[Senate Hearing 114-219]
[From the U.S. Government Publishing Office]



 
       DEPARTMENT OF DEFENSE APPROPRIATIONS FOR FISCAL YEAR 2016

                              ----------                              


                        WEDNESDAY, MARCH 4, 2015

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 10:32 a.m., in room SD-192, Dirksen 
Senate Office Building, Hon. Thad Cochran (chairman) presiding.
    Present: Senators Cochran, Shelby, Collins, Blunt, Reed, 
and Schatz.

                         DEPARTMENT OF DEFENSE

                         Department of the Navy

                        Office of the Secretary

STATEMENT OF HON. RAY MABUS, SECRETARY


               opening statement of senator thad cochran


    Senator Cochran. The committee will please come to order. 
We are delighted to be able to welcome a distinguished panel of 
witnesses to discuss the fiscal year 2016 budget submission of 
the Navy and Marine Corps.
    Our hearing will review the budget requests that have been 
submitted to the Congress. And we are also very pleased to 
personally welcome each of you distinguished leaders in our 
military forces here today: the Honorable Ray Mabus, Secretary 
of the Navy; Admiral Jonathan Greenert, Chief of Naval 
Operations; and General Joseph Dunford, Commandant of the 
Marine Corps.
    For fiscal year 2016, the President's budget is requesting 
$161 billion in base funding to support the Navy and Marine 
Corps. The request is $11 billion higher than the current level 
of funding.
    The request also includes $7 billion to support ongoing 
overseas contingency operations. These funds support the 
forward deployment of sailors and marines throughout the world 
and the important work done every day to ensure our Nation's 
security.
    This committee recognizes the uncertainty of the current 
fiscal environment on the Navy and Marine Corps. If the 
Department of Defense has to live with the budget caps in 
fiscal year 2016, the Navy has already indicated that it will 
not be able to support the current defense strategy.
    We appreciate the complexity of building the fiscal year 
2016 budget and look forward to any comments this distinguished 
panel of witnesses will make in regard to the health and well-
being of our services, as well as the work and dedication put 
to the challenge of protecting our national security interests 
by all of the men and women under your command.
    Our committee looks forward to working with each of you 
closely as we work our way through the fiscal year. We are 
confident this leadership, and the men and women who serve in 
our Armed Forces, will protect the security interests of our 
country.
    Mr. Secretary, the floor is yours, and we welcome you to 
make any comments that you see fit.


                  summary statement of hon. ray mabus


    Secretary Mabus. Thank you, Mr. Chairman, my home State 
Senator, and members of the committee. Thank you so much for 
this opportunity to discuss the Department of the Navy.
    Here, with Chief of Naval Operations John Greenert, 
Commandant of the Marine Corps Joe Dunford, I have the great 
privilege of representing the sailors and marines, the 
civilians who support them, and all of their families.
    This is Admiral Greenert's last posture testimony before 
this committee. He has been a steady hand on the helm of the 
U.S. Navy through the past 4 years of international instability 
and budget turbulence. Every day, his judgment, his advice, his 
counsel, have been critical. It is an honor to serve with him, 
and he will leave a lasting legacy.
    Today, our security interests face an increasing array of 
threats and demands, while our budgetary situation grows more 
challenging and complex. But it is clear that the Navy and 
Marine Corps team offer the best value to advance both our 
global security and our economic interests.
    Uniquely, the Navy and Marine Corps provide presence around 
the world, around the clock. We are the Nation's first line of 
defense, ready for anything that might come over the horizon. 
Presence means we respond faster; we stay on station longer; we 
carry everything we need with us; and we do whatever missions 
are assigned by our Nation's leaders without needing anybody 
else's permission.
    We have always known that America's success depends on an 
exceptional Navy and Marine Corps. Article I of our 
Constitution authorizes you in Congress to raise an army when 
needed, but it directs you to provide and maintain a navy.
    From the first six frigates to our growing fleet today, 
from Tripoli to Afghanistan, sailors and marines have proven 
the Founder's wisdom. American leaders across the political 
spectrum have understood the vital significance of seapower.
    We are truly America's away team. We deploy just as much in 
peace as we do in war. And our role in the last 70 years in 
securing sea lanes and freedom of commerce has boosted our own 
and the world's economy.
    Nearly half of the world's population lives within 100 
miles of the sea. Ninety percent of global trade goes by sea, 
and 90 percent of all voice and data go under the sea. The 
shelves of our stores are stocked through just-in-time delivery 
with products from all over the globe, and some 38 million jobs 
in America are directly linked to seaborne international trade.
    For seven decades, the Navy and Marine Corps have been the 
primary protector of this international system that has created 
unprecedented economic growth. And while we have led this 
effort, we have worked with allies and partners, increasing 
interoperability, establishing relationships that also help 
keep the peace. That is why the National Defense Strategy that 
we have today is so clearly focused on the maritime domain and 
requires investment in maritime assets.
    For the past few years, the Department of the Navy has 
attempted to minimize the impact of an uncertain budgetary 
environment marked by numerous continuing resolutions, 
imposition of sequester-level funding, and the threat of the 
return of sequestration. This environment has made it more 
difficult, but even more critical, to set priorities and make 
hard choices.
    The presence that our Navy and Marine Corps uniquely 
delivers is built on four foundations: people, platforms, 
power, and partnerships. These are the keys to the capability, 
capacity, and success of our naval services, and they remain my 
top priorities.
    Our people, our sailors and marines, are well-known for 
their ability to exercise independent judgment and the 
flexibility to adapt to changing circumstances or environments. 
We remain committed to providing our sailors and marines and 
our civilians with the training and support they need to 
maintain our naval presence. And we include in this their 
dedicated families and our wounded.
    We have launched a comprehensive approach to ensure it's 
the world's healthiest, fittest, most-resilient, and best-
educated force truly representing America's diversity. We 
continue to aggressively combat sexual assault, abuse, ethical 
failings, and similar challenges.
    But our people, as good as they are, can't do their job 
without platforms. Providing presence, being where we are 
needed, when we are needed, requires ships, submarines, 
aircraft systems, equipment. Quantity has a quality all its 
own. And the main thing that means is that we have to have a 
properly sized and balanced fleet.
    On September 11, 2001, the Navy's battle force stood at 316 
ships. By 2008, our fleet had declined to 278 ships. Our focus 
on two ground wars only partly explains this decline.
    In the 5 years before I took this job, the Navy contracted 
for only 27 ships, not enough to stop the slide in the size of 
the fleet. In the first 5 years I have been in this job, we 
have contracted for 70 ships, halting and reversing the 
decline. And by the end of this decade, we will be at 304 
ships.
    We have accomplished this with a direct and fundamental 
business approach: increasing competition; relying more on 
fixed-price contracts; and thanks to this committee and 
Congress's help, multiyear and block buys.
    But budget instability and uncertainty seriously erode our 
ability to grow our fleet, manage our resources, and maintain 
the industrial base.
    In the face of this budgetary uncertainty, cutting ships is 
the most damaging, dangerous, and least reversible course of 
action, which is why I am committed to preserving shipbuilding.
    Fueling those ships, aircraft, vehicles of our Navy and 
Marine Corps is a vital operational concern and enables the 
global presence necessary to keep the Nation secure. That is 
why the Navy has a history of innovation, particularly in 
energy, moving from sail to steam to oil to pioneering nuclear. 
In all cases, we believe our national security interests and 
the ability of the Navy and Marine Corps to meet its missions 
must be enhanced by increasing our energy diversity and 
efficiency.
    And finally, our ability to maintain presence and advance 
global security will also be augmented through partnerships. 
Cooperation makes us more effective.
    Again and again, naval forces have proven themselves the 
most immediate, the most capable, and the most adaptable option 
when a crisis develops. Overall, the fiscal year 2016 
President's budget balances current readiness needed to execute 
our assigned missions while sustaining a highly capable fleet.
    That tough budget climate, however, demands our most 
rigorous examination of every dollar we spend. And we must 
continue our aggressive efforts to cut unnecessary costs in 
every program, and shift resources from tail to tooth.


