment in Naval Shipyard infrastructure continues to adhere closely
to the report to Congress and exceeds the minimum level required by law
(10 USC 2476) for all Department of Navy Depots.
As part of the Navy's Nuclear Enterprise Review, $42 million was
added in fiscal year 2016 and the President's Budget submission for
fiscal year 2017 adds $48 million to accelerate shipyard infrastructure
improvements from a 17-year recapitalization plan to a 15-year plan.
Increased funding for sustainment and for restoration and modernization
is intended to reduce the risk to the Nuclear Enterprise as supported
by the shipyards.
In fiscal year 2017, the Naval Shipyard Capital Investment Program
industrial plant equipment investments include a $25 million defueling
complex at Portsmouth Naval Shipyard, $9 million in drydock #2 material
processing improvements at Pearl Harbor Naval Shipyard & Intermediate
Maintenance Facility, and $4 million in dock crane modernization
projects for Puget Sound Naval Shipyard & Intermediate Maintenance
Facility. These investments will help to improve Naval Shipyard
performance.
summary
Our Naval Shipyards are comprised of more than 33,000 hardworking,
dedicated professionals devoted to supporting our Navy. Through our
Registered Apprenticeship Programs, ongoing training, and productivity
improvement initiatives, we will continue to invest in this workforce.
We will gain increased efficiencies through recapitalization of our
infrastructure. Our goal each and every day is to get our Navy's ships
back to sea when the Fleet needs them.
Again, thank you for the opportunity to talk about our critical
Naval Shipyards and for your continued and crucial support of our Navy.

Senator Ayotte. Thank you for your leadership and all that
you have done for the country, for the Navy, and we are so
grateful for the sacrifices and service of you and your family.
We wish you the very, very best. Thank you.
I would like to call on Admiral Smith now for his
testimony.

STATEMENT OF VICE ADMIRAL DIXON R. SMITH, USN, COMMANDER,
UNITED STATES NAVY INSTALLATIONS COMMAND

Admiral Smith. Thank you, Madam Chair. Madam Chair, Senator
Kaine, and distinguished members of the committee, thank you
for inviting Admiral Hilarides and me today to discuss our
efforts in support of the Navy's four public shipyards and our
investment in their infrastructure and supporting services.
Budget shortfalls over the past several years have caused
Navy to take deliberate risk in the shore infrastructure in
order to sustain fleet readiness. Within the shore accounts,
the Navy continues to place a high priority on the
infrastructure of our Navy shipyards, including military
construction, facilities sustainment, and facilities
restoration, and modernization. Shipyard investments address
the most critical safety and productivity deficiencies in the
controlled industrial area, which primarily includes
production, jobs, piers, wharfs, and dry docks.
Despite today's fiscal constraints, the Navy remains
committed to improving the condition of our naval shipyards
which are critical to maintaining the warfighting readiness of
our force. I am pleased to report in fiscal year 2017, as
Senator Kaine stated, the Navy will again exceed the mandated
capital investment of 6 percent across our shipyards.
Having served as an installation commander and a region
commander three times, regions which included three of the four
public shipyards, now as Commander of Navy Installations
Command, I have witnessed firsthand the challenges and
opportunities of operating such a complex command and have made
it my personal priority to support the shipyard commanders and
their world-class workforce.
Thank you, Madam Chair. I look forward to yours and the
committee's questions.
Senator Ayotte. Thank you, Admiral Smith.
I would like, first, to begin with a question for Admiral
Hilarides about the TDY policy. This is something that this
committee has also discussed as well very recently with Admiral
Howard who came before our committee. She had testified that
there should be a concern that we ensure that there is no
negative impact on the naval shipyards' ability to effectively
and efficiently conduct Navy ship maintenance. To me, this is
something that--I talked to her about your prior comments in
the January letter, and she expressed concern as well that this
policy could end up costing us more.
My concern, having heard from, obviously, my constituents
who work at the Portsmouth Naval Shipyard who are deployed to
help other shipyards all the time and obviously help the Navy,
they want to do this. But right now, the new TDY policy is
negatively impacting their ability to do that. We cannot ask
them to go off to other shipyards and leave their family and
actually be in situations where it might cost them more to do
that based on staying stateside or put them in living
conditions that do not allow them to focus on their job.
I wanted to ask you just very specifically based on what
you have said in the past--I know you have already said that it
has had a negative impact on the naval shipyards' ability to
effectively and efficiently conduct Navy maintenance and does
have the potential to increase the end cost. I know that was
not the goal in putting the policy in place, but we have to
look at the actual impact of a policy. I think that is really,
really important.
I wanted to ask you today how has the new long-term TDY
policy negatively impacted the naval shipyards' ability to
effectively conduct naval ship maintenance. I know the policy
was intended to save money, but what are these unintended
consequences that have flowed from it that I think all of us
think it is important to address?
Admiral Hilarides. Yes, ma'am. I will attempt to
characterize it, and I will try to be concise but it does
require some detail.
I do stand by the letter that I wrote, and it deals
specifically with the trade laborers. These are shipyard
workers who spend 10, sometimes 12 hours a day hauling a
welding machine cable, pipe. This is hard physical work. They
are volunteers. To go on TDY in accordance with their union
contract requires them to volunteer. They will volunteer if
they are properly recompensed for their travel.
The travel regulation, as I understand it, when it was put
in place, said after a month, you can negotiate a long-term
arrangement with your housing, and you can lower your cost of
food and other things by shopping smartly. Many people on
travel can do that. They go to school for 6 months. They can
find time to get to a store and stock a long-term lease with
that kind of food.
These folks, however, are working many times 12 hours a
day, hard, physical labor, and getting out to a store, finding
food, coming back, and cooking it just has not been something
that fits in the kind of day that they have. They spend their
money at the closest fast food store they can find, and they
really cannot survive on the money that is provided once it
starts to get reduced on that.
I wrote specifically about those folks because we need them
to volunteer to go do these jobs, many times of which is 3
months, 4 months. It could even be more than 6 months. We want
them to go as a team. They are most effective. It is as much an
effectiveness argument as anything. They are most effective
when that team is integral and operates together as a team for
their entire time. When that work team goes, you want them to
volunteer. You want to properly support them, and you want them
to get their work done efficiently and effectively.
If after a month, their allowance goes down and they go
home and are replaced by someone else, you lose that
effectiveness in the team, and then of course you have the
travel costs.
I wrote my letter. It is in staffing. We have made the
business case that is being analyzed, as the Vice Chief
indicated. I will continue to fight to have them see that, yes,
in fact, in this narrow case, it makes sense to create some
sort of a standard variance from that rule. We will see how
that goes over the next few months.
Senator Ayotte. Well, you know, I certainly appreciate that
you have made that case, Admiral. I think we are, hopefully,
going to make our case as well, wanting to make sure that our
shipyard workers can continue to help and deploy to help with
the naval maintenance that needs to be done.
I know today, in fact, every Senator who is representing a
public shipyard is supporting legislation that I have
introduced that will ensure that we have a TDY policy that
allows them to continue doing this. We want to work with you on
this. I want to thank all my colleagues, including the ranking
member and, of course, Senator Shaheen and Senator Hirono, for
their support on this issue because this is a critical issue to
us and to make sure that we can continue to support our
workforce as they deploy to other shipyards or other
maintenance calls from the Navy.
I also want to ask about the issue of best practices
because as we look at the number of new hires that have been
made, I mean, it is a tremendous number of new hires. Having
recently been at the graduation at the Portsmouth Naval
Shipyard, this is quite a few people that they are integrating.
They have an excellent apprentice program. As we think about
how to improve all of our public shipyards, how are we going to
make sure that we share best practices whether it is in the
training space?
Also, Portsmouth has really done a lot of work on labor-
management collaboration, empowering the workforce, and this I
think is what has allowed Portsmouth, for example, to produce
these submarines back into service under budget and before
time. How are we in the Navy going to make sure that we do that
and we are all sharing each other's best practices not only on
the training and the workforce issues but also just the
excellence and performance issues so that we all benefit from
hearing from each other?
Admiral Hilarides. Yes, ma'am. That is really headquarters'
responsibility to pull the four shipyards together. We have
created, really with the help of the shipyards--in many cases,
it was their idea--things we call communities of practice. You
get the electrical shop of all four shipyards together in one
location. You share the best training ideas. You share the best
workforce development ideas. If there is a new maintenance
practice that has been created, there is nothing like being
shown it hands-on as opposed to a written description or even a
video. Those communities of practice is our principle method of
taking those best practices and sharing them across all the
yards.
Portsmouth is very much in the lead of this, but Pearl
Harbor's rigging trainer sets the standard for the shipyards.
Actually some Portsmouth people saw that rigging trainer and
said, boy, we need one of those at our shipyard. Those
communities of practice are a predominant way to do that.
On the labor-management side, my predecessor created a
thing called the NAVSEA Labor-Management Council. This is a
council between NAVSEA, the national metal trades, the national
IFPT, and the other unions that are at the shipyards above the
bargaining unit, so it is a management-labor discussion that is
above bargaining and it is about opening up this dialogue about
how to make sure we have all the pathways to the sharing across
the shipyards to the very best communications between
management and labor. When there are shortfalls, they tend to
go up to the Labor-Management Council, and then I talk at the
national level with folks like Ron Ault and then we go work on
it together from a national level to go try to help labor
relations improve. I think Portsmouth still is at the leading
edge of that labor-management relationship.
Senator Ayotte. Well, I thank you for that. I think having
seen how they together really from the grassroots perspective
develop their declaration of excellence and things, I hope that
that is something that we can, obviously, share. I appreciate
your testimony. Thank you.
I would like to call on Senator Kaine.
Senator Kaine. Thank you, Madam Chair.
I want to talk a little bit about the infrastructure and
how you guys measure the infrastructure plan that you have. The
naval shipyard depot maintenance infrastructure plan was issued
in April 2013. I think it was pursuant to the NDAA [National
Defense Authorization Act] that was done in 2012. The plan had
five tenets of infrastructure improvement: eliminating
maintenance backlogs, remediating seismic deficiencies at any
of the shipyards, maintaining dry dock certification, improving
infrastructure layout to increase efficiency, and improving the
utility system reliability. When the plan was initially done,
there was an extensive list of things to be done. It was
estimated that it would take about 17 years to complete each of
the five tenets.
Talk to us about progress on that plan. The plan came out
right as full sequester hit. I am going to get into the
sequester in a minute. But I am curious as to the timeline of
the Navy's effort to tackle that significant amount of work to
keep our shipyards in a very efficient and productive status.
Admiral Smith. Senator, we have been working at that. As
you know, with the budget restraints that we have right now, we
have to prioritize the risk of what we go after. With the
shipyards, the requirements that Admiral Hilarides has at his
four shipyards feeds into the fleets, and then the fleets will
balance that with the requirements they have on the operational
side. Then those will go up and come up to D.C., and then we
will rack and stack those in the priorities. Through that
process, we are making efforts on getting after the shipyards
and that plan and moving it. I believe we are inside 17 years
now. I am not sure of the specific----
Admiral Hilarides. As a result of the review of the nuclear
forces, that number has actually been reduced to 15 years, and
that 15 years has been funded as reflected in the 2017 budget.
Admiral Smith. Whereas, for example, in fiscal year 2017
where we are funding our facilities sustainment, restoration,
and modernization account to 70 percent, shipyards are being
funded to 85 percent and the nuclear enterprise is being funded
to 100 percent. We are putting our emphasis on the shipyards to
get them where they need to be.
Senator Kaine. Admiral?
Admiral Hilarides. The other question I think is about dry
dock modernization. The dry docks at Norfolk Naval Shipyard
will eventually be required to support the Ford-class aircraft
carrier, which is significantly different. We have those
modernizations laid in place. Of course, they are not for a
number of years because the first dry-docking at Norfolk Naval
is not out for a number of years.
Similar is true of the Virginia-class. Eventually we will
need more dry docks in Pearl Harbor and Portsmouth that are
capable of docking the Virginia-class, which has some
differences from the 688 class. Particularly as we go look to
put Virginia payload modules into Virginia, we will lay those
plans in. But we will not do them long in advance of those
requirements. We will probably do them just in time as those
ships come into the fleet and then are projected out to when
they will need their first dry-docking, which could, in some
cases, be as many as 10 years into the ship's life.
Senator Kaine. Now to kind of segue into sequester, because
it is related to the ability to complete this infrastructure
program, when we went into full sequester in fiscal year 2013,
there was a $9 billion shortfall in the Navy's budget, and as
it affected these items, there was the cancellation in the Navy
of about 75,000 days of civilian labor for major projects and
the outright cancellation of a number of planned shipyard
projects.
We heard from Admiral Howard earlier this month that even
if everything is fine going forward, we do not go back into
full sequester, that dip will suggest that we will not get back
to full spectrum readiness until at least the early 2020s, and
that is assuming no more sequester.
How would another round of sequester, if we do not find a
path out of sequester at the end of the biannual budget deal we
did--how would another round of sequester affect your ability
to do the ship maintenance on time, on budget, but also
complete some of these infrastructure improvements that you
planned out over the next 15 years?
Admiral Hilarides. I will take a stab at sort of the
operation of the shipyard and then turn to Admiral Smith for
the infrastructure side.
The most damaging thing that happened out of all of the
things that went on there is when it became clear the budget
was going to be dramatically reduced, they put in place a
hiring freeze and stopped the hiring of civilian employees.
Then the sequester then locked that freeze in place. It was
some number of months after the kind of a path from that point
was laid out before we returned to hiring. It ended up being
almost a year where we did not hire in the shipyards.
If you do the math on what I talked about, we lost ground
by 2,500 or so employees from zero, and we were supposed to be
hiring up during that time period. We found ourselves 4,000 or
5,000 people below manning at a time when the budget came back
and we started doing the maintenance again, that we were so far
behind that that bow wave that formed is a part of what the
Vice Chief was talking about.
The most damaging part of all of it is the idea that we
stopped the hiring machine that is in the shipyards. Two
thousand five hundred people a year on average just for
attrition. If you are not hiring regularly with connections
into the schools and into the local labor force, you cannot
just turn that on a dime. For me, that is the most alarming
thing out of the thought that we would go into some sort of a
temporary freeze is those temporary freezes have lasting
impacts that go for a very long time.
The other part that a sequester does is it squeezes the
other accounts. The people who are in the government will be
paid, and we have a commitment to them to pay them. But they
will not get any overtime or enough overtime to do all the jobs
they have. They will not get those borrowed labor folks from
Newport News or from the other places we get borrowed labor to
go help them in those times where the work peaks and they do
not have all the resources themselves.
Then it hurts in the material and parts and all the things
necessary to be ready to do the job when you show up.
It is a broad impact, hard to measure in any one metric,
saying that was caused by sequester. But overall in efficiency.
The place we are right now is still very much due to the
impacts that that event had there at the end of 2013.
Senator Kaine. Admiral Smith?
Admiral Smith. Sir, with respect to infrastructure
facility--and I will talk larger than just the shipyards. We
track our facility condition by what we call FCI, facility
condition index, code. One hundred is good. We consider 60
failing. The Navy's average right now--we are at 79.9 is our
FCI. The shipyards are a little bit less than that, i.e., the
reason we are funding above the 6 percent.
With the BBA [Bipartisan Budget Act of 2015] right now, in
2021 with the current funding, that 79.7 will drop to 77.7. We
are going to lose 2 percent just with the funding we have right
now. If we go into sequestration, that is going to fall off
even more.
In other words, we are not gaining ground right now. We are
gaining ground in the shipyards. We are putting 100 percent to
the nuclear enterprise, but for the rest of our facilities out
there, we are not gaining ground. We are losing ground.
Sequestration will cause us to lose even faster.
Senator Kaine. Thank you very much. I appreciate it.
Senator Ayotte. Senator Rounds?
Senator Rounds. Thank you, Madam Chair.
I would like to just begin by talking a little bit about
the per diem issue with regard to the shipyard workers. I think
the chairwoman's proposal to offer a legislative fix may very
well be the appropriate way to go in terms of reinstating the
full per diem payments. Admiral, it would appear that you agree
with the chairwoman's thought process in terms of bringing that
back up to where it should be. Is that a fair--am I putting
words in your mouth, sir?
Admiral Hilarides. No, Senator. I just want to be clear. It
was for a very specific group of trade labor people, direct
labor people. It was not for everybody who travels from the
shipyards or all of us who travel routinely for our business.
It is for that narrow group. Yes, I very much stand by that.
Senator Rounds. Very good. Thank you. I have an interest in
seeing that move forward. I do think that the possibility is
that we have probably tried to save some pennies and it may
very well be costing us in terms of pounds. I do not have any
shipyards in South Dakota, but I do have an interest in seeing
that things run efficiently within those shipyards, and it
sounds like this is one of those cases where it would be very
helpful to make things more efficient.
Also, am I correct in that when we start looking at the
labor arrangements that we have, that as these folks are asked
to volunteer, there is a lineup from senior members down the
line to the most junior in terms of those who may accept a
deployment away from their home? If we have reduced the per
diem for these individuals, the most qualified are perhaps the
first to decline where you may have junior members accepting a
deployment away from their home base, thus probably not having
your most seasoned team members moving from one location to
another on a regular basis. Am I correct in that?
Admiral Hilarides. Sir, I think to be precise, that depends
on the bargaining unit of each shipyard, which trade school you
are talking about. Generally that is, I believe, an accurate
description of how those union arrangements work. But it is
very specific by bargaining unit. But I do know that broadly it
has been detrimental to both the quality of the people who come
and their willingness to stay long enough to finish the job,
sir.
Senator Rounds. Let me turn just a little bit--I noted in
the discussion earlier that you had indicated, sir, that the
Naval Sea Systems Command is focused on updating the shipyards,
the outdated IT systems in order to meet modern cybersecurity
standards. I am just wondering if you could take a few minutes
and elaborate on just what that means and the impacts, if there
are some examples of concerns that you could share with us and
what the needs are that are out there right now.
Admiral Smith. Yes, sir. We are in the middle of a study to
go figure out the correct path to go replace the information
infrastructure that we run our shipyards from. That really does
include everything from the individual work items, putting them
into packages that workers can use, taking those packages and
streaming them into a time-phased network that allows you to
plan and sequence the work. It allows you to apply people to
those jobs and then have them be paid. It is the actual system
that documents their hours and makes sure they get a paycheck
in their account at the end of the 2-week period.
That system right now is an old set of information systems
that have been put together over the last 30 years. We have
attempted to modernize it before and not done well at that
because, frankly, we did not put the right professionals in my
opinion against the task. We are now re-arraying those correct
IT professionals with people who actually have better
experience to go get that project right.
We anticipate that is a 5 to 6 year project. It is
currently in the analysis of alternative [AOA] stage. I am
confident that we will be able to, this time, modernize that
system and be able to answer all the things that go on there.
There is an efficiency piece there. We have a program to
build an electronic work document. If you get a shipyard
worker, he will be walking around with this stack of paper
drawings and paper procedures. The electronic work document is
about ready to field, and of course I need the infrastructure
to put that technical work document in. That is all part of
that investment. You will begin to see that investment in our
budgets going forward as we finish the AOA and lay in the
program to go do that.
Sir, I will point out that when South Dakota is ready to
come into a shipyard, we want to make sure they are ready.
[Laughter.]
Senator Rounds. No question about it. The experience that I
had yesterday in the keel laying for the future USS South
Dakota was impressive. Anytime you learn about a Virginia-class
submarine and what the capabilities are, you start to realize
how significant the weapon systems are, how complex they are,
and how much they rely on the newest technology. I think when
we start talking about the work on the weapon systems that are
found within these shipyards and propulsion systems, it would
appear to me that this would be an area of very high priority
in terms of making sure that the data we take in, the
information that we feed back in and so forth would be of the
most sensitive nature. Certainly we should have appropriate
cybersecurity protections in place. It sounded like while we
talked a little bit about the operations side on this--or the
information side on it, the operations side of the systems and
so forth, which are also upgraded, would be a critical part of
that discussion as well.
Admiral Hilarides. Yes. The shipyards also would use those
systems to feed, for example, dimensional controls into a
numerically controlled machine. The cybersecurity of that is
along the lines of our SCADA [Supervisory Control and Data
Acquisition] systems, the things that are going on. A lot of
work inside NAVSEA to go provide the cybersecurity of those
control systems both inside ships and then inside our physical
infrastructure, Admiral Smith as well for his critical
infrastructure. That would be part of that program would be to
make sure we do that exactly right.
Senator Rounds. Thank you very much for your service to our
country.
Thank you, Madam Chair.
Senator Ayotte. Thank you, Senator Rounds.
I would like to call on Senator Hirono.
Senator Hirono. Thank you very much.
We just noticed that the clock is not quite giving us the
full time, just to let you know, Madam Chairman.
Senator Ayotte. I am going to make sure everyone gets their
full time.
Senator Hirono. Thank you very much, Admiral Hilarides, for
your service, and I also extend my best wishes to you in your
future endeavors.
Thank you also for raising the issue with regard to the
impact of TDY on our workers. Those of us who have shipyards--
and of course, Pearl Harbor is the largest industrial employer
on Oahu--we have all heard from our workers as to the negative
effects of this policy. I certainly support the chairwoman's
initiatives in this regard.
As we look at the need for training of the workforce, as
you mentioned, the hiring freeze really put a damper on the
number of workers that we need. Training, our apprenticeship
programs are really critical. I try to go to every single one
of our apprenticeship graduations as I can.
My understanding is for the apprenticeship program at Pearl
Harbor, they get a lot more applicants than they actually take
into the apprenticeship program. Is that the case in the other
apprenticeship programs? If so, since we have such huge
workforce needs, can we expand the program so that we can train
more people?
Admiral Hilarides. The apprenticeship programs were sized
to make up that sort of standard loss, a couple thousand people
a year.
Senator Hirono. Two thousand five hundred or so.
Admiral Hilarides. When we try to take many more than that,
as we have in the last 2 years, we stretch those apprenticeship
capabilities sort of to their maximum. I actually believe they
are appropriately sized, as long as we continue as a going
concern, normally hiring and not freezing and then rehiring.
Your question I think, though, is beyond that. It is could
we use those apprenticeship programs to train workers for other
industries. I would not advocate that, but again, we can go
look at that.
Senator Hirono. I think that we definitely need people
trained, especially in the STEM areas. It is very impressive to
see a submarine in dry dock, for example, because you realize
the kind of skill sets that our workers need to repair and
maintain these huge, complicated ships.
When we talk about efficiencies, I realize that
modernization and maintenance of our facilities is really
important--best practices. I am curious to know whether you
have a process or a system to get input from the workers
themselves as to how they can improve efficiencies at the
shipyards.
Admiral Hilarides. Yes, ma'am. Actually I know you are
fairly aware of them, the moonshine projects that have come out
of Pearl Harbor Naval Shipyard. Really each of the shipyards
has a slightly different name but really the same idea, which
is when you get the trade labor involved in the decisions about
what machine to buy, how to modernize your processes and
procedure, you get the very best idea. I think Toyota would
tell you the same thing. We very much work to encourage those.
They tend to be local. I do not spend a lot of time from
headquarters directing that because those things do not tend to
work very well. But the shipyard commanders certainly know that
I have incentivized them to open up the idea machine from the
workforce and make sure that we are getting their best ideas. A
very complex set of controls and things associated with it
because you have got to also be very safe with all that. But I
think that each of the shipyards, to the best of their ability,
is working to go tap into that stream of innovation that comes
from their workforce.
Senator Hirono. There have been some real creative ideas
from the workers themselves that have been incorporated into
the shipyard.
Admiral Hilarides. Yes. I think point of use tooling is a
great example of that. Can you not just put the tools by where
the worksite is? They challenged us and we did. Of course, we
got efficiencies from that.
Senator Hirono. That seems so sensible.
As Senator Kaine has mentioned, though, our experiential
level is not where they could be in terms of the workers we
have. Are there any programs to bring some of the more
experienced people back into the workforce or keep them in
longer to fill that gap--experienced staff?
Admiral Hilarides. Yes, ma'am. In the government civilian
ranks, there is a program called ``retired annuitant.'' You can
get a retired annuitant.
Senator Hirono. Retired what?
Admiral Hilarides. Retired annuitant. Basically you are
allowed to bring them back for up to 2 years half-time, so
about a year's worth of work. They have to spend half of their
time training the workforce. You cannot bring them back just to
work. They have to come back for training.
I know the shipyards are using those sparingly because they
are fairly expensive. Those people, after they get out, a lot
of times will go get other jobs.
We have a contract with several different companies,
different in each shipyard, to bring coaches. We are finding
that now with a large tranche of new labor force that the first
and second line supervisors, of course, are not keeping up.
Because you have created that bathtub that Senator Kaine
pointed out, you are pulling forward first and second line
supervisors to more senior jobs, and we are getting a lot of
very junior first and second line supervisors. We are actually
working to bring in companies that know how to coach new
supervisors on how to run a meeting, how to schedule work, how
to deal with problem employees. We are doing both of those
things.
Senator Hirono. Is that happening at all of our four
shipyards?
Admiral Hilarides. To varying degrees and, again, according
to their need. I think Pearl is probably not quite as urgent as
Puget and Norfolk are. Their numbers are very, very large.
Pearl has been able to use predominantly their traditional
methods. But I think that is the case. Yes, ma'am.
Senator Hirono. I also know that at Pearl Harbor that we do
have students from other nations. Right now, 12 students from 7
nations are learning skills at the shipyard on various aspects.
Can you discuss the importance of working with our
international partners and programs such as these?
In Pearl Harbor's case, we have people from Bahrain,
Bangladesh, Brunei, Guyana, Pakistan, Saudi Arabia, and the
Philippines working with our shipyard people.
Admiral Hilarides. Yes, ma'am. That is a project that
predates my leadership time at NAVSEA. We basically partner
with countries that we want to help build their own capacity.
Predominantly this is at the leadership level not at the trade
skill level. It is at the leadership level. Someone who would
likely run one of their shipyards. We bring them in. We show
them how our shipyards function. We provide them mentoring
opportunities and training opportunities. Then those
relationships--I know some of my shipyard commanders have
relationships with people they went through that course with
when they were younger, and those relationships endure and
create the kind of conditions by which we have very, very close
shipbuilding relationships with many, many countries that are
our close allies.
Senator Hirono. That is probably a really good idea.
Would you like to add anything to that, Admiral Smith?
Admiral Smith. We use the annuity guys also, you know, for
hiring after, for training. I have got some of my staff that
are out. They are folks that are ready to retire. I want them
to be able to pass on their skill set. It is not just kept to
the shipyards, but we do use that across DOD [Department of
Defense] and Navy.
Senator Hirono. Thank you.
Thank you, Madam Chair.
Senator Ayotte. Senator Shaheen?
Senator Shaheen. Thank you.
Thank you both for being here and for the work that you do
every day for the country.
I want to also add my voice to the support for the waiver
of those joint travel regulations. Like Senator Ayotte, I
represent the shipyard in Portsmouth, and we have heard very
directly about the concerns that people have had. As you
reiterated, we want the very best people with the most skills
doing those jobs when they travel. I think it is very
appropriate that you have waived those requirements, and
hopefully we can get that fixed for the long term.
I also want to applaud again the Navy's exceeding the
minimum 6 percent capital investment for shipyard
modernization. Obviously, we are seeing that begin to have an
effect at Portsmouth where they are working on the backlog of
projects that need to be done. I wonder if you can speak to the
importance of those modernization projects. You have talked a
little bit about how important they are to maintaining the
fleet, but can you elaborate on that?
I know one of the things that we are very proud of in
Portsmouth is, when a project comes in, completing it on time
and on budget and often ahead of time. Do you know what
percentage of ships and submarine maintenance were completed on
time and within budget for the last year that we have data on?
Admiral Hilarides. We have that data. It is not
particularly flattering, and I can provide it to the committee.
[The information referred to follows:]

In fiscal year 2015, the 4 Naval Shipyards completed 22
availabilities of which 6 (27.3 percent) were on time and 1 (4.5
percent) was at budget. For perspective, 10 of the 22 availabilities
completed in fiscal year 2015 were within 10 percent of CNO schedule
durations and 4 of those 22 availabilities completed within 10 percent
of budgeted mandays.

Senator Shaheen. Does it break out how the differences by
ship, by shipyard, by year, by project in a way that provides
some insight on what could be done to improve operations with
respect to completing projects?
Admiral Hilarides. Yes, ma'am. For--and I will say
Portsmouth and Pearl Harbor where predominantly it is SSN
projects and there is a lot of like work, that is very good
data and we use it all the time to go benchmark and figure out
how to help project teams do better and better.
The two large shipyards are wrestling with a much more
challenging set of work. Each of the big yards has a ballistic
missile submarine refueling going on right now. They are
actually moving nuclear fuel around a ballistic missile
submarine. Both of them have an aircraft carrier in yard right
now, which is a massive workload compared to a submarine
project. They both have SSN projects, as well as waterfront
support and other off-yard things. Puget has a carrier in San
Diego and a carrier in Yokosuka also under repair.
I can provide you all that detail. I would just urge
caution in the use of the data for benchmarking. Each shipyard
is in a place in its cycle. Portsmouth is in a very, very good
cycle. They have been at the top of their game now for quite a
while. Pearl is on the rise. There are some lights of great
performance and a couple of things that have not gone quite so
well in the other two yards as well. We can provide the data. I
would just urge caution in how you would interpret as that
shipyard is great and that shipyard is not any good. We spend a
lot of time on that data.
Senator Shaheen. Well, and certainly that would not be my
thinking about it, but more to think about how the Navy is
using the information and what lessons can be learned from
shipyard to shipyard about what is working and effective and
what needs more work.
Admiral Hilarides. We used that data actually to make the
case for the hiring. The hiring was not a slam dunk. It took us
a long time to convince the Navy to allow us to hire up to the
numbers that we made the case for. We used specifically the
Portsmouth performance in 2011, 2012, and 2013--and Pearl. They
got almost all their avails done in time during that period
because their workforce was sized to the workload we had. We
are just now starting to size Norfolk, Puget for the workload
they actually have in yard. Performance is improving nowhere
near fast enough and plenty of work to do, but we do use that
data. Thank you, ma'am.
Senator Shaheen. To what extent has sequestration affected
the ability to make the case for the hiring that you need for
those projects?
Admiral Hilarides. We went into the time of the sequester
working on convincing them to hire us up. They had applied some
efficiency targets to the shipyards that had suppressed the
total number of people we had. We had made the argument that
those targets were not rational and that we needed to release
them. We were sort of on a flat hiring spot. Then we froze
hiring, and then we finally made the case. Those 11,000 people
really represent that divot, and that divot is reflected in
delays in aircraft carriers, submarines, the avails that are
going on right now. That is not an excuse. That is just the
facts.
Senator Shaheen. One of the things that I have been very
impressed by is the Navy's diversifying its energy resources
and the ability to use efficiencies both on base and in terms
of the fleet and making it more efficient and relying less on
fossil fuels. I wonder if you could talk about how you see the
importance of that.
Admiral Smith. We take the energy conservation and
efficiency very seriously. We are working very hard to meet not
only the Federal goals, but we have our own goals within DOD
and the Navy. I can speak to the shore side. I really cannot
speak to the operational side. But we focus at all 70 of our
installations on how we do conservation, reducing the demand,
efficiency against a 2003 baseline. They are all well over 20
percent and coming down. We invest a significant amount of
resources in each year into those energy projects to help
continue to bring those down. It is also a behavioral and
getting folks to turn out lights and do those kind of things.
The more we do that, it reduces the utility bill. I have for
running the shore, about a $10 billion budget. About $1 billion
goes to utilities. The more we can drive down that utility
bill, it is obvious that it is going to help us. That is why we
focus on it very hard. It is just smart business because it is
less expensive.
Senator Shaheen. I assume there are some national security
incentives for doing that as well.
Admiral Smith. Yes, ma'am.
Admiral Hilarides. On the ship side, there is a set of
alterations to various classes of ships that are aimed
specifically at that. It is really not to save the money for
the fuel. It is to give the CO [commanding officer] more combat
range because the ship uses less gas. There is an operational
imperative on the ship side as well.
Senator Shaheen. Thank you. I think sometimes that gets
lost in the debate around energy that it is really not just
about saving money and being more efficient. It is also about
the national security imperative. Thank you.
Thank you, Madam Chair.
Senator Ayotte. Thank you, Senator Shaheen.
First of all, I want to say a thank you, which I have said
before, but I want to make sure I thank you again, Admiral, and
that is for requesting funding for the P285 barracks at
Portsmouth Naval Shipyard for our junior enlisted sailors. I
thank you. I know that Senator Shaheen was a great advocate for
that too, and I think both of us were grateful that you put
that in. Thank you.
I also wanted to ask about--in light of the threat of
terrorism, as we think about force protection, obviously
security personnel, security barriers are all important as we
think about the important assets at our shipyard. Obviously,
our nuclear submarines are so important in terms of their
technology in protecting them.
One of the things I wanted to ask you, Admiral Smith--has
the Navy been examining waterside security barriers to provide
better protection for our shipyards and naval bases? I think
that was an issue that you were studying, and if you could give
me an update versus what you have determined on that and how
that compares to what is currently used. Is there a next
generation of force protection for waterside barriers that we
should be looking at?
Admiral Smith. Yes, ma'am. We are looking at next
generation. We have been doing that throughout this winter. All
our shipyards have a harbor security barrier around it, as do
our installation piers. But what we have right now does not
meet the requirement for high-speed boats that could be used
for a terrorist attack.
Senator Ayotte. What is in place right now does not do it.
We need to----
Admiral Smith. Yes, ma'am. We are looking at that. This
past winter--actually this week, we are going through the
eighth testing of a new product down in Norfolk. My operations
officer from headquarters is actually going to be down there to
witness it. It has got a better ability--it is proving out to
have a better ability to stop vessels quicker. It also has a
semi-automatic capability to open and close on its own. One, it
has the potential to provide more security, and it also, on the
other hand, can be more efficient so we can reduce overhead,
dedicated boats that we have to open and close those. That
testing is still going on, but it looks to be very fruitful. I
am very optimistic that we are well on our way to going to the
next generation and have good potential resources out there to
do that.
Senator Ayotte. Good. This important to the Navy to do
that?
Admiral Smith. Yes, ma'am. Absolutely.
Senator Ayotte. Thank you.
I also wanted to ask about an issue that has been brought
to my attention at our shipyard as well, which is security
personnel. This is the issue, obviously, of the gates and
people who are manning the entry points in our shipyard. The
concern that I had that has been raised with me is it is taking
too long to recruit and train security personnel. I know that
the Navy recognized this issue. It is something that I have
also spoken to Vice Chief Admiral Howard about, that you raised
the GS [general schedule pay] level for security personnel and
created a career progression because one of the issues was
keeping people in that position to pay the people in a way that
they are going to stay and conduct these important security
positions.
I understand the new policy is going to allow security
personnel at Portsmouth and other shipyards the opportunity for
career progression that did not exist with a fixed GS-5
position and that officers will be GS-7 positions, and
supervisory police officers will have a GS-8 position.
Is that what you understand is the new policy? What impact
is the policy having on attrition, and do we continue to have,
still, challenges on the security for our shipyards?
Admiral Smith. Yes, ma'am. We have redone the position
descriptions for that. We are building the career path. We are
still in the process of doing that. That is not a complete----
Senator Ayotte. Okay. You have not put it in place yet.
Admiral Smith. It is starting to roll out.
For example, you talk to the GS-5's. We now have the GS-6
in place. Folks will be evaluated and move up to GS-6. 7's are
not in place yet. We have the 8. We are still in the process of
building that in addition to then-CNO [Chief of Naval
Operations] Greenert last summer directed that we hire another
1,461 security personnel because of the shortfall. We are still
hiring to that.
From an enterprise perspective, we are doing pretty well.
We are still struggling in the mid-Atlantic and New England. We
are still struggling at Portsmouth. I know that. I am diving
into that to figure out why, why am I being successful
elsewhere but not being successful in Portsmouth.
Senator Ayotte. Is the Navy prepared, if they have to, to
address the career progression issue? I know you have gone to
GS-6, but also I think looking at the progression issue, GS-7,
GS-8 perhaps for the supervisory positions. Is this something
you are going to continue? How fast do you expect implementing
the rest of this policy and keeping a focus on those----
Admiral Smith. The goal is to have the plan built by the
end of June and then to start working our way into it as we get
the hires and identify, based upon the requirements of each
installation, who needs what resources based upon number of
entry control points, amount of waterside property, those kind
of things. We are still working to build a plan to understand
where we need to put those positions at. I should have that
done by the end of June.
Senator Ayotte. Thank you. I appreciate it.
I see that Senator Ernst is here. I know that Senator Kaine
has a couple. What I will do is I have a couple more questions.
I will wait till the end. I believe the next would be Senator
Ernst.
Senator Ernst. Thank you very much, gentlemen, for being
here today. I apologize. We were talking about small arms
modernization in the other subcommittee. Glad to join you.
I do appreciate your support. Shipyards--I will be honest.
Not my thing in Iowa. If you want to talk about corn or
soybeans, you know, that is awesome.
But public shipyards. Thank you. I know you are both very
familiar with this. Thank you for holding this hearing.
Just for my information as well, the public shipyards are
hiring thousands of additional workers to better match
workforce with workload. What I have heard is that the process
from application to the first day on the job--so filling out
the paperwork, whether it is online, and then actually getting
to work--that that is unnecessarily long and complicated for a
lot of those workers.
As a result, we are losing some of our best applicants as
they take other jobs that can hire them quicker. This is not
just in this particular situation. I think it is DOD-wide.
Are you seeing this issue and are you concerned by it? I
know they have to go through--what is the website? USA Jobs.
Yes. Thank you very much. You are familiar with that. If you
could talk a little bit about that issue, if you are concerned
by it, and maybe the average wait time, if you are aware of
that, from that time the applicant goes on line, fills out the
application, until they are actually able to be hired.
Admiral Hilarides. Yes, ma'am. We will talk the specific
case of the shipyards. When we recognized how far behind we
were and the need to hire that nearly 11,000 that we hired in
the last 2 years, we went out and sought authorities and
streamlined processes, everything from a physical--you got to
get a physical. We hired extra doctors. We had to get
clearances. The clearance system was bogged down. We helped
them with contractors to go help boost their capacity to go
process clearances. We specifically went after all those
barriers and got the shipyard hiring specifically because we
had this tremendous challenge and hill to climb. We were able
to get it down.
Routinely, however, I hear that same thing at my
headquarters, at my field activities that the government hiring
process is cumbersome and it takes a long time. We do lose some
number of folks who apply for those jobs. We have a few silver
bullets we can use, but we cannot use them all the time. I
think that that is going to continue to be an issue is the
amount of time it takes. When a company like a Google can show
up at a college and make a job offer in a minute, I just do not
have that opportunity. That will continue to be a challenge for
us.
Admiral Smith. I mean, from the Navy at large, DOD, we are
seeing the same challenge. To Madam Chair's question on
security, it is taking us 163 days to get a security officer on
board. That is just way too long. Yes, ma'am. It is too long.
We have got to get the process better.
Senator Ernst. That is pretty incredible. I know we do have
an arsenal that sits between Iowa and Illinois, and we face
some of those similar challenges as well. I have heard from
workers there that maybe they have someone they would just love
to see in their workforce. They encourage them to apply. They
will apply online through the website, and it may be 6 months
before they ever hear back from the entity that is hiring. That
is too long. By then, those folks have already moved on. They
have found other workforce opportunities. I do not think that
that is acceptable that we are asking people to wait that long
for these important positions. Yes, I am astounded. That should
not happen.
Do you happen to know the reasons why it would take that
long? Is it reasonable to expect people to wait that long to
hear back on these types of positions?
Admiral Hilarides. Those procedures have grown up over a
lot of years. Some of the parts of it are extremely important.
We have hired some people who we found out were bad people. In
the last 2 years, we hired 2 people who turned out to be
attempting to work for us to get inside to get information to
sell to someone else. The security piece is absolutely
essential. The same thing with the physical. You are going to
put them in the bilge of a ship and hauling an 80-pound welding
rig around, you want to make sure they are physically capable.
Many parts of it are absolutely essential.
The parts that are not tend to be outside of our controls.
The Navy is a big bureaucracy. Hiring a government civilian--
you want to be a little careful as well because generally you
are hiring that person for a long time. Very few people come
into the government and leave just a couple years later. The
number of people who come in our shipyards and stay for their
entire career is a very large number--and other places. We end
up being pretty careful.
I would say this. These jobs are attractive enough that if
somebody really wants to come into the government, they wait. I
do not think we are taking a really large hit on the quality.
But it is frustrating, and I hate to get a new employee who
just the first thing tell me as a leader is how frustrated they
are at the selection process. Yes, ma'am.
Senator Ernst. Absolutely.
Are there any suggestions that you would make on how we can
speed up the process? Like if you are buying a home, you can
get prequalified on your loan while you are looking for a home.
Is there anyway that you could prequalify individuals? Within a
certain time frame maybe they get a physical and it is good for
6 months if they are looking for government employment. Are
there ways that we could work with them?
Admiral Smith. There are a lot of fingers, hands go into
the hiring process. It is streamlining that process. There are
things that as the commander, Admiral Hilarides or I can do
within our command to improve our processes, but then we rely
on others. I mean, one of the things we have done in going back
to the security manning and hiring and the challenges we find
in that is a potential employee would have to go out and get
his eye exam. He would have to go out and get a health exam. He
would have to go out and get this exam instead of coming in a
one-stop shop. One of the things that we have done is now do a
one-stop shop, and we have all the medical facilities and
requirements there so they can come in and get it done at once.
We are saving several weeks with that process. There are those
kind of things out there.
I would submit, though, the biggest challenge is because
there are so many hands in the pot trying to get that
streamlined which a lot of that is not within our control as
commanders of our organizations.
Senator Ernst. Is there anything that we could do as
Congress that would help that, or is that beyond----
Admiral Hilarides. The only other point I was going to make
is that we use both the intern program. We have authority for
interns. We do a temp worker program in the shipyards where we
need a worker for a short period of time. They are sort of a
probationary employee. They come in and you can let them go.
Those tend to last a year. Those are the places where we do
most of that prequalification. When there is a hiring, when
hiring is available, often those temp workers will be brought
in. That is a very good process by which the workforce sort of
vets them and finds out if they are willing to work hard enough
and all that sort of stuff. But those are really our
workarounds.
I cannot point to an agency and say get rid of that agency.
I probably should not.
Senator Ernst. Well, my time has expired. But I very much
appreciate your expertise and your willingness to be here
today. I am better informed, those of us that are not familiar
with shipyards. I appreciate it. Thank you.
Thank you, Madam Chair.
Senator Ayotte. Thank you, Senator Ernst.
I just want to share Senator Ernst's concerns about the
hiring period, and I think that is a challenge. We want to get
talented people in. This is something, of course, we would want
to work with you on in any way we can assist with.
With that, I would like to call on Senator Kaine.
Senator Kaine. Thanks, again. Just a couple of points, but
Senator Ernst made a good point in saying, well, I am from
Iowa. We do not have a shipyard. I am from Virginia. I have
been in our shipyards a million times, but I am not a
professional at it. I do not necessarily know what I am looking
at.
But I will tell you it is something I would recommend to
committee members on Armed Services. We do travel to other
nations. Go look at another nation's shipyards. It was not
until I went with Senator King of this committee to the Mazagon
docks in Mumbai and looked at the Indian shipbuilding industry.
They were so proud that two U.S. Senators would want to come
see their shipbuilding operation. It was a fantastic visit.
But, boy, when you saw that, now all of a sudden I could think
about what I had seen at Newport News or at the Norfolk base
and realize, wow, just in terms of the layout, so much more
efficient--the layout and the scheduling of the work. They were
basically doing things in a very odd set of structures that had
been built for different kinds of ships. They were trying to
build subs in there. It was just virtually impossible. They
were proud to do and excited to show it off, but it really
helped demonstrate what we had and what we sometimes take for
granted.
Two really specific things: one about an old problem and
one about a new opportunity.
Old problem: corrosion. I am amazed. You know, we have
spent all this time battling about budgetary issues. I read GAO
reports that say corrosion DOD-wide--$22 billion a year. Wow.
$22 billion a year. As we get into sequester and some of the
pressures that lead us to defer maintenance, that is a problem
that can expand, not shrink. But if you could do innovative
strategies to reduce the corrosion expenditure in DOD by a
third, there is a whole lot of really important programs in the
United States where we spend than $7 billion a year.
I am just wondering. I am really curious in what you do in
your corner of the world, what are the kind of innovative
strategies to deal with the corrosion problem, especially given
some of the budget pressures that we have put on your
shoulders.
Admiral Hilarides. Sir, I will make sure you get an
invitation to Megarust. We actually have a Navy conference
called ``Megarust.''
Senator Kaine. Wow.
Admiral Hilarides. We bring in Sherwin Williams, all the
paint manufacturers. We bring in chemical companies and are
actually looking at all series of formulations to go try to do
that. Again, sea water, air, ships, vibration. There are a lot
of reasons why there is a constant need for painting of ships.
Continually looking at better and better paint systems. One
of those paint systems was pioneered up at Portsmouth Naval
Shipyard, the high solids pain that we put in the ballast tanks
on submarines, went from a 10-year period of painting it to a
15-year period which saves one entire paint cycle of a
submarine over the course of its life.
We put a lot of effort into it. I spend way too much time
on rust, and so I am right with you, sir. We are looking for
industry to help us out as much as possible.
Senator Kaine. That is great.
Another area of industry--I am going to go to the new
opportunities side because the hearing is about sort of
investment strategies. We have a lot of innovative private
sector folks in Virginia in the additive manufacturing or 3D
printing area. I understand that the Navy has used 3D printing
technologies to do on shipboard production of some parts that
can be used so you do not have to fly parts in to a ship. Talk
a little bit about 3D printing and the kind of investment going
forward especially for on-time, on-ship production of critical
components.
Admiral Hilarides. Yes, sir. We actually have a lot of
research inside the entire Naval Sea Systems Command enterprise
and across the Navy on additive manufacturing. Our principal
challenge is almost all the things that we need that are
critical are made of some material that is not plastic, some
alloy of some metal. Right now, the research is going on. Even
if you alloy a steel and you three-dimensionally print it, the
atoms go in in the sequence the printer puts them in.
When we manufacture that piece of steel otherwise, it gets
worked. It gets heat-treated, and we know its properties very
well. We are actually now characterizing additive manufacturing
metal properties because I cannot certify that part out of that
printer until I know its metal properties. We actually have a
significant body of research going on in the Naval Sea Systems
Command to go characterize the strength of particularly the
metals to go make sure that we can then start to use it. It is
holding us back a little bit, but it is fundamental research
that has got to be done before you can say that part is ready
to go in that nuclear reactor or in that gun system or in that
kind of critical thing. We are working on it full speed,
though, and wherever we can, we qualify the process and the
fleet is already using those systems.
Senator Kaine. Great. Thank you both very much.
Senator Ayotte. I just have one final question for you,
Admiral Smith. One of the issues that I had focused on as well
is our servicemembers and our DOD civilians, you know, the jobs
that they are doing--is ensuring that they have access to good,
affordable child care. Obviously, those who serve our country--
it is really important that they have access to this so that
they can do their jobs.
Unfortunately, at Portsmouth, one thing I learned is that
there were over 160 families waiting average of almost 300 days
to get their children into care there. This is something I have
been focusing on not only for Portsmouth but thinking across
DOD.
The Navy told us yesterday that they believe that wait
times at Portsmouth had been reduced about 3 months, but we
also had my staff call Portsmouth and find out. What we learned
was that depending on the category of individual, wait times
can still be as long as a year.
I just wanted to follow up with you. I know the Navy has
said that you are looking at plans to install military learning
centers at Portsmouth to reduce the child development center
wait list and wait times. I wanted to get an update on that.
Obviously, I know that this is an issue at other naval
installations. If you can give me an update on Portsmouth and
then just an overall Navy view of where we are on these issues.
Admiral Smith. Yes, ma'am. Absolutely.
You are right. It depends. We will talk Portsmouth. Like
any CDC [Child Development Centers], the wait list varies on
the age of the child and spaces available. The average wait
list right now is 7 months up at Portsmouth. The high was 10.
It is down to 7. But that goes to some folks who were waiting a
year, some folks less.
For the MLCs [Military Learning Centers], we are still
working through that process. They will be on the ground,
installed. We are targeting the end of this fiscal year three
to four MLCs will be there. Depending how you configure them,
whether you configure them for an infant, 1-year-old, or an
older child, they can accommodate anywhere from 8 to 24
children. We will hire some additional staff members to man
those up, nominally four per MLC with the final number being
depending how we configure it.
Senator Ayotte. So--I am sorry. Go ahead.
Admiral Smith. You were coming with a question.
Senator Ayotte. No. It just occurred to me with all the new
hiring, this is going to be a bigger issue.
Admiral Smith. Absolutely. I will say, though, that is not
appropriated fund [APF] hiring. It is a little bit different
from APF, and it is a bit easier to hire on the NAF [non-
appropriated funding] side.
That is where we are at with Portsmouth.
From a big picture, so we have got 120-plus CDCs across our
70 installations. We have 57,000 spots in those CDCs. We have
created an additional 7,000 since 2009. We created those
additional 7,000 to get us down to the DOD target of a 3-month
wait list. The Navy is meeting the 3-month wait list overall.
We have 16 installations, Portsmouth being one of them, that is
not meeting that 3-month.
Senator Ayotte. Well, I really would appreciate, obviously,
the focus on getting the military learning centers up and
running as soon as possible at Portsmouth. Then having been
there, we need to get to a new facility that has more capacity
in the long term. I look forward to continuing to remind you of
that issue.
Admiral Smith. Yes, ma'am.
[Laughter.]
Admiral Smith. We are finishing up the engineering studies
right now to put in the pads, and then it will take about 3 to
4 months to get the MLCs there installed, upgraded, and ready
to go.
Senator Ayotte. Okay. Thank you. I appreciate it.
I want to thank you both for being here and for your
service to the country. Again, I want to thank you, Admiral
Hilarides, for your leadership and for your dedicated service
for decades to our country. Will you please pass along to your
family how grateful we are for all that they have done as well?
Admiral Hilarides. Will do.
Senator Ayotte. Thank you.
[Whereupon, at 3:52 p.m., the hearing was adjourned.]
Questions Submitted by Senator Kelly Ayotte
dry-docks
1. Senator Ayotte. Admiral Hilarides and Admiral Smith: How
important are the dry-docks at our public shipyards to the Navy and our
nation?
Admiral Hilarides and Admiral Smith. The ability of the public
shipyards to fulfill their mission of executing depot-level nuclear
ship maintenance is highly dependent on the condition of dry docks
along with related facilities, including piers, nuclear facilities,
production shops, and utilities. Without dry docks, all required depot-
level submarine, aircraft carrier, and ship maintenance cannot be
accomplished.
As for their importance to the nation, the execution of submarine,
aircraft carrier, and ship depot-level maintenance is essential to
national defense, and the continued availability of dry dock capacity
is essential to ensure an effective and timely response for
mobilization, national defense contingency situations, and other
emergency requirements.

Senator Ayotte. My sense is that naval shipyard dry-dock capacity
is substantially inadequate to serve the future life-cycle depot-level
maintenance needs of the U.S. Navy fleet. This means that significant
investment in dry-dock facilities at our four public shipyards is
necessary. I understand that more than $2.3 billion is needed in dry-
dock construction and modernization might be needed at the four public
shipyards.

2. Admiral Hilarides and Admiral Smith: Can you describe the need
for dry-dock construction and modernization?
Admiral Hilarides and Admiral Smith. Naval shipyard dry dock
concerns are being driven by the following:

1. New ship characteristics render some dry docks obsolete.
2. Unprecedented Inactivation and Reactor Compartment Disposal
workload (SSN 688 class and CVN 65 and 68 class) over the next three
decades.
3. Environmental vulnerabilities (seismic and flooding) have the
potential to cause loss of critical facilities.
4. All dry docks require periodic maintenance and repair to
maintain certification.

The estimated costs are pending the completion of the ongoing Dry
Dock Modernization study. Cost estimates are impacted by pre-
construction site studies, such as National Environmental Policy Act
requirements, class maintenance plan changes, workload forecasting
between public and private shipyards, and improved depot maintenance
performance.

3. Senator Ayotte. Admiral Hilarides and Admiral Smith: How does
the Navy plan to resource this requirement without crowding out other
required military construction projects?
Admiral Hilarides and Admiral Smith. Modernizing naval shipyard dry
docks is required to mitigate future obsolescence due to modern ship
characteristics and workload, such as recycling aircraft carriers, as
well as mitigating seismic and flooding vulnerabilities. However, the
Navy is still in the process of evaluating all available courses of
action to ensure Naval Shipyards maintain mission capability. The
options being considered include modifying dry docks to increase
capacity, using floating dry docks, and upgrading dry dock utility
systems.
maritime security barriers
Senator Ayotte. Admiral Smith: During Tuesday's hearing you
testified that ``shipyards have harbor security barrier around it, as
do our installation piers. But what we have right now does not meet the
requirement for high-speed boats that could be used for a terrorist
attack. We're looking for next (generation barrier).''

4. What is the Navy's plan to procure next generation barriers?
Admiral Smith. We have an ongoing next generation barrier pilot
project at Naval Station Norfolk. This pilot will run throughout fiscal
year 2016 with final evaluation and recommendations complete in April
2017. The next step is to use results of this pilot to develop detailed
performance specifications and an acquisition strategy.
p-371 utility investment for nuclear facilities
5. Senator Ayotte. Admiral Hilarides and Admiral Smith: Why is the
P-371 utility investment MILCON project at Portsmouth Naval Shipyard
that the Navy has requested funding for in fiscal year 2017 needed?
Admiral Hilarides and Admiral Smith. P-371 (Utility Investment for
Nuclear Facilities) is primarily focused on mitigation of risks to
existing utility systems, primarily electrical, that provide services
to nuclear submarines in Dry Dock 1 or pier side. In addition to
electrical enhancements, the project improves steam, compressed air,
and water distribution capabilities to Berths 1 and 2 adjacent to Dry
Dock 1. The project increases utility system reliability and
resiliency, and improves energy efficiency via modern equipment and
technology. The project was developed as a consequence of failure
analysis of potential risks attributed to the current system condition.
This project will improve the Portsmouth Naval Shipyard utility
infrastructure and meets the recently adopted standby power
requirements for nuclear powered warships.
optimized fleet response plan (o-frp)
Senator Ayotte. Under the Navy's new force generation model, the
Optimized Fleet Response Plan (O-FRP), all the ships in a strike group
need to come out of maintenance at roughly the same time. However, the
first carrier, which will deploy under O-FRP later this year, USS
Eisenhower (CVN 69), overran its latest 14 month maintenance period by
9 months when it concluded last August. Eisenhower is just the latest
example in a pattern of aircraft carrier maintenance delays in public
shipyards.

6. Admiral Hilarides and Admiral Smith: Can you comment on the
schedule-dependent nature of O-FRP and what steps you have taken to
ensure aircraft carriers finish availabilities on time?
Admiral Hilarides and Admiral Smith. Increased deployment lengths
have resulted in a maintenance backlog prior to entering an
availability that has not been fully identified or resourced, which has
resulted in extended maintenance periods to restore their material
readiness.
The increased operational tempo of the last 10 years and the
effects of sequestration on our shipyard workforce, coupled with a
fixed capacity industrial base (both public and private) has resulted
in lengthened maintenance schedules and delayed availability
completions. As detailed in the responses to Questions #10 and #11, the
Navy's life cycle activities are all working with the maintenance
community at large to ensure the execution plans for the maintenance
requirements are providing the ``best value'' and take the industrial
base's constraints into account.
To address these issues, the Navy began implementing a revised
operational schedule in November 2014 referred to as the Optimized
Fleet Response Plan (OFRP). The Navy is in the process of applying an
OFRP process to all of our force elements to include carrier strike
groups, amphibious-ready groups, submarines, expeditionary units,
aviation squadrons, and Military Sealift Command ships. OFRP is
designed to achieve a number of benefits, including service readiness
recovery and a sustainable level of employability to support combatant
commander demand. OFRP seeks to provide a more sustainable schedule for
Navy ships, as it holds deployment lengths constant and introduces more
predictability for maintenance and training. Improved scheduling
through OFRP will provide stability to our sailors and improve the
ability of our public shipyards and private ship repair companies to
plan and schedule maintenance. OFRP is still in its early stages of
implementation and will take time to create positive change. As of
January 2016, no aircraft carriers and only 15 of 83 cruisers and
destroyers had completed a Chief of Naval Operations' maintenance
availability under OFRP.
defining maintenance requirements
Senator Ayotte. In May 2015, GAO found that incidents of degraded
or out-of-service equipment have doubled on surface and amphibious
ships over the past 5 years (GAO-15-329). According to Navy officials,
we are now paying for the deferred maintenance and increased use of the
surface force over the last decade. In addition, officials state that
deferred maintenance is not just postponed, but also increased as
corrosion weakens structural aspects of the ship (a compounding effect
referred to as the ``fester factor'').
The Navy has been struggling to adequately define maintenance
requirements which are key to completing maintenance on time. GAO's
preliminary analysis showed that from fiscal years 2011 to 2014,
aircraft carriers and surface combatants required 16 and 34 percent
more work, respectively, than estimated by the Navy.

7. Admiral Hilarides and Admiral Smith: Please discuss the impacts
of deferred maintenance on the Navy's ability to accurately predict the
duration and cost of ship maintenance?
Admiral Hilarides and Admiral Smith. The Navy maintenance budget
requests are built based upon independently certified models reflecting
engineered maintenance plans for each ship class. Those engineered
maintenance plans include what and when certain maintenance should be
performed in support of the ship reaching its expected service life.
When that maintenance is deferred, deviating from those plans,
uncertainty is introduced and the engineering analysis used to predict
ship material condition and determine the required maintenance may be
invalidated.
There are systems where inspections to determine their actual
condition are not possible until the ships are in the maintenance
availability, particularly in dry dock. For example, many portions of
ships' hulls are not accessible unless the ship is in dry dock. The
paint used on these surfaces are known to last at least the planned
eight years between dry docking availabilities, when repainting is
scheduled in the engineered maintenance plan. If deferred to nine
years, one ship may have no issues, but another may have significant
corrosion damage requiring significant time and funding resources for
additional repairs.

8. Senator Ayotte. Admiral Hilarides and Admiral Smith: Please
discuss the risk posed by the magnitude of the surface fleet's deferred
maintenance on its ability to achieve the CNO's goals for operational
availability?
Admiral Hilarides and Admiral Smith. The Navy's plans to reduce and
minimize future deferred maintenance in the surface fleet are aligned
with the CNO's goals for operational availability as reflected in the
Optimized Fleet Response Plan (O-FRP). O-FRP allows us to recover
material readiness ``in-stride'' while providing an agreed to level of
presence to the combatant commanders. It protects the time required to
properly train our sailors, maximizes the employability of our
operational units for both sustainable global presence and contingency
response, gives our sailors and their family's predictable deployment
schedules, and preserves our force structure so that it meets service
life expectations. If the Navy cannot reduce the magnitude of the
surface fleet's deferred maintenance, we will continue to have
difficulty completing maintenance on time without disrupting O-FRP
schedules and negatively impacting training and certification, surge
availability, and overall readiness.

9. Senator Ayotte. Admiral Hilarides and Admiral Smith: How long
will it take to remedy the surface fleet's deferred maintenance
backlog?
Admiral Hilarides and Admiral Smith. The President's Budget for
2017 and the Future Years Defense Program (FYDP) supports continued
efforts to work through the maintenance requirements and address the
maintenance backlog to reset the force. Full recovery of the material
readiness of the fleet is likely to extend beyond 2020. Stable funding,
improvement in the on-time execution of ship depot maintenance and
steady state operations are required to meet fleet readiness goals.

10. Senator Ayotte. Admiral Hilarides and Admiral Smith: What is
the navy doing to improve its definition of maintenance requirements?
Admiral Hilarides and Admiral Smith. The various platform life
cycle planning activities ensure that Class Maintenance Plan
requirements are assigned at the correct level (Organizational (Ships
Force), Intermediate (Intermediate Maintenance Facility), and or Depot
(Naval or Private Shipyard) to enable proper accomplishment, taking
into consideration applicable laws, urgency, priority, crew impact,
capability and total cost. Maintenance procedures and schedule for Navy
ships and related equipment are developed and performed per condition-
based maintenance (CBM) methodology. The goal is to perform maintenance
only when there is objective evidence of actual or predictable failure
of a ship's installed systems or components, while ensuring operational
readiness, safety, and equipment reliability in a cost effective
manner. This is determined by approved reliability-centered maintenance
(RCM) methodology by the command exercising technical authority for the
system or component. The planning activities continually collect and
evaluate Material Condition Data, Performance Monitoring Equipment
data, Component Casualty Reports and accomplish Reliability Centered
Maintenance Workshops / Maintenance Effectiveness Reviews (MERs). This
is a continuous validation and refinement of Maintenance Plans using
Reliability Centered Maintenance Principles coupled with Engineering
Analysis, Configuration Data, Material Conditions, and Job Completion
Data, which provides the outputs of 1) What to do: Inspect, Test,
Restore, Replace, etc., 2) When to do it: Time Based, Condition, or
Situation Based, and 3) Who to do it: Depot, Intermediate or Ship's
Force.

11. Senator Ayotte. Admiral Hilarides and Admiral Smith: What
progress has the Navy made in limiting the amount of growth and new
work in its ship maintenance availabilities?
Admiral Hilarides and Admiral Smith. The various life cycle
planning activities, including Submarine Maintenance Engineering
Planning and Procurement Activity (SUBMEPP), Surface Maintenance
Engineering Planning Program Activity (SURFMEPP) and Carrier Planning
Activity (CPA), accomplish post-completion reviews of their respective
platform availabilities, review the fidelity (scope) of existing
maintenance requirements and analyze the growth and new work items that
were accomplished for possible addition as new requirements in future
availabilities.
As an example of this process, the CPA is working with the entire
maintenance community, including technical warrant holders, to focus
efforts on future improvements, including; 1) the Availability Work
Package Development Knowledge Sharing Network (KSN) where working
groups review recent availabilities growth/new work and develop
mitigation plans to support future availabilities, 2) the Remaining
Service Life KSN, which focuses on specific systems and components, and
3) the Industrial Material Processes KSN, which addresses material
issues, and planned equipment replacement program improvements.
constructing new buildings
12. Senator Ayotte. Admiral Smith: As the Navy conducts new
construction and major renovations, in terms of bathrooms and locker
rooms, what assumptions are made regarding the ratio of men and women?
Admiral Smith. Navy shore engineers continually assess existing
facility capacity and configuration in order to meet requirements.
Prior to constructing or renovating a facility, the end user provides
the actual number and gender of personnel to be supported. The shore
establishment then determines bathroom and locker room capacity/
configuration. Specific plumbing fixture allowances and criteria for
these facilities are then determined through tables found in the DOD's
Unified Facilities Criteria (UFC).
integrated lodging pilot program
Senator Ayotte. Admiral Smith: As you know, on January 27, I wrote
to you about the conditions at the Navy Gateway Inns and Suites in
Norfolk at Scott Center Annex that many of my constituents have had to
endure while conducting TDY.
Some of my constituents, preparing to conduct maintenance on
nuclear-powered submarines the next day, had to sleep in their cars due
to elevated temperatures.
I appreciate your February 11 response, and I appreciate that you
took the time to visit the facility. However, I am concerned that you
are saying the temperature problem in the rooms will not be addressed
until 2018.

13. Admiral Smith: What can we do to expedite this necessary
solution?
Admiral Smith. The Navy is developing a project to repair/modernize
Bldg 1530. Pending funding availability, we anticipate award in fiscal
year 2017. In the event of unseasonable weather impacting room
temperatures, the lodging staff will offer to move guests to another
NGIS building at Norfolk Naval Shipyard or provide a certificate of
non-availability to allow use of commercial lodging options.

DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
2017 AND THE FUTURE YEARS DEFENSE PROGRAM

----------

TUESDAY, APRIL 12, 2016

U.S. Senate,
Subcommittee on Readiness
and Management Support,
Committee on Armed Services,
Washington, DC.

MILITARY CONSTRUCTION, ENVIRONMENTAL, ENERGY, AND BASE CLOSURE PROGRAMS

The subcommittee met, pursuant to notice, at 2:32 p.m. in
Room SR-232A, Russell Senate Office Building, Senator Kelly
Ayotte (chairman of the subcommittee) presiding.
Committee members present: Senators Ayotte, Ernst,
McCaskill, Shaheen, Hirono, and Kaine.

OPENING STATEMENT OF SENATOR KELLY AYOTTE

Senator Ayotte. Good afternoon. I want to thank all of you
for being here.
This hearing on the Subcommittee on Readiness and
Management Support will come to order.
I want to thank Ranking Member Kaine for your leadership on
defense issues, including infrastructure, energy, and
environmental programs, which is what our hearing is about
today.
We are joined this afternoon by Mr. Peter Potochney,
performing the duties of the Assistant Secretary of Defense for
Energy, Installations and Environment. We are joined by
Assistant Secretary of the Army for Installations, Energy and
Environment, the Honorable Katherine Hammack. Wonderful to see
you, Secretary Hammack. We are also joined by Secretary McGinn
and certainly the Assistant Secretary of the Navy for Energy,
Installations and Environment. We are joined by Assistant
Secretary of the Air Force for Installations, Environment and
Energy, Secretary Ballentine. So thank you all for being here
today and for your service to our country. We really appreciate
it.
As we prepare for the committee markup of the National
Defense Authorization Act, the focus of today's hearing is on
the state of our military installations and the
administration's budget request for military construction,
facilities sustainment and restoration, energy projects, and
environmental remediation and management. As I have said
before, well maintained and modern Department of Defense
installations are critical to maintaining the readiness of our
armed forces.
That is why we must carefully scrutinize the Department's
military construction and facilities sustainment, restoration,
and modernization funding requests. While we must continually
root out waste and inefficiency and scrutinize the need for
every proposed project, I am concerned that a defense budget
based on artificial budget caps, rather than our national
security interests, is forcing each of the services to postpone
important facility projects that our troops need.
The services are being forced to take risks in facility
investments in order to understandably prioritize near-term
readiness requirements for our men and women in uniform. One of
the purposes of this hearing is to better understand the
consequences over time of underfunding facility accounts.
As you point out in your written testimony, Mr. Potochney,
almost 27 percent of the Department's facility inventory is in
poor or failing condition. The condition of readiness centers
in New Hampshire is particularly unacceptable. According to the
December 2014 Army National Guard study, the average condition
index of New Hampshire Army National Guard readiness centers is
poor, 64 out of 100 scale, ranking New Hampshire 51 out of 54
States and territories that have been evaluated nationwide.
After repeatedly raising concerns about the need for
military construction projects in New Hampshire to support our
Army National Guard, I am very, very pleased that the Army has
requested funding for much needed vehicle maintenance shops in
Hooksett and Rochester for fiscal year 2017. So I thank you for
that.
I also look forward to authorizing those needed projects in
this markup, as well as projects at the Pease Air National
Guard Base, Portsmouth Naval Shipyard, and other bases around
the country in my Readiness Subcommittee mark and working with
my colleagues to provide timely funding.
I look forward to discussing some budget requests that
require additional scrutiny, including the request for $6.1
million for a microgrid project in California that Department
documents say will support nonessential functions. So I would
like to understand more about that request.
While I recognize that the Obama administration has once
again requested another round of base realignment and closure,
BRAC, I continue to oppose another BRAC round for many reasons.
As I have said before, according to the Government
Accountability Office, the 2005 BRAC round process cost 67
percent more than originally anticipated, and even after
acknowledging the shortcomings of the 2005 round, the
Department continues to request another BRAC round. I do not
want to give the Department the open-ended authority to pursue
another BRAC round that will potentially incur significant
upfront costs when we do not have the room in our budget in the
next few years to afford many fundamental readiness investments
that are right before us.
Also, our military is currently sized based on artificial
budget caps, instead of being sized to protect our national
security interests from the threats we face, and certainly we
have had testimony before this committee by the Vice Chiefs of
Staff of each of our forces discussing the concerns they have
about the size of our force and our readiness. In short, there
is a significant and dangerous gap between the military we have
and the military we need.
Therefore, I do not believe at this point it makes sense to
authorize a round of base closures when many of us are hopeful
that regardless of the outcome of this coming election, that
the next administration will align its proposed defense budget
and the size of our military to the growing threats we face and
we will need many of the bases that DOD [Department of Defense]
may currently want to close.
I will also say it will be up to us in the Congress to
address sequestration and to make sure that sequestration does
not go back into effect. We will need to do that on a
bipartisan basis, and I look forward to working on that.
So I will not be including the authority to conduct a BRAC
round in the Readiness Subcommittee mark of the National
Defense Authorization Act for the Fiscal Year of 2017.
Regarding environmental programs, I look forward to getting
an update from you, Secretary Ballentine, regarding the recent
agreement with the City of Portsmouth, as well as the Air
Force's compliance with the Environmental Protection Agency's
directive to restore the Pease aquifer. I appreciate that the
Air Force has really negotiated with the city to come to this
outcome, and I look forward to hearing about it.
I look forward to the testimony of our witnesses and to
continuing our work together to ensure that each of the
service's military construction, energy, and environmental
programs are well designed and appropriately funded to support
our servicemembers, military families, combat readiness, and
our national security.
I thank our witnesses again for being here today and for
their leadership and service to our country in challenging
times. I look forward to your testimony.
With that, I would like to call on my ranking member,
Senator McCain--Senator Kaine. I made him chairman already.
[Laughter.]
Senator Ayotte. Senator Kaine for his opening statements.
Thank you, Senator Kaine.

STATEMENT OF SENATOR TIM KAINE

Senator Kaine. Thank you, Madam Chair.
To all my colleagues, I was at my son's graduation from the
basic school, and it was a massive crowd. They started to
introduce dignitaries in the audience, and they said, and we
have Senator McCain here. Really?
[Laughter.]
Senator Kaine. Why did Senator McCain come to the
graduation? Oh. Okay. So at my own son's graduation, I was
introduced as Senator McCain. But I am used to that now, I
guess.
But I want to thank you all for coming. This is an
important hearing, and it is all to prep for the work that we
will be doing shortly in this room and the room around the
corner on the NDAA [National Defense Authorization Act].
The administration budget request is $7.4 billion for
MILCON [military construction] and family housing, and another
$10.2 billion for facilities sustainment and modernization.
Both of these numbers are $1 billion less compared to last
year's request.
Now, last year, the administration requested more than the
budget caps and got grief for that. This year, the
administration's requests are in accord with the budget deal,
and we will give you grief for that. But it all goes for the
proposition that we recognize that sequester and the budget
caps put you and put the national defense under a
straightjacket that it is our responsibility, working with our
colleagues, to ameliorate and hopefully lift. If we do not
reach a deal to repeal sequestration, our military end
strength, our readiness, our modernization all suffer, and in
our installations, the readiness account items start to really,
really degrade. Then it will cost us more to bring them back to
where they should be. So we appreciate the service you provide,
and we are going to get into this today.
Many of you have significant expertise for energy programs.
I just want to say a word about that. The DOD is the biggest
energy user in the Federal Government. I am happy--I have been
happy--to see the degree of forward thinking in the DOD about
energy usage. Alternative energy strategies, pursuing sort of
third-party financed energy, alternative energy, real energy
projects at little or no cost to the DOD is a significant item
that you have been working on.
The Air Force has established an Office of Energy Assurance
and leveraging lessons learned there. The Air Force is
developing a solar array at Nellis. I want to understand more
about that and think that that can be important because that
will insulate the base and provide protection in case the grid
were to go down. We need to worry about those eventualities.
The Army has a biomass project in New York which could
enable Fort Drum to operate completely independently off the
grid.
These are example, I think, of smart investments that can
give us resilience.
These operational energy investments are not only important
for costs and resilience, but they have a direct impact on our
warfighting mission. History provides a lot of lessons here.
During Operation Iraqi Freedom, 20 percent of our casualties
came from units having to protect resupply convoys, of which 70
to 80 percent of those resupply convoys were water and fuel
restocking. The USS Cole was bombed while it was in refueling.
If we can mitigate those kinds of risks to sailors and marines,
by having hybrid electric drives enabling ships to steam
farther on the same amount fuel, then it reduces risk of the
most dangerous kind. So we need to increase our energy across
the DOD spectrum. I know we will talk about that today.
The Marine Corps is investing in fascinating technologies
in this regard, not just to protect ourselves, but to engage in
better warfighting, solar powered unmanned aircraft which can
identify and then use thermals to sail off even longer for as
long as 20 hours per day, advancing our defense mission.
then finally, there is a number of items underway in each
of the service branches to deal with the effect of climate
change on our installations and infrastructure. I have a real
sensitivity about this because of the effect of climate and sea
level rise, especially upon the largest naval installation in
the world in Hampton Roads, Virginia. It is a region that is
the second most vulnerable to sea level rise in the United
States after New Orleans. Currently the main Norfolk road in
and out of the largest naval base in the world is going to be
inundated by normal daily tides 2 or 3 hours a day by 2040, and
that does not even take into account storm conditions, which
are getting more and more frequent.
I associate myself with sort of the punch line of the
chairwoman's comments about BRAC and maybe from a slightly
different angle.
I think the military is assessing that you may have 15 to
20 or even 25 percent of excess infrastructure. Now, that is a
cost. If we are spending a cost on something that is truly
excess, then there is money we are spending on things we should
not and there would be a higher and better use to spend it on
things we should.
My own experience with BRAC as a mayor and governor
convinced me that there has got to be a better way to
rationalize excess infrastructure. I have tended to be of the
belief that the military should make recommendations to us
about infrastructure the way they make recommendations about
pay and benefits or weapon systems or a whole lot of things.
You know what happens. You make these recommendations to us and
we ask you a lot of tough questions, and we sure do not agree
with all of them. We may agree with two-thirds of them. We may
agree with three-quarters of them. This is a hard dialogue.
But the BRAC process, from the standpoint of somebody who
has been a mayor and governor, basically is this. The Federal
Government will declare a need for a BRAC. Every city and
county in the United States that has any military asset then
has to hire lawyers and lobbyists to do a full court press to
protect their base, even if their particular installation is
not at all in jeopardy. But it would be political suicide for
local officials or State officials not to put on the full court
press to protect an installation, even it was not in jeopardy
on the off chance that, at the end of the day, there would be a
decision made about it, and the local officials would say,
well, gosh, why did you not do anything about this?
So what BRAC becomes is just this massive lobbyist and
lawyer effort that is largely unnecessary. The military has
great expertise. You are no more omniscient or perfect than any
of us are. You might make recommendations that we would
disagree with for maybe the wrong reasons or we might disagree
with them for the right reasons.
But I would love to move to a situation where we
rationalize our infrastructure investments, even including
closures, with the basic recommendations that are based on the
expertise within DOD and then allowing Congress to do what we
do, which is kick them around and criticize them. We will
embrace some of them and we will reject others. I think that
would be a much better way to look at the rationalization of
infrastructure, and that is why I want to support the
chairwoman when we get into the mark with respect to a BRAC
round.
But a lot of important issues to talk about. We appreciate
your service, and we are looking forward to hearing your
testimony and asking questions.
Senator Ayotte. Thank you, Senator Kaine.
I would now like to call on Mr. Potochney for his
testimony. Thank you.