                           prepared statement


    I want to thank this committee for all that you have done 
to ensure that the Navy and Marine Corps remain the preeminent 
fighting force in the world. When America has called, the Navy 
and Marine Corps have always answered.
    I look forward to answering your questions and working 
along with you, the Commandant, and the CNO (Chief of Naval 
Operations) to maintain our great Navy and Marine Corps.
    Thank you, Mr. Chairman.
    [The statement follows:]
                  Prepared Statement of Hon. Ray Mabus
             maritime presence is critical in today's world
    Chairman Cochran and Vice Chairman Durbin, members of the 
Committee, thank you for affording this opportunity to discuss 
readiness and posture of the Department of the Navy. With Chief of 
Naval Operations Jonathan Greenert and Commandant of the Marine Corps 
Joseph Dunford, I have the great privilege of representing the Sailors 
and Marines who serve our Nation around the world, the civilians who 
support them and all of their families.
    I cannot let it pass without noting that this will be Admiral 
Greenert's last posture testimony before this committee. He has been a 
steady hand on the helm for the U.S. Navy through the past 4 years of 
international instability and budget turbulence. Every day his 
judgment, his advice and his counsel have been critical. He has been a 
great CNO, and it has been an honor to serve with him. He will leave an 
enduring legacy of having advanced the interests and capabilities of 
our Navy and our Department, and I know this committee and our country 
want to share in offering our heartfelt thanks.
    This statement, together with those provided by General Dunford and 
Admiral Greenert, presents to you and to the American people, an 
overview of the Department of the Navy, and highlights our priorities 
as we move forward with the fiscal year 2016 budget process. As the 
Secretary of the Navy, I am responsible for recruiting, training, and 
equipping the almost 900,000 Sailors, Marines, and civilians who spend 
every day working to defend the American people and our national 
interests.
    This opportunity to review our current posture comes at a 
particularly critical juncture in our Nation's history. Our national 
security interests face an increasing array of threats and demands 
around the globe, even as our fiscal and budgetary situation grows more 
challenging. However, this is an opportune moment as well, as I firmly 
believe the threats and demands are best met with a strong and 
comprehensive maritime response. Similarly, I believe naval assets 
offer not only the best value to preserve our national security by 
advancing our global interests, but also the best value in supporting 
our own and the world's economy to help meet our fiscal challenges. The 
rationale for that belief is as simple as it is enduring.
                         the value of presence
    Uniquely, the United States Navy and the United States Marine Corps 
provide presence around the globe, around the clock. We are the 
Nation's first line of defense, ready for any challenge that might come 
over the horizon. Presence means we respond faster, we remain on 
station longer, we carry everything we need with us, and we carry out 
the missions assigned by our national leaders without needing anyone 
else's permission.
    America's leadership role in the world is due in large part to our 
Nation's sea services capability and capacity to ensure stability, 
build on our relationships with allies and partners, deter adversaries, 
prevent wars, and provide our Nation's leaders with options in times of 
crisis. And, should those measures fail, the combat power necessary to 
fight and win in any sort of conflict. As America's away team, 
performing most often far from home, the operational tempo of the Navy 
and Marine Corps are--unlike our sister services--little different in 
times of peace or in times of conflict. There are no permanent 
homecomings for Sailors and Marines because we are never a garrison 
force.
    Born a maritime nation, we have known throughout our 239 years that 
for America to succeed, we must have an exceptional Navy and Marine 
Corps. Thomas Paine famously declared in Common Sense in 1776 that 
``the cause of America is in a great measure the cause of all 
mankind.'' He was equally adamant that the defense of liberty required 
a capable naval force. More than just physical security and defense 
from European powers, Paine drew direct connections between the Navy 
and the economic success of the American experiment.
    Our Nation's founders, whether northern merchants and lawyers like 
John Adams or southern planters like Thomas Jefferson, also considered 
a Navy critical to our Nation's success. Article One of our 
Constitution grants Congress the power to ``raise'' an Army when 
needed, but directs Congress to ``provide and maintain a Navy.'' Over 
the past two centuries, American leaders from across the political 
spectrum have hewed to that Constitutional direction and have, in a 
nonpartisan fashion, promoted the vital significance of sea power. And 
over the past two centuries, from Tripoli to Iwo Jima to Tripoli, from 
the first six frigates to the Great White Fleet to the great fleets of 
World War II, our Navy and Marine Corps have protected and advanced 
American interests, stability and freedom around the world.
    Today, the value and importance of our naval assets to security and 
stability here at home and around the world has never been greater. 
Nearly half the world's population lives less than 60 miles from the 
sea. With ninety percent of global trade carried by sea, even those who 
live in landlocked States are dependent on the world's oceans. In these 
days of an Internet-connected world, 95 percent of all the voice and 
data goes under the ocean through cables, including the data keeping 
the world's financial system running.
    We live in an age of globalization and worldwide trade. The shelves 
of stores of every variety are stocked through ``just in time'' 
delivery with products from all over the globe. Estimates show that a 
single major port facility in the U.S. impacts more than a million 
American jobs and contributes about a billion dollars a day to our 
Nation's economic productivity. Overall, some 38 million American jobs 
are directly linked to seaborne international trade.
    The security and stability of the international system of trade and 
finance is tied irrevocably to the free movement of goods and data 
across and under the sea, and is more than just a military concern. It 
impacts potentially every American in the prices we pay for goods and 
services and in the very availability of those goods and services. 
While it is far away and out of sight to most Americans, our naval 
presence around the world isn't a theoretical construct.
    For seven decades, the United States Navy and Marine Corps have 
been the primary protector of this international system. There is a 
sound basis in the proposition that rising international prosperity is 
directly linked to the United States Navy. We have kept the sea-lanes 
open. We have kept freedom of navigation open for anybody engaged in 
peaceful and legitimate trade. As the President has said, we have 
``been the anchor of global security.''
    We benefit from this enormously economically, but we also benefit 
from the way that shared economic success helps to limit conflict and 
war. Around the world, high unemployment, stagnant economies, financial 
struggles often lead to social disorder, political unrest, upheaval, 
and outright conflict. Maritime instability contributes to these 
problems, stoking the fires- as can increasing competition for scarce 
resources. By helping to secure the world's maritime commons, by 
providing a calming presence, and by responding to crises early to 
limit their escalation and enhance diplomatic opportunities, the 
ability of the U.S. Navy and Marine Corps to be where it matters when 
it matters is vital to international stability. That is why our 
national defense strategy is so clearly focused on the maritime domain 
and requires investment in maritime assets.
                   around the globe, around the clock
    The best illustration of the extent and impact of the presence 
provided by our Nation's sea services can be seen in just a single day 
of operations. I've chosen July 26th not because it was especially 
important, but because it was reasonably typical. On that day, I was on 
a trip around the world, visiting Sailors and Marines and meeting with 
some of our international partners. In my nearly 6 years as Secretary, 
I've traveled to 131 countries and territories and traveled nearly one 
million air miles. I believe I can do my job better by actually seeing 
and talking with the men and women who serve our Nation where they are 
serving, and by meeting face-to-face with representatives of other 
countries, and not just sitting behind a desk in Washington.
    My trip last July began in Hawaii, observing activities and 
operations in the world's largest maritime exercise, Rim of the Pacific 
(RIMPAC), which included the navies of 22 Nations, including allies 
from the region, like Japan and Australia and South Korea, but also 
valued NATO allies like Norway, which sent a warship all the way from 
the Baltic Sea to join the exercises. For the first time it also 
involved ships from the People's Republic of China's Navy. During the 
exercise, these diverse forces worked together on everything from 
search and rescue and humanitarian missions to practicing counter-
piracy tactics and maritime security missions.
    As I flew onward to Tokyo to meet with Japanese leaders, an annual 
exercise, MALABAR, was just beginning in the Indian Ocean. This 
bilateral U.S.-Indian naval exercise, which has grown in scope and 
complexity since its first iteration, has fostered mutual understanding 
with our Indian counterparts and enhanced our ability to operate with 
one another in a wide range of missions. This year, the Maritime Self-
Defense Force from Japan joined the exercise in an important 
demonstration of multilateral cooperation between Pacific and Indian 
Ocean nations. The relationship between the nations of the Pacific and 
the Indian Oceans will continue to be critical in these important 
maritime regions.
    On the same day, in Afghanistan, our Marines were increasing 
training of Afghan security forces, working toward turning over 
operational responsibilities to them, as the Marines reduced their 
direct combat mission. On that day, we had more than 5,000 Marines and 
Sailors in the country, patrolling, training, and working with our 
Afghan partners and NATO allies.
    At the same time, our Marine Corps Black Sea Rotational Force was 
involved in PLATINUM LION, a series of exercises with our Romanian, 
Bulgarian, and Serbian partners, taking place in Bulgaria. Working with 
these NATO allies and friends from Eastern Europe, this exercise is an 
important annual event in the Black Sea region to build the capacity 
and capability of our partners and to promote peace and stability in an 
area that has been in turmoil for the past several years. Our Marine 
Corps Black Sea Rotational Force regularly deploys throughout Europe, 
training with other forces, monitoring security developments, and 
enhancing our ability to operate with our partners and allies in future 
contingencies.
    On July 26 the U.S. Embassy in Tripoli was evacuated as the 
fighting in Libya intensified and the State Department decided U.S. 
personnel were no longer safe at the Mission. The Marines of the 
Special Purpose Marine Air Ground Task Force-Crisis Response, in 
support of U.S. Africa Command, helped coordinate the evacuation and 
escorted the vehicles that carried our diplomatic and military 
personnel to safety in Tunisia. This kind of operation, reacting to 
threats and problems as they develop, is the very reason our Navy and 
Marine Corps are forward deployed, and must be forward deployed to 
effectively give our leaders options.
    On that day about half of our Navy's ships and submarines were at 
sea, with 99 of our ships forward deployed and another 41 training near 
our shores. Tens of thousands of Sailors and 36,000 Marines were away 
from their homes, far from friends and family, forward deployed around 
the world, serving in both combat and cooperation missions.
    That was just one day last July. Each of these exercises on the 
world's oceans, training events, security cooperation engagements with 
friends and allies, combat operations in Afghanistan and contingency 
operations in North Africa, continued to build and strengthen our 
partnerships and alliances to help protect Americans and secure the 
global system.
    For 365 days per year, the Navy and Marine Corps operate across the 
planet. When strikes against ISIL targets in Iraq and Syria were 
ordered, Navy ships and aircraft were quickly in range and launched 
operations. In fact, for the first 54 days, FA-18s off USS George H.W. 
Bush were the lone strike component. When the President decided to 
employ military assets to support the fight against Ebola in West 
Africa, V-22s and Marines from our Special Purpose Marine Air Ground 
Task Force-Crisis Response were on the ground within hours to provide 
logistical support to the medical responders.
    Our Nation's Defense Strategic Guidance is clearly a maritime-
centric strategy focused on the Asia Pacific, on the Arabian Gulf, on 
building partnerships, all while maintaining our presence around the 
globe. To fulfill our role in this strategy the Navy and Marine Corps 
face daily demands ranging from humanitarian assistance and disaster 
relief, to protecting our embassies, to working with scores of partners 
and allies, to dealing with multiple asymmetric threats and potential 
conflicts. The Navy and Marine Corps meet these demands, and many more, 
using the same people and the same platforms and equipment 
demonstrating the versatility and flexibility that is the hallmark of 
this force.
    For the past few years we at the Department of the Navy have 
attempted to minimize the impact of an uncertain budgetary environment, 
marked by numerous continuing resolutions, the imposition of sequester-
level funding and the threat of the return of sequestration. That 
environment has made it more difficult, but even more critical, to set 
priorities to make hard choices and to find opportunities to improve 
our stewardship of taxpayer dollars.
    Almost 6 years ago, when I was preparing for my confirmation 
hearing to be Secretary and began closely examining the challenges our 
Navy and Marine Corps faced, it became clear to me there are four areas 
that demand our attention in order to provide and maintain the presence 
our Navy and Marine Corps uniquely deliver. Those four areas are 
People, Platforms, Power and Partnerships. Those have been, and 
continue to be, the key factors in assuring the capability, capacity 
and success of our naval services, and that is why they have been, and 
will remain, my top priorities.
People--Our True Advantage
    It is one of the great maxims of naval history that Sailors and 
Marines are the sea services' greatest advantage and most important 
asset. In the U.S. Navy and Marine Corps, we have the best people in 
the world. Our Sailors and Marines are well known for the ability to 
exercise independent judgment, to flexibly adapt to changing 
circumstances or environments that were unanticipated at the start of a 
deployment, but for which their training has fully prepared them. 
Perhaps less well known is how far down the chain of command we devolve 
critical responsibility. Aboard USS Ronald Reagan in the weeks after 
the earthquake and tsunami that ravaged Japan, I was surrounded by flag 
officers, but the briefing on relief operations I received came from a 
Third Class Petty Officer and a Lieutenant Junior Grade because they 
had been instrumental not just in executing, but also in designing, the 
effort.
    Providing our Sailors, Marines and civilian workforce the training 
to deal with the uncertainties they will certainly face and providing 
the support that they need to do their jobs is one of our most 
important responsibilities. This also extends to helping their 
dedicated families and ensuring we support our wounded or injured 
veterans.
    Three years ago, we introduced the 21st Century Sailor and Marine 
Initiative, to provide a more coordinated and comprehensive approach to 
assuring we have the healthiest, fittest, most resilient, and best 
educated force in the world. The goal is to help our Sailors and 
Marines maximize their personal and professional readiness, and to 
assist them and their families with the mental, physical and emotional 
challenges of military service. It eliminated the stovepipes that 
existed between many of the programs designed to support our people and 
helps us address issues like suicide, sexual assault, and alcohol 
related incidents in a comprehensive way that protects our Sailors and 
Marines and makes them stronger. A fleet full of successful Sailors 
will ensure a successful Navy, and a force full of successful Marines 
will ensure a successful Marine Corps.
    We are looking to expand the initiative by exploring new ways to 
improve the fitness of our force. We are reassessing our physical 
fitness requirements to make them more relevant to warfighting and to 
instill a ``culture of fitness'' instead of just training for a 
physical fitness test. This means reviewing nutritional standards, 
making efforts to reduce stress, and improving healthcare and support 
networks to deal with issues like suicide and abuse. We are also 
working hard across these areas to curb the all-too-common factor of 
alcohol-related incidents, which can end careers and, tragically, 
sometimes lives. Available data shows that the number of these damaging 
incidents has trended downward. To ensure we maintain that trend, we 
are using media and education campaigns, directed actions against the 
irresponsible use of alcohol like continuing to place reasonable limits 
on where and when alcohol is sold on base, and the continued use of the 