STATEMENT OF PETER J. POTOCHNEY, PERFORMING THE DUTIES OF
ASSISTANT SECRETARY OF DEFENSE FOR ENERGY, INSTALLATIONS AND
ENVIRONMENT

Mr. Potochney. Thank you, ma'am. Good afternoon, Chairwoman
Ayotte and Ranking Member Kaine and distinguished members of
the committee.
My name is Pete Potochney. I am proud and honored to be
here. I am currently the Deputy Assistant Secretary for Basing,
and so I know a little bit about BRAC because I have been doing
BRAC for quite a while. But I am also performing the duties of
the Assistant Secretary for Energy, Installations and
Environment, and in that capacity, I am sitting here in front
of you this afternoon. I have been in that capacity since
December and will probably remain for a little while.
I will make three quick points, and they piggyback onto the
points that both the chairwoman and ranking member just made.
The budget situation we are in right now is critically
impacting us, and it is obvious. Everybody knows it. Yet, here
we are. Facilities do have a direct impact on our warfighting
capability, quality of life of our personnel, our families,
retention, everything. But we do enjoy less of a priority than
operational requirements that are more directly related to
readiness. For that reason, we choose to accept risk in our
facilities, and that is why we pay, I would argue, a
disproportionate share of the cuts that we are experiencing
right now, but that is the way it should be.
The second point I would make that flows from that is the
people sitting around this table facing you right now. We are
the advocates for our facilities. We are not the warfighters.
So we are the people who are trying like hell to make sure that
the Department exercises informed decision-making and that
decision-making is informed by the facts of how important our
facilities are. Yet, we compete for resources like everyone
else.
The third point I will make--and it piggybacks on both what
you said but it runs counter to it--is that we do need BRAC. We
do need to avoid wasting the precious funding that we do get on
facilities that we do not need. I think all the services would
benefit from an examination, a holistic examination of their
infrastructure compared to their force structure and their
projections for that force structure in a process that treats
all bases equally, fairly, in a way that Congress has oversight
and an independent commission reviews it, although, Senator
Kaine, I appreciate your comments about BRAC being--I do not
want to put words in your mouth, but BRAC being very difficult
on communities. You are absolutely right. But I would argue it
is so important that it has to be, and we need a process that
will allow us to conduct that kind of rigor that those
communities and the Congress deserve. That is my final point.
I appreciate the opportunity to be here. Thank you.
[The prepared statement of Mr. Potochney follows:]

Prepared Statement by Mr. Pete Potochney
introduction
Chairman Ayotte, Ranking Member Kaine and distinguished members of
the subcommittee: Thank you for the opportunity to present the
President's Fiscal Year (FY) 2017 Budget request for the Department of
Defense programs supporting energy, installations, and the environment.
In my testimony, I will focus first on the budget request. As you
will note, the Administration's budget includes $7.4 billion for
Military Construction (including family housing), and $10.2 billion for
Facility Sustainment and Recapitalization. These are both decreases
from last year, as the Bipartisan Budget Act of 2015 caps overall
defense spending. Although this request allows a reduction in
facilities risk due to a slight increase in Sustainment funding by the
Services, the Department is still accepting risk in facilities. As this
Subcommittee well knows, facilities degrade more slowly than readiness,
and in a constrained budget environment, it is responsible to take risk
in facilities first.
My testimony will also address the environmental budget. This
budget has been relatively stable, and we continue to show progress in
both our compliance program, where we've seen a decrease in
environmental violations, and in cleanup, where 84 percent of our
39,000 sites have reached Response Complete. We remain on track to meet
our goals of 90 percent Response Complete in 2018, and 95 percent in
2021.
As you know, Operational Energy Plans and Programs merged with
Installations and Environment office in 2015 to form the Office of
Assistant Secretary of Defense for Energy, Installations and
Environment (EI&E). EI&E now oversees all energy that is required for
training, moving and sustaining military forces and weapons platforms
for military operations, as well as energy used on military
installations. While the budget request for Military Construction and
Environmental Remediation programs includes specific line items, the
Department's programs for Operational Energy and Installation Energy
are subsumed into other accounts. With that in mind, I will summarize
the newly released 2016 Operational Energy Strategy and address the
budgets for the Department's operational and installation energy
portfolio.
In addition to budget, I will also highlight a handful of top
priority issues--namely, the Administration's request for BRAC
authority, European consolidation efforts, European Reassurance
Initiative, the status of the movement of marines from Okinawa to Guam,
an overview of our energy programs, and climate change.
fiscal year 2017 budget request--military construction and family
housing
The President's Fiscal Year 2017 Budget requests $7.4 billion for
the Military Construction (MilCon) Appropriation--a decrease of
approximately $1.0 billion from the fiscal year 2016 budget request
(see Table 1 below). This decrease is directly attributable to the
resourcing constraints established by the Bipartisan Budget Agreement
and the Department's need to fund higher priority readiness and
weapon's modernization program. The request does recognize the
Department's need to invest in facilities that address critical mission
requirements and life, health, and safety concerns, while acknowledging
the constrained fiscal environment. In addition to new construction
needed to bed-down forces returning from overseas bases, this funding
will be used to restore and modernize enduring facilities, acquire new
facilities where needed, and eliminate those that are excess or
obsolete. The fiscal year 2017 MilCon request includes projects that
directly support operations and training, maintenance and production,
and projects to take care of our people and their families, such as
medical treatment facilities, unaccompanied personnel housing, and
schools.
As shown by the decrease in this year's budget request, the DOD
Components continue to take risk in the MilCon program in order to
lessen risk in other operational and training budgets.
While the Department's fiscal year 2017 budget request funds
critical projects that sustain our warfighting and readiness postures,
taking continued risk across our facilities inventory will degrade our
facilities and result in the need for significant investment for
facility repair and replacement in the future. Our limited MilCon
budget for fiscal year 2017 leaves limited room for projects that would
improve aging workplaces, and therefore, could adversely impact routine
operations and the quality of life for our personnel.

Table 1.--MilCon Appropriation Request, fiscal year 2016 versus fiscal
year 2017
------------------------------------------------------------------------
Change from FY 2016
FY 2016 FY 2017 ---------------------
Account Category request request Funding
($ ($ ($ Percent
millions) millions) millions)
------------------------------------------------------------------------
Military Construction....... 6,653 5,741 (912) (14%)
Base Realignment and Closure 251 205 (46) (18%)
Family Housing.............. 1,413 1,320 (93) (7%)
Chemical Demilitarization... 0 0 0 0%
NATO Security Investment 120 178 58 48%
Program....................
TOTAL................... 8,437 7,444 (993) (12%)
------------------------------------------------------------------------

Military Construction
The fiscal year 2017 military construction request of $6.1 billion
addresses routine requirements for construction at enduring
installations stateside and overseas, and for specific programs such as
Base Realignment and Closure and the NATO Security Investment Program.
This is a 13 percent decrease from our fiscal year 2016 request, and
this level of funding remains significantly less than historic trends
prior to the Budget Control Act. In addition, we are targeting MilCon
funds to three key areas.
First and foremost, our MilCon request supports the Department's
operational missions. MilCon is key to supporting forward deployed
missions as well as implementing initiatives such as the Asia-Pacific
rebalance, European Infrastructure Consolidation, European Reassurance
Initiative, and cyber mission effectiveness. Our fiscal year 2017
budget request includes $473 million for 13 F-35A/B/C maintenance,
production, training, and support projects to accommodate initial F-35
deliveries; $194 million to support 8 fuel infrastructure projects;
$62.2 million for a power upgrades utility project in support of the
U.S. Marines relocation to Guam; $260 million for recapitalization of
National Security Agency facilities; and $53.1 million for the third
phase of a Joint Intelligence Analysis Complex Consolidation at Royal
Air Force Croughton, United Kingdom. The budget request also includes
$470 million to address new capabilities/mission, force structure
growth, and antiquated infrastructure for Special Operations Forces;
$176 million for 3 Missile Defense Agency projects, including $156
million for Phase 1 of the Long Range Discrimination Radar System
Complex in Alaska; a $76 million investment to recapitalize facilities
at three Naval Shipyards; and $124 million for 4 unmanned aerial
vehicle operational facilities.
Second, our fiscal year 2017 military construction budget request
continues the Department's 10 year plan (which started in fiscal year
2011) to replace and recapitalize more than half of the DODEA schools.
Funding in fiscal year 2017 includes $246 million to address four
schools in poor condition at Dover, Delaware; Kaiserslautern, Germany;
Kadena AB, Japan; and RAF Croughton, United Kingdom.
Third, the fiscal year 2017 budget request includes $304 million
for medical facility recapitalization. This includes $50 million for
the first increment of a $510 million project for the Walter Reed
Medical Center Addition/Alteration; $58.1 million for increment six (of
a $982 million seven increment project) for the Medical Center
Replacement at Rhine Ordnance Barracks in Germany; and $195.9 million
for five other smaller medical/dental facilities. All the projects are
crucial for our continued delivery of quality health care that our
servicemembers and their families deserve whether stationed stateside
or during overseas deployments.
Overseas Contingency Operations
The fiscal year 2017 Overseas Contingency Operations budget request
includes $47.9 million for projects supporting the mission in East
Africa (Djibouti). The request also includes $113.6 million in European
Reassurance Initiative military construction funding for military
construction activities for the Active components of all Military
Services, and Defense-Wide Activities supporting military operations in
Europe in direct support of NATO, Operation Freedom's Sentinel, and
Operation Inherent Resolve. Funds provided would bolster security of
U.S. NATO Allies and partner states in Europe and deter aggressive
actors in the region by enhancing prepositioning and weapons storage
capabilities, improving airfield and support infrastructure, providing
5th generation warfighting capability, and building partnership
capacity.
Family and Unaccompanied Housing
A fundamental priority of the Department is to support military
personnel and their families to improve their quality of life by
ensuring access to suitable, affordable housing. Service members are
engaged in the front lines of protecting our national security and they
deserve the best possible living and working conditions. Sustaining the
quality of life of our people is crucial to recruitment, retention,
readiness and morale.
Our fiscal year 2017 budget request includes $1.3 billion to fund
construction, operation, and maintenance of government-owned and leased
family housing worldwide as well as to provide housing referral
services to assist military members in renting or buying private sector
housing, and oversight of privatized family housing (see Table 2
below). Included in this request is $356 million for construction and
improvements; $232 million for operations (including housing referral
services); $229 million for maintenance; $154 million for utilities;
and $349 million for leasing and privatized housing oversight.
This funding request supports over 38,000 government-owned family
housing units, almost all of which are on enduring bases in foreign
countries now that the Department has privatized the vast majority of
our family housing in the United States (over 206,000 units). The
Department is also leasing more than 9,000 family housing units where
government-owned or privatized housing is not feasible. Our request
also includes $3.3 million to support administration of the Military
Housing Privatization Initiative (MHPI) Program as prescribed by the
Federal Credit Reform Act of 1990, to ensure the project owners
continue to fund future capital repairs and replacements as necessary
to provide quality housing for military families and to ensure that
these projects remain viable for their 40-50 year lifespan.
In fiscal year 2015, the Department notified Congress of DOD's
intent to transfer $96 million of Navy family housing construction
funds into the Department's Family Housing Improvement Fund (FHIF) to
execute Hawaii Phase 6 to support Marine Corps housing requirements in
Hawaii. Execution of Hawaii Phase 6 brings the Department's total
privatized family housing inventory to nearly 202,000 homes.

Table 2.--Family Housing Budget Request, Fiscal year 2016 Versus Fiscal
Year 2017
------------------------------------------------------------------------
Change from FY 2016
FY 2016 FY 2017 ---------------------
Account category request request Funding
($ ($ ($ Percent
millions) millions) millions)
------------------------------------------------------------------------
Family Housing Construction/ 277 356 79 29%
Improvements...............
Family Housing Operations & 1,136 961 (175) (15%)
Maintenance................
Family Housing Improvement 0 3 3 100%
Fund*......................
TOTAL................... 1,413 1,320 93 (7%)
------------------------------------------------------------------------
*We made no fiscal year 2016 request for funds to oversee privatized
housing because we had sufficient fiscal year 2015 cost savings to
cover our fiscal year 2016 expenses.

The Department also continues to encourage the modernization of
Unaccompanied Personnel Housing (UPH) to improve privacy and provide
greater amenities. In recent years, we have heavily invested in UPH to
support initiatives such as BRAC, global restationing, force structure
modernization, and the Navy's Homeport Ashore initiative. However, this
constrained budget request only includes five UPH projects totaling
$161 million, all of which are for transient personnel or trainees such
as a $67 million Recruit Dormitory at Joint Base San Antonio, Texas.
Facilities Sustainment and Recapitalization
In addition to new construction, the Department invests significant
funds in maintenance and repair of our existing facilities. Sustainment
represents the Department's single most important investment in the
condition of its facilities. It includes regularly scheduled
maintenance and repair or replacement of facility components--the
periodic, predictable investments that should be made across the
service life of a facility to slow its deterioration, optimize the
Department's investment, and save resources over the long term. Proper
sustainment slows deterioration, maintains safety, preserves
performance over the life of a facility, and helps improve the
productivity and quality of life of our personnel.

Table 3.--Sustainment and Recapitalization Budget Request, Fiscal Year
2016 Versus Fiscal Year 2017
------------------------------------------------------------------------
Change from FY 2016
FY 2016 FY 2017 ---------------------
Account category request request Funding
($ ($ ($ Percent
millions) millions) millions)
------------------------------------------------------------------------
Sustainment (O&M)........... 8,022 7,450 (572) (7%)
Recapitalization (O&M)...... 2,563 2,088 (475) (19%)
TOTAL................... 10,585 9,538 (1,047) (10%)
------------------------------------------------------------------------

The accounts that fund these activities have taken significant cuts
in recent years. For fiscal year 2017, the Department's budget request
includes $7.4 billion for sustainment and $2.1 billion for
recapitalization (see Table 3 above) in Operations & Maintenance
funding only. The combined level of sustainment and recapitalization
funding ($9.5 billion) is a 10 percent decrease from the fiscal year
2016 President's Budget (PB) request ($10.6 billion), and reflects an
acceptance of significant risk in DOD facilities. In fact, the request
supports average DOD-wide sustainment funding level that equates to 74
percent of the FSM requirement as compared to the Department's goal to
fund sustainment at 90 percent of modeled requirements.
Recent and ongoing budget constraints have limited investment in
facilities sustainment and recapitalization to the point that 11.7
percent of the Department's facility inventory is in ``poor'' condition
(Facility Condition Index (FCI) between 60 and 79 percent) and another
14.8 percent is in ``failing'' condition (FCI below 60 percent) based
on recent facility condition assessment data. Compared to last year
(see Table 4), the Department is seeing more poor facilities moving
into failing conditions. Until the out-year sequestration challenges
are overcome, the Department will continue to take risk in funding to
sustain and recapitalize existing facilities. This will ultimately
result in DOD facing larger bills in the out-years to restore or
replace facilities that deteriorate prematurely.

Table 4.--Comparison of Fiscal Year 2014 and Fiscal Year 2015 Facility
Condition Indices
------------------------------------------------------------------------
End of FY 2015 FCI (%)
-------------------------------------------
End of FY 2014 FCI (%) Poor (60- Failing Poor (60- Failing
79 %) (<60%) 79 %) (<60%)
------------------------------------------------------------------------
Army........................ 31.3 10.2 12.8 26.1
Navy........................ 17.4 6.4 15.8 6.4
Air Force................... 2.6 4.1 5.7 3.9
Washington Headquarters 2.2 4.7 2.1 5.8
Service....................
TOTAL................... 19.7 7.4 11.7 14.8
------------------------------------------------------------------------

fiscal year 2017 budget request--environmental programs
The Department has long made it a priority to protect the
environment on our installations, not only to preserve irreplaceable
resources for future generations, but to ensure that we have the land,
water and airspace we need to sustain military readiness. To achieve
this objective, the Department has made a commitment to continuous
improvement, pursuit of greater efficiency and adoption of new
technology. In the President's Fiscal Year 2017 Budget, we are
requesting $3.4 billion, a slight decrease from fiscal year 2016, to
continue the legacy of excellence in our environmental programs.
The table below outlines the entirety of the DOD's environmental
program, but I would like to highlight a few key elements where we are
demonstrating significant progress--specifically, our environmental
restoration program, our efforts to leverage technology to reduce the
cost of cleanup, and the Readiness and Environmental Protection
Integration (REPI) program.

Table 5.--Environmental Program Budget Request, Fiscal Year 2017 Versus Fiscal Year 2016
----------------------------------------------------------------------------------------------------------------
Change from FY 2016
FY 2016 FY 2017 -----------------------
Program Request Request Funding
($millions) ($millions) ($millions) Percent
----------------------------------------------------------------------------------------------------------------
Environmental Restoration..................................... 1,107 1,030 (77) (7%)
Environmental Compliance...................................... 1,389 1,493 103 7%
Environmental Conservation.................................... 389 420 31 8%
Pollution Prevention.......................................... 101 84 (17) (17%)
Environmental Technology...................................... 200 186 (14) (7%)
BRAC Environmental............................................ 217 181 (36) (17%)
TOTAL..................................................... 3,405 3,395 (10) (0.3%)
----------------------------------------------------------------------------------------------------------------

Environmental Restoration
We are requesting $1.2 billion to continue cleanup efforts at
remaining Installation Restoration Program (IRP--focused on cleanup of
hazardous substances, pollutants, and contaminants) and Military
Munitions Response Program (MMRP--focused on the removal of unexploded
ordnance and discarded munitions) sites. This includes $1.0 billion for
``Environmental Restoration,'' which encompasses active installations
and Formerly Used Defense Sites (FUDS) locations and $181 million for
``BRAC Environmental.'' The amount of BRAC Environmental funds
requested will be augmented by $108 million of land sale revenue and
prior year, unobligated funds, bringing the total amount of BRAC
Environmental funding planned for obligation in fiscal year 2017 to
$289 million. These investments help to ensure DOD continues to make
property at BRAC locations safe and environmentally suitable for
transfer. We remain engaged with the Military Departments to ensure
they are executing plans to spend remaining unobligated balances in the
BRAC account.

Table 6.--Progress Toward Cleanup Goals
----------------------------------------------------------------------------------------------------------------
Goal: Achieve Response Complete at 90% and 95% of Active and BRAC IRP and MMRP sites, and FUDS IRP sites, by FY
2018 and FY 2021, respectively
-----------------------------------------------------------------------------------------------------------------
Projected Status Projected Status
Status as of the at the end of FY at the end of FY
end of FY 2015 2018 2021
----------------------------------------------------------------------------------------------------------------
Army................................................... 90% 94% 97%
Navy................................................... 80% 86% 92%
Air Force.............................................. 80% 89% 94%
DLA.................................................... 86% 97% 97%
FUDS................................................... 80% 89% 94%
TOTAL.............................................. 84% 91% 95%
----------------------------------------------------------------------------------------------------------------

We are cleaning up sites on our active installations in parallel
with those on bases closed in previous BRAC rounds--cleanup is not
something that DOD pursues only when a base is closed. In fact, the
significant progress we have made over the last 20 years cleaning up
contaminated sites on active DOD installations is expected to reduce
the residual environmental liability in the disposition of our property
made excess through the BRAC process or other efforts.
By the end of 2015, the Department, in cooperation with state
agencies and the Environmental Protection Agency, completed cleanup
activities at 84 percent of Active and BRAC IRP and MMRP sites, and
FUDS IRP sites, and is now monitoring the results. During fiscal year
2015 alone, the Department completed cleanup at over 870 sites. Of the
roughly 39,500 restoration sites, almost 31,500 are now in monitoring
status or cleanup completed. We are currently on track to meet our
program goals--anticipating complete cleanup at 95 percent of Active
and BRAC IRP and MMRP sites, and FUDS IRP sites, by the end of 2021.
Our focus remains on continuous improvement in the restoration
program: minimizing overhead; adopting new technologies to reduce cost
and accelerate cleanup; refining and standardizing our cost estimating;
and improving our relationships with State regulators through increased
dialogue. All of these initiatives help ensure that we make the best
use of our available resources to complete cleanup.
Environmental Technology
A key part of DOD's approach to meeting its environmental
obligations and improving its performance is its pursuit of advances in
science and technology. The Department has a long record of success
when it comes to developing innovative environmental technologies and
getting them transferred out of the laboratory and into actual use on
our remediation sites, installations, ranges, depots and other
industrial facilities. These same technologies are also now widely used
at non-Defense sites helping the nation as a whole.
While the fiscal year 2017 budget request for Environmental
Technology overall is $191 million, our core efforts are conducted and
coordinated through two key programs--the Strategic Environmental
Research and Development Program (SERDP--focused on basic research) and
the Environmental Security Technology Certification Program (ESTCP--
which validates more mature technologies to transition them to
widespread use). The fiscal year 2017 budget request includes $65
million for SERDP and $32 million for ESTCP for environmental
technology demonstrations, with an additional $20 million requested
specifically for energy technology demonstrations.
These programs have already achieved demonstrable results and have
the potential to reduce the environmental liability and costs of the
Department--developing new ways of treating groundwater contamination,
reducing the life-cycle costs of multiple weapons systems, and
improving natural resource management.
As an example, this past year SERDP-sponsored project to conduct
basic research that is will develop an environmentally benign Chemical
Agent Resistant Coating (CARC), which is critical technology for the
protection of military assets. Current CARC coatings contribute
approximately 2.3 million pounds of volatile organize compounds (VOCs)
and hazardous air pollutants (HAPs) to the environment each year. The
new novel powder CARC is absent of solvent, emits nearly zero VOCs, can
be recycled, and is compatible with existing CARC systems. In addition,
testing to date proves that the exterior durability of this coating is
superior to any liquid CARC system, supporting DOD's initiative for
corrosion prevention and mitigation. Coating products are currently in
transition to Original Equipment Manufacturers, Depots, and the Defense
Logistics Agency (DLA).
Looking ahead, our environmental technology investments are focused
on the Department's evolving requirements. In the area of Environmental
Restoration, we are launching a new three-year initiative to support
sustainable range management by researching the environmental impacts
of new munitions compounds and we will continue our investments in
technologies to address the challenges of contaminated groundwater
sites where no good technical solutions are currently available. We are
working to understand the behavior of contaminants in fractured bedrock
and large dilute plumes, which represent a large fraction of these
sites, and to develop treatment and management strategies. We will
continue our efforts to develop the science and tools needed to meet
the Department's obligations to assess and adapt to climate change.
Finally, to transition the important work of improving the
sustainability of our industrial operations and reducing life-cycle
costs by eliminating toxic and hazardous materials from our production
and maintenance processes we are initiating a program to demonstrate
that our most hazardous chemicals can be eliminated from a maintenance
production line.
Environmental Conservation and Compatible Development
To maintain access to the land, water and airspace needed to
support our mission needs, the Department continues to successfully
manage the natural resources entrusted to us--including protecting the
many threatened and endangered species found on our lands. DOD manages
approximately 25 million acres containing many high-quality and unique
habitats that provide food and shelter for nearly 520 species-at-risk
and over 400 that are federally listed as threatened or endangered
species. That is 9 times more species per acre than the Bureau of Land
Management, 6 times more per acre than the United States Fish and
Wildlife Service (USFWS), 4.5 times more per acre than the Forest
Service, and 3.5 times more per acre than the National Park Service. A
surprising number of rare species are found only on military lands--
including more than 15 listed species and at least 75 species-at-risk.
The fiscal year 2017 budget request for Conservation is $420
million. The Department invests these funds to manage its imperiled
species as well as all of its natural resources in an effort to sustain
the high quality lands our service personnel need for testing, training
and operational activities, and to maximize the flexibility our
servicemen and women need to effectively use those lands. Species
endangerment and habitat degradation can and does have direct mission-
restriction impacts. That is one reason we work hard to prevent species
from becoming listed and, if they do become listed, to manage these
species and their habitat in ways that sustain the resource and enable
our ability to test and train. All of our plans now adequately address
these species, and we have successfully and consistently avoided
critical habitat designations because our plans adequately address
management concerns for species that exist on our lands. Getting ahead
of any future listings has been a prime, natural resource objective for
the last several years and will remain so in the future.
Readiness and Environmental Protection Integration (REPI) Program
To help ensure DOD sustains its national defense mission and
protects species under duress, the Department has developed a strategy
that supports conservation beyond installation boundaries. Under this
strategy DOD engages with other governmental and non-governmental
partners, as well as private landowners, to develop initiatives and
agreements for protecting species for the purposes of precluding or
mitigating regulatory restrictions on training, testing, and operations
on DOD lands. Expanding the scale and options for protecting species on
non-DOD land benefits conservation objectives while helping sustain
access to, and operational use, of DOD live training and test domains.
This strategic focus is a key element of the Readiness and
Environmental Protection Integration (REPI) Program. Under REPI, the
Department partners with conservation organizations and state and local
governments to preserve buffer land and sensitive habitat near
installations and ranges. Preserving these areas allows the Department
to avoid more costly alternatives such as workarounds, restricted or
unrealistic training approaches, or investments to replace existing
test and training capability. Simultaneously, these efforts ease the
on-installation species management burden and reduce the possibility of
restricted activities, ultimately providing more flexibility for
commanders to execute their missions.
Included within the $420 million for Conservation, $60 million is
directed to the REPI Program. The REPI Program is a cost-effective tool
to protect the nation's existing training, testing, and operational
capabilities at a time of decreasing resources. In the last 13 years,
REPI partnerships have protected more than 437,000 acres of land around
86 installations in 29 states. In addition to the tangible benefits to
training, testing, and operations, these efforts have resulted in
significant contributions to biodiversity and recovery actions
supporting threatened, endangered and candidate species.
The REPI Program supports the warfighter and protects the taxpayer
because it multiplies the Department's investments through unique cost-
sharing agreements. Even in these difficult economic times, REPI is
able to directly leverage the Department's investments at least one-to-
one with those of our partners, effectively securing critical buffers
around our installations for half-price.
In addition, DOD, along with the Departments of the Interior and
Agriculture, continues to advance the Sentinel Landscapes Partnership
to protect large landscapes where conservation, working lands, and
national defense interests converge--places defined as Sentinel
Landscapes. Established in 2013, the Sentinel Landscapes Partnership
further strengthens interagency coordination and provides taxpayers
with the greatest leverage of their funds by aligning federal programs
to advance the mutually-beneficial goals of each agency.
Thus far, three Sentinel Landscapes have been identified around
Joint Base Lewis-McChord, Washington; Fort Huachuca, Arizona; and Naval
Air Station (NAS) Patuxent River and the Atlantic Test Ranges,
Maryland. The pilot Sentinel Landscape project at JBLM influenced the
USFWS decision to avoid listing a butterfly species in Washington,
Oregon, and California. The USFWS cited the ``high level of protection
against further losses of habitat or populations'' from investments
made by Joint Base Lewis-McChord's REPI partnership, actions that allow
significant maneuver areas to remain available and unconstrained for
active and intense military use at JBLM. At Fort Huachuca, NAS Patuxent
River and the Atlantic Test Ranges, DOD is working with USFWS, the
Natural Resources Conservation Service, the U.S. Forest Service, and a
variety of state and private conservation organizations to protect
important swaths of special use airspace used for aircraft testing and
training, while also benefiting ecologically sensitive watersheds and
the installations, wildlife, and working lands dependent on those
resources.
fiscal year 2017 budget request--energy programs
Unlike the Department's Military Construction and Environmental
Remediation programs, where the budget request includes specific line
items, our energy programs are subsumed into other accounts. The
following sections describe the Energy portion of the budget request.
Further discussion of energy follows in the highlighted issues section.
Operational Energy
In fiscal year 2017, the Department's budget request includes an
estimated $9.8 billion for 93.3 million barrels of fuel. In order to
increase warfighting capability and reduce operational risk, the
Department's fiscal year 2017 budget request also includes $2.5 billion
for adaptations and improvements in our use of operational energy.
Operational energy is the energy used to power aircraft, ships, combat
vehicles, and mobile power generation at contingency bases. While there
is no explicit budget request for Operational Energy, these investments
across multiple accounts and appropriations are intended specifically
to improve military capability.
Within this overall request, the Department is requesting $37.3
million in RDT&E funding to support the Operational Energy Capabilities
Improvement Fund (OECIF). OECIF provides funding to DOD research
programs that improve operational energy performance organized around a
specific annual theme or focus area, as well as sustain funding to
those programs already underway. The fiscal year 2017 President's
Budget will provide funding for new programs, as well as support those
programs established in fiscal year 2014-fiscal year 2016.
Finally, the Department is requesting $5.4 million in fiscal year
2017 to fund the operations of OASD(EI&E) and oversee operational
energy activities. Each year, EI&E certifies that the President's
Budget is adequate for carrying out the Department's Operational Energy
Strategy. The full certification report, which will be provided to
Congress in the near future, will provide a more comprehensive
assessment of the alignment of operational energy initiatives with the
goals of the recently released 2016 Operational Energy Strategy.
2016 Operational Energy Strategy
Reflecting lessons learned, strategic guidance, and the evolving
operational environment, the 2016 Operational Energy Strategy is
designed to improve our ability to deliver the operational energy
needed to deploy and sustain forces in an operational environment
characterized by peer competitors, asymmetric insurgents, and
unforgiving geography. The strategy identifies the following three
objectives:

Increase Future Warfighting Capability. Foremost, the
strategy focuses on increasing warfighter capability through energy-
informed force development. In addition to energy Key Performance
Perimeters (eKPP) informed by energy supportability analyses that
improve the combat effectiveness and supportability of major
acquisition programs, the Department will continue to invest in energy
innovation that improves the long-term capability of the Department,
such as increasing the unrefueled range or endurance of platforms. With
this knowledge of inherent energy constraints and risks, the Military
Departments will be better able to make energy-informed decisions
related to force development and future capabilities.
Identify and Reduce Logistics and Operational Risks. To
effectively reduce logistics risks, the Department will address energy
risks in near-term operation plans as well as more exploratory, longer-
term concepts of operation. Initiatives that fall into this category
seek to mitigate warfighting gaps found in Integrated Priority Lists,
OPLANs, and wargames. The Department's focus on risk will ensure future
forces are better aligned to mitigate potential threats to operations.
Enhance Mission Effectiveness of the Current Force.
Finally, the strategy will improve the effectiveness of U.S. forces
operating around the globe today. To do so, the Department will
emphasize improved energy use in operations and training, and enhanced
education of operators, logisticians, and system developers. These
initiatives may include material and non-material enhancements to day
to day operations, as well as adaptations in training, exercises, and
professional military education.

In coordination with the Combatant Commands, Military Departments,
Joint Staff, and Defense Agencies, my office is overseeing the
execution of fifteen targets arrayed across the three objectives. For
instance, we are supporting Joint Staff oversight of the energy KPP,
facilitating operational energy advisors at the Combatant Commands, and
assessing the role of operational energy in war games and operation
plan reviews. In addition to the Defense Operational Energy Board, we
will use existing requirements, acquisition, programming, and budgeting
processes to review Department progress against these targets.
Installation Energy
As with Operational Energy, there is no explicit request in the
overall budget for Facilities Energy--utilities expenditures are
included in the Base Operations O&M request. Facilities Energy remains
our single largest base operating cost and in fiscal year 2015, we
spent $3.9 billion to heat, cool, and provide electricity to our
buildings. To reduce this cost the Department is pursuing energy
efficiencies through building improvements, new construction, and
third-party investments.
The Department's fiscal year 2017 budget request includes
approximately $618 million for investments in conservation and energy
efficiency, most of which will be directed to existing buildings. The
majority ($468 million) is in the Military Components' operations and
maintenance accounts, to be used for sustainment and recapitalization
projects. Such projects typically involve retrofits to incorporate
improved lighting, high-efficiency HVAC systems, double-pane windows,
energy management control systems, and new roofs. The remainder ($150
million) is for the Energy Conservation Investment Program (ECIP), a
Military Construction account used to implement energy efficiency,
water conservation, and renewable energy projects. Each individual ECIP
project has a positive payback (i.e. Savings to Investment Ratio (SIR)
> 1.0) and the overall program has a combined SIR greater than 2.0.
This means for every dollar we invest in ECIP, we generate more than
two dollars in savings.
The Military Component investments include activities that would be
considered regular maintenance and budgeted within the O&M accounts for
Facilities Sustainment, Restoration, and Maintenance activities. The
risk that has been accepted in those accounts will not only result in
fewer energy projects, but failing to perform proper maintenance on our
buildings will without question have a negative impact on our energy
usage. In plain terms, upgrades to air conditioning systems will not
reduce energy usage as projected if the roof is leaking or the windows
are broken.
In addition to retrofitting existing buildings, we continue to
drive efficiency in our new construction. Our new buildings must be
constructed using the high-performance sustainable buildings standards
issued by my office 2 years ago which include greater energy efficiency
requirements.
Additionally, the Department is taking advantage of third-party
financing through Energy Savings Performance Contracts (ESPCs) and
Utility Energy Service Contracts (UESCs), to implement energy
efficiency improvements in our existing buildings. Under these
contracts private energy firms or utility companies make energy
upgrades to our buildings and are paid back over time using utility
bill savings.
Facilities Energy Management
With respect to facilities energy management the Department has
made great progress towards improving the energy efficiency of its
installations. Since fiscal year 2009, the Department reduced the
energy consumed on our military bases by 10 percent, avoiding over $1.2
billion in operating costs.
In addition to using appropriated funding for energy conservation
and efficiency initiatives, the Department is continuing to take
advantage of third-party financing tools through energy performance
based contracts (ESPCs and UESCs) to implement energy efficiency
improvements in our existing buildings. While such performance-based
contracts have long been part of the Department's energy strategy, the
Services have significantly increased the use of ESPCs and UESCs in
response to the President's Performance Contracting Challenge (PPCC)
originally issued in December 2011 and extended in May 2014. The PPCC
challenged federal agencies to award $4 billion in energy performance
based contacts by the end December 2016. The DOD's commitment to the
challenge is just over $2 billion in contracts. To date the Department
has awarded $1.3 billion in ESPCs and UESCs.
Regarding renewable energy, the Department has a goal to deploy 3
gigawatts of renewable energy by fiscal year 2025. Most renewable
energy projects we pursue are financed by private developers. DOD's
authorities for renewable energy--particularly the ability to sign
power purchase agreements of up to 30 years--provide incentives for
private firms to fund the projects themselves, and can also provide a
strong business case that they are able to offer DOD lower energy rates
than are being paid currently. The DOD does not make any capital
investment in these renewable energy projects. When feasible, renewable
energy projects are being built with micro-grid-ready applications that
can enable the provision of continuous power in the event of a
disruption.
As of the end of fiscal year 2015 the Department has 702 megawatts
in renewable energy projects in operation. The Services also have more
than 550 megawatts of projects under construction including a 15 MW
Solar PV/ 50 MW wind ``hybrid'' project at Ft Hood, TX and an off-site
210 MW solar PV facility that will supply power to 14 Department of
Navy installations in California. Further, there is another 1.3
gigawatts of renewable energy projects in various stages of
development; putting the Department well on track towards meeting its 3
gigawatt goal.
highlighted issues
Merger of the Energy, Installations, and Environment Organizations
As you know, the fiscal year 2015 National Defense Authorization
Act directed the merger of the Assistant Secretary of Defense for
Operational Energy Plans and Programs and the Deputy Under Secretary of
Defense for Installations and Environment to create the Assistant
Secretary of Defense for Energy, Installations and Environment. The ASD
(EI&E) is now the principle advisor to the Secretary of Defense for
Acquisition, Technology, and Logistics on matters relating to energy,
installations, and environment and the principal advisor to the
Secretary of Defense and the Deputy Secretary of Defense regarding
operational energy plans and programs.
The Department is currently developing the required report on the
status of the merger, and will provide that to the Congress later this
year. I can tell you that through the merger operational energy
functions have benefited from additional resources and collaboration
with complementary functions related to installation energy, facilities
investment and management, and basing.
Base Realignment and Closure
Given the need to find efficiencies and reexamine how our
infrastructure is configured, the Administration is requesting the
authority from Congress to conduct a 2019 BRAC round. As indicated in
testimony last year, the Department has excess capacity. The Army and
Air Force have analyzed their infrastructure and have found that they
have 18 percent and 30 percent excess capacity, respectively. We are
currently conducting a DOD wide parametric analysis as directed by the
fiscal year 2016 National Defense Authorization Act, which will likely
indicate excess of around 20 percent. This level of excess is not
surprising given the fact that in 2004 we found that the Department had
24 percent excess and BRAC 2005 reduced infrastructure by 3.4 percent
(as measured by plant replacement value).
As we have said, a new BRAC round will be different than BRAC 2005.
The new round will be efficiency focused. It will save about $2 billion
a year after implementation; with costs and savings during the six year
implementation being a wash at approximately $7 billion. Our projection
is based on the efficiency rounds of the 1990s.
In addition to being a proven process that yields savings, BRAC has
several advantages that we have outlined before in our testimony. I
want to highlight a few of these:

BRAC is comprehensive and thorough--all installations are
analyzed using certified data aligned against the strategic imperatives
detailed in the 20-year force structure plan;
The BRAC process is auditable and logical which enables
the Commission to conduct an independent review informed by its own
analysis and testimony from affected communities and elected officials;
The Commission has the last say on the Department's
recommendations--being fully empowered to alter, reject, or add
recommendation;
The BRAC process has an ``All or None'' construct which
prevents the President and Congress from picking and choosing among the
Commission's recommendations; thereby insulating BRAC from politics;
The BRAC process imposes a legal obligation on the
Department to close and realign installations as recommended by the
Commission by a date certain that facilitates economic reuse planning
by impacted communities and grants the Department the authorities
needed to satisfy that legal obligation.

In recognition of your concerns about cost and the amount of time
the BRAC Commission has to review our recommendations, the Department's
request for BRAC authorization includes four key changes from prior
year submissions as well as a handful of administrative and timeline
changes. Each of the changes are narrowly tailored to address
congressional cost concerns while not altering the fundamental
principles of the BRAC process: treating all bases equally; all or none
review by both the President and Congress; review by an independent
Commission; making military value the priority consideration; and a
clear legal obligation to implement all of the recommendations in a
time certain together with all the authorities needed to accomplish
implementation.
To ensure the next BRAC round is focused on saving money and
maximizing efficiency, our legislation adds a requirement for the
Secretary of Defense to certify that the BRAC round will have the
primary objective of eliminating excess infrastructure to maximize
efficiency and reduce cost. Like the existing requirement to certify
the need for a BRAC round, this certification occurs at the outset of
the BRAC process and is a precondition to moving forward with
development of recommendations. Additionally, subject to the
requirement to give priority consideration to the military value
selection criteria, the legislation now requires the Secretary to
emphasize those recommendations that yield net savings within 5 years
of completing the recommendation and limits the Secretary's ability to
make recommendations that do not yield savings within 20 years. In
order to make a recommendation that does not yield savings within 20
years, the Secretary must expressly determine that the military value
of such recommendation supports or enhances a critical national
security interest of the United States.
Finally, the legislation also now specifically delineates those
costs that must be considered when determining the costs associated
with a recommendation. As revised, the legislation specifies that the
Department must consider costs associated with military construction,
information technology, termination of public-private contracts,
guarantees, the costs of any other activity of the Department of
Defense or any other Federal agency that may be required to assume
responsibility for activities at the military installations, and such
other factors as the Secretary determines as contributing to the cost
of a closure or realignment. Previous versions of the legislation had
only specifically mentioned the costs of any other activity of the
Department of Defense or any other Federal agency that may be required
to assume responsibility for activities at the military installations
Our proposal extends the Commission review period to run from April
15 to October 1 which adds two months to Commission review and requires
that Commissioners be named by February 1st which enables the
Commission to be up and running for ten weeks before our
recommendations come to them. Our revision also requires the Chair of
the Commission to certify that the Commission and its staff have the
capacity to review the Department's recommendations.
Heretofore, we've addressed every concern raised by Congress. We
conducted the European Infrastructure Consolidation to address concerns
that we need to look at overseas installations first; we programmed the
costs and pledged the next round will reduce excess instead of the 2005
round's more costly ``transformation'' focus in response to concerns
that we could not afford BRAC; and we have demonstrated that excess
capacity exists--Army and Air Force testified to 21 and 30 percent.
We've updated our DOD-wide (parametric) analysis and will provide it to
Congress soon; it indicates over 20 percent excess.
We hope the Department's efforts will result in a real dialog with
members of Congress regarding the need for and value of the BRAC
process, ultimately resulting in authority for a 2019 BRAC round.
European Infrastructure Consolidation
In response to our recent requests for BRAC authority, Congress
made it clear that it wanted DOD to look at reducing our overseas
infrastructure first--particularly in Europe. We did so by conducting
the European Infrastructure Consolidation (EIC) analysis--the first
holistic and joint review of our legacy infrastructure in Europe.
To analyze our European infrastructure we used a process very
similar to the proven U.S. BRAC process. We looked at capacity,
requirements (including surge), military value, cost, and the
diplomatic dynamics involved with each action. As we consolidate our
footprint, the infrastructure remaining in place will continue to
support our operational requirements and strategic commitments, but we
will not need as many support personnel (military, civilian, and host
nation employees) to do so.
The 26 approved EIC actions will allow us to create long-term
savings by eliminating excess infrastructure without reducing our
operational capabilities. In other words, operationally we will
continue to do everything we currently do but at a lower cost. After a
one-time investment of approximately $800 million in Military
Construction to implement two major base closures, eight minor site
closures, and 16 realignment actions, the Department will realize
approximately $500 million in annual recurring savings.
These actions will be executed over the next several years, but
that does not mean that everything will remain static in Europe while
these changes occur. There were consolidations made before EIC and
there will undoubtedly be future basing actions--especially given the
evolving security environment. However, our holistic review and the
resultant actions allow us to redirect resources supporting unneeded
infrastructure and apply them to higher priorities, thus strengthening
our posture in Europe.
Although we continually seek efficiencies as we manage
installations worldwide, the Department does not conduct this degree of
comprehensive analyses of its infrastructure on a regular basis. That's
one of the reasons we have requested BRAC authority from Congress to do
a review of our U.S. installations. In this fiscal environment it would
be irresponsible of us not to look for such savings.
rebalance to the asia-pacific
Rebasing of Marines from Okinawa to Guam
The movement of thousands of marines from Okinawa (and elsewhere)
to Guam is one of the most significant re-basing action in recent
years. We appreciate Congress' support allowing us to move forward on
this essential component of our rebalance to the Asia-Pacific region,
resulting in a more geographically dispersed, operationally resilient,
and politically sustainable posture in the area. As a U.S. territory,
Guam offers strategic advantages and operational capabilities that are
unique in the region. Presence in Guam is a force multiplier that
contributes to a force posture that reassures allies and partners and
deters aggression.
Now that the very complex National Environmental Policy Act (NEPA)
process (nearly five years of study) is complete, there is a clear path
for construction to proceed in earnest. Utilities and site improvements
(8$300 million funded by the GoJ) for the main cantonment area at
Finegayan, and a live-fire training range ($125 million) at Andersen's
Northwest Field will be the first projects under the new Record of
Decision (ROD). Construction for the Marine Aviation Combat Element
(ACE) at the North Ramp of Andersen proceeded earlier because it was
covered under the original 2010 ROD; it remains on track.
We understand Congress' concerns regarding both the cost and
feasibility of the relocation and we are firmly committed to the
principles of operational effectiveness and fiscal responsibility. We
remain confident in the estimate of $8.7 billion for the program, which
includes $3.1 billion provided by the Government of Japan (GoJ) ($1.152
billion transferred to date). The Department is evaluating this program
in advance of each year's budget submission to pursue efficiencies that
have the potential to reduce overall cost. For example, the
Department's decision to relocate housing to Andersen Air Force Base
reduced the requirement for a water works project (at the main
cantonment area) saving the Department approximately $50 million.
Additionally, we continue to provide the necessary oversight,
conducting quarterly Deputy Secretary led Guam Oversight Council
meetings to address issues related to the program's implementation.
The Marines, in conjunction with the Naval Facilities Engineering
Command (NAVFAC), have an established program management organization
for construction execution and oversight. NAVFAC is standing up an
Officer in Charge of Construction office and anticipates it will be in
place by the first quarter of 2017. The marines continue with planning
to meet operational requirements on the ground. This is the largest
infrastructure program (8$9 billion) that has been executed in many
years, so it is prudent to have the necessary management structure in
place to ensure success.
The Economic Adjustment Committee Implementation Plan (EIP)
(submitted to Congress in October 2015) was the last Congressional
requirement restricting project execution on Guam. The Plan outlines
the five ``outside the fence'' projects (listed in the table below)
associated with the impacts of the build-up on Guam's civilian
infrastructure. Last year's fiscal year 2016 NDAA provides
authorization for moving forward with the water/wastewater projects--
but not for the cultural repository and the public health lab projects.
Our fiscal year 2017 President's Budget requests authority for these
two projects and the balance of funding ($87 million).

Table 7--EAC Projects Supporting DON Record of Decision
------------------------------------------------------------------------
Previous
Project FY(s) FY 2017
Project title total Appropriated request
($millions) ($millions) ($millions)
------------------------------------------------------------------------
Upgrade Wastewater Treatment 139 71 68
Plan...........................
Refurbishment sewer line 31 31 0
Andersen AF....................
Repair/expansion Aquifer 4 4 0
monitoring system..............
Public Health Laboratory........ 32 13 19
Cultural Repository............. 12 12 0
TOTAL....................... 218 131 87
------------------------------------------------------------------------

The cumulative impact of this stationing was carefully evaluated
within the environmental analysis process and we determined that water/
wastewater, public health, and our obligation to care for artifacts
uncovered in our construction need to be addressed. The associated
projects total $218 million, which is a relatively small, but
absolutely necessary, portion of this relocation.
Failure to provide authorization for these projects increases the
risk of litigation and project delay and will affect DOD's credibility
with the Guam's populace. Our inability to meet commitments to the
Government of Guam will also adversely affect our credibility with the
Government and people of the Commonwealth of Northern Mariana Islands
(CNMI) since they have similar concerns, as discussed below.
Commonwealth of Northern Mariana Islands (CNMI) Initiatives
The Department continues to pursue two key military initiatives in
CNMI--the CNMI Joint Military Training (CJMT) Complex (a U.S. Pacific
Command (PACOM) initiative (led by USMC) to reduce joint training
deficiencies in the Western Pacific); and an Air Force Divert and
Exercise Field on Tinian.
PACOM requires a Joint Military Training Complex in-theater to meet
Department of Defense training requirements in the theater. The Complex
will make a key contribution to the readiness of marines relocating to
Guam and provide bilateral and multilateral training opportunities with
foreign allies and partners. The Department sought to design the CJMT
complex on Tinian and Pagan in a manner that minimizes the impacts on
the local communities and provides direct economic and other benefits
while meeting PACOM and its Service Components' training requirements.
The training complex includes a series of live-fire Range Training
Areas, training courses, maneuver areas, and associated support
facilities located in close proximity to each other. The total cost of
the complex is 8$900 million with GoJ contributing $300 million. In
April 2015, the Department of Navy (DON) released the draft
Environmental Impact Statement (DEIS) for the proposed action with an
original public comment period of 60 days (extended to 180 days to
accommodate requests by the CNMI Governor to give him more time in
light of internet problems and damage from Typhoon Soudelor). In
response to the over 28,000 comments received in October 2015 the DON
announced its intent to prepare a Revised DEIS to more fully address
potential impacts to water, coral, and other natural resources. The DON
now estimates the ROD will be issued in the summer of 2018. This
timeline still supports force flow to Guam in 2022.
The Air Force needs to establish a divert capability for up to 12
tankers if access to Andersen Air Force Base is unavailable. The Air
Force proposes to construct facilities and infrastructure to support a
combination of cargo, tanker, and similar aircraft and associated
personnel not only for divert operations, but also to support periodic
exercises and disaster relief activities. Efforts to establish this
capability are on track for a Record of Decision in mid-April 2016. The
Air Force is now pursuing a Tinian-only solution consistent with CNMI's
desires.
Building and Maintaining Resilience in the Face of a Changing Climate
Resilience to climate change continues to be a priority for the
Department. Both the 2010 and 2014 Quadrennial Defense Reviews (QDRs)
discussed the impacts associated with a changing climate that present a
threat to DOD's national security mission. We recognize these impacts
and their potential threats represent one more risk that we must
consider as we make decisions about our installations, infrastructure,
weapons systems and, most of all, our people. We have always dealt with
the risks associated with extreme weather events and its impacts on our
operations and missions. Our challenge today is how to plan for changes
in the environment we will be operating from and in.
Even without knowing precisely how or when the climate will change,
we know we must build resilience into our policies, programs, and
operations in a thoughtful and cost effective way. In January 2016, we
issued a DOD Directive on climate change adaptation and resilience that
identifies roles and responsibilities across the Department for
implementing these strategies over the next ten years.
Specifically, I am focusing on our installations and
infrastructure. Sea level is rising and many coastal areas are
subsiding or sinking. This impacts the operation and maintenance of our
existing installations and infrastructure. As Arctic Sea ice melts and
breaks apart, our early warning radar sites are being eroded away at a
much greater rate than before. Drought and flooding, which ironically
go together, threaten water resources for us and our surrounding
communities and exacerbate wildfire issues across the country.
The Military Services have conducted a screening level assessment
of all DOD sites world-wide to identify where we are potentially
vulnerable to extreme weather events and tidal anomalies today. The
information gleaned from this initial look will help to focus reviews
of installation footprints, and shape planning for current and future
infrastructure.
Given the projected increases in major storms, DOD continues its
progress to ensure energy resilience for its military installations. We
completed our power resilience review, and are now updating Department-
level instructions to include energy resilience requirements. These
requirements will ensure that the Department has the ability to prepare
for and recover from energy disruptions that impact mission assurance
on its military installations.
Our goal is to increase the Department's resilience to the impacts
of climate change. To achieve this goal, we are integrating
consideration and reduction of climate risks into our already
established mission planning and execution.
Financial Improvement & Audit Readiness
In order to effectively manage its financial resources, the
Department remains focused on improving financial record keeping and
conducting an independent audit of DOD's financial books beginning in
fiscal year 2017. This includes not only an audit of the Department's
Statement of Budgetary Resources, but also validating the existence and
completeness, rights and obligations, and financial valuation of
slightly less than 562,000 facilities located at 513 installations
world-wide. The results of a more accurate and reliable real property
inventory will better inform our decisions and actions in addressing
our real property management challenges.
The Department has made significant progress towards the
environmental liabilities associated with our cleanup program and
disposal of equipment aspects of the financial audit. Last fall we
issued clarifying policies through which we are refining the cost
estimates associated with those liabilities; thereby giving the
Department a better understanding of our future environmental costs and
the ability to plan for any required remediation.
Mission Compatibility Evaluation Process
The Department appreciates the legislative changes made in fiscal
year 2016 to section 358 of the Ike Skelton National Defense
Authorization Act of Fiscal Year 2011. These changes significantly
streamlined the Mission Compatibility Evaluation Process, and ensured
that DOD's mission capabilities are protected from incompatible energy
developments. As a result of congressional direction and our own
efforts we are effectively evaluating the mission impact of utility-
scale energy projects, while being mindful of the need for a clean
energy future. In 2015 the Department reviewed over 3,400 applications
for energy projects that were forwarded by the Federal Aviation
Administration. The DOD Siting Clearinghouse worked aggressively with
the Military Departments, energy project developers, and relevant
states to implement affordable and feasible mitigation solutions where
DOD missions might have been adversely impacted. No project reviewed in
2015 rose to the level of an unacceptable risk to the national security
of the United States, which is the threshold established in section 358
of the fiscal year 2011 NDAA to object to a project. The Department is
prepared for an increased number of renewable energy project
developments as newly approved tax credits become available to
developers.
conclusion
Thank you for the opportunity to present the President's Fiscal
Year 2017 Budget request for DOD programs supporting installations,
energy, and the environment. Our budget situation requires that we take
risk in our facilities. No one is happy about that, but we are
effectively managing within this budget constrained environment and we
appreciate Congress' continued support for our enterprise and look
forward to working with you as you consider the fiscal year 2017 budget
request.

Senator Ayotte. I would like to call on Secretary Hammack.

STATEMENT OF HONORABLE KATHERINE G. HAMMACK, ASSISTANT
SECRETARY OF THE ARMY FOR INSTALLATIONS, ENERGY AND ENVIRONMENT

Ms. Hammack. Thank you, Chairwoman Ayotte and Senator Kaine
and other distinguished members of this subcommittee. I
appreciate the opportunity to talk to you about the fiscal year
2017 budget request for military construction, environmental,
energy, and base closure.
For fiscal year 2017, the Army's budget for MILCON is just
over $1 billion, a reduction of 18 percent from last year's
appropriations and an over 60 percent cut from fiscal year
2013. This is the lowest level of military construction for the
Army since 1993.
Of the Army's military construction request, 28 percent
supports combatant commanders' top priorities and another 20
percent funds new directed missions. So that leaves only 50
percent of the military construction budget for
recapitalization of existing infrastructure.
Of that 50 percent, 23 percent is going to the National
Guard, supporting recapitalization of readiness centers.
Senator Ayotte, as you mentioned, the National Guard readiness
center report really clarifies and brings to light some of the
challenges and critical facility shortfalls that the National
Guard is seeing. The fiscal year 2017 request of $233 million
represents a step toward addressing those shortfalls but does
not come close to meeting the backlog of requirements the
National Guard has.
At the request of Congress, the National Commission on the
Future of the Army report was completed, and its findings were
issued to Congress in January of this year. The commission
specifically recommended--and I quote--that Congress and the
administration should look for cost savings opportunities in
areas such as energy savings and a reduced inventory of
military facilities. With the planned reduction in our forces
from where we are now to 450,000 by fiscal year 2018, the Army
will have excess facility capacity of approximately 21 percent.
If budget caps remain in place, the Army will need to further
reduce the number of soldiers and our excess capacity will
continue to increase.
As Mr. Potochney mentioned, the Army's budget request does
represent our decision to continue to take risk in installation
readiness so that we can focus our financial resources on
soldier readiness. The risk we are taking in sustainment
funding results in an accumulation of deferred maintenance
right now estimated at approximately $7 billion. The Army needs
the authorization to optimize installation capacity and free up
funds to use for critical military needs. The Acting Secretary
of the Army and the Chief of Staff of the Army have testified
that they are fully in support of another round of base
realignment and closures authorized in fiscal year 2017.
As Pete mentioned, BRAC is a proven, cost-effective means
to reduce excess infrastructure. Without a BRAC, the Army
continues to spend scarce resources to maintain unneeded or
underutilized facilities and infrastructure, thus hurting our
highest military value bases. This is an unacceptable result
for the Army and a disservice to the American taxpayer. I look
forward to working with you to figure out how we can shape a
means to dispose of excess infrastructure in a fair and
equitable manner.
The Army manages over 12 million acres of land, on which
more than 200 endangered species live. Our environmental budget
of approximately $1 billion addresses those areas, as well as
our historic areas, our cleanup requirements, and maintaining
access to training and testing lands.
The request also supports implementation of energy cost
savings and ensuring energy security across our installations.
We are leading the Federal Government and leveraging private
sector capital for energy savings performance contracts. Since
2003, we have reduced our energy consumption by approximately
22 percent. Working with the private sector increasing
renewable energy projects, we estimate we are going to generate
about $250 million in savings across the life of those
projects.
But the Army's top priority continues to be readiness, and
so to meet our mission requirements, your Army does require
ready and resilient installations.
I look forward to continuing to work with you to ensure
that they have the critical resources our soldiers need to
defend the homeland. So thank you for the opportunity to appear
before you today, and I look forward to your questions.
[The prepared statement of Ms. Hammack follows:]

Prepared Statement by the Honorable Katherine G. Hammack
introduction
Chairman Ayotte, Ranking Member Kaine, and Members of the
Subcommittee: on behalf of the soldiers, families, and civilians of the
United States Army, thank you for the opportunity to present the Army's
fiscal year (FY) 2017 budget request for Installations, Energy,
Environment, and Base Realignment and Closure.
The U.S. Army's top priority continues to be readiness: the Army
must be ready to shape the global security environment, defend our
homeland, and win the nation's wars. To meet these missions, the Army
requires ready and resilient installations--our power projection
platforms--to enable regional engagement and global responsiveness. Our
fiscal year 2017 budget request reflects the Army's decision to take
risk in our installation facilities and services to maximize available
funding for operational readiness and modernization. The request
focuses our limited resources on necessary and prudent investments in
military construction, installation energy programs supporting
operational activities, and environmental compliance.
The Army recognizes that reduced funding of installations accounts
will lead to the continued degradation of our facilities and
infrastructure, and risks our long-term ability to adequately support
Army forces and meet mission requirements. The Army is stretched thin
at a time when we are facing a global security environment that is more
uncertain than ever. Without increased funding in the outyears or the
authority to close and realign our installations, these problems will
only get worse--expending precious funds and putting the readiness and
welfare of our soldiers at risk. It is therefore particularly critical
that we maximize the efficient use of our resources at this time to
meet mission requirements and ensure soldier readiness.
The Army's fiscal year 2017 military construction appropriations
request strikes a careful balance to meet these growing and changing
demands. We look forward to working with Congress to ensure that our
national security needs and priorities are met in the upcoming fiscal
year and well into the future.
making efficient use of army facilities
To meet readiness requirements, the Army must maintain
installations that make efficient and effective use of available
facilities. Army installations should be sized and resourced to meet
the needs of our current and future missions, both at home and
overseas.
Efficient use of our installations includes the closure of low
military value installations and the divestment of excess facilities
that burden Army budgets. Reducing the portfolio of Army facilities was
among the recommendations of the National Commission on the Future of
the Army (NCFA), established by Congress as part of the fiscal year
2015 National Defense Authorization Act (NDAA). The NCFA's report,
released in January 2016, states that ``Congress and the Administration
should look for cost-saving opportunities in areas such as . . . a
reduced inventory of military facilities.'' \1\ The report recommends
that the Army pursue these and other efficiency initiatives to free up
funds that could be used to meet warfighting needs and other high-
priority initiatives identified by the Commission.
---------------------------------------------------------------------------
\1\ National Commission on the Future of the Army, ``Report to the
President and Congress of the United States,'' 28 January 2016, p. 44:
Recommendation 5.
---------------------------------------------------------------------------
The Army has made every effort to be fiscally prudent in the
maintenance of excess infrastructure. The Army has employed its current
authority to minimize costs and maximize the use of existing
facilities. We have identified and are working to reduce excess
capacity overseas through the European Infrastructure Consolidation
(EIC) initiative, in addition to implementing efficiency measures
across the board. Nevertheless, the modest savings attained from these
efforts cannot substitute for the significant savings that can be
achieved through base realignments and closures. Without them, the Army
is forced to make deep cuts at our highest military value installations
because we continue spending scarce resources maintaining and operating
lower military value installations.
As the Army is planning to reduce its Active Component end strength
to 450,000 by fiscal year 2018, we will have over 170 million square
feet of facilities that are not fully utilized--an excess facility
capacity averaging 21 percent. Depending on the facility type, the
excess infrastructure ranges from 18 percent to 33 percent. At an
annual cost of about $3 per square foot to maintain these facilities,
the Army is incurring over $500 million a year in unnecessary
expenditures. If fiscal year 2018-2021 budget caps remain, the Army
will need to further reduce the number of soldiers, and our excess
capacity will continue to increase.
The Army cannot afford this status quo. Although Base Realignment
and Closure (BRAC) forces difficult choices affecting the local
communities surrounding our installations, they are already seeing
fewer soldiers and families as force structure continues to decline.
BRAC allows the Army to use a fair and non-partisan process to close a
few lower military value locations and realign the remaining missions
to help fill the excess capacity at our higher military value
installations.
Today, facilities needed to support readiness, training exercises,
airfields, and other priorities are deteriorating, while resources are
diverted to supporting installations that could be closed. The Army
cannot carry excess infrastructure costing over half a billion dollars
per year indefinitely. Half a billion dollars represents the annual
personnel costs of about 5,000 soldiers, which is slightly less than
the number assigned to a Stryker Brigade Combat Team. It represents
five annual rotations at the Army's Combat Training Centers, which are
the foundation of Army combat readiness.
Until we get the BRAC authority to analyze what types of excess
exist at individual installations and develop recommendations on how to
best consolidate into the highest military value installations we have,
we do not know which lower military value installations should be
closed and/or realigned. However, we do know BRAC is a proven process
producing significant reoccurring savings of roughly $2 billion per
year for the Army, as validated by the Government Accountability Office
(GAO). A future BRAC round has the capability to save the Army hundreds
of millions of dollars per year. Once the up-front costs are paid, the
intermediate and long-term savings from BRAC can fund any number of
important Army warfighter initiatives, including force structure,
additional CTC rotations, and modernization.
Not authorizing BRAC is a choice with real consequences. The lack
of authorization for a BRAC results in our highest military value
installations bearing the deepest impacts. This is an unacceptable
result for the Army and a disservice to American taxpayers.
The BRAC process is a proven, cost-effective means for reducing
costly excess infrastructure, while ensuring a continued focus on
efficiency and consolidation. The Army strongly supports DOD's request
for a BRAC round, and urges Congress to enact legislation in fiscal
year 2017 authorizing the Department to begin the process.
preserving ready installations
Army installations--where soldiers live, work, and train--are where
Army readiness is built to meet future challenges and ensure the
security of our nation. Increasing global threats generate installation
requirements for force protection, cyber security, and energy security.
Installation budgets provide the premier All-Volunteer Army with
facilities that support readiness and quality of life for our soldiers,
families, and civilians.
The Army continues to focus its limited resources on supporting
readiness initiatives and replacing failed facilities. As we remain
under pressure from current law budget caps, our installation services
must continually be adjusted. Increases in deferred maintenance and
reduced investments in installations and infrastructure ultimately
increase our growing backlog of failing facilities. This degrades the
Army's ability to be ready to project full spectrum forces over time.
Excess facility capacity burdens the Army sustainment and base
operations--consuming limited dollars that need to be better invested
elsewhere.
Sustainment, Restoration, and Modernization (SRM) accounts fund
investments to maintain and improve the condition of our facilities.
Periodic restoration and modernization of facility components are
necessary to ensure the safety of our soldiers and civilians. Efforts
are focused on preventing the degradation of our facilities and
optimizing the use of Army investments, to prevent small maintenance
issues from turning into large and expensive problems.
The fiscal year 2017 $3.1 billion budget request will help support
our sustainment and restoration requirements. However, the Army is
assuming risk in installation readiness to preserve operational
readiness. The $2.7 billion request for Sustainment meets 71% of our
Facility Sustainment Model for long-term sustainment, whereas DOD
recommended meeting an 80 percent threshold to stem the tide of further
facility degradation.
Reduced funding in the outyears for installation readiness
adversely impacts facility condition and ultimately increases future
military construction and restoration and modernization requirements.
This shifts the Army's investment focus to the worst facilities,
diverting resources needed to preserve our newest and best
infrastructure. Deferred sustainment over the long term can lead to
higher life-cycle repair costs and component failure, significantly
reducing facility life expectancy.
Responsibly managing over 12 million acres of real property also
means that the Army must maintain extensive base operations. Through
funding for Base Operations Support (BOS) accounts, Army installations
provide services similar to those associated with a municipality:
public works, security protection, logistics, environment, and Family
programs. These programs and services enable soldiers, civilians, and
families to live and work on 154 Army installations worldwide.
Balancing BOS needs in a changing global environment calls for
continued due diligence. The President's fiscal year 2017 budget
therefore requests a total of $9.43 billion for BOS accounts, including
$7.82 billion for the Active Component; $1.04 billion for Army National
Guard; and $573.8 million for Army Reserve.
investing in essential infrastructure
The Army's request for Military Construction provides secure and
sustainable facilities and infrastructure critical to supporting the
combatant commander's top priorities, enabling Army missions, and
maintaining soldier and unit readiness. For fiscal year 2017, the Army
requests just over $1 billion for Military Construction, a reduction of
$229 million--18 percent--from fiscal year 2016 appropriations. The
budget allocates $503 million (approximately 50 percent) for the Active
Component; $233 million (23 percent) for the Army National Guard; $68
million (7 percent) for Army Reserves; and $201 million (20 percent)
for Army Family Housing Construction.
The Army continuously reviews project scope and costs. We must
continue to adapt to evolving missions, account for emerging
organizational changes, and meet unit readiness needs, while
simultaneously seeking efficiencies at every opportunity. However,
funding for Army Military Construction has reached historically low
levels. This reduces the Army's ability to recapitalize inadequate and
failed facilities into infrastructure that supports operations,
readiness, and the welfare of the All-Volunteer Force.
The Army National Guard (ARNG) is the oldest component of the U.S.
Armed Forces. The Guard has courageously participated in every war and
every conflict this nation has ever fought, including Iraq and
Afghanistan, and is our first line of defense in responding to domestic
emergencies. These men and women perform an important mission for our
country, and our military construction budget endeavors to ensure that
the needs of their facilities are met.
The Guard's fiscal year 2017 Military Construction request is
$232.9 million. This includes $161.3 million to support seven Readiness
Centers, $50.9 million to construct three maintenance facilities, $12
million to fund minor projects, and $8.7 million for planning and
design. Our ARNG budget request is focused on recapitalizing readiness
centers--the heart and soul of the National Guard--as well as
maintenance facilities, training areas, ranges, and barracks to allow
the Guard to be ready to perform state and federal missions. These
projects will address space constraints and focus on replacing failing
facilities.
In the 2014 ARNG Readiness Center (RC) Transformation Master Plan,
a key finding was that the RC portfolio is experiencing ``critical
facility shortfalls.'' This budget request is a small step toward
addressing the ARNG's challenges.
The fiscal year 2017 budget request for the Army Reserve totals
$68.2 million, with four critical projects totaling $57.9 million.
Three of these will focus on replacing some of our most dilapidated and
failing facilities on Army Reserve installations that are in the most
dire need. This includes $21.5 million to replace an Emergency Services
Center at Fort Hunter Liggett, CA--currently in failing condition--
which will provide life-saving police, fire, crash and rescue, and
Emergency Medical Team (EMT) services. An additional $10.3 million will
support planning and design of future year projects, as well as to
address unforeseen critical needs through the Unspecified Minor
Military Construction account.
The Army Family Housing budget allows us to provide homes and
services to the soldiers and their families living on our installations
around the world. For fiscal year 2017, the Army requests $200.7
million for family housing construction. This will fund two projects in
Korea, at Camp Humphreys and Camp Walker, critical to supporting
consolidation and quality of life for our soldiers and their families.
The projects are necessary to eliminate dilapidated family housing
units and meet the U.S. Forces Korea (USFK) Commander's requirements
for housing. An additional $326 million is requested to help sustain
all family housing operations, cover utility costs, ensure proper
maintenance and repair of government family housing units, lease
properties where advantageous, and provide privatization oversight and
risk mitigation.
ensuring energy security
It is operationally necessary, fiscally prudent, and mission
essential that the Army have assured access to the energy required to
achieve our primary objectives for the United States. The Army has led
the way toward increasing energy efficiency on our installations,
harnessing new energy technologies to lessen soldier battery loads, and
improving our operational capabilities to reduce the need for fuel
convoys. Our installation energy budget request is focused on enhancing
mission effectiveness, and is supported by strong business case
analyses. For fiscal year 2017, the Army is requesting $1.716 billion
to pay utility bills on our installations, leverage private sector
investment in renewable energy projects, and invest in discrete energy
efficiency improvements.
In response to risks posed to our vulnerable energy grid, the Army
is improving the ``resiliency'' of its installations through the use of
on-base renewable sources of energy. A resilient Army installation is
one that can withstand threats to its security--be they power
interruptions, cyber-attacks, or natural disasters--and endure these
hazards to continue its own operations and those of the local
community. With this in mind, the Army conducted a test and temporarily
disconnected Fort Drum, NY from the energy distribution network this
past November, validating the installation's ability to operate
independently from the wider grid.
The Army leads the Federal Government in the use of Energy Savings
Performance Contracts (ESPCs) and Utility Energy Service Contracts
(UESCs), which allow private companies and servicers to provide the
initial capital investment needed to execute projects using repayments
from Utilities Services Program savings. The amount of energy saved by
Army ESPC and UESC projects awarded between fiscal year 2010 and fiscal
year 2015 is equal to the amount of energy consumed by Fort Bragg--one
of the Army's largest and most populous installations--in a year. In
total, the Army has reduced its facilities energy consumption by 22.6
percent since fiscal year 2003, while also leading the Federal
Government in reductions of its potable water intensity use and non-
tactical vehicle (NTV) fossil fuel use.
In addition, our energy program account funds the Office of Energy
Initiatives (OEI), which helps to plan and develop third party-financed
renewable energy projects. OEI currently has 14 projects completed,
under construction, or in the final stages of the procurement process--
together providing an incredible 350 megawatts (MW) of generation
capacity. These projects represent over $800 million in private sector
investment, saving funds that would otherwise be appropriated for
military construction. Further, all of these projects provide
electricity that is at or below the cost of conventional power.
The Army's operational energy initiatives seek to extend range and
endurance, increase flexibility, improve resilience, and enhance force
protection, all while enhancing mobility and freedom of action for our
soldiers. Operational energy investment in science and technology has
been a proven force multiplier, providing our soldiers with a distinct
advantage on the battlefield. Therefore, the bulk of our operational
energy budget request, $1.28 billion, is for investments in energy
efficient equipment that will reduce physical and logistical burdens on
our soldiers and, most importantly, help save lives.
Improved use of energy enhances mission capabilities. Our
operational energy program is focused on improving soldier power,
enhancing maneuver capabilities, advancing research and development of
new technologies, and more effectively supporting our contingency
bases. Working with the marines, we have reduced the battery weight
carried by infantry soldiers by 23 percent. We have deployed tactical
micro-grids and more efficient generators to our base camps, which
reduce the volume and frequency of fuel resupply. Since fuel and water
constitute 80 percent of our resupply convoy capacity by weight, these
improvements can decrease the number of convoys, reduces the
vulnerability of our soldiers, and frees up assets for other purposes.
The Army's energy program has proven results--reducing our reliance
on the grid, improving energy security and efficiency, and contributing
to mission readiness--all at a minimal impact to Army budgets. Energy
performance on our installations is a testament to the Army's success
in leveraging its limited resources to achieve considerable results. We
urge Congress to continue to support the Army's energy initiatives both
in operational and installation environments.
safeguarding our environment
The mission of the Army's environmental program is three-fold: (1)
to comply with environmental laws and regulations and ensure proper
stewardship of our natural, cultural, and Tribal resources; (2) to meet
DOD's goals for installation restoration and munitions response; and
(3) to invest in environmental technology research, development,
testing, and evaluation.
The Army manages over 12 million acres of land, which requires the
Army to protect endangered species and historic sites or structures.
Efforts are made to remediate environmental contaminants that pose a
danger to human health or the environment, while supporting Army
operations and our soldiers, families, and communities. Our fiscal year
2017 budget request of $1.05 billion will allow the Army to fulfill
these objectives, keeping the Army on track to meet our cleanup goals
and maintain full access to important training and testing lands, which
are integral components of Army readiness.
conclusion
Readiness is the U.S. Army's top priority--there is no other
``number one.'' The Army's fiscal year 2017 Military Construction
budget request takes moderate risk to ensure our readiness needs are
met by focusing our financial resources where they are needed most.
Maintaining failing facilities and low-military value installations
takes money away from critical investments in the readiness of our
soldiers and the acquisition of advanced weapons and technology. BRAC
allows the Army to optimize installation capacity and achieve
substantial savings, freeing up scarce resources that could easily be
applied elsewhere.
The strength of the U.S. Army is its people, and our installations
serve as the platforms for this strength. Without ready and resilient
installations, our soldiers will be ill-equipped to fight the growing
threats facing our nation. We owe it to our men and women who wear the
Army uniform to be prudent in the use of our installation budgets and
prioritize them appropriately to ensure they have the best resources
available to defend our homeland.
Thank you for the opportunity to present this testimony and for
your continued support of our soldiers, families, and civilians.

Senator Ayotte. Thank you, Secretary Hammack.
Secretary McGinn?

STATEMENT OF HONORABLE DENNIS V. McGINN, ASSISTANT SECRETARY OF
THE NAVY FOR ENERGY, INSTALLATIONS AND ENVIRONMENT

Mr. McGinn. Madam Chairman, Ranking Member Kaine, members
of the committee, thank you for the opportunity to discuss our
Department of the Navy's enterprise for installations.
This year's request is nearly $1.4 billion less than it was
for fiscal year 2016 for the same reasons that have been noted.
The prioritization on readiness and warfighting investments
have reduced the amount of money available to maintain our
ashore establishment.
That said, we have become very, very good at risk
management. We worry about things breaking, and we have been
very fortunate in a deliberate way from avoiding that to date.
But as you know, leaks do not fix themselves and old buildings
and facilities and utilities do not get better with age. So we
are in the business of making the case that every dollar that
is available for sustainment, for base operating supports, for
military construction has to address in a very deliberate way
the highest priorities to maintain readiness of all of our Navy
and Marine Corps installations to support the operating forces,
as well as to maintain a quality of life for our sailors,
marines, and their families and our civilian workforce.
We have, as the other services, invested in energy and, as
Senator Kaine pointed out, a lot of that is funded by third
party finance, which creates a win-win-win for the service, for
the people who are doing the work, and for the people who are
investing in those projects. We will continue to do that. It is
not, however, any type of long-term solution for underfunding
in our basic accounts.
With that, I will conclude my opening statement, and I look
forward to your questions.
[The prepared statement of Mr. McGinn follows:]

Prepared Statement by the Honorable Dennis V. McGinn
Chairman Ayotte, Ranking Member Kaine, and members of the
Subcommittee, I am pleased to appear before you today to provide an
overview of the Department of the Navy's (DON's) investment in its
infrastructure, energy, and environment programs.
Our Navy and Marine Corps installations and facilities are the
platform to train and prepare our marines and sailors, to deploy ships,
aircraft and operational forces, as well as to support our military
families. We are stewards of a large portfolio of installations--valued
at $229 billion ($173 billion Navy and $56 billion USMC, respectively)
in plant replacement value--that is vital to our operational forces.
Against the backdrop of world events and competing requirements and
resources, we must balance our desired level of funding with the
principal purposes for our existence: to optimize readiness of the
operational forces and preserve their quality of life. Readiness-
enablers include runways, piers, operations & maintenance facilities,
communications & training facilities, and utilities; those that enable
quality of life include barracks, mess halls, and recreation and
fitness centers. We have a responsibility to balance the investments
for this portfolio according to current year authorizations while being
mindful of the impacts to life cycle and ever-evolving mission
requirements.
investing in our infrastructure
We thank Congress for passage of the Bipartisan Budget Act (BBA) of
2015, the National Defense Authorization Act (NDAA) for fiscal year
(FY) 2016 and the Consolidated Appropriations Act, 2016. Although the
BBA of 2013 provided some budget stability for fiscal year 2014-2015,
and limited relief from the Budget Control Act (BCA) of 2011
sequestration levels, the unfortunate consequence of constrained DON
funding levels and timing is that many of our installations' piers,
runways, and other facilities are degrading. We continue to make
progress in replacing and demolishing unsatisfactory infrastructure,
yet still have challenges based on BCA caps and on the prospect of a
return to sequestration levels in fiscal year 2018.
In fiscal year 2017, the President's Budget (PB) is requesting
$11.9 billion in various appropriations, a 10.4 percent decrease
($1.4B) from amounts appropriated in fiscal year 2016 to operate,
maintain and recapitalize our shore infrastructure. Figure 1 compares
the fiscal year 2016 enacted budget and the Fiscal Year 2017 Presidents
Budget request by appropriation. Each appropriation is discussed more
fully in the following sections.

Figure 1.--DON Infrastructure Funding by Appropriation
----------------------------------------------------------------------------------------------------------------
FY2016
Appropriation enacted PB17 Delta Delta (%)
($millions) ($millions) ($millions)
----------------------------------------------------------------------------------------------------------------
Military Construction, Active and Reserve..................... 1,739 1,126 (613) (35.3%)
Family Housing, Construction.................................. 17 94 77 452.9%
Family Housing, Operaitons.................................... 353 301 (52) (14.7%)
BRAC.......................................................... 170 154 (16) (9.4%)
Sustainment, Restoration and Modernization.................... 3,110 2,356 (754) (24.2%)
Base Operating Support........................................ 7,625 7,610 (15) (0.2%)
Environmental Restoration, Navy............................... 300 282 (18) (6.0%)
Total..................................................... 13,314 11,923 (1,391) (10.4%)
----------------------------------------------------------------------------------------------------------------

We strive to maintain a shore infrastructure that is mission-ready,
resilient, sustainable and aligned with Fleet and operational
priorities. Toward that end, and especially important given the risks
inherent at these funding levels, Navy and Marine Corps have taken
actions to more proactively manage the installations portfolio. For
example, Navy has taken the initiative to:
Standardize the facility inspection and Facility
Condition Index (FCI) process that quantifies facility condition and
documents the needed maintenance and repair work within our facilities
portfolio. This information helps guide spending of available dollars.
Incorporate principles of condition-based maintenance
across all buildings, utilities and structures, in order to prioritize
work on only the most critical components (e.g. roofs and exterior
walls) at our most critical facilities or on components that relate to
life, health and safety. We are able to focus resources on specific
building components and systems where failure jeopardizes personnel
safety or a warfighting mission.
Led by Commander, Navy Installations Command, exercise a
single integrated forum to receive and adjudicate demand signals from
Fleet and Enterprise Commanders to identify and prioritize projects,
optimizing the available resources.
Maintain focus on reducing footprint by demolishing or
divesting unneeded buildings as funds are available, and recapitalizing
existing facilities in lieu of new construction when possible.
Supplement available appropriated dollars by the
increased use of authorities that leverage third party financing for
improving infrastructure while lowering energy consumption and energy
costs.
We support a DOD legislative proposal that would provide
temporary authority to classify facility conversion projects as repair
projects. This proposal would afford the Services the flexibility to
use operations and maintenance funding to repurpose existing
facilities. The proposal will help installations increase their
facility utilization, will enable increased efficiency and
effectiveness, and will support footprint reduction and energy
efficiency goals. The Navy will collect data to determine the
effectiveness of this proposal.
Military Construction (MILCON)
Navy's MILCON program funds infrastructure at home and abroad,
supports our warfighters, and meets the objectives in CNO's Design for
Maintaining Maritime Superiority and the Secretary of Defense's
Strategic Guidance. Together, Navy and Marine Corps will invest $1.13
billion worldwide in military construction funds to support warfighting
and modernization of our utilities and critical infrastructure.
For Navy, the fiscal year 2017 request is for 25 projects, Planning
and Design and Unspecified Minor Construction, at a budget of $700
million, which is 29 percent lower than the fiscal year 2016 as-enacted
budget of $986 million. Navy has invested an average of $1 billion
annually in MILCON since 2010, and the fiscal year 2017 request is the
lowest since 1999. Navy continues to invest prudently in MILCON, but
assumes long-term risk in deferring recapitalization of our existing
infrastructure.
The Navy's fiscal year 2017 MILCON request supports combatant
commander requirements, enables new platforms/missions, upgrades
utilities and energy infrastructure, recapitalizes Naval Shipyard
facilities, and supports weapons of mass destruction (WMD) training
requirements. They include:

Combatant Commander Support ($233 million, 9 projects)
Medical/Dental Facility-Camp Lemonnier Djibouti
Harden POL Infrastructure-NAVBASE Guam
Coastal Campus Utilities Infrastructure-NAVBASE Coronado
Coastal Campus Entry Control Point-NAVBASE Coronado
Communication Station-NAVSTA Rota
Grace Hopper Data Center Power Upgrades-NAVBASE Coronado
Missile Magazine-NAVWPNSTA Seal Beach
P-8A Hanger Upgrade-NSA Naples (Keflavik, Iceland)
P-8A Aircraft Rinse Rack-NSA Naples (Keflavik, Iceland)
New Platform/Mission ($198 million, 6 projects)
UCLASS RDT&E Hangar-Naval Air Station PAX River
Triton Mission Control Facility-NAS Whidbey Island
Triton Forward Operating Base Hangar-VARLOCS
EA-18G Maintenance Hangar-NAS Whidbey Island
F-35C Engine Repair Facility-NAS Lemoore
Air Wing Simulator Facility-NAS Fallon

Utilities and Energy Infrastructure ($85 million, 4 projects)
Upgrade Power Plant & Electrical Distribution System-PMRF Barking
Sands
Energy Security Microgrid-Naval Base San Diego
Service Pier Electrical Upgrades-Naval Base Kitsap
Shore Power (Juliet Pier)-COMFLEACT Sasebo

Naval Shipyards ($76 million, 4 projects)
Sub Refit Maintenance Support Facility-Naval Base Kitsap
Nuclear Repair Facility-Naval Base Kitsap
Utilities for Nuclear Facilities-Portsmouth Navy Shipyard (NH)
Unaccompanied Housing Consolidation-Naval Shipyard Portsmouth (NH)

WMD Training ($21 million, 1 project)
Applied Instruction Facility-NAS Whiting Field, Milton, FL

MILCON Reserves ($11 million, 1 project)
Joint Reserve Intelligence Center-NAS JRB New Orleans

For the Marine Corps, the fiscal year 2017 request is for 11
projects, Planning and Design and Unspecified Minor Construction, at a
budget of $426 million, which is 44 percent lower than the fiscal year
2016 as enacted budget of $754 million. Investments in MILCON will
primarily support new warfighting platforms, weapons support, force
relocation facilities (Rebalance to the Pacific, Aviation Plan),
improve security and safety posture, and recapitalize and replace
inadequate facilities. The 11 projects in the Marine Corps fiscal year
2017 MILCON budget include:
New Platform and Weapons Support Facilities ($110 million, 2 projects):
F-35 aircraft maintenance hangar at MCAS Beaufort, SC; and
F-35 aircraft maintenance shops at Kadena Air Base, Japan.