alcohol detection program implemented in 2013.
    Sexual assault and harassment remains a challenge that we are 
responding to aggressively. In the past several years we have taken 
numerous steps to address it. These include widespread training like 
our bystander intervention program, increased use of interactive means, 
victim support programs like the Victim's Legal Counsel, and new 
investigative resources. Combined with much more direct leadership 
engagement, evidence suggests that these efforts are improving the 
confidence of Sailors and Marines in the system and their belief that 
reports will be taken seriously. Because of this increased trust in 
their chain of command, we have seen survivors coming forward in larger 
numbers and also, increasingly, reporting incidents that took place 
earlier than the year it is being reported. This large increase in 
reports, especially since 2012 when many programs began to mature, is 
what we anticipated seeing if our efforts were successful, since they 
would represent increased confidence in the system. We are turning more 
attention to the risk of retaliation, especially by peers, as this 
issue has increased in prominence in our surveys. Our interactive 
education programs are having a measurable impact, and we will continue 
to develop and deploy those. Sexual assault is an ``insider threat'' 
with devastating impacts on the Navy and Marine Corps. We've done 
myriad things to attack this insidious threat, but, no matter how much 
we've done, there is more to do until we've eliminated the scourge of 
sexual assault.
    Vice Admiral James Calvert, who earned two Silver Stars as a 
submariner in World War II, once wrote that ``as important as ships 
are, naval history is made by men.'' I would make one change to that 
statement: today naval history is made by men and women. From the 
appointment of Admiral Michelle Howard as the Vice Chief of Naval 
Operations, to our work expanding roles and missions open to women to 
the maximum extent possible, we are leading the military in our quest 
to ensure we're using our best and most talented service members across 
the force. We will continue our efforts to recruit and retain a diverse 
force, including a more representative number of women. A more diverse 
force is a stronger force.
    For several years now, female officers have had the opportunity to 
serve on our ballistic and guided-missile submarines, and they have 
performed exceptionally well, as anticipated, earning their 
qualifications and opening a new path. We are expanding opportunities 
for them. USS Minnesota and USS Virginia, both fast attack submarines, 
are leading the integration of women into the rest of the submarine 
force at this moment. In January, the Navy also announced a plan and a 
set of milestones for fully including enlisted women on submarines that 
will begin next year.
    Women have also been integrated into the Coastal and Riverine 
Squadrons and have deployed. We have also opened 348 billets for Navy 
positions that support Marine Corps units. The Marine Corps continues 
on pace with their study of the positions that are currently closed to 
women and will have results later this year. In accordance with the 
Secretary of Defense's guidance, the default position will be that all 
currently closed positions will be opened to the assignment of women 
unless an exception is formally requested.
    Talent is best cultivated by promoting and advancing our Sailors 
and Marines on merit and competition. It also requires us to maximize 
their opportunities to broaden their experience and exposure to new 
ways of doing things. We have to look at things like moving away from 
year group management for our officers and expansion of the Career 
Intermission Program (CIP), as well as other reforms and adjustments 
within our current system. While a number of our initiatives can be 
undertaken within our current authorities, there are some that will 
require adjustments to the law, including changes to the Defense 
Officer Personnel Management Act (DOPMA), which is almost four decades 
old. We have made legislative proposals in this area, and we ask for 
your help in bringing our personnel system into the 21st century.
    Maintaining our presence around the world is hard on our force. 
That is one of the reasons why in 2014 we began the implementation of 
the Optimized Fleet Response Plan (OFRP). This is a program that Navy 
is using to schedule and plan our deployments and the maintenance of 
our platforms. Over the course of the past 13 years of war, one of the 
biggest challenges for our Sailors and Marines has been predictability 
in their deployments. The goal of OFRP is to return some amount of 
scheduling to their lives. Missing holidays, birthdays, and other 
significant family events is hard enough, but not knowing when it will 
happen makes things even more difficult. There is no way to completely 
eliminate the unexpected. Events around the world can, and do, take on 
a life of their own, and our men and women know this. Increasing the 
predictability of deployments will help with the stress on our Sailors 
and Marines and their families and also has the added benefit of 
helping us properly support our maintenance requirements and readiness 
posture.
    There will be times when a crisis erupts somewhere in the world and 
our Sailors and Marines remain deployed in order to deal with it. The 
world gets a vote. For the past several years we have had a number of 
ships and units remain at sea far beyond the normal deployment length. 
In order to help our Sailors and Marines and their families during 
these extended deployments, we've implemented the Hardship Duty Pay--
Tempo (HDP-T) program. When operational tempo is high and a deployment 
extends beyond more than 220 consecutive days, this pro-rated 
additional payment kicks in. This is an effort to show our Sailors and 
Marines we understand the difficulty these extended deployments create 
for them and their families and to show them, in a tangible way, the 
gratitude of the Department of the Navy and the American people.
    Those Sailors and Marines on sea duty, deployed away from home 
around the world, are the backbone of the Navy and Marine Corps, and 
they enable us to provide and maintain our global presence. Despite the 
challenges involved, we need to ensure our men and women are 
incentivized to take on sea-going assignments. This past year we 
increased Career Sea Pay for those who have spent a total of 3 years at 
sea in order to both improve critical sea-duty manning and reward those 
who take these challenging sea-going assignments. We also increased 
Career Sea Pay--Premium, which recognizes Sailors and Marines who spend 
more than 36 consecutive months in sea-going positions or who have 
spent a cumulative 8 years at sea during their career. These increases 
are long overdue since they were last adjusted in 2001.
    The Reserve Component continues to be a vital part of the Navy and 
Marine Corps Team. In fiscal year 2014 we mobilized 2,700 individual 
Reserve Sailors and Marines to support operations around the world. As 
the force level shifts in Afghanistan, our Reserve Component will be 
taking on the vast majority of the individual augment requirements 
requested by the joint force. This allows us to focus our active 
component on filling critical sea billets to help ensure fleet 
wholeness and readiness. Reserve Sailors and Marines are deployed 
globally, and we will continue to maintain a Reserve that is ready, 
relevant, and responsive to the Nation's needs.
    Attracting and retaining our talent is critical to maintaining our 
innovative and adaptive force. An important part of that involves the 
challenge of military compensation. Cooperation between Congress and 
the Department of Defense on this issue will be vital as we look at 
slowing the growth rate of our personnel costs. We must keep the faith 
with the men and women who are in uniform. And we must look for the 
right ways to build incentives and retain our most talented people. But 
we also must recognize that growth in pay and benefits must be 
contained or we will not be able to provide our Sailors and Marines 
with the training and equipment that they need.
    Our civilian workforce is also vital to the success of the 
Department of the Navy. They help design our ships, aircraft, and 
equipment and are critical enablers of our forces. Without them, we 
literally would not have a fleet to put to sea. And we could not 
operate ashore at our bases across the globe. Over the past few years 
our civilian workforce has persevered through some very trying times. 
From pay freezes, to hiring freezes, and the huge, negative impact of 
furloughs, they have shown an immense amount of dedication to our Navy, 
Marine Corps, and our Nation. In 2013 twelve of our civilians were 
killed, and others injured in visible and invisible ways, in the attack 
on the Washington Navy Yard. There is no more tragic example of how our 
civilians share the burden with those in uniform. We continue to 
support the victims and the families who endured this tragic attack and 
have implemented numerous security measures to improve the safety of 
our workforce.
    This committed and patriotic workforce is the foundation of how the 
Department of the Navy operates. In order to ensure we have the most 
capable people, in the right positions, we run a number of leadership 
development programs. Annually we select participants for senior 
leader, executive leader, and developing leader programs to provide 
education and training that will help our people tackle the issues we 
face.
Platforms--America's Fleet
    The hard truth of providing the presence the American people and 
our Nation's leaders expect is that it requires platforms. To be where 
we are needed, when we are needed, we must have the ships, submarines, 
aircraft, vehicles, and equipment for our Sailors and Marines to 
operate. That means we must have a properly sized fleet. Quantity has a 
quality all its own.
    Recently much has been said in many venues about the size of our 
fleet. The completely wrong assertion is made over and over that our 
fleet is shrinking. Let me state this very clearly: our fleet is 
growing and will number greater than 300 ships before the end of this 
decade.
    It is absolutely true that our fleet shrank dramatically between 
2001 and 2008. On September 11, 2001, the Navy's battle force stood at 
316 ships. But, by 2008, after one of the great military buildups in 
American history, our fleet had declined to 278 ships.
    Part of the reason for that was understandable: our focus was on 
two ground wars. But, frankly, it cannot all be attributed to that. In 
the 5 years before I took office as Secretary, the Navy only contracted 
for 27 ships, far too few to maintain the size of the fleet, much less 
grow it. In my first 5 years as Secretary, we contracted for 70 ships. 
We have halted and reversed the decline.
    And we haven't done this at the cost of naval aviation. During my 
time in office we have bought 1,300 aircraft. That is 40 percent more 
than the Navy and Marine Corps bought in the 5 years before this 
administration took office.
    We have done this both in ships and aircraft by taking some direct 
and basic actions including: block buys and multi-year procurements; 
increased competition; stable designs and mature technologies; targeted 
reviews; pursuing cross-program common-equipment buys; and 
affordability through hard but fair bargaining. In addition, we have: 
supported shipyard facility improvements and optimal-build plans; 
conducted rigorous ``should cost'' studies; designed equipment for 
affordability and modularity; instituted strict controls to fight 
``requirements creep;'' used open-architecture systems to the maximum 
extent possible; and signed shipbuilding capability preservation 
agreements resulting in more competitive shipyards and lower costs for 
the Navy.
    The amphibious and auxiliary ships industrial base is of concern to 
us and is at risk should future funding levels be reduced. We have 
recently introduced an integrated acquisition strategy for LHA 8, T-
AO(X), and LX(R) to support stability and competition within this 
sector of the industrial base. The strategy will help ensure the ships 
are built affordably, while providing the greatest degree of stability 
for the industrial base.
    There are a number of references previously to the industrial base. 
A healthy design and production industrial base is critical to 
achieving what is needed for our fleet in ships, aircraft, weapons and 
all procurements. Stability and predictability are critical to the 
health and sustainment of this industrial base.
    This is especially true in shipbuilding. Changes in ship-build 
plans are significant because of the long lead time, specialized 
skills, and extent of integration needed to build military ships. Each 
ship is a significant fraction of not only the Navy's shipbuilding 
budget but also industry's workload and regional employment. 
Consequently, the timing of ship procurements is a critical matter to 
the health of American shipbuilding industries, and has economic 
impacts at the local, regional and national levels.
    It is important, therefore, to provide stability and predictability 
to the industrial base to maintain our ability to continue to build the 
future fleet. In the overall picture, we should not pay for one Navy 
ship by cutting another Navy ship; each ship is crucial in many, many 
ways.
    The Department's shipbuilding plan continues to build the balanced 
force we require. This year we have requested funding for nine new 
ships as well as for the refueling of the carrier USS George 
Washington. We also plan to modernize 11 cruisers, which are our most 
capable ships for controlling the air defense of a carrier strike 
group. The Navy's cruiser modernization plan, in accordance with fiscal 
year 2015 Congressional direction, will allow the Navy to reduce 
overall funding requirements while most efficiently increasing the 
capability and extending the service life of these large surface 
combatants.
    Our efforts to maintain and affordably procure our fleet's ships 
and submarines have continued through this past year. The Department 
has established a steady state Ford Class procurement plan designed to 
deliver each new ship in close alignment with the Nimitz Class ship it 
replaces. CVN 78 (future USS Ford) cost performance has remained stable 
since 2011 and under the Congressional cost cap. We are also committed 
to driving down and stabilizing aircraft carrier construction costs for 
the future John F. Kennedy (CVN 79) and the future Enterprise (CVN 80) 
and have made significant progress in doing so. As a result of the 
lessons learned on CVN 78, we have made significant changes to reduce 
the cost to build CVN 79, including improvements in material 
availability and pricing; major changes in build strategy and processes 
determined to execute construction activities where they can most 
efficiently be performed; incorporation of design changes only for 
safety, those mandated or lower costs; and aggressive measures for cost 
control in government furnished equipment. The costs of CVN 79 also 
remain stable and under the Congressional cost cap.
    In our attack submarine program we are continuing procurement of 
two Virginia Class submarines per year while reducing construction time 
and also developing the Virginia Payload Module (VPM). Thanks to the 
support of Congress in authorizing the use of a multi-year procurement 
(MYP), in April 2014, the Navy awarded the Block IV contract for ten 
submarines. The savings realized with this MYP contract was more than 
$2 billion, effectively giving the Navy ten ships for the price of 
nine.
    SSBNs, coupled with the Trident II D-5 Strategic Weapons System, 
represent the most survivable leg of the Nation's strategic arsenal and 
provide the Nation's only assured nuclear response capability. 
Originally designed for a 30-year service life, the Ohio Class has been 
extended to 42 years of operation. They cannot be extended further. For 
this reason, we are intensively continuing development of the follow-on 
twelve-submarine Ohio Replacement Program (ORP). This effort is driven 
by meeting the program's performance requirements while reducing costs 
across design, production, operations and sustainment. However, in 
order to afford the ORP procurement costs beyond this Future Years 
Defense Program (FYDP) it is clear that this program must be funded by 
a significant increase in the Navy's shipbuilding budget, or from other 
sources. Otherwise, funding this necessary program will effectively 
keep the Navy from performing its other critical missions.
    The Arleigh Burke Class (DDG 51) program remains one of the Navy's 
most successful shipbuilding programs--62 of these ships are currently 
operating in the fleet. We are in the third year of an MYP. The second 
of our fiscal year 2016 ships will provide significant upgrades to 
integrated air and missile defense and additional ballistic missile 
defense capability by introducing the next flight (Flight III), which 
incorporates the Air and Missile Defense Radar (AMDR) designed to 
address a number of growing threats.
    With four Littoral Combat Ships (LCS) in service, operational 
experience continues to increase through at-sea testing and rotational 
deployments, and the value of this class continues to be demonstrated. 
USS Fort Worth began her maiden deployment to the western Pacific, and 
upon arrival in Singapore was sent to assist in the search and recovery 
efforts for the downed Air Asia airliner in the Java Sea. USS Fort 
Worth's deployment marks the beginning of continuous LCS forward 
presence in Southeast Asia and will validate the 3:2:1 (three crews, 
two ships, one ship always forward-deployed) rotational manning and 
crewing concept for the LCS class. This will also be the first 
deployment of the Navy's MH-60R Seahawk helicopter along with the MQ-8B 
Fire Scout on an LCS.
    After an exhaustive analysis by the Navy's Small Surface Combatant 
Task Force, in December 2014 the Secretary of Defense approved the 