Facilities to Support Force Relocations/Increased Force Requirements
($119 million, 3 projects):
Aircraft maintenance hangar for VMX-22-MCAS Yuma;
Expansion of Reserve Center Annex-Galveston; and
Utility upgrades for Finegayan cantonment area--Guam.

Safety, Security, and Environmental Compliance ($31 million, 2
projects):
EPA-required central heating plant conversion-MCAS Cherry Point;
and
Range safety improvements at MCB Camp Lejeune.

Recapitalize and Replace Inadequate Facilities ($117 million, 4
projects):
Replace and consolidate communications, electrical, and maintenance
shops-MCB Hawaii;
Replace unreliable electrical power supply at reserve center-
Brooklyn, NY;
Replace reserve training facilities-Syracuse, NY; and
Modernize recruit barracks and construct a recruit reconditioning
center for injured recruits at MCRD Parris Island.

Reduced funding availability in MILCON will result in reduced
investments in projects that support the consolidation of functions or
replacement of existing facilities, which will cause degradation of the
long-term health of existing facilities.
Relocation of marines to Guam remains an essential part of the
United States' larger Asia-Pacific strategy of achieving a more
geographically distributed, operationally resilient and politically
sustainable force posture in the region. Guam provides a critically
important forward base for our expeditionary marine ground and air
forces and also provides key sustainment capabilities for our forward-
deployed ships and submarines. The permanent basing of marines in Guam
significantly contributes to maintaining regional stability and
provides reassurance for key allies and partners across the Pacific
region.
With the PB 2017 budget request, the Navy will exceed the minimum 6
percent mandated by 10 USC 2476 for depot capital investment. The Navy
has met this statutory requirement every year since its enactment in
2006.
Family Housing
The Department continues to rely on the private sector as the
primary source of housing for sailors, marines, and their families.
When suitable, affordable, private housing is not available in the
local community, the Department relies on government-owned, privatized,
or leased housing. The fiscal year 2017 request of $395 million
supports Navy and Marine Corps family housing operation, maintenance,
renovation, and construction requirements. Of this amount, $79 million
is for the first phase of replacement of inadequate family housing at
Naval Support Activity Andersen, Guam and $11 million is for the
renovation of family housing at Marine Corps Air Station Iwakuni,
Japan. The budget request also includes $301 million for the daily
operation, maintenance, and utilities expenses of the military family
housing inventory.
To date, over 62,000 Navy and Marine Corps family housing units
have been privatized through the Military Housing Privatization
Initiative (MHPI). MHPI has enabled the Department to leveraged private
sector resources to improve living conditions for sailors, marines, and
their families.
Facilities Sustainment, Restoration and Modernization (FSRM)
To maximize support for warfighting readiness and capabilities, the
President's fiscal year 2017 budget request continues to carefully
accept risk in FSRM.
The fiscal year 2017 budget requests $1.9 billionto sustain
infrastructure, a 16 percent reduction from the fiscal year 2016
enacted value of $2.3B. Navy and the Marine Corps have resourced fiscal
year 2017 facilities sustainment at 70 percent and 74 percent,
respectively, of the Department of Defense (DOD) Facilities Sustainment
Model. Over time, this lack of sustainment will cause our facilities to
deteriorate.
To restore and modernize our existing infrastructure, the fiscal
year 2017 budget request is $463 million, a 38 percent reduction from
the fiscal year 2016 enacted value of $749 million. Budget constraints
have compelled the Department to focus its limited resources to address
life/safety issues and the most urgent deficiencies at our mission-
critical facilities, piers, hangars, runways and utility systems. We
are committed to fully funding infrastructure at strategic weapons
facilities, accelerating Naval shipyard infrastructure improvements,
supporting the Marine Corps Aviation Plan, and force relocations.
However, as the Department defers less critical repairs, especially for
facilities not directly tied to DON's warfighting mission, certain
facilities degrade and the overall facilities maintenance backlog
increases. At current funding levels, the overall condition of DON
infrastructure will slowly, but steadily, erode over the Future Years
Defense Plan (FYDP). Although we are proactively managing the risk we
are taking in our shore infrastructure, we acknowledge that this risk
must eventually be addressed.
Base Operating Support (BOS)
The fiscal year 2017 BOS request of $7.6 billionis essentially the
same as fiscal year 2016 levels. Similar to the risk taken in our
facility investments, the Department is accepting lower standards in
base operating support at our installations. Base operations at Navy
and Marine Corps installations are funded to the minimum acceptable
standards necessary to continue mission-essential services. We have
enforced low service levels for most installation functions
(administrative support, base vehicles, grounds maintenance, janitorial
and facility planning) in order to maintain our commitment to
warfighting operations, security, family support programs, and child
development. These measures, while not ideal, are absolutely necessary
in the current fiscal environment.
Safety Program
Our initiatives are improving the skills of our Safety
Professionals directly benefiting over 800,000 personnel (uniformed
personnel (Active and Reserve) and civilian) executing diverse, complex
missions across the globe. DON's safety program has expanded its global
online training resources to ensure the Naval Safety workforce is
educated and trained through more effective and modernized cost
efficient methods. We are acquiring commercial off-the-shelf
information technology tools to enhance our tireless fight to reach our
objective of zero mishaps. The Risk Management Information initiative
will comprise a streamlined mishap reporting system, data base
consolidation, state-of-the-art analytical innovations, and data
capabilities to improve our predictive abilities for safer sailors and
marines.
managing our footprint
Base Realignment and Closure (BRAC)
We appreciate the Congressional support for additional fiscal year
2016 funds for environmental cleanup at BRAC properties. For fiscal
year 2017, the Department has planned to expend $154 million to
continue cleanup efforts, caretaker operations, and property disposal.
By the end of fiscal year 2015, we disposed of 94 percent (178,180
acres) of our excess property identified in previous BRAC rounds
through a variety of conveyance mechanisms. Of the remaining 6 percent
(11,674 acres), the majority is impacted by complex environmental
issues. Of the original 131 installations with excess property, Navy
only has 17 installations remaining with property to dispose.
Although many tough cleanup and disposal challenges remain from
prior BRAC rounds, we have fostered good working relationships with
regulatory agencies and local communities to tackle these complex
issues and provide creative solutions to support redevelopment
priorities.
Compatible Land Use
DON has an aggressive program to promote compatible land use
adjacent to our installations and ranges. This program helps Navy and
Marine Corps to operate and train in cooperation with surrounding
communities, while protecting important natural habitats and species.
We conduct Air Installation Compatible Use Zone Studies and Range Area
Compatible Use Zone Studies, and provide them to nearby communities for
their consideration in the exercise of their land management
responsibilities.
A key element of the program is Encroachment Partnering, which
involves cost-sharing partnerships with states, local governments, and
conservation organizations to acquire interests in real property
proximate to our installations and ranges.
The Department is grateful to Congress for providing funds for the
DOD Readiness and Environmental Protection Integration (REPI) Program.
Since 2005, DON has acquired restrictive easements on approximately
91,000 acres.
protecting our environment
The Department is committed to environmental compliance,
stewardship and responsible fiscal management that support mission
readiness and sustainability, investing over $1 billionacross all
appropriations to achieve our statutory and stewardship goals. The
funding request for fiscal year 2017 is about 2.3 percent less than
enacted in fiscal year 2016, as shown in Figure 2:

Figure 2.--DON Environmental Funding by Program
----------------------------------------------------------------------------------------------------------------
FY2016
Category enacted PB17 Delta Delta (%)
($millions) ($millions) ($millions)
----------------------------------------------------------------------------------------------------------------
Conservation.................................................. 86 93 7 8.1%
Pollution Prevention.......................................... 22 19 (3) (13.6%)
Compliance.................................................... 480 485 5 1.0%
Technology.................................................... 36 37 1 2.8%
Active Base Cleanup (ER,N).................................... 300 282 (18) (6.0%)
BRAC Environmental............................................ 158 141 (17) (10.8%)
Total..................................................... 1,082 1,057 (25) (2.3%)
----------------------------------------------------------------------------------------------------------------

The Department continues to be a Federal leader in environmental
management by focusing resources on achieving specific environmental
goals, implementing efficiencies in our cleanup programs and regulatory
processes, proactively managing emerging environmental issues, and
integrating sound policies and lifecycle cost considerations into
weapon systems acquisition to achieve cleaner, safer, more energy-
efficient and affordable warfighting capabilities without sacrificing
operational capability.
In fiscal year 2017 we will complete environmental planning for
Navy's Records of Decision (RODs) for EA-18G Growler training at
Whidbey Island, Washington. As an example of our land stewardship
responsibilities, we will complete natural and cultural surveys to
support Marine Corps air and ground training at Twentynine Palms,
California. To maintain our environmentally responsible operations at
sea, we will continue to be leaders in ocean research by studying
marine mammal behavioral response to sound in water. We will also build
on our accomplishments this past fiscal year, which included finalizing
the environmental planning processes for the new Marine Corps Base on
Guam; completing a five year authorization for testing and training in
the Marianas Island Testing and Training area with National Marine
Fisheries Service; and successfully rearing five hundred hatchlings and
releasing thirty five mature tortoises with the University of
California, Los Angeles (UCLA) at the Marine Corps Twentynine Palms
Desert Tortoise Head Start Facility.
Coastal installations and the communities in which our sailors,
marines, civilians and their families live are especially vulnerable to
rising sea levels and increased storm surge resulting from a changing
climate. The resilience of these installations and communities is
essential to future readiness associated with all naval mission areas.
The DON continues to develop relevant policy and guidance to address
climate change challenges.
enhancing combat capabilities
The Department of the Navy's Energy Program has two central goals:
(1) enhancing Navy and Marine Corps combat capabilities, and (2)
advancing energy security afloat and ashore. Partnering with other
government agencies, academia and the private sector, we strive to meet
these goals with the same spirit of innovation that has marked our
history--new ideas delivering new capabilities in the face of new
threats.
Our naval forces offer us the capability to provide power and
presence--to deter potential conflicts, to keep conflicts from
escalating when they do happen, and to take the fight to our
adversaries when necessary. Presence means being in the right place,
not just at the right time, but all the time; and energy is key to
achieving that objective. Using energy more efficiently allows us to go
where we're needed, when we're needed, stay there longer, and deliver
more firepower when necessary.
Improving our efficiency and diversifying our energy sources also
saves lives. During the height of operations in Afghanistan, we were
losing one marine, killed or wounded, for every 50 convoys transporting
fuel into theater. That is far too high a price to pay. Reducing demand
at the tip of the spear through energy efficiency, behavior change and
new technologies takes fuel trucks off the road.
I'll mention just a couple of examples. The work that the Marine
Corps is doing to integrate solar power and software into autonomous
UAVs will allow them to take advantage of environmental conditions and
provide persistent surveillance for periods far in excess of our
current capabilities without refueling. They are also working on
technologies that harvest kinetic and other forms of energy into an
integrated power system capable of running a marine's radios and
electronic gear. These are real combat capabilities that will result in
increased lethality.
Navy is pursuing similar combat capabilities. In 2016 we will begin
installing hybrid electric drives in our destroyers, enabling our ships
to remain on station longer during low speed missions and extend time
between refueling. This is the same technology that is now onboard USS
Makin Island and USS America, allowing those ships to stay on station
between refueling far longer than their predecessors.
Improving Energy Security and Resilience
Reliable and affordable electricity at our installations is
critical to mission effectiveness. Measures to reduce vulnerability and
to increase resiliency of the electrical system improve and protect
national security. The 2013 attack on key grid infrastructure in
California is a reminder of how fragile the commercial system can be.
The Department of the Navy recognizes this vulnerability and is working
to enhance our energy security.
Navy's Renewable Energy Program Office (REPO) has brought one
gigawatt (GW) of renewable energy into procurement. We expect those
renewable energy projects to yield hundreds of millions in projected
utility cost savings and even more important energy security benefits.
For example, last August we celebrated the procurement of 210 megawatts
(MW) of solar generation for 14 installations in California, with a
projected cost savings of $90 million over a 25-year term. At Naval
Submarine Base Kings Bay, Georgia Power Company is constructing a 42 MW
solar generation facility, which the base will have access to during
external grid outages. Marine Corps Logistics Base Albany will receive
access to a 44 MW on-base solar generation facility for use during grid
outages and a second feeder line from Georgia Power Company's grid.
DON's successful industry partnerships form a foundation for future
third party-financed energy resiliency projects in the form of
microgrids, battery storage, fuel cells, and distributed generation,
where these capabilities make sense. Industry has shown interest in
battery storage by proposing facilities located at two Navy
installations in California. The Arizona Power Service recently signed
an agreement to develop a microgrid at Marine Corps Air Station Yuma
and will provide the base unlimited access to onsite backup power,
eliminating the need for up to 41 diesel generators. These and future
energy security efforts using existing title 10 authorities will help
make DON's installations more energy secure and resilient mission
platforms.
Strategic Investments in the Future
We endeavor to make investments that enhance our operational
flexibility. Our program to test and certify emerging alternative fuels
is critical for us to keep pace with developments in the private sector
and maintain interoperability with commercial supply chains. In
addition, the Defense Logistics Agency (DLA) Energy (through which Navy
buys operational fuels) recently awarded a contract to provide us with
an alternative fuel blend of F-76--the fuel we use to power our ships.
The contract was awarded at a cost competitive rate with traditional
fossil fuels and represents an important step toward diversifying our
fuel supply chains.
conclusion
Navy-Marine Corps Energy, Installations and Environment team will
continue to carefully and deliberately manage our portfolio to optimize
mission readiness, and improve quality of life. The Department's fiscal
year 2017 request makes needed investments in our infrastructure and
people, preserves access to training ranges, and promotes
environmentally prudent and safe actions, while ensuring energy
resiliency and security.
Thank you for the opportunity to testify before you today. I look
forward to working with Congress to deliver an innovative, resilient,
sustainable and secure shore infrastructure that enables mission
success for the United States Navy and Marine Corps, the most
formidable expeditionary fighting force in the world.

Senator Ayotte. Thank you, Secretary McGinn.
Secretary Ballentine?

STATEMENT OF HONORABLE MIRANDA A.A. BALLENTINE,
ASSISTANT SECRETARY OF THE AIR FORCE FOR INSTALLATIONS,
ENVIRONMENT AND ENERGY

Ms. Ballentine. Good afternoon, Chairwoman Ayotte, Ranking
Member Kaine, distinguished members of the committee. It is a
great honor and pleasure to represent America's airmen before
you today.
Look, the bottom line for the Air Force is that our
installations are too old, too big, and too expensive to
operate. Twenty-four years of continuous combat really have
taken their toll.
Like the other services, in order to afford other Air Force
priorities, our total fiscal year 2017 PB [President's Budget]
facilities request at $8.3 billion is down 4 percent compared
to last year. That includes MILCON, FSRM [facilities
sustainment, restoration, and modernization], environmental
accounts, former BRAC implementation, and environmental
programs.
The Air Force has prioritized MILCON this year over FSRM,
requesting $1.8 billion in MILCON, which is actually up 14
percent compared to last year, and $2.9 billion in FSRM, which
is down about 10 percent compared to last year.
I expect our backlog of degrading facility requirements to
grow.
Our MILCON program is three-tiered similar to the other
services. First, we support combatant commanders' requests at
about 16 percent of our MILCON budget this year. Second, 34
percent of our budget supports the beddown of new weapon
systems to ensure that they have the facilities required.
Third, about 40 percent of our fiscal year 2017 MILCON request
this year allows us to begin to chip away at that significant
backlog of existing infrastructure recapitalization needs.
In fiscal year 2017, we funded only about 30 of the 500 top
priority projects that our MAJCOM [major command] commanders
submitted, about 30 of the 500.
Let me briefly address the Air Force energy programs. The
Air Force is focused on mission assurance through energy
assurance. We are taking a holistic enterprise approach to our
installation energy programs with an emphasis on resilient,
cost effective, cleaner energy projects.
The Air Force is also developing, acquiring, and improving
aviation energy technologies and behaviors to improve the range
and endurance of our weapon systems.
Finally, the Air Force does need another round of base
realignment and closure. We have about 30 percent excess
infrastructure capacity. Since the Gulf War, we have reduced
our combat-coded fighter squadrons from 134 to 55. That is a
nearly 60 percent reduction. Yet, all BRACs in that time have
only reduced U.S. bases by about 15 percent. BRAC is not easy.
Congress has laid out three very specific concerns, which
you reiterated today in your opening statements.
First, communities. Air Force communities are some of our
greatest partners. Our friends and our families live there. The
Association of Defense Communities recently asked community
leaders what they thought about BRAC, and 92 percent said that
they believe BRAC is better for their communities than the
status quo of hollowed-out bases, reduced manning, and reduced
funding. Without BRAC, many communities will continue to suffer
the economic detriment of hollowed-out bases without the
economic benefits that only BRAC legislation brings.
Second, cost. Congress rightly wants to ensure that the
savings of BRAC justify the costs, and we agree. Simply put,
the results for the Air Force have been staggering. Previous
rounds of BRAC save the Air Force $2.9 billion each and every
year. The Air Force supports new BRAC legislation that
emphasizes recommendations that yield net savings within 5
years.
Third, mission. Some have questioned the wisdom of right-
sizing infrastructure to current force structure. We have no
intent to close infrastructure that may be needed for future
missions. Through five previous rounds of BRAC and numerous
force structure changes, we have always left room for future
maneuvering, and we always will.
We continue to leverage community partnerships, enhanced
use leases, power purchase agreements, but we really need BRAC
authority to significantly reduce our spend on installations.
In closing, the Air Force has made hard, strategic choices
during this budget request, attempting to strike that delicate
balance between readiness and modernization. We believe it is
the right way ahead.
Chairman Ayotte, Ranking Member Kaine, members of the
committee, I ask for your full support of the Air Force 2017
program, and I thank you for questions.
[The prepared statement of Ms. Ballentine follows:]

Prepared Statement by Miranda A. A. Ballentine
Miranda A.A. Ballentine is the Assistant Secretary of the Air Force
for Installations, Environment, and Energy, Headquarters U.S. Air
Force, the Pentagon, Washington, DC. Ms. Ballentine is responsible for
the oversight, formulation, review and execution of plans, policies,
programs and budgets for installations, energy, environment, safety and
occupational health.
Prior to assuming her current position, Ms. Ballentine served as
the Director of Sustainability for Global Renewable Energy and
Sustainable Facilities at Walmart Stores, Inc. In this role, she
developed and executed global strategies to reduce operating expenses
in over 10,000 facilities in over 25 countries. Through acceleration of
renewable energy, energy efficiency, and sustainability, Ms. Ballentine
identified over $1 billion in potential annual expense reductions and 9
million metric ton of potential avoided greenhouse gas emissions.
Prior to joining Walmart, Ms. Ballentine was Vice President for
Investor Analysis and Chief Operating Officer at David Gardiner &
Associates, where she informed multi-million dollar investment
decisions by analyzing companies' off-balance sheet risks and
opportunities, including climate and energy programs, environmental
management, labor relations, diversity, and corporate governance.
Ms. Ballentine previously served as the chair of the World Economic
Forum's Global Growth Action Alliance's Renewable Energy Working Group,
as well as a number of non-profit boards, including the Sustainability
Consortium's External Relations Committee; the NetImpact Corporate
Advisory Council; and the George Washington University's Institute for
Sustainability Research, Education, and Policy Advisory Board.
In 2013, Ms. Ballentine was selected by the World Economic Forum
for membership in its Forum of Young Global Leaders. Ms. Ballentine
also serves as a guest lecturer at a number of national business
schools, including Duke University, University of North Carolina, and
George Washington University.
education
1996 Bachelor of Science Degree in Psychology, Colorado State
University, Magna cum Laude
2004 Master of Business Administration in Environmental Management
and Policy and International Business, George Washington University
career chronology
1. 2001 - 2004, Operations Director, Solar Electric Light Fund,
Washington, DC.
2. 2003 - 2008, Vice President of Investor Analysis and Chief
Operation Officer, David Gardiner & Associates, LLC, Washington, DC.
3. 2008 - 2014, Director of Sustainability for Renewable Energy
and Sustainable Buildings, Walmart, Washington, DC.
4. 2014 - present, Assistant Secretary of the Air Force for
Installations, Environment, and Energy

(Current as of October 2015)
introduction
Ready and resilient installations are a critical component of Air
Force operations. Unfortunately, twenty-four years of continuous
combat, a fiscal environment constrained by the Budget Control Act
(BCA), and a complex security environment have taken their toll on Air
Force infrastructure and base operations support investments.
Furthermore, the Air Force is currently maintaining installations that
are too big, too old and too expensive for current and future needs.
This forces us to spend scarce resources on excess infrastructure
instead of operational and readiness priorities.
Air Force installations are foundational platforms comprised of
both built and natural infrastructure. Our installations serve as the
backbone for Air Force enduring core missions delivering air, space and
cyberspace capabilities; sending a strategic message to both allies and
adversaries signaling commitment to our friends and intent to our foes;
foster partnership-building by stationing our airmen side-by-side with
our Coalition partners; and enable worldwide accessibility when our
international partners need our assistance and, when necessary, to
repel aggression. Taken together, these strategic imperatives require
us to provide efficiently operated, sustainable installations to enable
Air Force core missions.
The total Air Force fiscal year (FY) 2017 facilities budget request
is down 4 percent from fiscal year 2016 at $8.5 billion including
Military Construction (MILCON), Facility Sustainment, Restoration and
Modernization (FSRM), Housing, BRAC implementation and Environmental
programs. As in fiscal year 2016, the Fiscal Year 2017 President's
Budget (PB) request for the Air Force attempts to strike the delicate
balance between a ready force today and a modern force for tomorrow
while also continuing its recovery from the impacts of sequestration
and adjusting to sustained budget reductions. The result is the Air
Force facilities budget accepts near term risk in the entire
infrastructure Maintenance and Repair portfolio of MILCON and
Sustainment, Restoration and Modernization accounts in order to protect
readiness and maintain credible capabilities in other core missions. In
doing so, it acknowledges this choice will have long term effects on
the overall health of infrastructure.
The Air Force's Fiscal Year 2017 President's Budget includes $1.8
billion in Military Construction (MILCON) requirements, a 14 percent
increase over the Fiscal Year 2016 President's Budget. This allows the
Air Force to replace degraded facilities that can no longer wait, while
still meeting combatant commander (COCOM) needs and new weapon systems
beddown requirements that must be accomplished now. This also allows us
to provide an equitable distribution of $333 million to the Guard and
Reserve components. This increase was funded by reductions in our
Sustainment, and Restoration and Modernization accounts for which we
request $2.9 billion, about 10 percent less than last year. We
recognize this reduction will expand a backlog of facility investment
requirements that already totals nearly $20 billion. To assure
continued focus on taking care of our airmen and their families, the
Fiscal Year 2017 President's Budget also requests $274 million for
Military Family Housing operations and maintenance, and $61.4 million
for Military Family Housing Construction, $56.4 million for Base
Realignment and Closure and $842 million for Environmental programs.
military construction
The fiscal year 2017 MILCON program consists of three primary
tiers. The first is support to the COCOMs; the second is providing
facilities for the beddown of new weapons systems by their need dates;
and the third is replacing our most critical existing mission degraded
infrastructure on a worst-first basis.
COCOM Support
This year's President's Budget request includes $293 million for
COCOM requirements; $35 million for Central Command (CENTCOM), $97
million for European Command (EUCOM), $29 million for Northern Command
(NORTHCOM), and $293 million for Pacific Command (PACOM). The Air Force
continues with phase three of the U.S. European Command Joint
Intelligence Analysis Center consolidation at Royal Air Force (RAF)
Croughton, United Kingdom, which also supports four other COCOMs.
Additionally, the Asia-Pacific Theater remains a focus area for the Air
Force where we will make a $109 million investment in fiscal year 2017
to ensure our ability to project power into areas which may challenge
our access and freedom to operate, and continue efforts to improve
resiliency. Guam remains one of the most vital and accessible locations
in the western Pacific. For the past ten years, Joint Region Marianas
(JRM)-Andersen AFB, Guam has housed a continuous presence of our
Nation's premier air assets, and will continue to serve as the
strategic and operational center for military operations in support of
a potential spectrum of crises in the Pacific. Additionally, fiscal
year 2017 investments in the Pacific Theater include Kadena Air Base,
Japan; Royal Australian Air Force Base (RAAF) Darwin, Australia; and
the Commonwealth of Northern Marianas Islands (CNMI).
To further support PACOM's strategy, the Air Force is committed to
hardening critical structures, mitigating asset vulnerabilities,
increasing redundancy, fielding improved airfield damage repair kits
and upgrading degraded infrastructure as part of the Asia-Pacific
Resiliency program. In 2017, the Air Force plans to construct a
Satellite Communications Command, Control, Communications, Computers
and Intelligence facility at JRM-Andersen AFB, Guam to sustain Guam's
continued functionality. The Air Force also intends to recapitalize the
munitions structures in support of the largest munitions storage area
in the Air Force. Furthermore, the fiscal year 2017 budget invests in
the aircraft parking apron expansion and aircraft maintenance support
facility projects at RAAF Darwin supporting the Air Force's
participation in bilateral training exercises. The fiscal year 2017 PB
investment also includes a land acquisition in CNMI, to support the Air
Force's operational capability to execute weather diverts, accomplish
training exercises and respond to natural disasters. Our total fiscal
year 2017 COCOM support makes up 16 percent of the Air Force's MILCON
request.
New Mission Infrastructure
The Fiscal year 2017 President's Budget request includes $623
million of infrastructure investments to support the Air Force's
modernization programs, including the beddown of the F-35A, KC-46A,
Combat Rescue Helicopter (CRH) and the Presidential Aircraft
Recapitalization. The Air Force's ability to fully operationalize these
new aircraft depends not only on acquisition of the aircraft
themselves, but also on the construction of the aircraft's accompanying
hangars, maintenance facilities, training facilities, airfields and
fuel infrastructure.
The fiscal year 2017 PB includes $132.6 million for the beddown of
the KC-46A at five locations. This consists of $11.6 million at Altus
AFB, Oklahoma, the Formal Training Unit (FTU); $8.6 million at
McConnell AFB, Kansas, the first Main Operating Base (MOB 1); $1.5
million at Pease International Tradeport Air National Guard Base
(ANGB), New Hampshire, the second Main Operating Base (MOB 2); $17
million at Tinker AFB, Oklahoma, for KC-46A depot maintenance; and
$93.9 million at Seymour Johnson AFB, NC, the preferred alternative for
the third Main Operating Base (MOB 3).
This request also includes $340.8 million for the beddown of the F-
35A at five locations consisting of $10.6 million at Nellis AFB,
Nevada; $20 million at Luke AFB, Arizona; $10.1 million at Hill AFB,
Utah; $315.6 million at Eielson AFB, Alaska; and $4.5 million at
Burlington International Airport, Vermont. Additionally, the fiscal
year 2017 investment includes $7.3 million in support of the CRH
beddown at Kirtland AFB, New Mexico. As the Air Force continues its
efforts to modernize its fleet, we have moved forward to select
installations to beddown our newest airframes. In January of this year,
we announced the enterprise and criteria for the fourth KC-46A Main
Operation Base (MOB 4).
In preparation for the Presidential Aircraft Recapitalization
acquisition, the Air Force's 2017 budget request accounts for the
planning and design requirements essential to this future beddown and a
project to relocate the Joint Air Defense Operations Center Satellite
Site at Joint Base Andrews, Maryland.
Existing Mission Infrastructure Recapitalization
This year's President Budget request also includes $723 million in
MILCON recapitalization projects addressing existing mission
infrastructure. Existing mission projects include requirements that
revitalize the existing facility plant and projects that address new
initiatives for capabilities already contained in the Air Force
inventory. The Air Force's fiscal year 2017 PB supports Nuclear
Enterprise priorities and includes three MILCON projects, totaling $41
million. With this budget submission, the Air Force intends to provide
a Missile Transfer Facility at F.E. Warren AFB, Wyoming, which
recapitalizes the current facility and continues to ensure proper
processing of missiles in support of the Missile and Alert Launch
Facilities at three sites. The fiscal year 2017 budget also includes a
Consolidated Communications Facility recapitalization project at
Barksdale AFB, Louisiana. Additionally, a new Missile Maintenance
Dispatch Facility at Malmstrom AFB, Montana will be built in support of
the UH-1 Helicopter and Tactical Response Force facilities beddown.
Together, these projects will consolidate scattered installation
functions and provide adequately sized and configured operating
platforms for the UH-1 recapitalization. Additionally, the fiscal year
2017 PB request includes three munitions storage projects to
accommodate the realignment and relocation of primary Standard Air
Munitions Package assets from McConnell Air Force Base, Kansas to Hill
Air Force Base, Utah.
The Air Force's fiscal year 2017 PB supports airfield
recapitalization requirements to include a project to construct an
updated, properly sized Air Traffic Control Tower at McConnell Air
Force Base, Kansas and a new aircraft maintenance hangar in support of
the Global Hawks at JRM-Andersen AFB, Guam. Additionally, the Air
Force's Fiscal Year 2017 PB supports force protection recapitalization
requirements to include a project that constructs a compliant main gate
complex at RAF Croughton, United Kingdom and new Combat Arms Training
Maintenance facilities at Buckley Air Force Base, Colorado, Yokota Air
Base, Japan, and Joint Base-Andrews, Maryland.
In total, our fiscal year 2017 request represents a balanced
approach ensuring critical infrastructure requirements to meet mission
needs and operational timelines.
facility sustainment, restoration and modernization
In fiscal year 2017, the Air Force requests $2.9 billion for
Facilities Sustainment, Restoration and Modernization (FSRM), which is
approximately 10 percent less than our fiscal year 2016 PB request and
funds sustainment to 77 percent of the OSD modeled requirement. The
Restoration and Modernization account is reduced by 34 percent in
fiscal year 2017 as compared to fiscal year 2016. The Air Force cut
this account in order to increase the MILCON program and therefore
reduce the greatest risk within the facility infrastructure portfolio
this year. Nonetheless, the Air Force's fiscal year 2017 FSRM request
attempts to keep ``good facilities good'' as the AF continues to focus
limited resources on ``mission critical, worst-first'' facilities
through application of asset management principles.
housing
During periods of fiscal turmoil, we must never lose sight of our
airmen and their families. Airmen are the source of Air Force airpower.
Regardless of the location, the mission, or the weapon system, our
airmen provide the innovation, knowledge, skill, and determination to
fly, fight and win. There is no better way for us to demonstrate our
commitment to servicemembers and their families than by providing
quality housing on our installations. The Air Force has privatized its
military family housing (MFH) at each of its stateside installations,
including Alaska and Hawaii. The Air Force has 32 projects at 63 bases,
with an end-state of 53,240 homes and we are now focused on long-term
oversight and accountability of the sustainment, operation and
management of this portfolio.
Concurrently, the Air Force continues to manage approximately
18,000 government-owned family housing units at overseas installations.
Our $274 million fiscal year 2017 Family Housing Operations and
Maintenance (O&M) sustainment funds request allows us to sustain
adequate units and improve inadequate units, and our $61.4 million
request for Family Housing Construction funds improves 204 tower units
at Camp Foster, Okinawa and 12 units on Kadena Air Base. This request
will ensure we support the housing requirements of our airmen and their
families as well as the Joint Service members the Air Force supports
overseas.
Similarly, our focused investment strategy for dormitories enables
the Air Force to achieve the DOD goal of 90 percent adequate dormitory
rooms for permanent party unaccompanied airmen, while continuing to
support airmen in formal training facilities. The fiscal year 2017 PB
MILCON request includes two training dormitories at Fairchild AFB,
Washington and Joint Base San Antonio, Texas. With Congressional
support, we will continue to ensure wise and strategic investment in
these quality of life areas to provide modern housing and dormitory
communities. More importantly, your continued support will take care of
our most valued asset--our airmen and their families.
air force community partnership program
In support of the Air Force priority to ``make every dollar
count'', the Air Force has put a concentrated effort to cultivate
partnerships between our installations and the local communities. The
Air Force Community Partnership program has been heralded by our Wing
Commanders and community leaders as an ideal forum for exploring win-
win partnerships. To date, there are 53 installations and communities
participating in the Air Force Community Partnership program. Since the
program's inception in 2013, we have completed more than 140
partnership agreements that have generated over $23 million in Air
Force benefits and $24 million in community benefits. Beyond the
tangible savings, the program creates an invaluable forum for fostering
relationships and promoting innovation. Installations and communities
now have the framework and tools needed to finalize many of the over
1,000 potential initiatives identified to date, such as shared medical/
EMT training, joint small arms ranges, and shared refuse management
services.
Without losing focus on fostering a partnership mentality across
the Air Force, we are now turning our attention to cultivate
initiatives that show significant promise of large returns-on-
investment (ROI) or have Air Force-wide application. In the future, the
Air Force Community Partnership program will continue to strengthen its
foundation by building upon concepts under development while
reallocating resources towards initiatives with large returns on
investment.
Of course, we need your help to pursue the initiative, which has,
by far, the largest return-on-investment--Base Realignment and Closure.
base realignment and closure (brac)
The Air Force has more infrastructure capacity than our missions of
today and tomorrow require. Our numbers of aircraft and personnel have
drawn down significantly since the Cold War. Since the last round of
BRAC in 2005, we have continued to drawdown our forces, but we have not
paired these drawdowns with comparable reductions in our
infrastructure. Since BRAC 2005, the Air Force has thousands fewer
personnel and hundreds fewer aircraft in our planned force structure,
yet we have not closed a single installation in the United States.
Ultimately, we are paying to retain more installations than we require,
and that money could be used to recapitalize and sustain our weapons
systems, on readiness training, and on investing in airmen quality of
life programs.
Congress has expressed concerns that BRAC may cost too much, is
often hard on communities, and may not adequately consider potential
future growth of our forces.
Regarding cost, Air Force experience shows that BRAC provides
significant savings. BRAC pays for itself. In each prior round of BRAC,
including BRAC 2005, the Air Force achieved net savings during the
implementation period. Couple that with the plain truth that the Air
Force simply cannot afford to maintain our current infrastructure
footprint, and our request for BRAC makes fundamental economic sense.
The Air Force has a $20 billion facility investment backlog. We
estimate (parametrically) that we currently have about 30 percent
excess infrastructure capacity when measured against our fiscal year
2019 force structure. Sustaining and maintaining this extra
infrastructure further strains our limited funds by forcing us to
spread them even thinner to support infrastructure that we simply do
not need. Without previous rounds of BRAC, the Air Force infrastructure
bill would be about $3 billion higher each year than it is now. BRAC
has been effective in reducing our infrastructure cost and we need
another round to truly align our infrastructure to our force structure.
We acknowledge there will be upfront costs, but those costs are the
down payment to significant savings in the future.
Regarding BRAC's impact on communities, we understand that Air
Force installations are key components of their communities. These
communities house not only our missions but also our families; our kids
go to the local schools; our airmen attend the local sporting events;
our families volunteer across the spectrum of activities--these
communities are our neighbors. With that in mind, the Association of
Defense Communities asked our neighbors what they thought about BRAC,
and 92 percent of community leaders \1\ believe BRAC is better for
their community than the status quo of hollowed bases, reduced manning
and minimal investment. As BRAC is, by nature, a consolidation effort,
some installations will be the recipients of new missions and these
communities will benefit from the economic boost that increased
installation activity will provide. Other installations will close;
however, it is only under BRAC that communities whose bases are closing
will receive direct economic support through redevelopment guidance and
financial assistance. Based on prior rounds of BRAC, communities in
which bases closed had lower unemployment rates and higher per capita
income growth than national averages \2\. Additionally, the Air Force
is committed to partnering with DOD, Congress, and communities to
consider alternative approaches to the prolonged BRAC analysis and
selection process that puts an economic drag on all communities
surrounding military installations. In sum, without a BRAC, the Air
Force will continue to spread out our people and force structure, and
as this occurs many communities will continue to suffer the economic
detriment of hollowed out bases without the economic support that BRAC
legislation provides. This lose-lose scenario can only be reversed
through BRAC.
---------------------------------------------------------------------------
\1\ From the June 2015 Association of Defense Communities National
Summit at which General Session audience members were asked: ``What
would be worse for defense communities?'' and chose from ``Status Quo''
or ``BRAC''.
\2\ From Government Accountability Office (GAO) studies GAO-05-138
and GAO-13-436
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Finally, Congress has expressed concerns that a BRAC will enable
reductions in infrastructure that do not account for potential future
force structure growth. In asking for the authority to permanently
reduce our infrastructure footprint, the Air Force has considered both
its needs for today and its needs for the future. The Air Force has no
intent to close infrastructure that may support any realistically
achievable surge or contingency needs of the future. While we estimate
30 percent excess infrastructure capacity, the Air Force would build
specific reduction targets on future needs, and seek to reduce only
infrastructure that exceeds future scenarios. BRAC would be driven
first by a military value assessment grounded in operational needs, and
would not compromise future growth in force structure. In comparing
infrastructure capacity with force structure requirements going back to
the 1990s, the Air Force has never dipped below 20 percent excess
infrastructure capacity \3\ despite numerous force structure changes
and five previous rounds of BRAC. Thus, we believe we have the
opportunity to significantly reduce excess capacity while ensuring more
than adequate infrastructure to support any envisioned force structure.
Further, we are certain that BRAC provides the most effective means for
our infrastructure to achieve the right balance of effectiveness,
efficiency, and support to AF missions.
---------------------------------------------------------------------------
\3\ From DOD reports to Congress on BRAC and capacity in April 1998
and March 2004 in accordance with section 2912 of the Defense Base
Closure and Realignment Act of 1990
---------------------------------------------------------------------------
climate change
The 2010 and 2014 Quadrennial Defense Reviews (QDRs) recognized
that climate change will shape DOD's operating environment, roles, and
missions, and that we will need to adjust to the impacts of climate
change to our facilities, infrastructure and military capabilities. As
part of a larger DOD effort, the Air Force recently collected data from
over 1,500 sites regarding impacts from past severe weather events.
Surveyed sites not only included major installations, but also radar/
communications sites, housing annexes, training ranges, missile sites,
etc. Sixty percent of all sites reported some impact due to past
flooding, extreme temperatures, drought, wildfire, and wind. The single
most prevalent factor was drought which accounted for 42 percent of all
reported impacts, followed by non-storm surge flooding and wind with 19
percent each. Further, roughly a third of the 78 sites within 2
kilometers of the coast reported having experienced storm surge
flooding.
There are several pertinent examples of how climate change is
affecting our plans for current and future infrastructure operations.
The Air Force recently completed a study on the risks of coastal
erosion to remote Alaskan radar sites. Our radar stations are at risk
due to rapid, significant coastal erosion because the shore ice that
used to protect the coast from waves has melted. We continue to study
the rate of erosion, mitigate impacts and incorporate considerations in
future planning for these sites.
The DOD climate survey provided qualitative data that helped to
frame a more holistic understanding of the impacts of climate on
installations and operations. For the majority of reported severe
weather events, bases reported emergency preparedness actions and
procedures were successful in mitigating impacts on mission and
personnel. That being said, mitigation becomes more difficult and
cumulative impact to missions more crippling with increasing frequency
and/or magnitude of severe weather events. The Air Force continues to
integrate climate considerations into individual mission and
installation planning efforts to produce informed and resiliency-
focused decisions.
energy
The Air Force is the largest single consumer of energy in the
federal government. Air Force budgetary constraints have strained
investments in right-sizing, modernizing, and maintaining power
systems. As energy costs increase and budgets decrease, energy places
greater pressure on the constrained Air Force budget. From a cost
perspective, in fiscal year 2015, the Air Force spent approximately
$8.4 billion on fuel and electricity, with more than 86 percent going
towards aviation fuel. That $8.4 billion represented approximately
eight percent of the total Air Force budget; only 10 years ago, less
than four percent of the budget went towards energy expenses. As we
refocus our efforts, the Air Force will take a multi-faceted energy
investment approach to enhance mission assurance.
mission assurance through energy assurance
The Air Force's ability to accomplish its mission--whether
executing today's fight or training for future fights--is dependent on
fuel and installation electricity. We must ensure reliable, resilient,
cost-competitive power for our airmen to fly, fight and win. To do so,
the Air Force has revectored its installation energy program from a
largely conservation oriented stance to one of energy resilience
through strategic agility in installation energy programs and projects.
The guiding tenet for this strategic agility is ``Mission Assurance
Through Energy Assurance.'' This new paradigm focuses on providing the
Air Force with the ability to complete its mission in light of
disruptions to electricity and fuel, as well as optimizing its energy
productivity through improvements in technology and process.
installation energy
Over the last several years, the Air Force has seen installations
lose power for significant periods of time as a result of ice storms,
hurricanes, fallen trees, and other forms of denial of service. So far,
the Air Force has been able to mitigate the most critical mission
impacts due to those power losses by exercising alternatives such as
moving missions in the case of weather events. There are several
critical missions, however, that cannot be moved and where even a
microsecond interruption in power puts Air Force mission capabilities
at risk. Even though the Air Force has reduced its energy intensity by
more than 23 percent since fiscal year 2003, we still rely almost
exclusively on expensive, non-networked diesel generators limited to
very specific systems to provide the only depth of resiliency beyond
that inherent in the electrical grid in our system. While that can be
sufficient for short outages, today's grid is increasingly threatened
by cyber incursions and physical attacks designed to disrupt power;
increasing frequency and severity of natural disasters; and
malfunctions from human error, aging equipment, and faulty
infrastructure; all with the potential for long-term outages. To that
end, we must enhance the energy resilience of Air Force installations
through the adoption of innovative technologies and business models.
Going forward, the Air Force will transition to a more
comprehensive approach to installation energy challenges, and it will
holistically optimize cost and provide resilient, cleaner sources of
energy by balancing the objectives of AF energy projects, including
energy efficiency, renewable energy, energy resilience, and other
energy projects. The core principles below will continue to
characterize Air Force installation energy projects, but with an
increased focus on meeting multiple objectives within single projects.

Resilient: Every Air Force energy project should be
designed through the lens of enhancing energy resilience; the strategic
energy agility to maintain critical mission functions even during
unexpected disruptions. Air Force missions require agile networks of
platforms, communications equipment, satellites, and other technology
and equipment. The Air Force will secure critical infrastructure and
missions through a layered approach to energy resilience, taking
advantage of rapidly evolving energy technologies to meet both home
station and expeditionary needs. The Air Force will buttress commercial
power with on-site electricity generation (preferably cleaner) paired
with smart distribution networks and cyber-secure control systems,
enabled to power critical infrastructure during grid disruptions.
Cost-competitive: Air Force installations and commands
should continue to ``make every dollar count'' when acquiring advanced,
cleaner energy projects, while also examining trade-offs between lowest
price and other priorities such as resilience. The Air Force will
continue to pursue energy projects or transactions that will save
money, leverage third-party investment, and prioritize resources to
projects that also enhance energy resilience and reliability.
Cleaner: Three global trends identified in America's Air
Force: A Call to the Future (rapidly evolving technologies, decreasing
availability of natural resources, and diverse operating environments)
work in favor of energy modernization. Renewable and other distributed
energy technologies are key components of energy agility and assurance,
especially when projects are on site and capable of delivering
continuous energy when the grid is disrupted.
resilience
To help achieve Air Force energy resiliency goals, the Secretary
and the Chief of Staff of the Air Force established the Air Force
Office of Energy Assurance (AF-OEA) to serve as a central management
office dedicated to the development, implementation, and oversight of
privately-financed, large-scale renewable and alternative energy
projects. This office leverages partnerships with the Army's Office of
Energy Initiatives and Navy's Renewable Energy Program Office to
develop projects that contribute to strategic energy agility by
identifying and awarding third-party financed energy projects that
provide 10MW or greater and cleaner (but preferably renewable) power
that increases energy resiliency. These projects will provide
significant energy alternatives to assure Air Force missions in the
event of grid outages for short or long periods. The Air Force is
establishing this office with existing personnel resources and will not
include any new headquarters personnel; rather, it will co-locate AF-
OEA with the Army's Office of Energy Initiatives to share support and
processes, and move forward as a team. The AF-OEA will proactively team
with the Navy's Renewable Energy Program Office to optimize
opportunities that office identifies.
Finally, AF-OEA is charged to take a holistic, enterprise-level
approach to its energy assurance programs brought to bear on the Air
Force's mission assurance through an energy assurance approach. This
includes clean, cost-competitive, reliable and resilient energy through
the application of utilities privatization, power purchase agreements,
direct investment (e.g., energy conservation investment program), and
third-party financed (e.g., ESPCs, etc.) authorities Congress has
granted the Air Force. All available tools will be used.
cost competitive
Although current and projected energy prices are relatively low,
from a mission perspective, price volatility does not change mission
vulnerability. With mission assurance as our focus, the Air Force still
recognizes the need to reduce the cost of energy to allow our dollars
to support readiness and recapitalization requirements. The Air Force
directly invests in facility energy projects primarily using FSRM
funding based on Air Force priorities. Based on an historical average,
the Air Force anticipates approximately $223 million of its FSRM
funding going towards projects with energy benefits such as increased
resiliency and efficiency through modernized infrastructure.
While the Air Force has made considerable progress to avoid costs
through reduced energy consumption, there is more to do. The Air Force
is pursuing Energy Savings Performance Contracts (ESPC) and Utility
Energy Service Contracts (UESC) to fund energy conservation projects.
Since fiscal year 2012, the Air Force has awarded approximately $128
million across eight ESPCs and UESCs. In fiscal year 2016, the Air
Force expects to award up to $359 million in such contracts. To take
advantage of existing expertise, the Air Force has also partnered with
the Defense Logistics Agency (DLA) and the U.S. Army Corps of Engineers
(USACE) to expand its ability to identify and execute third-party
performance contracts.
clean energy
The Air Force recognizes both clean energy, and its more desirable
renewable subcomponent, are key elements to diversifying our energy
portfolio to achieve strategic energy agility. By the end of fiscal
year 2015, the Air Force had 311 renewable energy projects on 104
sites, either installed, in operation, or under construction, across a
wide variety of renewable energy sources, including wind, solar,
geothermal, and waste-to-energy projects. Cumulatively, the Air Force
has 104.3 megawatts of on-base renewable energy capacity. These
projects, which are typically owned and operated by private industry,
have increased energy production on Air Force installations by more
than 26 percent from fiscal year 2014 to fiscal year 2015. About eight
percent of the Air Force's total electrical energy consumption in
fiscal year 2015 came from a mixture of renewable on-base projects and
purchased commercial renewable supply. Unfortunately, little of this
energy can be directly consumed by our bases in the event of a grid
outage. As we evaluate both direct investment and third party
investment opportunities, the Air Force will exhibit preference for
renewable solutions where cost effective, followed by clean but not
renewable solutions, and ultimately by solutions that provide mission
assurance through energy assurance without a clean element.
the sweet spot
Each of the principles above are spectrums, and the Air Force does
not consider them ``either-or'' choices. The ``sweet spot'' projects
will have elements of all three core principals, but not every project
will demonstrate every characteristic. The Air Force will expect each
project to demonstrate a clear connection to at least two principles.
Projects that only achieve one principle will need strong mission
justification. In short, energy projects should move toward the ``sweet
spot.''
operational energy
Similar to the installation energy program, mission assurance is
the basis for the Air Force's operational energy program. Through
behavioral and technological advancements, the Air Force is optimizing
its capabilities in order to maximize combat readiness and reduce the
mission risks posed by our fuel supply challenges. With more than 5,000
aircraft in the Air Force fleet, and a demand for over two billion
gallons of jet fuel every year, improving how the aircraft and crew use
their fuel can generate significant increases in capabilities. To
address the risks posed by that demand, the Air Force has a goal to
improve its fleet aviation energy efficiency, defined as productivity
per gallon, by 10 percent by 2020. Since developing the goal in fiscal
year 2011, the Air Force has improved its aviation energy efficiency by
almost six percent through a combination of materiel solutions and
changes to policies and processes.
The Air Force is requesting $682.6 million in operational energy
related funding for fiscal year 2017. Included in this is $567.1
million to increase future warfighter capabilities, $4.5 million to
reduce the logistical risks to the mission from energy, and $111.0
million to improve current mission effectiveness.
materiel solutions
The Air Force faces a challenge when implementing materiel
solutions, as many of them require high upfront investments with long-
term paybacks. However, those paybacks often provide significant
returns in both fuel savings and reduced maintenance requirements. The
Air Force is in the midst of a propulsion upgrade program for the KC-
135 at a rate of 100 to 120 engines per year for the next 12 years, at
a cost of approximately $106 million per year. While this is primarily
a service-life extension effort, it provides a 1.5 percent reduction in
its fuel consumption rate per engine. Additionally, by improving
reliability and durability, these upgrades will provide lifetime fuel
and maintenance savings approaching $3 billion.
science and technology
Part of the Air Force's funding request for fiscal year 2017 is for
research, development, test and evaluation (RDT&E) opportunities with
operational energy benefits. One of the main operational energy related
projects is developing new adaptive engine technology, which provides
revolutionary advances in turbine engine performance. By incorporating
these advanced technologies, the Air Force will be demonstrating a
transformational engine that can operate with the power and performance
needed for a combat aircraft, while maintaining the higher fuel
efficiency of large aircraft. Based on the results of Air Force lab
experimentation, this engine will provide 25 percent greater fuel
efficiency, 30 percent greater range, 10 percent greater thrust, and
improved thermal management compared to current engines.
modeling and simulation
While the Air Force is enhancing its fleet through current and
future materiel solutions, it is also looking to improve how it manages
fuel usage for future conflicts. As part of the Joint Operational
Energy Modeling and Simulation (JOEMS) project, the Air Force is
leading a collaborative effort to examine how technology upgrades
impact operations in various scenarios through identification of fuel
usage requirements and logistical fuel supply challenges. By
incorporating energy considerations in wargames and other modeling and
simulation efforts, the Air Force can better understand the role fuel
and logistics can play in future operations. The way it manages and
consumes fuel can be a catalyst towards a successful mission, and the
Air Force is driving forward to ensure it maintains an energy advantage
against potential adversaries.
process changes
The Air Force is also actively fostering an energy-aware culture
that empowers airmen to take a smart approach to energy to better
complete their mission. Simple changes in how a pilot flies and trains
can affect aircraft fuel consumption. Through the Energy Analysis Task
Force (EATF), the Air Force studied how instructor pilots and simulator
instructors at Vance AFB in Oklahoma could incorporate fuel efficiency
concepts into pilot training to ensure new pilots understand how to
optimize fuel use. As part of a year-long trial, the EATF developed
four training techniques to reduce fuel consumption in the T-1A
Jayhawk, which were tested in T-1 simulators with a small group of
students. The energy efficiency techniques explored for integration
into the T-1 syllabus have the potential to save up to six percent in
fuel requirements on navigation training sortie profiles. One of these
techniques, called the Fuel Efficient Descent, involves teaching
student pilots to select the optimal point to begin their descent into
an airfield. When the students select the correct point to begin their
descent, they are able to reduce engine power to idle and descend using
minimum fuel. So far, the new technique has proven the potential to
reduce fuel usage by 35 percent during the descent phase of flight.
While this effort saves fuel today, it goes much further by
instilling an energy aware culture in those new pilots, which
proliferates into the Air Force's major weapons systems and will
potentially provide exponential savings. This type of savings can be
seen in the process changes executed at Altus AFB in Oklahoma, which
instituted scheduling and airspace utilization initiatives in 2013 that
are providing over $60 million in cost savings on an annual basis.
alternative aviation fuel
The Air Force is also committed to diversifying the types of energy
and securing the quantities necessary to perform its missions, both for
near-term benefits and long-term energy resiliency. The ability to use
alternative fuels in its aircraft provides the Air Force with enhanced
capabilities by increasing the types of fuels available for use. The
entire Air Force fleet has been certified to use two alternative
aviation fuel blends; one of these is generated from traditional
sources of energy and the other one is generated from bio-based
materials.
environmental stewardship
While the Air Force strives to prevent or minimize environmental
degradation from our training activities and operations, we recognize
that sustaining the world's most capable Air, Space, and Cyber Force
inevitably results in environmental impact. As a result, we view our
responsibility to protect human health and the environment as an
extraordinary duty. The Air Force is subject to the same environmental
statutes and regulations as any other organization in the country and
recognizes both its legal and inherent environmental responsibility.
The Air Force Fiscal Year 2017 PB request assures our programs comply
with applicable regulatory requirements but, more significantly, in a
manner that ensures the ready installations and resilient natural
infrastructure necessary to support the Air Force mission now and in
the future.
Environmental Program Funding Details
Within our environmental programs, the Air Force continues to
prioritize resources to ensure our defense activities fully comply with
legal obligations and our natural infrastructure remains resilient to
support our mission and our communities; restore sites impacted by Air
Force operations; and continuously improve. The fiscal year 2017 PB
seeks a total of $842 million for environmental programs. This is $20
million less than last year due to sustained progress in cleaning up
contaminated sites and efficiencies gained through centralized program
management. By centrally managing our environmental programs we can
continue to fund full compliance with all applicable laws, while
applying every precious dollar to our highest priorities first.
Further, our environmental programs are designed to provide
environmental stewardship to ensure the continued availability of the
natural infrastructure; the air, land and water necessary to provide
ready installations and ensure military readiness.
Environmental Quality
The Air Force's Fiscal Year 2017 PB request seeks $422.6 million in
Environmental Quality funding for environmental compliance,
environmental conservation, and pollution prevention. With this
request, the Air Force ensures a resilient natural infrastructure and
funds compliance with environmental laws in order to remain a good
steward of the environment. We have instituted a standardized and
centralized requirements development process that prioritizes our
environmental quality program in a manner that minimizes risk to airmen
and surrounding communities, the mission and the natural
infrastructure. This balanced approach ensures the Air Force has ready
installations with the continued availability of the natural
infrastructure it needs at its installations and ranges to train and
operate today and into the future.
The environmental compliance program focuses on regulatory
compliance for our air, water and land assets. Examples of compliance
efforts include more detailed air quality assessments when analyzing
environmental impacts from Air Force activities; protecting our
groundwater by improving management of our underground and aboveground
storage tanks; and properly disposing of wastes to avert contaminating
our natural infrastructure.
Efforts in pollution prevention include recycling used oil,
fluorescent lights and spent solvents, as well as sustaining our
hazardous materials pharmacies to manage our hazardous materials so
they don't turn into waste. We continue to make investments in
minimizing waste and risk to airmen through demonstrating and
validating new technology such as the robotic laser de-painting process
on aircraft.
The Air Force remains committed to a robust environmental
conservation program. Prior appropriations allowed the Air Force to
invest in conservation activities on our training ranges, providing
direct support to mission readiness. The conservation program in fiscal
year 2017 builds on past efforts to continue habitat and species
management for 96 threatened and endangered species on 45 Air Force
installations. This year's budget request also provides for continued
cooperation and collaboration with other agencies, like the U.S. Fish
and Wildlife Service, to provide effective natural resources management
and safeguard military lands from wildfire hazards through coordinated
planning and incident response, and the application of prescribed burn
techniques. The fiscal year 2017 budget will further the Air Force's
implementation of tribal relations policy to ensure that the unique
trust relationship the U.S. government shares with tribes continues,
and to provide opportunities to communicate aspects of the Air Force's
mission that may affect tribes.
As trustee for more than 9 million acres of land including forests,
prairies, deserts, wetlands, and costal habitats, the Air Force is very
aware of the important role natural resources plays in maintaining our
mission capability. Sustained military readiness requires continued
access to this natural infrastructure for the purposes of realistic
training activities. The Air Force utilizes proactive ecosystem
management principles and conservation partnerships with other federal
and state agencies to minimize or eliminate impacts on the training
mission. We are challenged by the fact that in many instances, our
installations have become the last bastion of habitat for certain
species due to the increased development outside the installation
boundary. The fiscal year 2017 PB request includes $53.4 million to
implement the Air Force's conservation strategy, which will ensure that
all aspects of natural resources management are successfully integrated
into the Air Force's mission.
The Air Force remains committed to good environmental stewardship,
ensuring compliance with legal requirements, mitigating mission
impacts, reducing risk to our natural infrastructure, and honing our
environmental management practices to ensure the sustainable management
of the resources we need to fly, fight, and win now and into the
future.
Environmental Restoration
The Air Force Fiscal Year 2017 PB request seeks $419 million in
Environmental Restoration funding for cleanup of current installations
and those closed during previous BRAC rounds. Our focus has been on
completing investigations and getting remedial actions in place, to
reduce risk to human health and the environment in a prioritized
manner. Ultimately, the Air Force seeks to make real property available
for mission use at our active installations, and to facilitate
community property transfers and reuse at our closed installations.
The Air Force has made progress over time in managing this complex
program area, with more than 13,500 restoration sites at our active and
closed installations (over 8,200 Active and almost 5,300 BRAC). The Air
Force BRAC restoration program is on-track to achieve, at least, a
``response complete status'' at 90 percent of its Installation
Restoration Program (IRP) sites at closed installations by the end of
fiscal year 2018. Our active installation restoration sites are
currently projected to achieve the same 90 percent response complete
level by fiscal year 2020.
A new topic of focus is Emerging Contaminants (EC). ECs pose
significant risk management challenges to the Air Force environmental
program. Regulatory requests for environmental sampling and
implementation of EC response actions are on the rise. Characterizing
the extent of Air Force environmental releases of an emerging
contaminant, assessing the potential risk and impact to human health
and the environment, and initiating response actions and implementing
appropriate mitigation measures, drive unforeseen, chemical- and site-
specific environmental liabilities and program costs.
The Air Force response to releases of ECs from its facilities is a
deliberate, science-based and data-driven process that is focused on
protection of human health and the environment, conducted in accordance
with the Defense Environmental Restoration Program, and consistent with
the Comprehensive Environmental Response, Compensation, and Liability
Act (CERCLA).
The Air Force continues to work with regulators, city and state
officials and other stakeholders to develop the best solution to an
emerging problem. For example, for confirmed perfluorinated compounds
(PFC) releases, the Air Force is determining the extent of
contamination and taking steps to mitigate any validated human
exposures with interim actions until cleanup standards and effective
remedial technologies are available. When groundwater sampling results
indicate PFC levels exceed the EPA's provisional health advisory for
drinking water, the Air Force reduces PFC levels with filtration
technologies or provides an alternate drinking water source. When PFCs
are detectable, but below the provisional health advisory level, the
Air Force may conduct well monitoring to track PFC level changes and
determine if further action is needed.
While we cannot compromise on the protection of the public, our
airmen and civilian workforce and their families, neither can we
endlessly absorb the operational and financial risks of attempting to
work with a myriad of unregulated contaminants without some level of
certainty that the cost of controlling exposure will have a
commensurate public health and operational benefit.
conclusion
The Air Force made hard strategic choices during formulation of
this budget request. The Air Force attempted to strike the delicate
balance between a ready force for today with a modern force for
tomorrow while also recovering from the impacts of sequestration and
adjusting to budget reductions. Our fiscal year 2017 PB request
increases funding in MILCON to support COCOM and new weapon system
requirements, reduces Restoration and Modernization (R&M) and continues
to address the current mission backlog of deferred infrastructure
recapitalization from the fiscal year 2013 PB strategic pause.
Sequestration will halt this recovery. We also must continue the
dialogue on right-sizing our installations footprint for a smaller,
more capable force that sets the proper course for enabling the Defense
Strategy while addressing our most pressing national security issue--
our fiscal environment.
In spite of fiscal challenges, we remain committed to our Service
members and their families. Privatized housing at our stateside
installations and continued investment in Government housing at
overseas locations provide our families with modern homes that improve
their quality of life now and into the future. We also maintain our
responsibility to provide dormitory campuses that support the needs of
our unaccompanied Service members.
Finally, we continue to carefully scrutinize every dollar we spend.
Our commitment to continued efficiencies, a properly sized force
structure, and right-sized installations will enable us to ensure
maximum returns on the Nation's investment in her airmen, who provide
our trademark, highly valued airpower capabilities for the Joint team.

Senator Ayotte. Thank you, Secretary Ballentine.
First of all, if you could give us an update on the recent
agreement that was reached between the City of Portsmouth and
the Air Force on the Haven well cleanup and also support in the
community and how you think that is going to work going
forward.
Ms. Ballentine. Yes. Thank you, ma'am. I appreciate the
question.
The emerging contaminant of PFCs [perfluorinated chemicals]
which is in Air Force firefighting foam or jet fuel
firefighting foam is an emerging contaminant that we are
managing all across the Nation. So we have been really pleased
with the partnership that you and Senator Shaheen and your
community have brought to really scrutinizing this issue and
looking at ways to lean in to solving it.
So we are excited. Last week, we were able to sign the
agreement with the city to move forward on the pilot phase of
the Harrison and Smith wells, and we are looking forward. The
next milestone is next month. So May. We are waiting for
estimated completion of construction September of 2017. But the
final design will be next month.
Senator Ayotte. I really appreciate your working with the
City of Portsmouth on this important issue because I want to
make sure, obviously, my constituents have clean water and also
continue your efforts that I know you have made to notify
current and former members of the Air Force and civilians who
have worked in that facility so that they are aware of their
potential exposure to this chemical.
Ms. Ballentine. Yes, ma'am. Thank you for your support. It
has been a great partnership.
Senator Ayotte. I appreciate it. Thank you. I look forward
to continuing to work on this so we can have clean water.
Pretty important.
In line with the City of Portsmouth, since we are on the
topic of the City of Portsmouth, I wanted to ask about--
actually I am going to ask Secretary Hammack. On January 26th,
I sent a letter to Lieutenant General Talley regarding the
transfer of the Paul A. Doble Center to the City of Portsmouth.
Can you provide me an update on that, what the timeline is for
when the Army Reserve expects to complete the environmental
reviews and then transfer ownership to the City of Portsmouth?
What can we do to expedite that?
Ms. Hammack. Senator Ayotte, thank you for that question.
We are following the normal procedures for property
transfer and one of those is consulting with the New Hampshire
Division of Historic Resources----
Senator Ayotte. Yes.
Ms. Hammack.--regarding the historic status of the
facility. We expect to receive a determination that the
property has historic resources that must be preserved. This
finding has lengthened the timeline for our disposing and
transferring of the property. But even so, we are progressing
with the environmental assessment.
Senator Ayotte. So right now, actually you are waiting for
the State Division of Historic Resources.
Ms. Hammack. Yes.
Senator Ayotte. Okay. Got it.
Ms. Hammack. But if it comes in the timeline that we
anticipate, we expect the transfer to take place by the end of
this calendar year.
Senator Ayotte. Okay. Excellent. Very good. Thank you for
continuing to focus on this. I know it is important to the
local community.
I also wanted to ask you, Secretary Ballentine, in January
I learned about approximately 100 New Hampshire Air National
Guard members who recently experienced unacceptable living
conditions at Al Udeid Air Base in Qatar. I know this is not
just my constituents who were impacted by this, but basically I
get reports of black mold existing in showers, bathrooms,
curtains, and some of my constituents talking about chunks of
black mold and people getting sick and potentially having been
caused by the mold.
So servicemembers have been told by my office that they
attempt to clean their living quarters thoroughly but years of
systematic neglect have put our airmen and other members who
are supporting our airmen in a tough position there.
I brought this up to Mr. Carson in the February hearing,
and I understand that local command is working hard to resolve
this problem. But we cannot deploy our men and women in uniform
and put them in situations that make them sick. So I would like
an update on what the Air Force is doing to ensure our
servicemembers, including our New Hampshire Air National Guard
members, do not have to live in unhealthy and unacceptable
conditions at Al Udeid Air Base in Qatar.
Ms. Ballentine. Thank you, ma'am.
You know, taking care of airmen is one of Secretary James'
top three priorities. So when this came to her attention, she
immediately directed two courses of action. One was for our
Surgeon General to ensure that airmen, sailors, soldiers,
marines, coalition partners who may have had exposure had
proper health care afterwards. The second was to direct all
those folks that are working on facilities to mitigate any mold
issues on the base.
So let me give you a little bit of an update on both of
those efforts. I am happy to provide a pretty extensive
response for the record as well.
Senator Ayotte. That would be terrific. I would appreciate
it.
[The information referred to follows:]

Upon recently learning of this mold issue at Al Udeid, Qatar,
Secretary James and General Welsh immediately requested more
information from AFCENT and the Air Force Surgeon General. Taking care
of airmen is one of our top priorities, including healthy, safe living
environments.
The AF Surgeon General, Lt Gen Dr. Mark Ediger, is actively
monitoring and evaluating potential health impacts associated with the
conditions of our facilities at Al Udeid. He issued guidelines based on
information from Centers for Disease Control and Institute of Medicine
on medical care for airmen with health concerns associated with mold.
All servicemembers rotating through Al Udeid are provided instructions
on what to do to avoid mold or mildew growth, how to clean the room if
it is found, and who to call should mold or mildew become a recurring
problem. We are monitoring the post-deployment health assessments of
the 34 New Hampshire Air National Guard unit members who have
documented mold exposures and none have required medical follow-up at
this time.
We have improved our maintenance capabilities and accelerated
repairs, recommissioning, and renovation efforts through increased
quality control, pre-positioned bench stock, $1.3 million dollars of
Secretary of the Air Force accelerated funding, and the prioritization
of mold repairs. Along the maintenance line of effort, the
implementation of our new custodial contract is already yielding great
dividends to improve the conditions of 73 trailer latrines. Airman are
actively conducting quality control assessments on 770 tasks per week
and this has resulted in the new contractor performing at a 97 percent
pass rate.
Great progress has been made repairing showers, faucets, urinals,
and air conditioning units in bathrooms. We expedited $312,000 of high
quality, US-sourced repair parts to the base which facilitated the
completion of 103 work orders on latrine or shower facilities in the
month of April alone. Two large bathroom facilities have been
recommissioned and another recommissioning effort is underway. Our
deployed engineers from the 379th and 1st Expeditionary Civil
Engineering Squadrons are performing full-scale renovations of the ten
worst large bathroom facilities. Their first renovation is near
completion and included stripping the building down to its frame and
replacing all plumbing fixtures, walls, and flooring.
Finally, we have two major facility replacement initiatives
underway. The first is the completion of a long-term 20-unit housing
facility construction project that includes integrated showers and
latrines. This project is planned to complete on Sep 16. It will house
up to 2,500 airmen, soldiers, sailors, marines and coalition partners
and reduce our dependency on latrine and shower trailers. The second
intuitive includes demolishing and replacing the 49 worst latrine
trailers. Through the persistent efforts of our 379th Expeditionary
Contracting Squadron, 12 trailers have been replaced since November
2015 and seven additional trailers are expected to arrive by July 2016.

Ms. Ballentine. Do you want a little update now or just
take it for the record?
Senator Ayotte. Yes, please. Why do you not give me an
update and then you can give me an even greater detail for the
record. That would be terrific.
Ms. Ballentine. All right. Sounds great.
So on the Surgeon General side, on the 7th of March, the
Surgeon General issued a guidance on how to evaluate airmen for
exposure to mold based on CDC [Center for Disease Control]
standards, and CDC standards indicate that treatment for any
kind of mold is the same.
534 guardsmen from a range of different States have been
evaluated in the last couple of months after their deployment.
120 of those documented some exposure that they believe that
they had been exposed to mold, and one airmen still needs his
or her post-deployment follow-up. None of those airmen have
required ongoing care for the exposure.
On the mold mitigation in the facilities, there are really
two elements to it. One is in the latrines and one is in the
living spaces, as you noted. Importantly, when we are in
expeditionary environments, the facilities are designed for
shorter lifetimes, and the facilities there have well exceeded
their life. So a big part of the plan is replacing or moving
folks into more permanent facilities.
So Secretary James had directed acceleration of $1.4
million of funding to accelerate the plan that the base had
already had in place for the latrine facilities. On the living
facilities, the dorms and lodging and the like, you are right.
The folks living in the facilities are responsible for their
cleaning. The commanders there have really stepped up their
communication on two things: one, ensuring that folks know how
to identify, clean and mitigate mold, but more important, that
they know how to elevate any concerns that they have that they
cannot handle on their own.
So one of the things that I have been very pleased about is
since the commander, Brigadier General James, has increased his
communication on this effort--and he is communicating quite
regularly with every member that is deployed there--we have
seen a significant increase in work orders come in as people
have learned how to communicate their concerns. Every single
one of those work orders is treated as an emergency. You know,
we send folks out within 24 hours. That is not new. We have
done that. Really, we looked back at work orders over the last
year. We were getting about, on average, 10 work orders a month
for mold concerns. We saw a significant increase when the wing
commander increased his communication telling folks how to do
it. So that is good news, an increase in folks telling us that
they have concerns.
The other good news is only about 10 percent of those work
orders that have come in actually have turned out to be mold.
But anyway, I will give you much more detail for the
record. I gave you more detail than I planned to.
Senator Ayotte. No, no. I appreciate it. One of the
interesting things for me is when I raised it with Mr. Carson,
apparently this has been going on for a long time because it
sort of opened up the flood gates to my office beyond our own
Air Guard on it. That is why I wanted to raise it. I think it
has impacted a lot of our men and women in uniform over the
period that that base has been in operation.
Ms. Ballentine. Actually Brigadier General James, when he
took command earlier last year, did note it as an issue and had
actually started a mitigation plan that has kind of come into
fruition in the last couple of months.
Senator Ayotte. Well, I appreciate your answer and
certainly look forward to any supplement you make on the
record.
I have many other questions, but now I am going to turn it
over to Senator Kaine.
Senator Kaine. Thank you, Madam Chair.
Just a couple of questions based upon testimony. Secretary
Hammack, I would like to start with you. You gave a very good
statistic. I want to make sure that we do not bury a lead here.
Since 2003, the Army has reduced its energy consumption by 22
percent. I want to dig into that a little bit, then maybe ask
the rest of you to share also in your own branches or DOD-wide
what you are seeing.
Is that 22 percent reduction in the energy budget or is
that actual in kind of unit of energy used the Army has reduced
by 22 percent?
Ms. Hammack. Thank you for that question.
The 22 percent is a reduction in consumption. That is the
actual amount of energy used.
It is interesting. There is another metric that we are
measured by and that is energy use per square foot. That has
not reduced as much because what we are doing is we are trying
to consolidate people into under-utilized facilities. So when
you have more people per square foot, then in that building
your energy used per square foot goes up. We are also demo-ing
some of our older under-utilizing facilities, and if your
square footage goes down, then your energy use per square foot
metric also goes up. But overall consumption has gone down, and
that is due to our team focusing on energy saving performance
contracts while the private sector is doing the investment, and
then we pay back out of the energy savings.
Senator Kaine. If I could hear from other branches if you
are seeing an equivalent reduction in energy consumption. I
think this is a very good news story. So Navy, Air Force,
Marines, DOD-wide. Are we seeing similar trends?
Mr. McGinn. We are, Senator. It is not just the reduction
in energy consumption because of our energy efficiency measures
that we are taking both ashore, as well as on our ships and
airplanes, but it is also in a large measure substituting brown
power with green power or renewable energy. I would like to
provide you a more detailed response, and I will differentiate
it from Navy and Marine Corps and shore and operational energy
as well.
Senator Kaine. That would be very helpful.
[The information referred to follows:]

operational / expeditionary energy input
U.S. Navy
The Navy is focused on optimizing energy use on our operational
platforms to increase our range, endurance, and payload. We are making
progress toward that goal.
Navy evaluated the trends in fuel consumption rates for several
classes of ships during the period from 1992 to 2014, which included a
period of significant variation in operational tempo. Reductions in
daily consumption were observed across all evaluated classes, with an
average reduction of 9.4 percent, or 63.4 barrels per day, which
translates into more than 10 additional steaming days per year for each
ship at the most recent average consumption rates.
Within classes of ships, we observed reductions across the Navy's
fleet of Arleigh Burke-class destroyers (DDGs) and Whidbey Island and
Harpers Ferry-class amphibious ships (LSDs), which on average were
consuming 9.8 percent and 6.5 percent less fuel per day, respectively.
This translates to about 11 additional steaming days per year for each
DDG, and 7 additional days per year for each LSD. During the same
period, employment rates of these ships also increased, with each DDG
underway for about 8 additional days per year on average, and each LSD
underway for an additional 11 days.
These reductions in fuel consumption demonstrate how the
combination of operational practices and fuel-saving upgrades, such as
stern flaps, are yielding real-world benefits that translate into
operational gains for our ships through extended reach, and further
fuel cost savings for the Navy. Additional efforts, such as the
installation of LED lighting across the fleet, and the incorporation of
hybrid-electric drive (HED) systems aboard DDGs, will build on those
gains and further enhance operational capability.
Navy also continues to identify and validate energy saving
initiatives for legacy and new aircraft through efforts like the
Aviation Energy Conservation Research and Development Program. The
program is working on advanced flight management system capabilities
such as optimized launch & recovery profiles which the Navy expects to
reduce fuel consumption by as much as 10 percent, extending available
aircraft range and flight time.
U.S. Marine Corps
The Marine Corps' operational energy goals are expanding the
warfighting capability of the Marine Air-Ground Task Force (MAGTF) and
increasing the training readiness of units. The Marine Corps views
operational energy as an enabler of combat power; we strive to manage
Operational Energy in the most effective manner to maximize capability.
Since the early 1990s, increases in information technology,
platform maneuverability, and force protection capabilities have
greatly increased the Marine Corps' capabilities, but these capability
increases comes with corresponding increases in energy consumption.
Analysis indicates the energy requirement for the Marine Expeditionary
Brigade (MEB) is approximately 29 percent higher today than in the mid-
1990s and is estimated to be 45 percent higher by 2024.
The Marine Corps understands the risks associated with increases in
energy requirements and is undertaking mitigation efforts. These
efforts are led by the Marine Corps Expeditionary Energy Office (E2O).
For example, efforts aligned with ground assets will result in a
projected 9 percent increase in efficiency of the MEB--putting downward
pressure on the trend of increasing fuel and battery requirements for
the MAGTF. E2O continues to work closely with Marine Corps units and
agencies, as well as other services, industry, and academia, to
identify and mitigate energy related risk to Marine Corps warfighting
capabilities to maintain the warfighting advantage for our current and
future force.
shore energy input
Department of the Navy (DON) shore installations are critical to
generating force structure, and play an increasingly important role in
supporting front line operations. DON is increasing energy efficiency
and resiliency across the U.S. Navy (USN) and United States Marine
Corps (USMC) shore enterprise.
DON initiatives focus on optimizing energy use--or making the most
of every gallon of fuel and kilowatt hour of power--as well as growing
the utilization of renewable energy assets in order to decrease
dependency on the commercial grid. DON has made significant progress,
reducing energy intensity by 22 percent since 2003.
Over the last four years, DON has made significant investment in
both appropriated and third party-financed projects. Return on many of
these investments is expected to begin in 2016, as projects reach
completion. DON's overall Energy Saving Performance Contract (ESPC)/
Utility Energy Savings Contract (UESC) pipeline has over $1.4 billion
in planning, acquisition and execution with over $150 million already
awarded this fiscal year.
DON is pioneering base-wide ESPC projects at a number of
installations. This approach looks beyond typical lighting and HVAC
energy conservation measures, to identify all possible efficiency
opportunities available in areas such as buildings, distribution
systems and industrial equipment.
DON has made great strides in developing renewable energy
resources, with over 650 MW of capacity from projects that are
operational, under construction, or awarded, and an additional 350 MW
in procurement. With continued reductions in energy consumption, we
estimate that half of DON's facility energy consumption will be
procured or produced from renewable sources by 2020.
DON also worked to modernize the non-tactical vehicle fleet,
reducing greenhouse gas emission by 32 percent.
Service specific information includes:
United States Navy
The USN has reduced its facilities energy consumption by 23 percent
and energy intensity by 21.5 percent since 2003. Navy is also on track
to meet its consumption reduction goal by 2020, as well as energy
intensity reduction targets.
In addition to reducing energy consumption and intensity, Navy's
Shore Energy Program focuses on improving energy security and energy
resilience. To this end, Navy has focused on increasing renewable
energy production. Currently the Navy produces or procures 33 percent
of its total shore electricity requirement from renewable energy
sources.
United States Marine Corps
USMC has reduced facility energy intensity by 20 percent since
2003. USMC intends to assess all installations to determine the
economic viability of utilizing third-party financing mechanisms to
identify, evaluate, and finance infrastructure upgrades and new
equipment that will improve energy efficiency.
USMC has significantly increase the amount of renewable energy
consumed by its facilities, exceeding the 7.5 percent goal set forth in
the Energy Policy Act of 2005 by over 2 percent. USMC has over 128 MW
currently in procurement, and continues to identify financially
opportunities to reduce energy consumption from brown power sources.
DON wide
While counterintuitive the DON aggregate is 22 percent. The overall
DON metric benefits from a reduction in the energy consumption
(numerator) primarily driven by Navy's reduction of 820 percent, as
well as an increase in the KSF (denominator) primarily driven by USMC's
increase in square footage of 820 percent. Even though USMC isn't very
large proportionally, their energy intensity is enough to push that
combined DON number to look slightly higher than either Navy or USMC
individually. Please see detailed breakdown below:

Navy FY15: 38,290,000 MBTU / 358,997 KSF = 106.6
Navy Baseline: 47,659,000 MBTU / 350,685 KSF = 135.9
Navy Progress: -21.5%

MC FY15: 10,442,000 MBTU / 133,080 KSF = 78.46
MC Baseline: 10,649,400 MBTU / 108,374 KSF = 98.27
MC Progress: -20.2%

DON FY15: (38,290,000 + 10,442,000) / (358,997 + 133,080) = 48,732,000
/ 492,077 = 99.03
DON Baseline: (47,659,000 + 10,649,400) / (350,685 + 108,374) =
58,308,400 / 459,059 = 127.02
DON Progress: -22.0%

Senator Kaine. Secretary Ballentine?
Ms. Ballentine. So for installation energy, the Air Force
has improved both our energy intensity and reduced absolute
energy by about 23-24 percent since the 2003 baseline.
Unfortunately, costs have gone up significantly during this
time. So the overall energy budget has not necessarily gone
down. We have avoided many, many millions of dollars
thankfully.
Senator Kaine. Mr. Potochney?
Mr. Potochney. Senator, my figures are overall for facility
energy, it is down 10 percent, and that is translated into a
cost avoidance of $1.2 billion. So I think that is pretty
substantial.
Senator Kaine. We are now seeing per-unit costs
dramatically decline in the last couple years. That was not the
case necessarily during that 2003 to today, but if you are
seeing reductions in energy consumption by 10 percent in
facilities or 22 percent Army-wide and then the other
statistics and you are seeing a reduction in per-unit costs of
energy, I mean, this is a big success story and we need to
recognize you for what you do and encourage other agencies to
do more of it.
Mr. McGinn. Senator, if I could.
Senator Kaine. Yes, please.
Mr. McGinn. I would just like to make the point that a lot
of times we tend to talk about technology, the technology of
energy efficiency or renewable energy. That certainly is a key
part. But I think across the whole DOD, certainly in the
Department of the Navy, we are seeing a tremendous benefit from
partnerships with other services, with DOE [Department of
Energy], and in our case with biofuels with the Department of
Agriculture. We are also seeing a great change in culture, and
the culture is going to be sustaining. From seaman to admiral,
from lance corporal to general, we are seeing great changes in
how we understand the value of energy, both in garrison as well
as in the field.
Senator Kaine. You talk about third-party contracts as part
of the reason for this, and I just want to make sure I
understand what you are talking about now. When I was mayor, we
entered into contracts where we asked third parties to install
energy efficiency equipment on city buildings and schools. They
did the capital investment. We contracted for the service, not
for the equipment. But then we had a baseline and then we
shared the reduction in energy cost with them. So it takes some
creativity on the acquisition side to switch from a ``buy the
equipment'' to ``enter into a service contract and then share
the energy reduction savings.'' Is that the kind of third-party
contract that you are talking about?
Mr. McGinn. That is very similar. We have an energy savings
performance contract mechanism that is very, very effective at
doing, in principle, the same thing as you did when you were
mayor. We really have done it for a number of years, but we are
really accelerating it over the past 3 or 4.
Senator Kaine. Because it is a different way than buying
the equipment. You get better and better at actually doing the
service contracts once you have the experience.
I want to ask Secretary Ballentine on the BRAC issue.
Again, the need to reduce spending on excess infrastructure I
really think we need to do that. I am just trying to grapple
with what is the right way to do it. You said the Air Force
suspects that you have got about 30 percent excess
infrastructure. How does the Air Force come up with that
number?
Ms. Ballentine. We use the same parametric capacity
analysis that we used early in the 2004 and in the prior BRAC
rounds.
Senator Kaine. The 2005 round?
Ms. Ballentine. Yes, the 2005 round. The 2004 analysis for
the 2005 round.
Senator Kaine. Since I was not here then--I was actually a
lieutenant governor working on a BRAC commission for my State
back then.
I do not mean to get into all the details, but I mean, how
does the Air Force approach it and come to that conclusion that
there is a 30 percent excess?
Ms. Ballentine. So we look at force structure. We have
looked at several different types of force structure. I think
Senator Ayotte's concerns about optimizing infrastructure to
today's force structure if today's force structure is not
optimal to the need is an important concern. So we looked at
force structure a range of different ways, which is why I say
about 30 percent excess capacity because depending on which
force structure we look at, it ranges from 27-28 percent all
the way up to 34-35 percent.
For the Air Force the infrastructure that is most important
that we look at is infrastructure that supports our aircraft.
So we look at ramp space, hangar space, maintenance space. We
do look at some facility space such as classroom space and the
like, but really most of our analysis is on infrastructure that
supports our aircraft. I can provide all nine categories for
you for the record and specifically the details on how we do
the parametric analysis.
Senator Kaine. Excellent. We will ask that question of all
the branches. I think that would be helpful.
[The information referred to follows:]

Ms. Ballentine. The Air Force used nine category metrics in
conducting its parametric excess infrastructure capacity analysis,
consistent with Air Force category metrics used to justify previous
rounds of BRAC. The category metrics are as follows: large aircraft
parking apron; small aircraft parking apron; Air Force Reserve parking
apron; Air National Guard parking apron; education and training parking
apron; education and training classroom space; depot level maintenance;
space operations; and product centers, labs, and test & evaluation
installations. For each metric, a baseload ratio, for example number of
aircraft to parking apron square yardage, is calculated and compared to
a 1989 baseline ratio. Decreases in baseloads indicate that force
structure drawdowns have outpaced reductions in infrastructure and that
excess infrastructure capacity exists.
Ms. Hammack. The Army used nine categories of installations to
develop its parametric capacity analysis. It analyzed the
infrastructure for a force structure comprising a Total Army of 980,000
by the end of fiscal year 2019 (450,000 Active Component, 335,000 Army
National Guard, and 195,000 Army Reserve). Each installation category
had a metric for infrastructure divided by a metric of force structure
to develop a ratio of infrastructure-to-force structure. That ratio was
then compared to a historical baseline (the year 1989) to measure the
amount of increase in that ratio over time. The overall excess capacity
for the Army was measured at 30 percent using the parametric capacity
analysis.
Administrative Installations: Base loading of approximately 97
square feet of infrastructure per person, which represents a 29 percent
increase in excess capacity in comparison to 1989. Seven installations
made up the category.
Depots: Base loading of approximately 27 percent more single-shift
capacity than available funding/utilization. However, this category
shows no net increase in excess capacity in comparison to 1989. Five
installations made up the category.
Other Organic Industrial Base: Base loading of approximately 30
percent more single-shift capacity than available funding/utilization.
However, this category shows no net increase in excess capacity in
comparison to 1989. Five installations made up the category.
Arsenals/Industrial Manufacturing: Base loading of approximately
2,258 square feet of facilities per person, which represents a 36
percent increase in excess capacity in comparison to 1989. Three
installations made up the category.
Major Training--Active: Base loading of approximately 7,949 acres
per maneuver battalion equivalent of force structure, which represents
a two percent increase in excess capacity to 1989. Four installations
made up the category.
Major Training--Reserve. Base loading of approximately 1.71 acres
per U.S. Army Reserve Soldier, which represents a 53 percent increase
in excess capacity in comparison to 1989. Five installations made up
the category.
Maneuver: Base loading of approximately 40,405 acres per maneuver
battalion equivalent of force structure, which represents a 42 percent
increase in excess capacity in comparison to 1989. Twelve installations
made up the category.
Schools: Base loading of approximately 72 square feet of
instructional space per solider/student, which represents a 44 percent
increase in excess capacity in comparison to 1989. Thirteen
installations made up the category.
Research, Development, Test, and Evaluation/Labs: Base loading of
approximately 879 square feet per person, which represents a 46 percent
increase in excess capacity in comparison to 1989. Ten installations
made up the category.
Mr. McGinn. For the capacity analysis based on fiscal year 2019
force structure, the Department of the Navy (DON) used 12
infrastructure categories to determine potential excess/deficit
capacity. Categories include: Naval Bases, Marine Corps Bases, Air
Stations, Ordnance Stations, Supply Installations, Aviation
Maintenance, Maintenance Depots (USMC), Shipyards, Research Development
Testing and Evaluation (RDT&E) Labs, Training Air Stations, Training
(Pipeline), and Training (Degree-granting).
The parametric analysis methodology was used to identify potential
excess/deficit percentage for each category and an aggregate DON
excess/deficit capacity. For each category, capacity and loading
information came from authoritative sources such as the internet Naval
Facilities Assets Datastore (iNFADS), which provides the real property
inventory for the DON, and the Navy Aircraft Program Data File (APDF),
which provides the number and types of aircraft. Ratios of capacity to
loading were calculated, with the resulting ratio compared to the 1989
ratio to determine the proportional excess/deficit in 2019. The
resulting estimate of 2019 excess/deficit percentage is an aggregate
value and cannot be used to imply an excess/deficit for a given
installation.
To determine the aggregate DON capacity, each category was assigned
a relative weight. Installations were mapped to categories, and each
category weighted by the percent of installations in the category
relative to the total number of installations.
For infrastructure categories that show a shortfall, the shortfall
percentage is reported as ``0'' in the aggregate calculation. As a
result, excess in one category is not offset by shortfalls in another
category.
Mr. Potochney. I have nothing more to add than what my co-panelists
provided and concur with their answers.

Mr. Potochney, you have a follow-up, and then I will turn
it over to Senator Ernst.
Mr. Potochney. To follow up, Senator, our analysis--it is a
parametric analysis, as Secretary Ballentine said. Basically
what it is it is a base loading analysis. If in 1989 we were
able to accommodate, say, for instance, three ships--or let us
make the math easy--four ships per 1,000 feet of pier space and
now we only have three ships to fill up that 1,000 feet, we
have a 25 percent delta in excess. That is how we do our excess
capacity analysis at the beginning end of BRAC. Its only
purpose is to illustrate there is enough out there to justify
you all authorizing us to do an actual BRAC analysis. It is not
a BRAC analysis.
Senator Kaine. I hope that we might have a full committee
discussion sometime about the best way to rationalize excess
infrastructure because my sense is your expertise in branches
or division-wide coming up with an assessment of the excess
infrastructure suggests you also have an expertise to make
recommendations to us. Again, we are going to approve some and
not approve some. I just believe, having lived at the other end
of BRAC as a mayor and governor, that that would be a better
process than the process in the past.
I know there have been critiques of the 2005 BRAC because
it did not really save money, but I understand some of that was
the BRAC was not just about excess infrastructure. It was also
about joint and transformation of mission, et cetera. But even
if we said, okay, there is a way to save money, there is way to
rationalize excess infrastructure, I am not sure the BRAC
process does it the right way. But you make a compelling case
that we should not be spending money on excess infrastructure.
Ms. Hammack. Absolutely. BRAC 2005 is saving the Army $1
billion a year and cumulatively the prior BRAC rounds are
saving us another $1 billion a year. So BRAC is a proven
process to save money. If you look at the GAO [Government
Accountability Office] report, the GAO report recognized that
BRAC 2005 did save money.
Senator Kaine [presiding]. Senator Ernst?
Senator Ernst. Thank you, Ranking Member Kaine, and thank
you to our witnesses for today. We appreciate you taking the
time to be here.
Secretary Potochney, I will start with you but I would love
input if the others would like to jump in as well.
I am a strong supporter of SOCOM's [Special Operations
Command] Preservation of the Force and Family, a very important
program, and their initiatives. I am glad to see that SOCOM has
done so much to support our special operations families and our
wounded warriors through this program.
I have a dear friend who is part of that family. He is an
injured special operator at Fort Bragg. Earlier this year, I
did have the opportunity and the honor to visit him at Fort
Bragg and go through some of his recovery process as well and
also visit a number of the operators that are not part of that
wounded warrior program but they are very important to us as
well.
Now, at Fort Bragg, they do have what is called the
tactical human optimization, rapid rehabilitation, and
reconditioning facilities. This is otherwise known as THOR III.
I see that you are familiar with that. I had the opportunity to
visit and loved the facilities and their very reason for being,
which is to not only assist our special operators as they are
training for the missions, but also in assisting their members,
their wounded warriors that come back, and assisting them to
getting back to their potential, hopefully their full
potential. I hope that we can enhance and expand these
facilities for our operators and again just want to make sure
that we are returning them to the fight. We invest a lot of
time and energy and money in these operators. They are a great
part of our war on terror, as well as many other missions. So
we want to support them however we can.
Sir, can you briefly describe the importance of THOR III to
our special operations soldiers and what more can we as
Congress do to support THOR III and this program, particularly
with MILCON and other initiatives under the preservation of the
force and families program? Can you talk a little bit about
that and its importance?
Mr. Potochney. Yes, ma'am.
We do support it. In fact, from what I can see, it is
expanding, and people do recognize its validity and its value.
We have got a series of projects in the works to enhance it.
There was some reporting requirements we had levied on us from
the appropriators, as I understand it, and we worked through
those, also as I understand it. So we are firmly behind it.
Senator Ernst. Any other thoughts from our panelists on
that particular issue?
[No response.]
Senator Ernst. I just want to reinforce again--and I have
brought this up in different types of subcommittees and the
committee as well as the full committee, just emphasizing how
important I believe this is because our special operators do
take on different types of missions maybe than a transporter
like myself would have done in the Iraqi War. So understanding
the importance it is to our families, to our wounded warriors,
and those special operators, I would like to encourage you to
continue working with that program, hopefully expanding those
facilities. It is very, very important to us.
Mr. Potochney. Yes, ma'am.
Senator Ernst. Thank you. That is all I have for today.
Thank you.
Senator Kaine. Thank you, Senator.
Senator McCaskill?
Senator McCaskill. Thank you.
Secretary Hammack, I know that you recently visited Fort
Leonard Wood, and one of the things that has cost our military
a lot of money that frankly a lot was wasted is the support of
contingency operations. If you look at the not-so-pretty
history of the LOGCAP [Logistics Civil Augmentation Program]
contracts, it does not take much work to figure out that we
sure overpaid for a lot of contingency support as it related to
particularly the early era of LOGCAP in Iraq. I spent a lot of
time on that.
So I think it is pretty important that we have CBITEC
[Contingency Basing Integration and Technology Evaluation
Center]. I know you visited it at Fort Leonard Wood. If you
would share with the committee what you think about this effort
to help us make smarter, more efficient, effective decisions
around contingency support, whether it is water, waste,
housing, security protection. If you could speak to that, I
think it would be important to get that on the record.
Ms. Hammack. Thank you, Senator.
CBITEC is a great opportunity for us to take technologies,
whether they are commercial, off-the-shelf technologies or
developing technologies, and run them through a test in a camp
that soldiers live and use every day, yet in an environment
where if something goes wrong, we can fix it.
The challenge, especially in the early years of Iraq and
Afghanistan, is we sent some equipment over there that had not
been thoroughly tested, we did not understand completely how to
operate, nor how to maintain it. A lot of our servicemembers
said do not use us as guinea pigs. CBITEC was stood up. So was
the base camp integration lab in Fort Devens, Massachusetts.
With those two base camps, one tests solutions for very
medium to large base camps. A B-cell does the small base camps.
But we are able to test force protection. We are able to test
technologies that are water savings technologies such as water
from air, which we might call a supersized dehumidifier. But
the fact is if you do not have to drill a well, then your force
becomes more expeditionary and there is less strain on the
environment in which you are setting up base camp.
But we are also able to test energy efficiency technologies
to try and reduce the number of convoys that are crossing the
roads and to reduce the risk and vulnerability to our
servicemembers. So we have seen great technologies and
solutions come out of that lab. We have also seen some
solutions that were tested there that were not ready for prime
time, and I think that is the right kind of environment to do
that testing in.
Senator McCaskill. Which, of course, saves us money. When
we figure out something is not ready for prime time, then we do
not chase bad money after good.
So I am confused as to why this thing appears to be headed
towards an end because we have got--surprise, surprise--people
fighting over who is supposed to be paying for it. I know this
is shocking within the armed services that people are fighting
over who should pay for it.
Can you help this committee navigate through this? It would
be a shame for us to lose this capability because one branch
says not us and the other branch says not us, and therefore, it
is my understanding, the funding is going to shut down this
year.
Ms. Hammack. That is true. Just due to sequestration, we
have limited funding for everything. So we have limited funding
to spend on maintaining our facilities. We are trying to focus
our funding on manning, training, and equipping our soldiers.
When it comes to some of the research, testing, and support for
installations----
Senator McCaskill. We are manning, equipping, and
protecting our soldiers. We know that. We are not talking about
testing for something that is not directly relevant to doing
what we are asking our soldiers to do.
Ms. Hammack. I agree with you. We have asked CBITEC to put
together what it will cost to continue to maintain it through
the end of this calendar year. TRADOC [U.S. Army Training and
Doctrine Command] is doing that now, and I expect to have that
information by the end of the month.
Senator McCaskill. Well, I am interested in this, and I
think sometimes--I know that you all are doing your best to try
to figure out how to operate in this environment, although I
see the OCO [overseas contingency operations funding] relief
wagon coming up over the horizon in this appropriations
process. I can assure you I think this Congress is getting
ready to do what I think is irresponsible and that is to push
everything into OCO instead living up to our responsibility of
putting it in the budget and being transparent and accountable
to the American people for that.
But I am very interested in figuring out really how much
money are we talking about and are we cutting off our nose to
spite our face if we let this important capability go by the
wayside. I particularly would be interested in knowing what we
have learned there has, in fact, saved us money because I
guarantee you there is a list, probably fairly long, of what we
have learned there that has saved us money. So I would
appreciate a follow-up of that.
[The information referred to follows:]

CBITEC provides a realistic training base camp for soldiers, as
well as a venue in which to demonstrate and assess new technologies and
techniques that will improve energy efficiency, equipment readiness,
and mission capability at future contingency bases. To date, CBITEC has
demonstrated a suite of life-support equipment with the potential to
reduce future contingency base fuel use by 50 percent.
While CBITEC provides an excellent capability to support soldier
training and doctrine development, the Army does have other facilities
in which to train. In an era of constrained resources, the Army must
make difficult choices to prioritize spending to maximize the
generation of readiness and the welfare of our soldiers.
Army Training and Doctrine Command (TRADOC) evaluated and
prioritized 67 unfunded requirements, of which CBITEC was one, for mid-
year reprogramming. TRADOC was unable to secure funding for the CBITEC.
The Maneuver Support Center of Excellence provided $40,000 in the
interim for limited operations (fuel, waste water), to continue
supporting initial military training classes. CBITEC's facilities began
limited operations on May 1, 2016, and will close on July 1, 2016 and
transfer to range control. The two term employees will be released at
the expiration of their term in August 2016.
In the absence of the CBITEC, the Army conducts field tests and
evaluations on contingency basing technologies at other locations,
including the Base Camp Integration Laboratory (BCIL) at Fort Devens,
MA, and the Army Warfighting Assessments at Ft. Bliss, TX.
Additionally, individual technologies that support base camp operations
are developed and evaluated at Army laboratories.

Just briefly for Mr. McGinn, you know, we are trying to
make sure that we are ready for women in our facilities. I just
referenced Fort Leonard Wood. They have been duly training our
soldiers there, both men and women, for a long time, and so
their facilities are capable in that regard. Could you briefly
give us your assessment of how prepared are our marine training
facilities to accommodate what we believe will continue to be
an increased number of women in the marines?
Mr. McGinn. I know that the marines are moving out smartly
in making adjustments to their whole training and operating
pipeline to support women marines as their roles and missions
have expanded. I will be happy to take a question for the
record to provide you a more comprehensive answer for both the
Marine Corps and, to the extent that you are interested, women
in the Navy as well, although that is a more stable situation
than the expansion of roles and occupations for women marines.
Senator McCaskill. Both would be great, but I am
particularly interested in the marine setting because it is
such an expansion. I know that has not exactly been the
smoothest of roads, so to speak. I am anxious to know how all
that is going.
[The information referred to follows:]

All Navy commands and activities, with the exception of Naval
Special Warfare Command, already train men and women in a fully
integrated training setting.
The Naval Special Warfare Center (NAVSPECWARCEN) and the Naval
Special Warfare (NSW) Women in Service Review team have identified all
known supply and facility requirements for integration and are
executing their plan to ensure all candidates are equipped and
outfitted for optimal training. NAVSPECWARCEN reviewed all training and
berthing sites and created a barracks instruction that addresses
standards, policy, and procedures for student's use of berthing and
restrooms. Restroom modification projects throughout NSW training
facilities are currently underway and are expected to be completed
prior to arrival of the first female students.
MCICOM reviewed facility requirements and identified the facility
projects necessary to accommodate the integration of women in the
force. The attachment shows the total facility change costs to date and
the work remaining. Approximately $977k of work has been completed as
of 15 May 2016 (the majority of projects by number). There are nine
projects remaining for training facilities, with an estimated cost
total of $1.53 million. These remaining projects are in various stages
from planning through construction, and are estimated to be fully
complete in fiscal year 2018. The list of projects is provided in the
attached table.

Mr. McGinn. Great.
Senator McCaskill. Thank you. Thank you all.
Senator Ayotte [presiding]. Thank you all.
Secretary McGinn, I wanted to ask about the Navy's request
for $6.1 million for a microgrid project in California.
According to the documents, it says it will support
nonessential functions. Yet, I know that there are significant
unfunded priorities. Just to use one example, the Marine Corps
requirement for F-35 stationing in Miramar. I am sure there are
many other examples that I could pull out. So could you help me
understand why we are requesting this and why you think given
all of the, really, reduction in funding we have talked about
here and all the concerns we have, that this is a priority?
Mr. McGinn. I will be happy to investigate that. I do not
have an answer, but I will find one for you, Senator. It may be
a matter of just words describing this microgrid as for
nonessential purposes. I assure you we are not doing anything
for nonessential things. It may be just a definition or use of
terms that is technical. But we will find out the specific
project and provide you a full background on its rationale.
Senator Ayotte. I appreciate it because when you can
imagine when I read ``nonessential,'' how that kind of makes me
wonder. So if you would get me more details on that, I would
really appreciate it.
[The information referred to follows:]

Naval Medical Center San Diego services nearly 100,000 enrolled
beneficiaries. The installation requires the energy security to provide
full mission support capability with increased continuity of
operations, especially during unplanned disasters.
The Navy's P624, $6.1 million ``Energy Security Hospital
Microgrid'' in San Diego, California (Balboa Hospital) will increase
the Naval Hospital energy security posture and afford improved
efficiencies and load shedding through improved metering, controls and
distribution improvements. The Navy will use this project to validate
concepts that will be applied on future projects.
This project improves the electrical distribution and control
infrastructure to increase the capability and usefulness of the
existing 10.4MW co-generation plant. The project will ensure the entire
hospital complex has reliable power during extended San Diego Gas &
Electric grid outages and mitigate impacts of unplanned outages. Since
2011, four unplanned outages occurred, which impacted hospital
facilities, emergency response, and family care centers, with some of
the outages taking almost half a day to restore to full service. The
restoration of power for the affected facilities could have been
significantly quicker with microgrid capability to support the
installation mission, take care of patients, families and staff.
Additionally, this project will install metering and controls to
improve energy monitoring and control capability.
The project would:
create a campus-wide microgrid at Balboa Complex that is
capable of providing reliable power to critical emergency services
infrastructure;
provide faster restoration of service in case of an
unplanned outage or natural disaster;
integrate additional power sources which will provide
power to other essential facilities at the Medical Center (this shall
increase energy resilience and security);
increase the efficient use of the existing turbine and
other generation assets during island mode;
integrate the cogeneration plant with all Balboa
facilities and to a future Facility and Energy Operation Center (FEOC).
The planned dates are: construction award: 2/2017, construction
start: 7/2017, and construction completion: 8/2018.

Mr. McGinn. I really appreciate that and I am glad I never
read ``nonessential'' in any of my fitness reports.
[Laughter.]
Senator Ayotte. We all hope not to read that in any of our
reports. Thank you.
Secretary Hammack, in your written testimony, you noted
that the Army recently conducted a test and a temporary
disconnect that was also referenced, I believe, by Senator
Kaine at Fort Drum, New York from the energy distribution
network, which is an important issue for us to understand as we
think about threats to our grid, the vulnerability of our base
and defense system to cyber attacks. So what have you learned
from this test? What has the Army learned? Have other services
conducted similar tests? What are we doing, and can you maybe
talk to me a little bit about what we are doing to make sure
that we think about protecting our military assets from
potential cyber attacks, potential other types of attacks that
even if we had a missile attack or something like that, that
could impact our grid that we have a plan to protect our
military assets?
Ms. Hammack. Thank you for that question.
Certainly the Fort Drum project is a delight that it
worked. It is a combination of things that were tried. It was a
decommissioned, coal-fired plant that the private sector and
the private sector's money rehabilitated into a biomass plant.
It is taking clippings from the timber industry and using that
for fuel. They are maintaining 3 months? worth of fuel within a
5-minute radius so that they could survive an extended outage.
There was a requirement in the contract for them to put in
additional technology to be able to disconnect from the grid.
The power plant in and of itself serves twice the needs of
Fort Drum. So it is supplying power to the local community in
addition to Fort Drum. But we wanted to simulate the grid
dropping out and how that switch would occur. The switch was
seamless. It was done in coordination with the utility so that
the utility grid itself did not experience a shock and they
knew what was going to go on. So we demonstrated that right now
Fort Drum is the most resilient installation in the Army's
portfolio from an energy standpoint.
As we all learn more about cybersecurity, we are
approaching that in a methodic way as well. It is interesting
that cybersecurity is the unknown unknown. You do as much as
you know about. We are working hard to ensure we stay abreast
of current threat and current technology because our intent is
that our installations are resilient so that they can become
and remain the deployment platforms that this Nation expects of
them.
Senator Ayotte. Great. Thank you.
Do any of the other services want to comment? Similar
projects?
Ms. Ballentine. Yes. I would say that from the Air Force
perspective, mission assurance here and all around the world is
absolutely dependent on energy assurance even at our CONUS
[continental U.S.] bases. The Air Force executes a real-time
mission from bases here in the United States. The threat
environment has changed.
We have always thought about energy resiliency on our
bases. We have always had diesel generators as backup, but it
is a 19th century solution supporting 21st century weapon
systems. So we are advancing how we think about energy
assurance to have smart, cybersecure, highly dynamic, agile
energy systems, microgrids, that allow us to be severed from
the wider utility grid because the threat environment has
changed. We are no longer in an environment where we are just
planning for a big hurricane or an ice storm. We have to
prepare for long-term outages, either due to physical threats
against the U.S. grid or cyber attacks against the U.S. grid.
So the Air Force has a number of tests, as well as with the
other services.
I have to say this is an area where we collaborate very,
very well. We work together. We are learning from each other.
We are ensuring that we are not replicating tests and R&D
[research and development] of various technologies. So we are
not making the same mistakes twice, and we are really learning
from one another.
Mr. McGinn. We are taking in the Department of the Navy a
hard look at all aspects of cybersecurity for our industrial
controlled systems and our SCADA [supervisory control and data
acquisition] systems for reasons of mission assurance. However,
mother nature continues to be the greatest threat to mission
resiliency in our installations around the world. So we are
deploying more and more distributed energy closer to loads. We
are deploying microgrids. I would describe them, Madam
Chairman, as essential microgrids for our bases for operations.
This is a process that has begun with the deployment of
distributed generation assets. Some of them are renewable
energy. Many of them are gas-powered. An example of that latter
category is at Marine Corps Station Yuma, Arizona where we have
a 25-megawatt gas-fired peaker plant that is going on inside
the defense line that will be able to cover all of our Marine
Corps Air Station Yuma requirements should there be a grid
outage. But in the meantime, it is very, very helpful to all of
the customers of APS [Arizona Public Service], the utility that
we are doing this partnership with, as a peaker plant to
prevent a grid outage in times of heavy load.
Ms. Hammack. If you do not mind, one more project that we
are working on in association with Hawaiian electric is in
Hawaii where on Oahu most of the power is generated on the
shoreline in the tsunami zone. Should there be a large weather
event there, the whole island of Oahu is at risk. So in
partnership with Hawaiian Electric, we are giving them an
easement at Schofield Barracks so they will be putting in a 52-
megawatt multi-fuel plant there that will power Schofield
Barracks so we will have an Army barracks up, Wheeler Army
Airfield, so there will be an airstrip since Honolulu airport
is again on the shoreline in the tsunami zone, and it is also
going to power a community hospital.
So when that gets up--we are doing the groundbreaking later
this summer. When that goes up, we will again test it
disconnecting those three locations, disconnecting from the
grid to ensure we have resiliency to help restart the island.
Senator Ayotte. Thank you. I think you might want to invite
Senator Hirono to that groundbreaking. I am sure she really
appreciates what you are doing there.
I understand that Senator Shaheen is on the way. So I am
going to ask you some additional questions until she gets here
to give her an opportunity to ask you.
Secretary McGinn, can you talk to me about the P-371
utility improvements project at the Portsmouth Naval Shipyard?
You have listed that as an important project for the Navy for
2017, including utilities for nuclear facilities at the
shipyard, and how that fits into some of our efforts there.
There have been a lot of energy efficiency efforts at the
shipyard, which I am glad that the Navy continues to support.
Mr. McGinn. About a year and a half ago, we began an in-
depth analysis of Portsmouth Naval Shipyard to determine the
state of health, if you will, of the power utilities. As a
result of that work, that analysis, we have identified exactly
where the best use of dollars are for that project so that, as
you know, anytime you have an outage, it has a lot of
compounding costs when you stop critical operations in the
shipyard and it delays the completion of a lot of key work. So
that project is intended to increase the reliability, the
resilience, if you will, of the shipyard, and to primarily
eliminate the potential for mechanical failures, but will have
other attributes as well to make it more robust in the face of
any storm or other type of natural phenomenon.
Senator Ayotte. Well, we really appreciate your including
that in the 2017 request, and I think it is a really important
priority to our prior discussion here about resiliency. It is
very critical, obviously, at all of our facilities, especially
the shipyard.
Mr. McGinn. As you know, we love the productivity of
Portsmouth and getting those boats in and out on time or
earlier at or below or cost. We want to make sure that
continues.
Senator Ayotte. Well, we appreciate it, Secretary McGinn.
When we can do some of these upgrades to our military
construction, it makes it more efficient for our shipyard
workers. I mean, we are so proud of them. They are phenomenal.
They have been producing, as you know, even setting records
when it comes to the work that they are doing in getting our
attack submarine fleet back out in operation. So thank you.
Mr. McGinn. That is great. Thank you.
Senator Ayotte. I appreciate it.
With that, Senator Shaheen is now here. So I want to turn
it over to her.
Senator Shaheen. Well, thank you, Senator Ayotte, both for
holding this hearing and for keeping it open long enough so I
could get here. I am a little late, I have to admit, because
Bono was testifying before the Appropriations Subcommittee on
Defense Operations.
[Laughter.]
Senator Shaheen. So I had to go there first.
But I certainly want to thank you all very much for what
you are doing to focus on energy and energy use within our
military. I think one of the really unknown secrets that people
do not appreciate is just how advanced the military in this
country is on addressing energy issues that we have. You all
know more directly than anybody else the threat to our national
security from too much dependence on overseas fuels, and so
your work is really critical to our security efforts. I just
want to start by thanking all of you for that.
Also, I want to thank you, Secretary Ballentine, for all of
the support from the Air Force in dealing with the Haven well
at Pease. I know Senator Ayotte has already addressed that and
you have talked about that, but I want to add my appreciation
for what the Air Force has committed to do and what you are
working on. The community is very appreciative. So thank you
very much.
I want to start, I guess, with you, Secretary McGinn,
because one of the things that I understand has been successful
in helping address efficiency has been the hybrid electric
drives [HEDs]. As it has been explained to me, it is kind of
like a Prius because it enables a warship to conduct anti-
pirate patrols for longer periods. I do understand that there
is a question about whether this is something that the Navy is
going to continue to do in future years in our defense program.
I just wondered if you could talk about that and what the Navy
is thinking about with respect to HEDs.
Mr. McGinn. We have in this budget and in the future years
defense plan a start with two retrofits of our Arleigh Burke
destroyers to hybrid electric drive which, as you point out,
increases their on-station time and their loiter time,
especially important in missions like ballistic missile defense
and Tomahawk strike boxes. It allows them to stay there longer
and be effective and not have to go alongside the oiler as
frequently.
The plan in the FYDP [Future Years Defense Plan] calls for
a 4-year, beginning in 2018, and it is our intention to keep
that drumbeat going in the future.
There are always a lot of competing requirements within a
particular program element, the Arleigh Burke destroyers. There
is a balance between how much you want to do in the way of
weapon systems and sensors and all that compared to the hull
mechanical electric that hybrid drive would come under. But we
intend to recognize not just the mission effectiveness, but the
lifecycle cost savings over the 30- or 40-year life of an
Arleigh Burke destroyer that hybrid electric drive brings.
Senator Shaheen. Thank you. I appreciate that that is going
to continue. So that is good to hear.
Secretary Hammack, the New Hampshire National Guard ranks
51 out of 54 in terms of the condition of our facilities and
armories. I do not know if Senator Ayotte has addressed this
already. I assume we are both on the same path in terms of some
of these New Hampshire issues. But I do want to say how pleased
I was that this year's budget request includes two MILCON
projects in New Hampshire. I wonder if you could talk about how
the future efforts to address these kinds of shortfalls, not
only in New Hampshire but around the country, would be affected
by a return of sequestration to the budgeting process.
Ms. Hammack. Sequestration has severely cut our budgets,
and this year's budget is 18 percent below last year's and 60
percent below fiscal year 2013. We are taking risk. We have a
tremendous backlog across Active Duty, Army National Guard,
Army Reserve. The total force has a huge backlog. The fact that
we only put forward about 31 projects for authorization out of
hundreds that are backlogged. If you say five per state and
then five per major base, you are getting into somewhere around
700 to 800 that are backlogged across the United States.
Sequestration has caused us to take risk in military
construction.
We know that we are building facilities to last for 50
years. Yet, we are funding replacement of facilities at well
over 100 years? life. That equation just simply does not work.
The effects of sequestration are felt the hardest in the
installation community. I think that holds true across the
services.
Senator Shaheen. What does that mean for readiness? For
example, we just welcomed home about 350 members of our Guard
who had been in the Middle East, and they had a number of
accolades that they had achieved while over there because of
what a great job they did. But what does having these kinds of
outdated facilities to train with--what does that do to our
readiness?
Ms. Hammack. I have got to tell you I actually visited them
over there, and they gave me a little bottle of maple syrup. I
said, serious, guys, you brought this over with you? They did.
Little bottles of maple syrup. They said it is a little taste
of home.
Senator Ayotte. Are they not awesome?
Ms. Hammack. They are awesome.
But they needed military construction in theater, and they
were in tents that were not in the best condition, yet they
were still doing a great job.
Unfortunately, sequestration is affecting us across the
board, and we are not doing what we know we should do in
installations. The risk, though, in underfunding installations
and military construction is not loss of life or limb. The risk
in underfunding manning and the risk in underfunding training
and the risk in underfunding equipment is loss of life or limb.
When you underfund installations, there is risk, but it is a
mitigatable risk. The longer, though, that you underfund, that
risk gets greater and greater. We are getting to that point,
having seen the last 5 years of underfunding installations and
military construction, that that backlog is getting to a
breaking point. I think the National Guard and their Readiness
Center Transformation Master Plan really identified the risks
that the National Guard is seeing.
Senator Shaheen. Thank you for that, and I certainly agree.
So hopefully we will--and I know this subcommittee and the
entire Senate Armed Services Committee is committed to trying
to roll back those cuts from sequestration because we
appreciate the impact that it is having.
I am out of time, but hopefully the chair will let me
continue.
I just want to ask one final question. Mr. Potochney, am I
pronouncing that correctly?
Mr. Potochney. Yes, ma'am.
Senator Shaheen. The budget request includes $113.6 million
from MILCON-related activities that are associated with the
European Reassurance Initiative [ERI]. I have just come back
from a trip to Europe where I met with some elected officials
from the Baltics, from Eastern Europe who were very
appreciative of the increased support for the ERI in the
President's budget. So can you talk a little bit about what
projects that this funding will support and how those projects
improve the capabilities of our forces in Europe?
Mr. Potochney. I can do so in general terms. They enhance
our capabilities and our presence and our reassurance for our
allies. In that regard, they allow us to carry out the--to
conduct or to maintain the capabilities that we need. We can go
through--and I can get you for the record--each one of the
projects and what it is specifically going to do if that would
help. I would be happy to do that.
Senator Shaheen. I would very much appreciate that.
[The information referred to follows:]

The Department's European Reassurance Initiative (ERI) military
construction request funds 20 projects, as well as planning and design
funding at various locations throughout Eastern Europe. The fiscal year
2017 ERI projects will enhance prepositioning of U.S. combat equipment
and provide support infrastructure improvements to training sites and
increase range capabilities. ERI projects will also improve airfield
infrastructure across the European theater to provide increased
dispersal options, an increased level of fixed-wing fighter operations,
as well as additional mobility capabilities. The airfield support
facility improvements are necessary to make fighter and air mobility
operations less dependent on weather and optimize training and
operations.