Navy's proposal to procure a new small surface combatant based on an 
upgraded LCS. This followed his February guidance to review the program 
and consider development of a more lethal and survivable small surface 
combatant. The upgraded LCS will provide multi-mission anti-surface 
warfare and anti-submarine capabilities, as well as continuous and 
effective air, surface and underwater self-defense. They are both more 
lethal and more survivable, as well as continuing to be affordable and 
providing the fleet with the requirements it needs. As these 
capabilities are consistent with those of a frigate, I directed 
designation of these new small surface combatants as Frigates (FF).
    Our amphibious ships are incredibly versatile. Across the spectrum 
of maritime operations, from the humanitarian assistance and disaster 
relief efforts in the Philippines following super-typhoon Haiyan to the 
combat operations in Libya during Operation ODYSSEY DAWN, the Navy and 
Marine Corps team do a wide array of things with these ships. At this 
moment, the USS Iwo Jima Amphibious Ready Group and 24th Marine 
Expeditionary Unit are in the Fifth Fleet area of operations, ready for 
anything that might happen from Iraq and Syria to Yemen.
    Congress provided $1 billion of funding in the fiscal year 2015 
Appropriations Act toward a twelfth LPD, and we have requested the 
balance of funding this year for this ship, LPD 28. Procurement of LPD 
28 will assist in mitigating impacts to shipbuilding and combat systems 
industrial bases, and the ship's design and construction features will 
fully exploit some of the ongoing design innovations and cost reduction 
initiatives that are necessary for the LX(R) to achieve its 
affordability goals.
    Support vessels such as the Mobile Landing Platform (MLP) and the 
Joint High Speed Vessel (JHSV) provide many additional options and 
flexibility to Combatant Commanders. The future USNS Lewis B. Puller 
(MLP 3), the first Afloat Forward Staging Base (AFSB) variant of the 
MLP, which includes a flight deck, was christened in early February in 
San Diego and will deliver in summer 2015. The Navy awarded MLP 4 AFSB 
in December 2014, and plans to request MLP 5 AFSB in fiscal year 2017. 
JHSV production continues with delivery of the fifth JHSV anticipated 
in April 2015. JHSVs 6 through 10 are also under contract. In fiscal 
year 2015, Congress provided funding for an eleventh JHSV, which we 
expect to be put under contract this coming summer.
    Combat Logistics Support ships fulfill the vital role of providing 
underway replenishment of fuel, food, repair parts, ammunition and 
equipment to forward deployed ships and embarked aircraft to enable 
them to operate at sea for extended periods of time. We will begin to 
replace the Fleet Replenishment Oilers beginning in fiscal year 2016 
with the TAO (X). These will be double-hulled and meet Oil Pollution 
Act of 1990 and International Marine Pollution Regulations.
    With the strong support of Congress, we continue to strengthen 
naval aviation as well. Adding new aircraft to our growing fleet will 
increase U.S. naval strength, in terms of both force capacity and 
capability. In the vertical lift community, multi-year production 
contracts for the MV-22 and MH-60R continue, as does the Marine Corps 
procurements of the AH-1Z and UH-1Y.
    The E-2D, our new and upgraded electronic early-warning aircraft, 
reached initial operating capability in October and is continuing 
production under a multi-year contract. We continue to buy P-8As to 
replace the venerable P-3. Last year, in 2014, we saw the first 
deployment of this aircraft and continuous rotational deployments to 
Seventh Fleet are now underway. This past year also continued the 
integration of the EA-18G Growler electronic attack aircraft into the 
fleet. With Congress's addition of 15 Growlers in 2015, we will have 
153 of these aircraft in 16 squadrons. With the final Navy deployment 
of the legacy EA-6B Prowler, and the looming retirement of the Marine 
Corps' last Prowlers, these incredibly capable new aircraft take over 
the Nation's airborne electronic attack mission.
    The F-35 Joint Strike Fighter remains a central part of the future 
of both Navy and Marine Corps aviation. This past year we saw the 
Marine Corps begin F-35B operations at two additional bases. The 
Marines are on track to have initial operating capability (IOC) for the 
first squadron this year. The Navy completed the F-35C's first flight 
operations at sea aboard USS Nimitz (CVN 68). According to plan, the 
Navy is the last service to acquire the F-35 and is continuing an 
acquisition strategy to achieve IOC in the 2018-2019 timeframe. 
Incentive agreements with the builders have been achieved that will 
improve aircraft unit costs while also improving the learning curve on 
production.
    Unmanned systems are critical to our ability to be present; they 
lessen the risk to our Sailors and Marines and allow us to conduct 
missions that are longer, go farther, and take us beyond the physical 
limits of pilots and crews. Launching and recovering unmanned aircraft 
as large and capable as our manned fighters from the rolling decks of 
aircraft carriers, launching unmanned rotary-wing patrols from our 
small surface combatants, and deployment of unmanned underwater 
vehicles globally are elements of both the present and future of 
maritime presence and naval warfare.
    We are moving ahead with a number of unmanned programs in the 
effort to rapidly integrate them into the fleet. The MQ-8B Fire Scout 
has already begun regular deployments. When USS Fort Worth deployed to 
Singapore recently the ship took a mixed aviation detachment of a 
manned MH-60R helicopter and MQ-8B UAV's. This kind of hybrid 
employment, pairing our manned and unmanned systems to take advantage 
of the strengths of each, will be a hallmark of our future approach to 
unmanned systems. The first operational variant of the larger and more 
capable next generation Fire Scout, the MQ-8C, was delivered in 2014. 
This aircraft will bring double the endurance and double the payload of 
the older versions.
    We continue to work toward a full start of the Unmanned Carrier 
Launched Airborne Surveillance and Strike system (UCLASS) program. This 
unmanned addition to the air wings aboard our aircraft carriers is a 
vital part of the future of naval aviation. Full start of this program 
has been delayed pending a defense-wide review. Having the proper 
balance of long-endurance surveillance capabilities and the ability to 
grow into long range, penetrating strike missions in the future is 
critical. Development also continues of the unmanned underwater systems 
that are part of our future mine warfare capabilities. These systems 
will see formal operational testing in the Littoral Combat Ship program 
in 2016.
    Maintaining the required pace of Navy shipbuilding while continuing 
the recapitalization of our aviation assets and other platforms made 
necessary by our deployment cycles and operational tempo is a very real 
issue. It will necessitate continued leadership, oversight and 
management to make sure we develop innovative solutions and maximize 
the efficiency in our acquisition system. Building our platforms is a 
unique public-private partnership and a key economic engine in nearly 
every State in the union. It provides more than 100,000 high-skill, 
high-paying jobs and helps ensure the foundation of global prosperity 
and security that our naval presence has assured since World War II.
    Because cuts to our shipbuilding programs are the least reversible 
in their impact on our fundamental mission of providing presence and in 
their consequences to the industrial base and to our economy, I am 
committed, to the maximum extent possible, to preserve ship 
construction and to seek reductions in every other area first, should 
further budget reductions such as sequestration become reality.
Power--Energy and Efficiency
    For two centuries the United States Navy has had a history of 
leadership in energy innovation, transitioning from wind to coal, coal 
to oil and finally pioneering nuclear power. Fueling the ships, 
aircraft, and vehicles of our Navy and Marine Corps is a vital 
operational concern and enables the global presence necessary to keep 
the Nation secure. But power and energy are also issues of national and 
international security.
    My responsibility as Secretary of the Navy is to ensure that the 
Navy and Marine Corps have the right people, with the right training 
and the right tools to defend our country. Power and energy are an 
important part of ensuring our people have what they need and can get 
where they are needed. It is a critical element of our presence and why 
Navy has always been an energy innovator.
    Throughout human history, access to resources has been a major 
source of conflict. Energy and fuel can and are being used as weapons. 
Threats against the shipping lanes in the Middle East, European 
dependence on Russian gas supplies and the impact of Russian energy 
dependence by the Ukraine are the subject of daily headlines. This is 
true regardless of the price of a barrel of oil, although the price 
decline of the last year has certainly impacted strategic calculations 
around the globe.
    Here in the United States, with domestic production up and new oil 
and gas reserves being discovered even as prices have fallen, energy 
still remains a security concern. Even if we were able to produce every 
single drop of oil or gas that America needs domestically, we cannot 
control the price. Oil is the ultimate global commodity, often traded 
on world markets based on speculation and rumor. Oil price instability 
is often the result of global instability, and prices fluctuate with 
little warning. The volatility of oil prices, both up and down, has 
been repeatedly demonstrated in recent years. And energy supply will 
remain an issue for many of our allies and for others around the globe, 
creating the potential for instability and even conflict.
    Operationally, energy matters now more than ever. The ships and 
aircraft that we deploy include advanced capabilities that make us the 
most effective expeditionary fighting force in the world. But our 
weapons platforms also use far more energy than their predecessors. Our 
ability to maximize our capabilities depends on having the energy 
available to power them.
    In 2009, I established formal energy goals for the Department of 
the Navy to help drive the Navy and Marine Corps to strengthen our 
combat effectiveness by using energy more efficiently and by 
diversifying our sources of power. From the deployment of hybrid 
electric drives, to the introduction of alternative fuels into the 
fleet, to the Marines' use of expeditionary power systems in 
Afghanistan, we have made real progress over the last few years.
    This past year we christened USS Zumwalt (DDG 1000), which has an 
electric propulsion system. This system is state-of-the-art and will 
significantly reduce fuel demand, which is a critical part of ensuring 
we have the fuel to power next generation weapons, like the Laser 
Weapon System (LaWS) and the electro-magnetic rail gun. This past fall 
we commissioned USS America (LHA 6) which is driven by hybrid electric 
power plants. This is the same engineering design used in USS Makin 
Island (LHD 8) that, for her maiden deployment, cut her fuel 
consumption nearly in half when compared to other big deck amphibious 
ships. We also took delivery of two more Virginia Class submarines, 
with their advanced nuclear power systems that lead the world in 
efficiency and safety.
    Our shore installations, like our shipyards, are critical to our 
operations. We continuously strive to be smarter and improve energy 
efficiency at our installations. And we are leveraging private sector 
funding to accomplish that goal. In fact, the Department of the Navy is 
on track to have awarded nearly one billion dollars in energy savings 
performance contracts by December 2016. That's one billion dollars to 
improve our infrastructure and lower our energy bills in the process. 
The Renewable Energy Program Office (REPO) coordinates and manages our 
goal of producing or procuring one gigawatt of cost-effective renewable 
energy for our bases. We will reach this goal by December of this year. 
The power we are buying through our REPO projects will be cheaper, over 
the life of the contract, than our current rates.
    Last September we announced contracts with three companies that 
have committed to produce drop-in, military-compatible biofuels at 
operational quantities. Let me be clear: we are not obligated to buy 
fuel from any producer and do not intend to buy any fuels unless they 
are cost competitive. That said, it is critical we continue to use 
alternative fuels in our ships and aircraft to ensure operational 
flexibility. The private sector, including major airlines, is expanding 
the use of alternative fuels just as we are.
    Diversifying our energy supply for our ships, our aircraft, and our 
bases helps guarantee our presence and ability to respond to any 
crisis. Increasing our energy efficiency assures that we can remain on 
station longer or extend our range, without the delays and 
vulnerability of refueling. And the benefits of competition, as we have 
demonstrated in shipbuilding, are always welcome. In these ways, our 
focus on power and energy is helping to ensure the United States Navy 
and Marine Corps remain the most powerful expeditionary fighting force 
in the world and their ability to protect and advance American 
interests around the globe.
Partnerships--Naval Diplomacy and International Cooperation
    In the 21st century, to be effective, all nations and people that 
seek freedom and security have to carry their own share of the 
responsibility of defending the global system. A collective effort will 
assure our navies can provide the necessary presence to maintain 
freedom of navigation and maritime security around the world. Whether 
blue water or brown, America's Navy and our other allies and partners 
help assure stability and security, creating and strengthening global 
relationships, providing humanitarian assistance and disaster relief, 
deterring adversaries when possible, and defeating aggression when 
necessary.
    Cooperation on the world's oceans helps us diffuse tensions, reduce 
misunderstandings, and limit conflict. The world's maritime tradition 
is nearly as old as human history. From harbors near the Arctic Circle 
and around the Mediterranean, from the littorals of Asia to the shores 
of Africa, the Americas and Australia, human civilizations have 
launched one great fleet after another toward the horizon. Again and 
again naval forces have proven themselves the most immediate, the most 
capable and the most adaptable option when a crisis develops.
    This is even more true when like-minded navies, with similar 
national policy objectives, can find ways to work together. Whether 
exercising together in the Baltic or in Southeast Asia, operating 
against pirates in the Gulf of Aden, or cooperating to provide relief 
in the aftermath of natural disasters, the strong cooperation between 
the United States and our partners and allies makes a difference all 
over the globe. Partnerships are a key contributor to presence.
    Building partnerships and establishing trust between our Nation and 
our Navy and countries around the world is why I travel to visit with 
foreign military and governmental leaders. Those meetings are critical 
to building the relationships that can help us deter conflict or 
respond in a more coordinated and effective manner to manmade or 
natural crises. It is critical in my job as Secretary of the Navy to 
understand the global landscape and the security challenges--and 
opportunities. Briefings and PowerPoint slides can never match the 
value of firsthand observation and interactions, as anyone who has 
served aboard a ship, at a forward outpost, or in a warzone can tell 
you. As the old Navy saying goes, ``You can surge people and you can 
surge platforms, but you cannot surge trust.''
    Our rebalance to the Pacific continues to be an important part of 
our partnership efforts. We must have the right platforms in the right 
places to ensure our friends and allies understand our commitment. 
We're moving more ships to the central and western Pacific, including 
forward basing an additional fast attack submarine in Guam and as I 
mentioned earlier we are forward stationing four Littoral Combat Ships 
out of Singapore. We are ensuring that our most advanced platforms are 
in the Pacific, so we're increasing the number of DDG's with the 
Ballistic Missile Defense systems based in Japan and the P-8A maritime 
patrol aircraft are making their first rotational deployments in the 
region. In the longer term, by 2018 we will deploy an additional 
Amphibious Ready Group to the Indo-Pacific region and we will deploy a 
growing number of Joint High Speed Vessels and Mobile Landing Platforms 
there. With these changes, and others, by the end of the decade 60 
percent of our fleet will be based in the Pacific, a fleet which will 
be larger than the one we have today.
    The Marine Corps is also building its capacity to work with our 
Indo-Pacific partners. We continue to increase the rotational 
deployment of Marines to Australia, which will culminate in the regular 
rotational deployment of a Marine Air Ground Task Force (MAGTF) of 
approximately 2,500 Marines. The Marines have increased the size of 
this deployment from just over 200 Marines to more than 1,000 and over 
the past year these Marines out of Darwin have conducted exercises and 
theater security operations throughout the region. We are also 
continuing forward on the plan to base another MAGTF (part rotational, 
part permanent) of about 5,000 Marines in Guam, which will become a 
central hub for many of our Pacific operations.
    This past year saw dramatic developments in Eastern Europe and the 
Black Sea region. The Navy and Marine Corps have been central to 
demonstrating support for our allies and friends and American interests 
in the region. Alongside the Marine Corps' Black Sea Rotational Force's 
operations in Eastern Europe, a series of Navy ships have deployed into 
the Black Sea to ensure freedom of navigation and work with our 
partners there. The bonds between America and Europe and our shared 
values remain as strong today as ever.
    That is demonstrated in one of the world's strongest and most 
enduring defense partnerships: the North Atlantic Treaty Organization. 
It is true that America's defense strategy calls for an increased focus 
on the Western Pacific, Arabian Gulf, and Indian Oceans. But that same 
strategy also ensures that we aren't turning away from our longstanding 
allies in Europe and also calls for renewing our commitment to NATO. A 
very concrete example of this is the move of four ballistic missile 
defense capable DDGs to Rota, Spain. All of these efforts are a 
continuation of NATO's 65-year mission to keep all nations free, and 
not to claim territory or tribute.
    This past summer USS America sailed from the Gulf Coast, where it 
was built in Mississippi, around South America to its new homeport in 
San Diego. As America sailed through the Americas, the Sailors and 
Marines aboard conducted theater security cooperation activities with 
countries in the region, training together and helping to develop the 
skills needed to counter illicit trafficking and conduct combined 
operations. Our new Joint High Speed Vessels are also deploying to the 
Americas with the ability to operate for longer periods and carry 
adaptive payloads. Our security is undeniably tied to our neighbors and 
we are working with innovative and small-footprint approaches to 
enhance this.
    This past September, I invited the leaders of our partner navies in 
West Africa to join me for a series of discussions in Newport, Rhode 
Island called the Gulf of Guinea Maritime Security Dialogue. Naval 
leaders from 16 nations bordering the Gulf of Guinea came to discuss 
how we could increase collaboration in a region where piracy, 
extremism, trafficking and insecurity of all types are on the rise. We 
discussed a unified code of conduct for maritime law enforcement and 
encouraged more direct cooperation in the region. As the economy in the 
Gulf of Guinea continues to grow, so does the increasing relevance of 
guarding against transnational crime like maritime terrorism and the 
illegal movement of drugs and weapons. The U.S. Navy and Marine Corps 
will continue to work with our partners in West Africa and help them 
improve their capabilities and promote collaboration.
    Sailors and marines of every nation have much in common with other 
sailors and marines. Working together, we become more inter-operable, 
we can provide key training and develop the operational capabilities of 
like-minded countries and navies. This in itself increases stability 
for the global system. It distributes the burdens and costs of maritime 
security and makes us all safer by reducing the likelihood of conflict. 
Direct engagement with foreign leaders by our Department's senior 
leadership is a central component of building the human connections 
that are critical to successful partnership and combined operations. 
They are a large part of what builds the international relationships, 
trust, and inter-operability that is central to our globalized world.
    In this interconnected world, threats know no boundary, no 
international lines, so the burden of security has to be shared. Across 
239 years of history our Navy and Marine Corps have worked with allies 
and friends. From suppressing the slave trade on the coast of Africa in 
the mid-19th century to the combined operations of World War II, the 
examples are endless. From the exercises I mentioned earlier like 
RIMPAC, MALABAR, and PLATINUM LION, to our multi-lateral and bi-lateral 
meetings with both uniformed and government leaders, to our combined 
operations like the search for Air Asia Flight 8501 and counter-piracy 
patrols off the Horn of Africa; these examples illustrate that the 
partnerships we build and maintain today remain critical to our global 
presence.
                   fiscal year 2016 budget submission
    The Department of the Navy's proposed budget for fiscal year 2016 
is designed with a focus on the three objectives laid out 2014 
Quadrennial Defense Review: protect the homeland, build security 
globally, and project power and win decisively when called upon. In 
doing so we have looked across the FYDP to maintain our ability to 
conduct the ten primary missions listed in the Defense Strategic 
Guidance to 2020 and beyond. Overall the fiscal year 2016 President's 
Budget balances current readiness needed to execute assigned missions 
while sustaining a highly capable fleet, all within a tough fiscal 
climate.
    Our approach to this budget has focused on six objectives. First, 
maintain a credible and modern sea-based strategic deterrent. Second, 
sustain our forward global presence to ensure our ability to impact 
world events. Third, preserve both the capability and capacity to 
defeat an aggressor in one multi-phase contingency operation while 
simultaneously denying another aggressor the ability to achieve their 
objectives. Fourth, ensure that the force is adequately ready for these 
operations through critical afloat and shore readiness and personnel 
issues. Fifth, continue and affordably enhance our asymmetric 
capabilities. Finally, sustain our industrial base to ensure our future 
capabilities, particularly in shipbuilding.
    Even as we deal with today's fiscal limitations, we cannot let slip 
away the progress we've made in shipbuilding. It takes a long time, 
measured in years, to produce a deployable ship. As I noted earlier, it 
is the least reversible thing we might do to deal with budget 
constraints. If we miss a year, if we cancel a ship, it is almost 
impossible to recover those ships because of the time involved and the 
fragile industrial base. To do the job America and our leaders expect 
and demand of us, we have to have those gray hulls on the horizon.
    This budget results in a 2020 fleet of 304 ships. We will purchase 
Virginia Class attack submarines at a rate of 2 per year for a total of 
ten across the FYDP, with the inclusion of the Virginia Payload Module 
by fiscal year 2019 for at least one boat per year. We also will 
continue to procure Arleigh Burke class destroyers at a rate of 2 per 
year, with the first Flight III DDG funded in fiscal year 2016 and 
delivered in fiscal year 2021. Fourteen ships of the Littoral Combat 
Ship class, of which at least the last five will be the frigate 
variant, will also be procured in this FYDP. We will also continue the 
construction of amphibious ships, mobile landing platforms, high speed 
vessels, and combat logistics ships.
    This budget carries on the development of the future carrier air 
wing. Procurement of both the F-35C and F-35B continues, with initial 
operating capability (IOC) of the F-35C coming sometime in late fiscal 
year 2018 or early fiscal year 2019. Our multi-year procurement of the 
E-2D will now include the introduction of inflight refueling capability 
for the new aircraft. We are continuing the integration and procurement 
of the Small Diameter Bomb II for the F/A-18 and fund advancements to 
the Advanced Anti-Radiation Guided Missile to reach IOC for Block I in 
fiscal year 2017. The budget also funds the EA-18G into its Full 
Operating Capability and full air wing integration in fiscal year 2017, 
and we continue the development of the Next Generation Jammer.
    We are accelerating the purchase of P-8A maritime patrol aircraft 
to reverse the reductions that were made due to sequester cuts. Our 
plan is to complete the buy in fiscal year 2019 and have the entire 
inventory of 109 aircraft by the end of the FYDP. We are also 
addressing the future of our logistics support and carrier onboard-
delivery aircraft. This budget funds the purchase of 24 Navy V-22 
Tiltrotor aircraft across the FYDP, with an IOC for Navy squadrons of 
fiscal year 2021.
    In order to face potential adversaries who are building 
technologically advanced platforms and weapons of their own, we must 
move forward on our development of new and innovative systems. This 
budget funds the accelerated acquisition of the Long Range Anti-Ship 
Missile (LRASM), which will reach early operating capability on the B-1 
in fiscal year 2018 and with F/A-18's in fiscal year 2019. We are also 
continuing procurement of SM-6 missiles. Funding for the next leap 
forward in weapons technologies, such as the LaWS and railgun programs, 
are included as well as the precision-guided Hyper-Velocity Projectile 
(HVP) for both our 5-inch guns (by fiscal year 2019) and for the 
railgun once development is complete.
    The fiscal year 2016 budget also places priority on emerging 
capabilities in the cyber and electronic warfare efforts. We will 
continue to recruit and train top talent to form 40 cyber mission teams 
by the end of 2016. We also include funding for Operation Rolling Tide 
and the results of Task Force Cyber Awakening, which invests in 
enhancements to our networks for cyber defense-in-depth, including 
defense solutions for ships, security improvements for our command and 
control networks, and the expansion of some of our defense initiatives 
to tactical IT systems. The Navy is developing capabilities to deliver 
cyber effects from land and sea-based platforms. We are continuing the 
build of the Mobile User Objective System (MUOS) satellites with an IOC 
expected in fiscal year 2016 and the launch of the fifth satellite in 
late 2016.
    The Marine Corps end strength will hold at 184,000 Marines for 2016 
while leadership assesses the impact of the drawdown that has been 
conducted over the past 4 years. This pause is for 1 year only. The 
Marines will draw down to 182,100 under this budget in 2017. After 
coming down by 18,000 Marines, we need to ensure we have the right 
number of small unit leaders and their ability to prepare their Marines 
for deployment. We must also make sure that units preparing for 
overseas operations have adequate time and ability to train and to 
maintain unit cohesion.
    The Marine Corps will begin procurement and testing of the next 
generation ground combat maneuver capability, starting with the Joint 
Light Tactical Vehicle. We will also award engineering manufacturing 
and development contracts to two vendors to produce Amphibious Combat 
Vehicle 1.1 prototypes for testing and evaluations. The F-35B program 
also remains a high priority for the Marine Corps, and this budget 
ramps up production of airframes with the plan to stand up a third F-
35B squadron by fiscal year 2018. These programs are important to our 
ability to maintain the Marine Corps as the Nation's expeditionary 
force-in-readiness. Our ability to remain forward engaged and ready to 
respond to crisis is dependent on the readiness of our forward deployed 
and home station units. The Marine Corps must remain the most ready 
when the Nation is least ready.
    Our support for our Sailors and Marines and their families is 
evident in the personnel initiatives in this budget, many of which were 
described earlier. We are continuing the Compensation Reform and 
Quality of Service initiatives that we first proposed in the budget for 
fiscal year 2015. This includes increasing our requested pay raise from 
1.0 percent to 1.3 percent in fiscal year 2016. To ensure fairness 
across the force, this budget also makes certain that every active duty 
family members has the option to receive healthcare with no co-pays/
cost share regardless of their assigned duty station, including remote 
locations. The re-investment in our talented and innovative workforce 
also continues from the fiscal year 2015 budget to this one, including 
the new sea duty incentive pays and bonuses, barracks improvements for 
our junior personnel, and improved fleet training and spares 
availability to ensure our men and women have the tools they need to 
get their jobs done.
    The American people have every right to expect that after coming 
out of two wars there would be savings in the defense budget. Our 
Department is continuing its reform of acquisition practices, including 
fundamental changes to how we contract for services. We are 
establishing additional discipline in the contractual services 
process--from requirements to tracking to execution to surveillance--
that ensures the integrity of the system remains high and to guard 
against fraud. Also, as a result of reformed contracting processes, we 
fully expect in this budget to achieve the reductions in contractual 
services that we began in last year, realigning those resources to 
buying more material equipment and readiness for the force.
    We continue to aggressively implement acquisition practices that 
improve the return for each taxpayer dollar we spend. Improved 
management of requirements, multiyear procurements, appropriate 
incentive contracts, additional competitions, and small business 
initiatives are but a few of the tools we are using to maximize the 
return on each dollar we invest on behalf of the taxpayer. However, the 
way some of the budget reductions have been executed in the law, 
through continuing resolutions and the sequester, have made planning 
virtually impossible and have not allowed us to approach reductions in 
a strategic way. After the initial return of a moderate amount of 
stability following last year's Bipartisan Budget Act and the recent 
Omnibus Spending Bill, the President's Budget for fiscal year 2016 
continues this stability to the Department's planning for the future. 
In order to maintain our Constitutional responsibility to ``provide for 
and maintain a Navy,'' we must work together to ensure that our Navy 
and Marine Corps remain the most powerful expeditionary fighting force 
in the world.
    Over the past 3 years the Navy and Marine Corps have had to make 
tough choices across a wide range of competing priorities in order to 
deal with funding instability. This proposed budget submission for 
fiscal year 2016 maintains the minimums necessary to accomplish the 
missions required by the DSG. We continue to accept some risk to our 
capacity to complete all ten of the missions, and we have continued 
reductions to the maintenance funds for our shore infrastructure, 
elements of our weapons capacity, and selected aviation accounts. While 
these reductions were seen as the most reversible, over a longer period 
of time the expenses have continued to add up. Because we have already 
taken these savings, a return to the funding level required by the 2011 
Budget Control Act certainly will have more dramatic impacts.
                               conclusion
    In 2015 we commemorate the bicentennial of the end of the War of 
1812. At the Battle of New Orleans a joint force of Sailors, Marines, 
Soldiers, and volunteers repelled a veteran British Army, battle 
hardened by their war against Napoleon. From the Navy's small 
combatants and gunboats that attacked the landing force in Lake Borgne, 
to the gunnery crews who joined the Army's artillery on the field of 
battle at Chalmette Plantation, Sailors and Marines ensured the defense 
of our homeland against invasion. Only weeks later off the coast of 
Africa, Captain Charles Stewart and USS Constitution fought the war's 
final battle at sea, bringing an end to the conflict that established 
the U.S. Navy as a player on the world's stage.
    When America has called, the Navy and Marine Corps have always been 
there. Two hundred years ago our squadrons sailed for the shores of 
Africa and the Second Barbary War, having just concluded that decisive 
role in the War of 1812. One hundred and fifty years ago, Admiral 
Farragut sailed up through Mobile Bay during the Civil War. One hundred 
years ago, as the First World War began, we prepared for convoy 
operations and anti-submarine missions in the battle for control of the 
Atlantic. Seventy years ago, Sailors and Marines fought their way 
across the Pacific toward Japan. For all of those two hundred plus 
years, and continuing today, the Navy and Marine Corps have been ready 
to fight and to win our Nation's wars, whether coming from the sea or 
on, above or beneath the sea.
    Today, from the coast of Africa to the wide expanse of the Pacific, 
from the Arctic to the Antarctic, our Sailors and Marines continue to 
deploy to protect and defend the American people and our national 
interests. They, and our Navy and Marine Corps civilians, continue to 
ensure that America's Away Team is ready and present around the world, 
prepared for action in times of crisis or working with our partners in 
times of peace.
    The United States of America faces an international security 
environment full of uncertainty. To face that world, the funding levels 
in the Department of the Navy's proposed budget for fiscal year 2016 
reflect the resources required to rapidly respond to a diverse scope of 
contingencies spanning extremist organizations, pandemic diseases and 
natural disasters, while continuing to deter assertive actors across 
the globe through our expeditionary presence and dominant warfighting 
capability. These investments will continue to provide the best value 
in dealing with that dynamic security environment, as well as securing 
and strengthening our own and the global economy.
    In order to ensure that we continue to provide the Navy and Marine 
Corps our Nation's leaders the American people have come to expect, the 
Commandant and Chief of Naval Operations and I look forward to working 
with this Committee and the Congress. From maintaining our momentum on 
our plan to build to a fleet of 304 by the end of the decade, to our 
continued efforts to purchase the aircraft, vehicles and weapons 
detailed in our budget submission, to the priority of ensuring we 
maintain and retain the talented Sailors, Marines, and civilians who 
make it all possible, we will need to work together. We look forward to 
answering your questions, at this hearing and in the future. We will 
continue to work to provide for, and maintain, our Navy and Marine 
Corps because, as President Theodore Roosevelt once said, ``A good Navy 
is not a provocation to war. It is the surest guaranty of peace.''