Senator Shaheen. I will point out I think I heard you say
that these are critical to us as well as our European allies--
--
Mr. Potochney. Yes, ma'am.
Senator Shaheen.--which I think is an important piece of
the consideration there because as we look at the challenge
that we are facing on the eastern front of Europe from Russia,
it is very important that we are working in conjunction with
our European allies.
Mr. Potochney. Yes, ma'am.
Senator Shaheen. Thank you.
Thank you very much, Madam Chairman.
Senator Ayotte. Thank you, Senator Shaheen.
This concludes the hearing, and I want to thank all of our
witnesses for your service and your testimony today.
[Whereupon, at 3:53 p.m., the hearing was adjourned.]

[Questions for the record with answers supplied follow:]

Questions Submitted by Senator Kelly Ayotte
department of defense new hampshire cleanup sites
Senator Ayotte. Mr. Potochney: In your witness statement you noted
that ``84 percent of our 39,000 sites have reached Response Complete.''
My staff requested an update on Department of Defense cleanup
projects in New Hampshire. Your staff provided a list of 32 cleanup
sites in New Hampshire.

1. What percentage of the cleanup sites in New Hampshire are
`response complete'?
Mr. Potochney. Through the end of fiscal year 2015, the Department
of Defense has achieved response complete at 83 percent of the cleanup
sites in New Hampshire.

2. Senator Ayotte. What is your plan to get the rest of these New
Hampshire sites complete as soon as possible?
Mr. Potochney. Through the end of fiscal year (FY) 2015, we have
completed cleanup at 83 percent of our sites in New Hampshire, and we
are working hard to finish the remaining sites as quickly as possible.
We expect to complete cleanup at 27 of the remaining 32 sites by the
end of fiscal year 2020, at which point 97 percent of the sites in New
Hampshire will be at response complete. We are studying the five sites
we will not complete by fiscal year 2020 to characterize them and
develop appropriate cleanup strategies.
long range discrimination radar system complex
Senator Ayotte. Mr. Potochney: In your written statement you
mentioned the fiscal year 2017 budget request for Phase 1 of the Long
Range Discrimination Radar System Complex in Alaska.

3. Mr. Potochney and Secretary Ballentine: Can you provide an
overview of this requested project and discuss what would specifically
occur in Phase 1?
Mr. Potochney. and Ms. Ballentine. The Long Range Discrimination
Radar (LRDR) is the new midcourse tracking radar that will provide
persistent coverage and improve discrimination capabilities against
long range ballistic missile threats to the homeland from the Pacific
theater. Discrimination capability is the missile defense function that
distinguishes between lethal and non-lethal objects in the threat
missile cluster. LRDR will also provide larger hit assessment coverage
enabling improved warfighting capability to manage Ground Based
Interceptor inventory by enabling the Ballistic Missile Defense System
to implement an improved post-intercept assessment capability.
The LRDR will be built in 2 phases: Phase 1 includes construction
of a Missile Defense Radar System Complex and will construct a System
Security Level-A secure boundary with an entry control facility, the
mission control facility, the radar foundation, site infrastructure and
security, along with the necessary utilities to provide initial
operations of the radar. Phase 2, programmed for fiscal year 2019, will
construct a HEMP shielded power plant.

4. Senator Ayotte. Secretary Ballentine: In light of the growing
ballistic missile threat from North Korea, what missile defense
capabilities would this project provide?
Mr. Potochney. The Long Range Discrimination Radar (LRDR) is the
new midcourse tracking radar that will provide persistent coverage and
improve discrimination capabilities against long range ballistic
missile threats to the homeland from the Pacific theater.
Discrimination capability is the missile defense function that
distinguishes between lethal and non-lethal objects in the threat
missile cluster. LRDR will also provide larger hit assessment coverage
enabling improved warfighting capability to manage Ground Based
Interceptor inventory by enabling the Ballistic Missile Defense System
to implement an improved post-intercept assessment capability.
quality dod school facilities for military families
Senator Ayotte. Mr. Potochney: You mention in your written
statement that your military construction budget continues the
Department's 10 year plan to ``replace and recapitalize more than half
of the [DOD] schools.''

5. Can you please provide an update on the effort to provide our
military families the quality school facilities for their children that
they deserve?
Mr. Potochney. The Department of Defense Education Activity (DODEA)
goal is to have all 173 school facilities in a Good or Fair (Q1 or Q2)
condition by fiscal year 2024 as defined by its recapitalization plan.
The 10 year plan objective was delayed by three years to address
additional analysis required to accommodate decreasing force structure,
completion of the European Infrastructure Consolidation review, and to
address site challenges at several overseas locations. Since receiving
initial recapitalization funds in 2011, DODEA has completed
renovations, additions, or replacement of 12 schools. DODEA also has 83
school projects in planning and design, or currently in construction
and is on track to meet the 2024 plan goal.
public shipyard dry-dock construction and modernization
6. Senator Ayotte. Secretary McGinn: How important are the dry-
docks at our public shipyards to the Navy and our nation?

My understanding is that naval shipyard dry-dock capacity is
substantially inadequate to serve the future life-cycle depot-level
maintenance needs of the U.S. Navy fleet. This means that significant
investment in dry-dock facilities at our four public shipyards is
necessary. I understand that more than $2.3 billion is needed in dry-
dock construction and modernization might be needed at the four public
shipyards.
Mr. McGinn. Importance to Navy: The ability of the public shipyards
to fulfill their mission of depot-level nuclear ship maintenance is
highly dependent on the condition of dry docks along with related
facilities, including piers, nuclear facilities, production shops, and
utilities. Without dry docks, depot-level submarine, aircraft carrier,
and ship maintenance cannot be accomplished.
Importance to the nation: The execution of submarine, aircraft
carrier, and ship depot-level maintenance is essential to national
defense, and the continued availability of dry dock capacity is
essential to ensure an effective and timely response for mobilization,
national defense contingency situations, and other emergency
requirements.

7. Senator Ayotte. Secretary McGinn: Can you specifically describe
the need for dry-dock construction and modernization at each of the
public shipyards?
Mr. McGinn. Naval shipyard dry dock concerns are being driven by
the following:

1. New ship characteristics render some dry docks obsolete.
2. Unprecedented Inactivation and Reactor Compartment Disposal
workload (SSN 688 Class and CVN 65 and 68 Class) over the next three
decades.
3. Environmental vulnerabilities (seismic and flooding) have the
potential to cause loss of critical facilities.
4. All dry docks require periodic maintenance and repair to
maintain certification.

Summary by shipyard:

Puget Sound Naval Shipyard and Intermediate Maintenance
Facility (PSNS & IMF)
o Requires investment to increase the physical capacity of a dry
dock to support CVN 78 Class.
o Requires dry dock electrical and salt-water cooling utility
upgrades to accommodate new systems.
o Requires mitigation for existing dry dock seismic
vulnerabilities.
Norfolk Naval Shipyard (NNSY)
o Requires upgrades to dry dock salt-water cooling utility to
accommodate CVN 78 Class. Electrical utility upgrades are underway.
o Requires investment to mitigate dry dock flooding risks during
extreme weather events.
Portsmouth Naval Shipyard (PNSY)
o Requires investment to increase the physical capacity of a dry
dock to support Virginia-class Submarines with Virginia Payload Module.
Pearl Harbor Naval Shipyard and Intermediate Maintenance
Facility (PHNSY & IMF)
o Requires investment to increase the physical capacity of a dry
dock to support Virginia-class Submarines with Virginia Payload Module.

8. Senator Ayotte. Secretary McGinn: How does the Navy plan to
resource this requirement without crowding out other required military
construction projects?
Mr. McGinn. The Naval Sea Systems Command Dry Dock Modernization
study is not yet complete, and the Navy is still in the process of
evaluating all available courses of action to ensure Naval Shipyards
maintain mission capability. The options being considered include
modifying dry docks to increase capacity, using floating dry docks, and
upgrading dry dock utility systems to make them CVN 78 capable.
new constructions reflect the future workforce
9. Senator Ayotte. Secretary McGinn: As the Navy conducts new
construction and major renovations, in terms of bathrooms and locker
rooms, what assumptions are made regarding the ratio of men and women?
Mr. McGinn. The building user determines the actual number and
gender of personnel whom will occupy the building. During the building
design phase, bathroom and locker room capacity/ configuration is
determined based on the number and gender of the buildings occupants.
Specific plumbing fixture allowances are then determined in accordance
with DOD Unified Facilities Criteria.

10. Senator Ayotte. Secretary McGinn: Do these assumptions reflect
the current or anticipated demographics during the life of the
building?
Mr. McGinn. It reflects the current building occupancy. As the
building is repurposed throughout the life cycle, bathroom and locker
room capacity/configuration and the associated fixtures are determined
based on the proposed new facility user group.
integrated lodging pilot program
Senator Ayotte. Secretary McGinn: On January 27, I wrote to Admiral
Dixon Smith about the conditions at the Navy Gateway Inns and Suites in
Norfolk at Scott Center Annex that many of my constituents have had to
endure while conducting TDY.
Some of my constituents, preparing to conduct maintenance on
nuclear-powered submarines the next day, had to sleep in their cars due
to elevated temperatures.
I appreciate that Admiral Smith took the time to visit the
facility. However, I am concerned that he is saying the temperature
problem in the rooms will not be addressed until 2018, and that is too
long for my constituents to wait.

11. As we enter the summer months, what can we do to expedite a
necessary solution to the temperature problems in the rooms there?
Mr. McGinn. The Navy Gateway Inns and Suites (NGIS) at Scott Center
Annex, Norfolk, is currently on a system that provides both heat and
Air Conditioning (AC) to the room. The current two-pipe system
configuration is unable to run both heat and AC simultaneously. The
change of season's transition date, from heat to AC in the spring and
back to heat in the fall, varies by year and is normally based on
outside ambient temperatures. It is during this transition period that
issues with room temperatures (too hot or too cold) are most likely to
occur. Currently as we enter the summer months, the system is set to
keep room temperature at 72 degrees when the AC is on. The planned
fiscal year 2018 upgrade to the system will allow for both heat and AC
to run simultaneously, eliminating the twice--a-year transition period.
If an NGIS is unable to maintain comfortable room temperatures, patrons
will be offered the opportunity to move to a different room, another
NGIS, other military lodging facility or off-base lodging facilities up
to the full per diem rate.

12. Senator Ayotte. If this problem cannot be fixed sooner, will
the Navy permit my constituents to stay elsewhere-providing them full
reimbursement?
Mr. McGinn. The Navy is committed to providing comfortable
accommodations for all our guests at Navy Gateway Inns & Suites (NGIS)
facilities. If an NGIS is unable to maintain comfortable room
temperatures, patrons will be offered the opportunity to move to a
different room, another NGIS, , other military lodging facility or off-
base lodging facilities up to the full per diem rate.
10 u.s. code Sec. 2476
Senator Ayotte. When 10 U.S. Code Sec. 2476 was revised to
increase the minimum funding level to 6 percent of total revenue of the
military depot, ``sustainment activities pertaining to maintenance''
were specifically excluded from the calculation. It appears that DOD is
continuing to determine the funds available for both investment and
sustainment in its military depots using the 6 percent rule even though
the Statute specifically excludes funds spent for sustainment from the
calculation.

13. Secretary McGinn: It is my understanding that Department of
Navy is now adding investment and sustainment requirements related to
utility systems into the 6 percent calculation. Is this correct?
Mr. McGinn. The DON does not include funds spent for sustainment in
its calculation to meet the 6 percent minimum capital investment for
certain depots per 10 USC Sec. 2476. More specifically, the DON does
not include funds spent for sustainment related to utility systems.
delayed milcon projects
Senator Ayotte. All witnesses: The budget for military construction
is over $1 billion short of what it was projected to be this year in
last year's future year defense program (FYDP).

14. How many military construction projects that you had planned to
request for fiscal year 2017 have been deferred as a result of budget
shortfalls?
Mr. Potochney. For completeness, attached is the list of all
military construction projects that have been either added to and
removed from the fiscal year 2017 Military Construction program. Please
see Appendix A for Milcon Projects.
Ms. Hammack. As a result of shortfalls due to fiscal constraints
under current law budget caps, the Army deferred 10 planned projects
valued at $286 million from its fiscal year 2017 Military Construction
Program. Of the 10 projects, four are Military Construction, Army;
three are Army National Guard; two are Army Family Housing
Construction; and one is Army Reserve.
Mr. McGinn. The Department of Navy's fiscal year 2017 budget
request deferred 36 projects (totaling $940 million programmed) which
were previously programmed for fiscal year 2017 in the Fiscal Year 2016
Future Years Defense Program (FYDP). Of these, 18 projects were delayed
in order to meet budget controls and 18 were replaced with higher
priority requirements.
Ms. Ballentine. From the Total Force perspective, the Air Force
deferred 31 military construction projects (10 Active Duty, 10 Air
Force Reserve and 11 Air National Guard) as a result of budget
shortfalls. The complete list is identified below.
air force kc-46a fuselage trainer milcon request
Senator Ayotte. Secretary Ballentine: As you note in your prepared
statement, to support the arrival of the KC-46A at Pease, the Air
Force's Fiscal Year 2017 budget proposal includes a $1.5 million
military construction request to install a KC-46A fuselage trainer.

15. Can you explain why this MILCON project is important?
Ms. Ballentine. The project is a vital part of the beddown of the
KC-46A at Pease. It is necessary for full operational capability of the
KC-46A mission and will ensure uninterrupted and cost effective
training of personnel supporting home station and COCOM taskings. The
KC-46A is a new aircraft acquisition replacing the KC-135. Additional
part-task training equipment items are required that did not exist for
the KC-135 mission. Existing facilities are not adequately configured
for the new training components and must be converted for the new
function. If not provided, aircrews will require travel to other
installations to conduct training. The lack of adequate training
facilities increase the potential for significant degradation of
mission readiness and performance. There are no other facilities or
cost-effective workarounds available to accommodate this requirement to
support the new mission. Without this facility, the Air Force will
incur costs to store and/or re-direct the fuselage trainer equipment.
south korea
Senator Ayotte. Mr. Potochney: The administration is requesting
that we authorize significant funds for host nation in-kind
contributions on the Korean peninsula as part of the shift away from
Seoul.

16. What are the additional elements that we can expect to see in
the future to complete this effort, and how much of that will rely upon
U.S. taxpayer funds vs. host nation contributions?
Mr. Potochney. As required under section 2803 of the National
Defense Authorization Act for Fiscal Year 2015, the Department of
Defense has requested the authorization of $684.1 million of in-kind
contribution construction projects to be accepted from the Republic of
Korea (ROK) under the U.S.-ROK Special Measures Agreement (SMA). The
SMA specifies cost sharing contributions the ROK makes toward the costs
of stationing U.S. forces on its territory.
The $684.1 million of in-kind contribution projects support the
military construction requirements of U.S. Forces in Korea to include
U.S. construction obligations under the Land Partnership Plan. The Land
Partnership Plan is one component of the U.S. Forces Korea Relocation
Program, where the relocation program--composed of the Land Partnership
Plan and Yongsan Relocation Plan--move the majority of U.S. Forces
located in the city of Seoul and north of Seoul to areas in the
southern half of the ROK.
Most U.S. construction obligations under the Land Partnership Plan
have already been met, being resourced for the most part with ROK
construction contributions accepted by the U.S. under the SMA. Future
Land Partnership Plan projects that will be resourced with ROK in-kind
construction contributions include a brigade headquarters facility,
site development, and a school.
impact of budget on environmental cleanup
17. Senator Ayotte. All Witnesses: How have budget challenges
limited your ability to meet environmental compliance, conservation,
and cleanup obligations?
Mr. Potochney. Budget challenges have not limited DOD's ability to
meet environmental compliance, conservation and cleanup obligations.
DOD continues to fund its statutory and regulatory requirements. DOD's
Fiscal Year 2017 President's Budget request for environmental programs
was $3.4B, which is only a 2 percent reduction from the fiscal year
2016 appropriations, and a less than 1 percent reduction from the
fiscal year 2016 request. Budget constraints have caused relatively
minor delays in the cleanup program. While these delays are not ideal
for cost or efficiency of the overall program, none of the delays have
impacted negotiated schedules for our National Priority List sites.
Ms. Hammack. The Army's Fiscal Year (FY) 2017 Environmental Program
budget request of $1.05 billion is a decrease of 6.25 percent from the
$1.12 billion fiscal year 2016 appropriation, as a result of budget
budget caps under current law. At this funding level, the Army will
meet its current statutory requirements and commitments and maintain a
sound compliance posture for air, water, and waste management. However,
progress will slow toward meeting future goals. In addition, budget
challenges result in risk being taken in Pollution Prevention,
Environmental Technology, and Environmental Cleanup programs. Deferral
of pollution prevention projects and environmental technology
initiatives can be an ``opportunity lost'' to make Army environmental
practices and programs more efficient and effective. The impact to the
cleanup program will result in delays finalizing cleanup
investigations, as well as deferring and extending the construction
timeframes of some cleanup remedies. Deferring or delaying cleanup
projects can also result in increased costs to complete projects and
increased regulatory pressure and enforcement actions.
Mr. McGinn. DON has met all legal agreements and requirements
within the environmental compliance, conservation, and cleanup
programs, despite the budget challenges over the past five years. We
have prioritized our investments to meet these requirements with a key
focus on protecting human health and the environment. Specifically
within the cleanup program, these decreased budgets have resulted in
lower priority sites being delayed to future years.
Ms. Ballentine. The current fiscal environment has led the Air
Force to reduce and defer some lower priority requirements in
environmental compliance and conservation. For example, compliance
education and training focuses on compliance mandated training while
leaving very little professional development or awareness training.
Budget reductions affect the conservation program by deferring lower
priority historic and archeological asset surveys which are important
but do not have specific completion deadlines. Although the Air Force
has continued to manage natural/built infrastructure to reduce risks
and mission impacts, while meeting all applicable legal and regulatory
obligations, Executive Orders, and DOD/Air Force policies, long term
budget reductions and funding deferments may impede our ability to
manage these resources efficiently and effectively in the future.
Budgetary challenges and a dynamic and evolving regulatory environment
have strained the program by limiting our ability to address emerging
contaminant challenges, but the Air Force is still focused on meeting
its currently identified environmental compliance and cleanup
obligations.
utilities privatization
18. Senator Ayotte. All Witnesses: Can each of you provide a brief
update on your service's activities related to utilities privatization?
Mr. Potochney. The Department has privatized 585 systems under the
authority of 10 U.S.C. Sec. 2688 as well as those privatized under
separate authority including 10 U.S.C. Sec. 2671 as of January 1, 2016.
These equate to: Army, 373; Navy, 58; and Air Force, 154.
Ms. Hammack. The Army has privatized 151 systems at 62
installations, representing 43 percent of its U.S. utility systems.
These include 41 electric, 39 natural gas, 33 water, 35 wastewater, and
3 heat/power systems. Another 107 system evaluations are scheduled or
in progress for UP decisions through fiscal year 2023.
Mr. McGinn. Department of the Navy (DON) has privatized ten percent
of current utility systems that distribute electricity, natural gas,
water, wastewater, or thermal energy. Of DON's 811 utility systems, 164
systems are owned by others (built and maintained by entity other than
U.S. Government or where overseas status agreements prevail). 64
systems have been privatized, leaving 583 systems available to
privatize.
In late 2015, Navy executed a privatization contract for the Naval
Air Station Key West waste water system (considered five waste water
systems). Office of the Secretary of Defense (OSD) recently completed a
post-conveyance survey and study that examined the ``pro et contra'' of
systems that have been privatized. Navy sponsored a study that looked
at alternative base management concepts including utilities
privatization. Additionally, Navy is finalizing a facility/utility
privatization study that evaluates the policies, statutory requirements
and the cost-benefit analysis of privatized systems.
The Navy acknowledges unique situations wherein divestiture of
utility assets and establishment of utility service contracts are
advantageous. The Navy fully intends to continue the Utilities
Privatization program where economically feasible and in support of
evolving resilient, cyber secure and energy efficient directives.
Current Navy policy is to privatize utility systems when cost
effective, where minimal energy security constraints exist and where
there are limited regulatory constraints that might restrict
transactions such as state regulations.
Ms. Ballentine. Air Force continues to analyze and privatize
utility systems where there are no precluding security impediments and
a favorable economic business case supports conveyance of the
infrastructure to a private owner. However, as a result of budget
constraints in recent appropriation years, the Air Force temporarily
paused initiating new analyses and issuing new requests for proposal.
The pause has not affected the more than 60 systems that were under
analysis or in solicitation at the time the pause was implemented. In
order to ensure funding is available for solicitations that may result
in awarding a contract, we do not anticipate lifting the pause until
resources can be identified across the Future Year Defense Plan. If
resources are identified and the pause is lifted, the Air Force will
schedule more than 175 remaining systems for analysis and potential
privatization.

19. Senator Ayotte. All Witnesses: What benefits and challenges
have you seen when it comes to utilities privatization?
Mr. Potochney. The Department has found over many years of
privatizing utilities that it provides greater resilience to our bases
and benefits than originally predicted. Some of these benefits are: the
provider often operates at higher standards, resulting in greater
resilience and reliability through modernization of systems; reductions
in emergency and service calls; and better trained resources. In
addition, the Utilities owning the systems leverage all resources
within their territories, allowing them to immediately address any life
safety issues, outages, and implement preventive maintenance programs
that sustain systems.
The Military Services are also realizing commodity reductions, for
example, the Army has reported an estimated 31 percent less gas use
across their privatized utilities and 28 percent less water use after
privatization. The Air Force is receiving similar commodity savings for
their privatized systems.
Utilities privatization also comes with unique challenges such as
discrepancies in system inventory (between a proposed contract vs.
post-privatization); funding for modification and planning for capital
upgrades; and need for better metrics to manage long term success of
privatization (i.e., service contracts can be executed up to 50 years).
Ms. Hammack. The Utilities Privatization (UP) Program is the Army's
preferred strategy to recapitalize and sustain utilities infrastructure
by leveraging private financing and expertise to provide for more safe,
efficient, and reliable mission support. A summary of life-cycle cost
analysis for the UP portfolio shows a 28 percent cost avoidance ($2.1
billion Net Present Value), as compared to the Army cost for similar
upgrades, operations, and maintenance. We see additional, second order
benefits to energy security and resilience. For water systems, metered
data show dramatic leak reductions following privatization. When the
combined benefits of operating cost reductions and commodity savings
are compared to UP Program costs, the Army calculated a Benefit-to-Cost
Ratio of 14.4 to 1 for the past three years. Additionally, UP
investments are prudent insurance against potential infrastructure
failures.
Mr. McGinn.

Benefits:
Privatization can lead to improved reliability,
resiliency, and energy savings for DOD utility systems
Privatization allows for more predictable and regular
capital budgeting for recapitalization and system improvements
Privatization can reduce liability concerns for
catastrophic or unforeseen conditions because privately owned systems
are required to be insured vice Department of Defense (DOD) self-
insurance

Challenges:
Privatization agreements create a ``must-pay'' bill for
DOD commodity users, which can reduce flexibility in their budget
execution (no ability to reduce sustainment funding in the future to
meet emergent Service requirements)
Successful privatization programs require additional
overhead and costs, which are difficult to secure in the current
constrained funding environment.
Privatization contracts can take multiple years to
execute, which adds overhead costs and takes staff away from
operational requirements
Some potential DOD systems are either in poor condition
(due to lack of sustainment resources) or are nearing the end of their
useful life. Private partners require DOD to provide up-front capital
in order to achieve a sustainable system that can be insured and
privatized. These privatization first-costs (capital improvements) are
extraordinarily difficult for DOD Services to program in the current
constrained funding environment. Additionally, these up-front costs
usually impact DOD commodity rates, making them very difficult to
implement. (If these DOD first-costs could be made without impacting
rates or the budgetary scoring system, additional DOD systems may be
more viable as privatization candidates.)

Ms. Ballentine. The benefit of Utilities Privatization (UP) is that
it restores systems to industry standard. A system at industry standard
improves reliability, reduces commodity consumption, and the cost of
system operation, maintenance, repair and recapitalization over the
long term. Paradoxically, the most significant benefit is also the
biggest challenge; maximizing reliability and resilience requires
significant near-term investment to eliminate system deficiencies.
Finding the resources in times of constrained budgets is challenging.
Additionally, we have two other challenges; privatization of wastewater
treatment plants (WWTPs) and a Department of Labor determination that
Davis Bacon Act (DBA) applies to UP. Privatization of WWTPs is impacted
as the Resource Conservation and Recovery Act's domestic sewage
exclusion (DSE) would no longer apply to operations of the WWTP on an
installation. This limits the range of competition because privately
owned WWTPs would likely be regulated under different, and potentially
more stringent, regulatory requirements. Lastly, DBA results in
increased costs and oversight negatively impacting the business case
for UP. We believe DBA rules do not apply to UP contracts awarded under
FAR Part 41, Utility Services. We believe legislation could help
mitigate these challenges.
stormwater impact
Senator Ayotte. All Witnesses: I have heard reports of outdated
drainage systems on some bases causing negative mission impacts.

20. How big of a problem is outdated drainage systems for each
service?
Mr. Potochney. Even though our drainage systems may be old, we are
not aware of any major issues throughout DOD. There may be areas on
some installations where heavy precipitation can cause occasional
flooding, but these are rarely chronic and mission impact is minimal
and isolated to those times of severe weather. Chronic instances are
addressed on a case by case basis.
Ms. Hammack. Operating and maintaining our stormwater
infrastructure does present some challenges, as many of the drainage
systems use overland routes to collect the stormwater into natural
streams and water retention basins. However, while the Army has some
older stormwater collection and drainage systems, they do not pose a
significant negative impact to Army mission capabilities. Although some
drainage systems are not performing optimally or as designed, the Army
has not seen any trend toward significant non-compliance with National
Pollutant Discharge Elimination System (NPDES) permits for stormwater.
Mr. McGinn. Outdated drainage systems are not a signifcant problem
for the Navy. Generally issues only arise when extreme weather results
in volumes of stormwater that exceed the design capacity of the system.
Examples include major flooding to heavy rains at NSA Mid-South in 2010
and storm surges at NAS Pensacola in 2013. Garnering more of Navy's
concern is ensuring compliance with applicable environmental
regulations for stormwater systems.
Ms. Ballentine. There are no indications that there are systemic,
Air Force-wide problems related to storm drainage. $30 million to $52
million a year for the last three years were invested to sustain and
modernize stormwater drainage systems across the enterprise. As the Air
Force shifts toward centralized execution of projects the drainage
requirements have been identified and executed at a higher rate as a
part of the Asset Management business model. The Air Force will
continue to monitor the capability and capacity of these systems in
light of future risk factors such as system age and global warming.
There is always a risk that larger than normal weather events could
exceed the capacity at any particular installation, but there are no
indications that Air Force missions are routinely at risk due to
drainage systems.

21. Senator Ayotte. What is your plan to address these outdated
drainage systems?
Mr. Potochney. Even though our drainage systems may be old, we are
not aware of any major issues throughout DOD. There may be areas on
some installations where heavy precipitation can cause occasional
flooding, but these are rarely chronic and mission impact is minimal
and isolated to those times of severe weather. If they become systemic,
they will be addressed on a case-by-case basis.
Ms. Hammack. Recapitalization of utility and drainage system
infrastructure is included in each installation's capital investment
plan. Where appropriate, the Army incorporates new or updated drainage
strategies that maximize natural recharge and minimize run-off. Along
with other utilities, existing stormwater infrastructure competes
within the Army's limited resources. Consistent with OSD guidance,
strategic and financial priority is placed on investments in
communications, natural gas, electrical, water, wastewater, heating,
and cooling systems. These other utilities provide mission-critical
capabilities, carry valuable commodities, or pose more significant and
direct risks to health, safety, and the environment, than does
stormwater drainage. However, specific stormwater requirements
stipulated under Clean Water Act / NPDES permits are given a priority
and limited stormwater repairs are performed as required on a case-by-
case basis. Army has considered stormwater systems in developing its
schedule for Utilities Privatization (UP) evaluations.
Mr. McGinn. Outdated drainage systems are not a significant problem
for the Navy, but are identified through specialized structural
inspections based on system criticality; projects to address drainage
issues are subsequently developed, prioritized, and compete for
available funding. Drainage systems not meeting design requirements or
are in failing condition that result in mission impacts or
environmental regulation violations would receive higher priority than
other drainage issues. Substandard drainage systems may be replaced or
upgraded as part of MILCON projects, or repaired through O&M,N funded
projects.
Ms. Ballentine. The Air Force uses a risk based model to determine
investment in the infrastructure portfolio. Storm water and drainage
projects compete against all infrastructure repair, maintenance and
sustainment requirements in the Air Force. Installations have
identified potential projects to repair, sustain and maintain storm
water systems and drainage. There are 21 drainage and/or storm water
projects valued at $30.6 million planned to take place at 16 bases in
fiscal year 2016. In fiscal year 2017, there are 23 projects worth
$51.6 million programmed to be executed at 16 bases. After fiscal year
2017, there will still be 57 requirements worth $51.9 million at 28
bases that will need to be completed in the following years. The Air
Force is taking a proactive approach to address the current condition
of drainage systems in order to address its readiness and mission
support.

22. Senator Ayotte. Referring to section 2813 of the Fiscal Year
2016 NDAA, is OSD or your service aware that the fiscal year 2016 NDAA
explanatory text explicitly stated, ``We note that there has been
confusion about whether the definition of a utility system for the
treatment of wastewater includes the treatment of stormwater. We
believe, consistent with the Department of Defense's interpretation,
that wastewater includes stormwater.''?
Mr. Potochney. Even though stormwater is not covered explicitly in
the definition of ``utility system'' in 10 U.S.C. Sec. 2688(i), the
Department agrees with the option to include conveyance of stormwater
treatment on a case-by-case basis where it makes economic sense.
Currently the DOD is drafting language to include further clarification
on current internal guidance.
Ms. Hammack. Yes, the Army is aware of the fiscal year 2016 NDAA
explanatory text stating that the definition of a utility system for
the treatment of wastewater includes the treatment of stormwater.
Mr. McGinn. Yes, Navy is aware of this 2016 NDAA text.
Ms. Ballentine. The Air Force is aware of the fiscal year 2016 NDAA
explanatory text stating that the definition of a utility system for
the treatment of wastewater includes the treatment of stormwater.
However, stormwater is not included in the definition of ``utility
system'' in 10 U.S.C. Sec. 2688(i). The Air Force believes explanatory
text provides guidance, but the language in the statute provides the
basis for compliance policy. At this time we are unaware of any OSD
interpretation on the treatment of stormwater as explained in the
NDAA's explanatory text. The Air Force canvassed the Army, Navy, and
Department of Defense on this question and are unaware of any
countervailing opinions.
__________
Questions Submitted by Senator Mazie K. Hirono
installation energy resilience planning
23. Senator Hirono. Secretary Hammack and Mr. Potochney, I commend
the Army for expanding its use of renewable energy, including the
upcoming biofuel-capable generation plant at Schofield Barracks in
Hawaii. Last year, I introduced the DOD Energy Security Act, which
would require the DOD to plan for integrating on-site power generation,
energy storage, and micro-grid technologies to enhance energy security
at critical military installations. What plans do the Army and the rest
of the Department of Defense have to enhance energy resilience at
critical installations?
Mr. Potochney. It is Department of Defense policy that DOD
Components shall take necessary steps to ensure energy resilience on
military installations. DOD Components are required to plan for and
have the capability to ensure available, reliable, and quality power to
continuously accomplish DOD missions from military installations and
facilities. This includes aligning energy requirements to critical DOD
missions, appropriately sizing energy generation systems; and
maintaining, fueling, and testing energy generation systems and
infrastructure. DOD Components are also required to perform periodic
vulnerability assessments and audits to assess the risk of energy
disruptions on military installations, and implement remedial actions
to remove unacceptable energy resilience risks.
Ms. Hammack. It is Department of Defense policy that DOD Components
shall take necessary steps to ensure energy resilience on military
installations. DOD Components are required to plan for and have the
capability to ensure available, reliable, and quality power to
continuously accomplish DOD missions from military installations and
facilities. This includes aligning energy requirements to critical DOD
missions; appropriately sizing energy generation systems; and
maintaining, fueling, and testing energy generation systems and
infrastructure. DOD Components are also required to perform periodic
vulnerability assessments and audits to assess the risk of energy
disruptions on military installations, and to implement remedial
actions to remove unacceptable energy resilience risks.
The Army's large-scale renewable energy portfolio includes 14
projects throughout the United States, totaling approximately 350 MW
and over $880 million in capital investments. The 50 MW multifuel-
capable power generation plant under development at Schofield Barracks
in Hawaii is evidence of Army efforts to enhance energy resilience at a
critical installation. Other large-scale renewable energy projects
located on installations in Arizona, Georgia, Maryland, New York,
Texas, and Alabama further demonstrate the Army's efforts to enhance
energy resilience at critical installations.

24. Senator Hirono. Secretary Hammack and Mr. Potochney, how can
renewable sources of power such as solar and wind provide utility
resiliency?
Mr. Potochney. Energy resilience solutions are not limited to
traditional standby or emergency generators and can include integrated
and distributed renewable energy generation sources. Renewable energy
can provide on-site generation independent from the local grid and
improve the energy resilience of military installations. Specifically,
renewable energy systems, when installed with the necessary inverter
hardware and coupled with battery storage or other forms of on-site,
distributed energy generation, can provide continuous power to a
military installation in the event of an energy disruption. This
redundant, secure and reliable power from renewable generation can
significantly reduce the consequences of blackouts or other power
disruption events and helps to enable the DOD to continue to carry out
its mission.
Ms. Hammack. Energy resilience solutions are not limited to
traditional standby or emergency generators and can include integrated
and distributed renewable energy generation sources. Renewable energy
can provide on-site generation independent from the local grid, and
thereby improve the energy resilience of military installations.
Specifically, renewable energy systems, when installed with the
necessary inverter hardware and coupled with battery storage or other
forms of on-site distributed energy generation, can provide continuous
power to a military installation in the event of an energy disruption.
This redundant, secure and reliable power from renewable generation can
significantly reduce the consequences of blackouts or other power
disruption events, and helps to enable the DOD to continue to carry out
its mission.

25. Senator Hirono. Secretary Hammack and Mr. Potochney, to what
extent, if any, have you achieved the ability to continue to operate
our installations in the event of a grid disruption?
Mr. Potochney. It is Department of Defense policy that DOD
Components shall take necessary steps to ensure energy resilience on
military installations. DOD Components are required to plan for and
have the capability to ensure available, reliable, and quality power to
continuously accomplish essential DOD missions from military
installations and facilities. This includes aligning energy
requirements to critical DOD missions, appropriately sizing energy
generation systems, and maintaining, fueling, and testing energy
generation systems and infrastructure. DOD Components are also required
to perform periodic vulnerability assessments and audits to assess the
risk of energy disruptions on military installations, and implement
remedial actions to remove unacceptable energy resilience risks. DOD
components are fully in compliance with DOD policy and every military
installation currently has backup generators to operate our essential
missions in the event of a grid disruption.
The DOD also has an on-going study that will establish a potential
framework to assess different energy resilience solutions on our
military installations. The study's analysis can be utilized by the
Department to ensure the implementation of cost-effective and reliable
energy resilience solutions at military installations.
Ms. Hammack. It is Department of Defense policy that DOD Components
shall take necessary steps to ensure energy resilience on military
installations. DOD Components are required to plan for and have the
capability to ensure available, reliable, and quality power to
continuously accomplish essential DOD missions from military
installations and facilities. This includes aligning energy
requirements to critical DOD missions, appropriately sizing energy
generation systems, and maintaining, fueling, and testing energy
generation systems and infrastructure. DOD Components are also required
to perform periodic vulnerability assessments and audits to assess the
risk of energy disruptions on military installations, and implement
remedial actions to remove unacceptable energy resilience risks. The
Components are fully in compliance with DOD policy, and every military
installation currently has backup generators to operate our essential
missions in the event of a grid disruption.
The DOD also has an ongoing study that will establish a potential
framework to assess different energy resilience solutions on our
military installations. The study's analysis can be utilized by the
Department to ensure the implementation of cost-effective and reliable
energy resilience solutions at military installations.
The Army has demonstrated the ability to continue full base
operations, when disconnected from the power grid, at Fort Drum, NY. In
September 2014, a contract was awarded to ReEnergy Black River LLC for
the provisioning, production, purchase, and delivery of Fort Drum's on-
site electricity requirements by a biomass generation facility. To test
the system, Fort Drum was fully disconnected from the grid in November
2015. The project performed as anticipated, providing the installation
with 100 percent of its energy requirements.
veteran opportunities
26. Senator Hirono. Mr. Potochney, I offered an amendment that was
added to the pending energy bill to boost the involvement of veterans
in a new energy workforce training pilot program. I would like to
ensure that veterans are able to take advantage of the job
opportunities associated with the rapidly expanding clean energy
market, which a witness at a recent Energy and Natural Resource
Committee hearing reminded us is a $300 billion global market annually.
Do the services have a sufficient number of building managers trained
in managing, energy efficiency, cybersecurity, smart meters, and other
building technologies? If not, what are the services doing to attract
and train veterans for building manager jobs?
Mr. Potochney. The Military Services review all workforce
requirements (i.e. number of personnel, required experience and
training) to support their infrastructure, to include building managers
trained in managing energy, cybersecurity, smart meters, and other
building technologies. Currently there are veterans in various jobs
such as energy managers and building managers. Even though we are not
aware of any programs that specifically target veterans for building
manager jobs, all energy/cyber security billets are open to veterans.
As with each vacancy, we will follow the veteran hiring policies which
have been established, and evaluate each applicant and select the best
person available for the position.

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