    Senator Cochran. Thank you, Mr. Secretary.
    Admiral Greenert, we will recognize you now for any opening 
statement you would have to make.
STATEMENT OF ADMIRAL JONATHAN W. GREENERT, CHIEF OF 
            NAVAL OPERATIONS
    Admiral Greenert. Thank you, Chairman Cochran, and 
distinguished members of the committee. I appreciate the 
opportunity to testify today.
    It is my honor to serve and represent more than 600,000 
Active and Reserve sailors, Navy civilians, and their families, 
especially the 41,000 sailors who are underway and deployed 
around the globe today. The dedication and resilience of our 
people continues to amaze me, Mr. Chairman. The citizens of 
this Nation can take great pride in the daily contributions of 
their sons and daughters around the world.
    It is also my pleasure to testify this morning beside 
Secretary Mabus and General Joe Dunford. Your Navy and Marine 
Corps team is united in fulfilling our longstanding mandate to 
be where it matters, when it matters, ready to respond to 
crises to ensure the security that underpins the global 
economy.
    Now to that point, recent events exemplify the value of 
forward-presence. For example, last August, the George Herbert 
Walker Bush carrier strike group relocated from the Arabian Sea 
to the North Arabian Gulf. That is about 750 nautical miles. It 
is like going from Jackson, Mississippi, to Chicago, just for 
perspective.
    They did that in under 30 hours. And when located there, 
they were doing sorties, that is missions, 20 to 30 a day, and 
they did that for 54 days, at which they were the only 
coalition strike option to project power. So that is pretty 
good.
    The USS Truxtun arrived in the Black Sea to establish a 
U.S. presence and to reassure our allies only a week after 
Russia invaded Crimea. Most of that week was getting the 
paperwork done to get and locate ourselves in the Black Sea.
    The Fort Worth, a littoral combat ship (LCS), and the USS 
Sampson, a destroyer, were among the first to support the 
Indonesian-led search effort for the Air Asia Flight 8501 in 
the Java Sea here last December.
    So we have been where it matters, when it matters.
    Mr. Chairman, I have testified before about the continuing 
resolution and sequestration, and it has deeply affected our 
Navy's readiness and capabilities, and we have not yet 
recovered from that 2013 period.
    Navy readiness is at its lowest point in many years. The 
budget reductions have forced us to cut afloat and ashore 
operations. It has generated a ship and aircraft maintenance 
backlog. And it has compelled us to extend unit deployments.
    Now, since 2013, many of our ships have been on deployment 
for 8 to 10 months or longer. That really does exact a cost on 
the resiliency of the people and the service lives of the ships 
themselves. Our degraded readiness posture has also affected 
our ability to satisfy contingency response requirements.
    Now, in addition to what is globally deployed today, our 
combatant commanders require three carrier strike groups and 
three amphibious ready groups ready to deploy within 30 days to 
respond to a major crisis. That is our covenant with them.
    However, on average, we have been able to keep only one 
carrier strike group and one amphibious ready group in this 
readiness posture. So we are at one-third of the requirement.
    Now, assuming the best case of an on-time, an adequate, and 
a stable budget, and no major contingencies, we might be able 
to recover from this accumulated backlog by 2018 for our 
carrier strike groups, and by 2020 for our amphibious ready 
groups. So that is 5 years after the first round of 
sequestration.
    That is just a glimpse of the damage that sequestration can 
and will do, if we go back there. Not only do we face several 
readiness problems, but we have been forced to slow Navy 
modernization.
    Mr. Chairman, we have lost our momentum in rapidly fielding 
emerging capabilities for future fights. We are losing our 
technical edge. The overall impact of budget shortfalls in the 
past 3 years has manifested in the continuing decline of our 
relative warfighting advantage in several areas, notably 
antisurface warfare, antisubmarine warfare, air-to-air warfare, 
and what we call the integrated air-and-missile defense.
    We have been compelled to accept significant risk in the 
execution of two key missions in the 2012 Defense Strategic 
Guidance. That remains our guidance. And I provided a little 
card here which lists the missions we are required to provide, 
where we are in President's budget 2016, and where we will be 
if we go to sequestration.
    The first mission where we have great risk in 2016 is to 
deter and defeat aggression. That means to win a war at sea by 
deterring another at sea in a different theater.
    The second mission is to project power despite an anti-
access/area denial challenge.
    Now when I say risk in this context, I mean that some of 
our platforms and our people and our systems will arrive late 
to the fight. They will arrive with insufficient ordnance, 
without superior combat systems, without superior sensors and 
the networks that they need. They will be inadequately prepared 
to fight, and that means a longer timeline to arrive and to 
prevail. More ships and aircraft will be out of action in 
battle. And, frankly, more sailors and marines and merchant 
mariners will be killed. And it's less credibility and, 
frankly, less deterrence for our adversaries, and less 
assurance for our allies, in the future.
    Now, given these circumstances, our President's budget 2016 
submission represents the absolute minimum funding levels that 
we need to execute our strategic guidance. To bring the Navy 
program into balance within this fiscal guidance, we focused 
first on building the appropriate capability, and then we 
deliver whatever the capacity we could afford based on the 
funding that we have.
    Now, that is similar to last year. We applied the following 
six priorities in preparing our program. Number one, we have to 
maintain a safe and credible sea-based strategic deterrent. 
Number two, we must sustain our forward presence. We have to be 
where it matters, when it matters. Three, we will develop the 
capability and the affordable capacity we have to win 
decisively. Number four, improve our weapon readiness. Number 
five, to develop the asymmetric capabilities to keep us 
technologically advanced. And number six, to sustain a relevant 
industrial base.
    Now, I list the industrial base as number six, but that is 
not the last priority. We have to balance all of those 
throughout this.
    Senator Cochran. Admiral Greenert, we are going to have to 
ask you to wind up your remarks. You have taken more time than 
either the Secretary or I have taken.
    Admiral Greenert. I will do that now.

                           PREPARED STATEMENT

    So in conclusion, Mr. Chairman, over the last 3 years, we 
have been provided $25 billion less than the President's 
budget. Frankly, if we continue down that track, we will be $55 
billion out.
    The budget request represents the floor, and any funding 
level below this submission will require revision to our 
strategy.
    I look forward to working with the Congress to find 
solutions. Thank you.
    [The statement follows:]
           Prepared Statement of Admiral Jonathan W. Greenert
                              introduction
    Chairman Cochran, Vice Chairman Durbin, and distinguished members 
of the Committee, I am honored to represent more than 600,000 active 
and reserve Sailors, Navy Civilians, and their Families, especially the 
41,000 Sailors who are underway on ships and submarines and deployed in 
expeditionary roles, around the globe today.
    As the chartlet below shows, about 95 ships (1/3 of the Navy) are 
deployed around the globe protecting the Nation's interests. This is 
our mandate: to be where it matters, when it matters.




              Figure 1: The Navy's Forward Presence Today

    I would like to begin this statement describing for you the 
guidance that shaped our decisions within the President's budget for 
fiscal year 2016 (PB-16) submission. I will address the Navy's 
situation following sequestration in fiscal year 2013, the Bipartisan 
Budget Act of 2013 (BBA), and the National Defense Authorization Act 
(NDAA) and Appropriations Act for fiscal year 2015. Then, I will 
provide details of our PB-16 submission.
                           strategic guidance
    The governing document for PB-16 is the Secretary of Defense's 2014 
Quadrennial Defense Review (QDR). The QDR uses the President's 2012 
Defense Strategic Guidance (DSG) as a foundation and builds on it to 
describe the Department of Defense's role in protecting and advancing 
U.S. interests and sustaining global American leadership. The DSG and 
its 10 Primary Missions of the U.S. Armed Forces have guided Navy's 
planning for the past 3 years. Validated by the QDR, those missions 
remain the baseline against which I measure our posture in various 
fiscal scenarios. Also, 2020 is the ``benchmark'' year identified by 
the DSG, and that remains the timeframe on which my assessments are 
focused.
    The QDR's updated strategy is built on three pillars: Protect the 
Homeland, Build Security Globally, and Project Power and Win 
Decisively. In support of these, it requires the Navy to ``continue to 
build a future Fleet that is able to deliver the required presence and 
capabilities and address the most important warfighting scenarios.''
    In order to improve its ability to meet the Nation's security needs 
in a time of increased fiscal constraint, the QDR also calls for the 
Joint Force to ``rebalance'' in four key areas: (1) rebalancing for a 
broad spectrum of conflict; (2) rebalancing and sustaining our presence 
and posture abroad; (3) rebalancing capability, capacity, and readiness 
within the Joint Force; and (4) rebalancing tooth and tail. To satisfy 
these mandates of the QDR strategy, the Navy has been compelled to make 
tough choices between capability, capacity, and readiness across a wide 
range of competing priorities. Our fundamental approach to these 
choices has not changed since I assumed this position. We continue to 
view each decision through the lens of the tenets I established when I 
took office: Warfighting First, Operate Forward, Be Ready.
                                overview
    Sequestration deeply affected the Navy budget in fiscal year 2013 
and we have not yet recovered. Stabilized funding in fiscal year 2014 
and 2015 provided by the BBA, along with an additional $2.2 billion 
above Navy's requested budget in fiscal year 2015, provided limited 
relief from sequestered Budget Control Act of 2011 (BCA) funding levels 
and helped Navy's overall posture. However, the cumulative effect of 
budget shortfalls over these years has forced the Navy to accept 
significant risk in key mission areas, notably if the military is 
confronted with a technologically advanced adversary or forced to deny 
the objective of an opportunistic aggressor in a second region while 
engaged in a major contingency. By ``risk,'' we mean that some of our 
platforms will arrive late to the combat zone, and engage in conflict 
without the benefit of markedly superior combat systems, sensors and 
networks, or desired levels of munitions inventories. In real terms, 
this means longer timelines to achieve victory, more military and 
civilian lives lost, and potentially less credibility to deter 
adversaries and assure allies in the future.
    The PB-14 Future Years Defense Program (FYDP) submission was the 
baseline required by Navy to carry out all 10 DSG missions. Over the 
last 3 years, however, the Navy funding under sequestration and the BBA 
was $25 billion less than the PB-13/14 submissions, shortfalls that 
manifest in the continued erosion of our warfighting advantages in many 
areas relative to potential adversaries. PB-16 represents the bare 
minimum to execute the DSG in the world we face, but still results in 
high risk in two of the most challenging DSG missions that depend on 
adequate numbers of modern, responsive forces. Should resources be 
further reduced below PB-16 levels, and certainly if sequestered, the 
DSG will need to be revised.
    If budgeted at PB-16 levels, we assess that the Navy of 2020 will: 
\1\
---------------------------------------------------------------------------
    \1\ Navy revised the accounting guidelines for its Battle Force 
according to requirements set forth in the fiscal year 2015 National 
Defense Authorization Act. Numbers in this statement are not directly 
comparable to those used in prior testimony, see chart below. The NDAA 
prohibits inclusion of `` . . . patrol coastal ships, non-commissioned 
combatant craft specifically designed for combat roles, or ships that 
are designated for potential mobilization.'' Ships that were counted 
last year, but are no longer counted, are Patrol Craft (PC) and 
Hospital Ships (T-AH). The following illustrates the differences 
between new and old Battle Force accounting guidelines: PB-16 New 
Guidelines--As of 1 Jan 2015: 279; Fiscal year 2016: 282; Fiscal year 
2020: 304. PB-16 Old Guidelines--As of 1 Jan 2015: 288; Fiscal year 
2016: 291; Fiscal year 2020: 308.
---------------------------------------------------------------------------
  --Include 304 ships in the Battle Force, of which about 115 will be 
        deployed. This global deployed presence will include more than 
        two Carrier Strike Groups (CSG) and two Amphibious Ready Groups 
        (ARG) deployed, on average.
  --In the best case, provide ``surge'' capacity of about three CSGs 
        (by approximately 2018) and three ARGs (by approximately 2020), 
        not deployed, but ready to respond to a contingency.
  --Deliver forces to conduct the DSG primary mission Deter and Defeat 
        Aggression, but with higher risk compared to PB-14 due to 
        capacity and readiness challenges.
  --Conduct, but with greater risk, the DSG primary mission Project 
        Power Despite Anti-Access/Area Denial (A2/AD) Challenges 
        against a technologically advanced adversary compared to PB-14. 
        This is principally due to the slower delivery of new critical 
        capabilities, particularly in air and missile defense, and 
        overall ordnance capacity.
    To ensure the Navy remains a balanced and ready force while 
complying with the reduction in funding below our PB-14 plan, we were 
compelled to make difficult choices in PB-16, including: slowing cost 
growth in compensation and benefits; deferring some ship modernization; 
deferring procurement of 18 of Navy's most advanced aircraft; delaying 
over 1,000 planned weapons procurements; and continuing to reduce 
funding for base facilities sustainment, restoration, and 
modernization. Deferments in PB-16 compound modernization delays we 
were compelled to accept in PB-15 due to budget constraints.
    Additional challenges are on the horizon. In the long term beyond 
2020, I am increasingly concerned about our ability to fund the Ohio 
Replacement ballistic missile submarine (SSBN) program--our highest 
priority program--within our current and projected resources. The Navy 
cannot procure the Ohio Replacement in the 2020s within historical 
shipbuilding funding levels without severely impacting other Navy 
programs.
         continuing impact of sequestration in fiscal year 2013
    Sequestration in fiscal year 2013 resulted in a $9 billion 
shortfall in Navy's budget, as compared to the PB-13 submission. This 
instance of sequestration was not just a disruption, it created 
readiness consequences from which we are still recovering, particularly 
in ship and aircraft maintenance, Fleet response capacity, and 
excessive CSG and ARG deployment lengths. As I testified in November 
2013, March 2014, and January 2015, the continuing resolution and 
sequestration reductions in fiscal year 2013 compelled us to reduce 
both afloat and ashore operations, which created ship and aircraft 
maintenance and training backlogs. To budget for the procurement of 
ships and aircraft appropriated in fiscal year 2013, Navy was compelled 
to defer some purchases to future years and use prior-year investment 
balances to mitigate impacts to programs in fiscal year 2013 execution. 
The most visible impacts occurred in Operations and Maintenance funded 
activities. Specific impacts to Navy programs include:
  --Cancelled five ship deployments.
  --Delayed deployment of USS Harry S. Truman strike group by 6 months.
  --Inactivated, instead of repaired, USS Miami.
  --Reduced facilities restoration and modernization by about 30 
        percent (to about 57 percent of the requirement).
  --Reduced base operations, including port and airfield operations, by 
        about 8 percent (to about 90 percent of the requirement).
  --Furloughed civilian employees for 6 days, which, combined with a 
        hiring freeze and no overtime for 6 months, reduced our 
        maintenance and sustainment output through lost production and 
        support from logisticians, comptrollers, engineers, contracting 
        officers, and planners.
  --Cancelled Fleet engagements and most port visits, except for 
        deployed ships.
    While the Navy was able to reprioritize within available resources 
to continue to operate in fiscal year 2013, this is not a sustainable 
course for future budgets. The actions we took in 2013 to mitigate 
sequestration only served to transfer bills amounting to over $4 
billion to future years for many procurement programs--those carryover 
bills were addressed in Navy's fiscal year 2014 and fiscal year 2015 
budgets. If we were sequestered again, we would be forced to degrade 
current and future Fleet readiness.
    Shortfalls caused by the fiscal year 2013 sequestration remain in a 
number of areas and the Navy is still working to recover from them. For 
example, we have not yet caught up from shipyard maintenance backlogs. 
We are working through shipyard personnel capacity issues to determine 
when ships can be fit back into the maintenance cycle and are balancing 
that against operational demands on the ships to ensure we meet the 
global force management requirement for Combatant Commands. The result 
of maintenance and training backlogs has meant delayed preparation for 
deployments, forcing us, in turn, to extend the deployments of those 
units already on deployment. Since 2013, many CSGs, ARGs, and 
destroyers have been on deployment for 8-10 months or longer. This 
comes at a cost to the resiliency of our people, sustainability of our 
equipment, and service lives of our ships.
    Maintenance and training backlogs have also reduced Navy's ability 
to maintain required forces for contingency response to meet Combatant 
Command operational plan requirements. Although the requirement calls, 
on average, for three additional CSGs and three additional ARGs to 
deploy within 30 days for a major crisis, Navy has only been able to 
maintain an average of one group each in this readiness posture. Root 
causes can be traced to the high operational tempo of the Fleet, longer 
than expected shipyard availabilities, and retirements of experienced 
shipyard workers, but the fiscal year 2013 sequestration exacerbated 
the depth of this problem and interfered with our efforts to recover.
    Assuming a stable budget and no major contingencies for the 
foreseeable future, I estimate it is possible to recover from the 
maintenance backlogs that have accumulated from the high operational 
tempo over the last decade of war and the additional effects of 
sequestration by approximately 2018 for CSGs and approximately 2020 for 
ARGs, 5 plus years after the first round of sequestration. This is a 
small glimpse of the readiness ``price'' of sequestration.
                           where we are today
    Before describing our fiscal year 2016 submission, I will discuss 
the Navy's current posture, which established the baseline for our PB-
16 budget.
    Congress's passage of the BBA averted about $9 billion of an 
estimated $14 billion reduction we would have faced under sequestration 
in fiscal year 2014. It enabled us to fund all planned ship and 
aircraft procurement in fiscal year 2014, but cumulatively the 
shortfalls increased risk in Navy's ability to execute DSG missions. 
The BBA still left a $5 billion shortfall below PB-14 in our 
investment, operations, and maintenance accounts.\2\ The shortage in 
funding compelled us to reduce procurement of weapons (many missile 
types) and aircraft spare parts, defer asymmetric research and 
development projects, cancel repair and maintenance projects for 
facilities ashore, and defer procurement of maintenance/material 
support equipment for the Fleet.
---------------------------------------------------------------------------
    \2\ Congress subsequently added $3.4 billion in fiscal year 2014, 
which added an SSN and increased Navy's Ship Modernization, Operations, 
and Sustainment Fund (SMOSF).
---------------------------------------------------------------------------
    The recent passage of the fiscal year 2015 NDAA and Consolidated 
and Further Continuing Appropriations Act averted about $2 billion of 
the estimated $13 billion reduction that Navy would have faced under 
sequestration; an $11 billion shortfall remains (as compared to PB-14). 
Although the funding enabled us to continue the refueling and complex 
overhaul of the USS George Washington (CVN 73), Navy was forced to 
balance its portfolio to mitigate the shortfall by making choices 
between capability, capacity, and readiness. We were compelled to 
further reduce the capacity of weapons and aircraft, slow 
modernization, and delay upgrades to all but the most critical shore 
infrastructure. As I described in testimony in March 2014, PB-15 
represented another iterative reduction from the resources we indicated 
were necessary to fully resource the DSG missions, making Navy less 
ready to successfully Deter and Defeat Aggression and Project Power 
Despite Anti-Access/Area Denial (A2/AD) Challenges. Continuing along 
this budget trajectory means that by 2020, Navy will not have recovered 
sufficient contingency response capacity to execute large-scale 
operations in one region, while simultaneously deterring another 
adversary's aggression elsewhere. Also, we will lose our advantage over 
adversaries in key warfighting areas such as Anti-Surface Warfare, 
Anti-Submarine Warfare, Air-to-Air Warfare, and Integrated Air and 
Missile Defense.
     our strategic approach to president's budget fiscal year 2016
    In developing our PB-16 submission, we evaluated the warfighting 
requirements to execute the primary missions of the DSG. These were 
informed by: (1) current and projected threat, (2) global presence 
requirements defined by the Global Force Management Allocation Plan 
(GFMAP), and (3) warfighting scenarios as described in Combatant 
Commanders' Operation Plans (OPLANs) and Secretary of Defense-approved 
Defense Planning Scenarios (DPS). We used these warfighting scenarios 
to assess our ability to execute more than 50 end-to-end capabilities, 
also known as ``kill chains'' or ``effects chains.'' These chains 
identify all the elements needed to provide a whole capability, 
including sensors, communications (networks), operators, platforms, and 
weapons. To arrive at a balanced program within fiscal guidance, we 
focused first on building appropriate capability, then delivering it at 
a capacity we could afford. Six budget priorities guided us:
    First, maintain a credible, modern, and survivable sea-based 
strategic deterrent. Under the New START Treaty, the Navy SSBN force 
will carry about 70 percent of the U.S. strategic nuclear warheads by 
2020. Our PB-16 request sustains today's 14-ship SSBN force, the 
Trident D5 ballistic missile and support systems, and the Nuclear 
Command, Control, and Communications (NC3) suite. The Ohio-class SSBN 
will begin retiring, one per year, beginning in 2027. To continue to 
meet U.S. Strategic Command presence and surge requirements, PB-16 
continues to support construction of the first Ohio Replacement SSBN in 
2021 for delivery in 2028 and first deterrent patrol in 2031. As part 
of the Navy's Nuclear Enterprise Review, our PB-16 submission also adds 
approximately $2.2 billion across the FYDP to: (1) increase shipyard 
and Nuclear Strategic Weapons Facilities (SWF) capacity by funding 
required civilian end-strength; (2) accelerate investments in shipyard 
infrastructure; (3) fund additional manpower associated with nuclear 
weapons surety; and (4) fund key nuclear weapons training systems.
    Second, sustain forward presence of ready forces distributed 
globally to be where it matters, when it matters. We continue to 
utilize cost-effective approaches such as forward basing, forward 
operating, and forward stationing ships in the Asia-Pacific, Europe, 
and the Middle East. Rotational deployments will be stabilized and more 
predictable through continued implementation of an improved deployment 
framework called the Optimized Fleet Response Plan (O-FRP). We will 
distribute our ships to align mission and capabilities to global 
regions, ensuring high-end combatants are allocated where their unique 
capabilities are needed most. We will meet the adjudicated fiscal year 
2016 GFMAP; this represents about 45 percent of the global Geographic 
Combatant Commander (GCC) requests. Sourcing all GCC requests would 
require about 450 combatant ships with requisite supporting structure 
and readiness.
    Third, strengthen the means (capability and capacity) to win in one 
multi-phase contingency operation and deny the objectives of--or impose 
unacceptable costs on--another aggressor in another region. PB-16 
prioritizes investments to close gaps in critical kill chains, but 
accepts risk in capacity or in the rate at which some capabilities are 
integrated into the Fleet.
    Fourth, focus on critical afloat and ashore readiness. PB-16 helps 
improve the overall readiness of our non-deployed forces, but not to 
our satisfaction. With a stable budget and no major contingencies for 
the foreseeable future, I estimate it is possible to recover from the 
maintenance backlogs by approximately 2018 for CSGs and approximately 
2020 for ARGs. Facilities Sustainment, Restoration, and Modernization 
(FSRM) funds are increased for fiscal year 2016 to arrest the decline 
of facilities conditions, but then FSRM funds are inadequate for the 
remainder of the FYDP, in order to fund afloat readiness. Our budget 
constraints prevent us from funding all but the most critical shore 
facility upgrades in fiscal year 2017 and beyond.
    Fifth, sustain or enhance Navy's asymmetric capabilities in the 
physical domains, as well as in cyberspace and the electromagnetic 
spectrum. PB-16 prioritizes capabilities to deal with adversary 
threats, including electromagnetic spectrum and cyber capabilities and 
those capabilities that provide joint access developed in concert with 
other Services under the Joint Concept for Access and Maneuver in the 
Global Commons (formerly known as Air-Sea Battle). In line with 
USCYBERCOM priorities, we are investing in cyber defense-in-depth and 
expansion of cyber defense initiatives to tactical platform Information 
Technology systems, boundary defense solutions for ships, and security 
improvements for our C4I systems.
    Sixth, sustain a relevant industrial base, particularly in 
shipbuilding. We will continue to evaluate the impact of our investment 
plans on our industrial base, including ship and aircraft builders, 
depot maintenance facilities, equipment and weapons manufacturers, and 
science and technology researchers. The government is the only customer 
for some of our suppliers, especially in specialized areas such as 
nuclear power. PB-16 addresses the health of the industrial base by 
sustaining adequate capacity, including competition, where needed and 
viable. While prioritizing required capabilities, we also sought to 
sustain a viable industrial base.
                             what we can do
    As described earlier, due to the impact of prior year shortfalls 
and modernization deferrals in the PB-16 FYDP, we still face 
significant risk in executing at least two of ten primary missions of 
the DSG in 2020. The 2014 update to the ``2012 Force Structure 
Assessment'' (FSA) and other Navy analysis describe the baseline of 
ships needed to support meeting each mission. Against that baseline and 
using a rigorous assessment of over 50 capabilities (with appropriate 
capacity) necessary to be tactically successful (called ``end-to-end 
kill chain'' analysis), we conclude that with PB-16, the Navy of 2020 
will support each of the 10 DSG missions as follows:
Provide a Stabilizing Presence
    PB-16 will meet the adjudicated presence requirements of this 
mission. By increasing the number of ships forward stationed and 
forward based, and by improving our deployment preparation process 
called the Optimized Fleet Response Plan (O-FRP), presence improves in 
some global regions as compared to previous budget submissions. The 
Navy of 2020:
  --Provides a global presence of about 115 ships (same as PB-15); an 
        increase over an average of 95 ships deployed today.
  --Increases presence in the Asia-Pacific region. This includes 
        forward deploying an additional SSN to Guam, the most capable 
        DDG to Japan, Mobile Landing Platform (MLP), Joint High Speed 
        Vessel (JHSV), both Littoral Combat Ship (LCS) variants, MQ-8C, 
        P-8A, EA-18G, upgraded F/A-18E/F, and E-2D. MQ-4C Triton high 
        endurance unmanned aerial vehicles will operate from Guam in 
        2017. This presence will assure allies, shape, and deter. 
        However, a major maritime operation will require substantial 
        naval forces to swing from other theaters or surge forward from 
        CONUS bases.
  --``Places a premium on U.S. military presence in--and in support 
        of--partner nations'' in the Middle East, by increasing 
        presence by 40 percent to about 36 ships in 2020. Though not 
        counted in Navy's Battle Force, 10 of our Patrol Craft (PC) 
        serve as Forward Deployed Naval Forces (FDNF) operating out of 
        Bahrain, and seven LCS will join them by the end of 2020. In 
        2016, Navy's first Mobile Landing Platform/Afloat Forward 
        Staging Base (MLP/AFSB) will augment the on-station AFSB-
        Interim (a modified dock landing ship) to support Special 
        Operations Forces and augment mine countermeasure capability.
  --Continues to ``evolve our posture'' in Europe by meeting ballistic 
        missile defense (BMD) European Phased Adaptive Approach (EPAA) 
        requirements with four BMD-capable guided missiles destroyers 
        (DDG) in Rota, Spain, and two land-based sites in Poland and 
        Romania. The first two DDGs arrived in 2014 and all four will 
        be in place by the end of 2015. Additional presence in Europe 
        will be provided by forward operating JHSVs and rotationally 
        deployed combatants.
  --Will provide ``innovative, low-cost and small-footprint 
        approaches'' to security in Africa and South America by 
        deploying one JHSV, on average, to each region. Beginning in 
        fiscal year 2015, we will deploy one hospital ship (T-AH), on 
        average, and, beginning in fiscal year 2016, add one PC ship, 
        on average, to South America. AFSBs forward operating in the 
        Middle East could also provide additional presence in Africa as 
        required. As available, we are deploying ships for shorter 
        periods (< = 2 months) in theaters other than those which they 
        would be primarily assigned (e.g., AFRICOM and SOUTHCOM).

        
        
       Figure 2: The Navy's Forward Presence in Fiscal Year 2020

Counter Terrorism and Irregular Warfare (CT/IW)
    We will have the capacity to conduct widely distributed CT/IW 
missions. This mission requires Special Operations Forces, Navy 
Expeditionary Combat capabilities such as Explosive Ordnance Disposal 
(EOD), Combined Explosive Exploitation Cells (CEXC), Intelligence 
Exploitation Teams (IET), and a variety of platforms that can 
accommodate adaptive force packages. PB-16 procures a third MLP/AFSB in 
fiscal year 2017 for delivery in fiscal year 2020, and funds an 
enhanced SOF capability on all three AFSBs, which provides more robust 
medical facilities, improved C4I, and increased accommodation for 
aircraft, and other SOF-specific equipment. PB-16 also procures ten MQ-
8C Fire Scout systems for deployments aboard LCS, which are 
fundamentally multi-mission.
Deter and Defeat Aggression
    Navy inherits and continues to experience high risk in this 
warfighting mission. Our FSA described the ship force structure 
necessary to meet this mission's requirement: to be able to conduct one 
large-scale operation and ``simultaneously be capable of denying the 
objectives of--or imposing unacceptable costs on--an opportunistic 
aggressor in a second region.'' According to the FSA, the Navy has a 
requirement for a force of 11 CVN, 88 large surface combatants (DDG and 
CG), 48 attack submarines (SSN), 12 SSBN, 11 large amphibious assault 
ships (LHA/D), 12 amphibious transport docks (LPD), 11 dock landing 
ships (LSD), 52 small surface combatants, 10 JHSV, 29 combat logistics 
force (CLF) ships, and 24 command and support ships. Provided 
sufficient readiness is restored and maintained across the Fleet, this 
globally distributed force will yield a steady state deployed presence 
of more than two CSG and two ARG, with three CSG and three ARG ready to 
deploy within 30 days in response to a contingency (``surge''). PB-16 
puts Navy on a path to procure the right mix of ships as defined by the 
FSA; however, the 2020 Battle Force will have a shortfall of small 
surface combatants due to a gap in FFG and MCM retirements and LCS 
deliveries. Other sources of risk in this primary mission are less 
aircraft, modern sensors, networks, and weapon procurements across the 
FYDP. Slowed modernization across the Fleet is a serious concern.
Conduct Stability and Counterinsurgency Operations
    The Navy of 2020 will be able to meet the requirements of this DSG 
mission.
Project Power Despite Anti-Access/Area Denial (A2/AD) Challenges
    Our power projection capability, reconstitution of weapons systems, 
and modernization programs to enable Joint Assured Access have been 
deferred due to budget constraints over the last 3 years. This reduces 
options and decreases our ability to assure access in all domains 
(space, air, surface, subsurface, and cyber). Over the last 3 years, 
funding shortfalls required us to reduce procurement in weapons by over 
4,000 planned quantities. We continue to take risk in capacity in order 
to preserve investments in developing future capabilities. This reduced 
procurement of weapons and deferring of air and missile defense 
capabilities, coupled with joint force deficiencies in wartime 
information transport, C2 resiliency, and airborne ISR, will result in 
high risk in conducting this DSG mission if we are faced with a 
technologically advanced adversary.
Counter Weapons of Mass Destruction
    This mission has two parts: (1) interdicting weapons of mass 
destruction as they proliferate from suppliers, and (2) defeating the 
means of delivery during an attack. PB-16 will continue to meet the 
requirements for this mission by providing sufficient deployed CSG, 
ARG, and surface combatants, as well as Navy special warfare personnel 
(SEAL) and EOD platoons, to address the first part. For the second 
part, BMD-capable DDG exist in sufficient numbers to meet the majority 
of GCC presence requirements under the GFMAP, and can be postured to 
counter weapons delivered by ballistic missiles in regions where 
threats are more likely to originate. That said, missile defense 
capacity in some scenarios remains a challenge.
Operate Effectively in Space and Cyberspace
    Our PB-16 submission continues to place priority on cyber efforts 
to build the Navy's portion of the DOD's Cyber Mission Forces and 
strengthen our cyber defense capabilities afloat and ashore. We have 
accessed about 80 percent of the 1,750 cyber operators that will form 
40 cyber mission teams by the end of 2016; we will continue to recruit, 
hire, and train this force. Additionally, we will align Navy networks 
with a more defensible DOD Joint Information Environment (JIE) through 
the implementation of the Next Generation Enterprise Network (NGEN) 
ashore and Consolidated Afloat Networks and Enterprise Services (CANES) 
at sea. We will continue funding for the launch and sustainment of the 
Mobile User Objective System (MUOS), DOD's newest and most robust 
solution for extending narrowband Ultra High Frequency Satellite 
Communications (SATCOM) connectivity ashore, in flight, and at sea. 
Also critical to assured command and control, PB-16 continues funding 
the installation and sustainment of the Navy Multiband Terminal (NMT), 
our newest and most robust solution for giving surface and submarine 
forces access to wideband Super High Frequency and Extremely High 
Frequency SATCOM connectivity.
Maintain a Safe, Secure, and Effective Nuclear Deterrent
    This mission is the Navy's top priority in any fiscal scenario, and 
our PB-16 submission meets its requirements. Our sea-based strategic 
deterrent remains safe, secure, credible, and effective today, but Navy 
is also implementing 27 specific actions based on the DOD Nuclear 
Enterprise Review recommendations, including oversight, training, 
policy, and process improvements, funded with an additional PB-16 
investment of over $400 million in fiscal year 2016 and over $2 billion 
across the FYDP. Our PB-16 submission satisfies STRATCOM demand for at-
sea SSBN availability through the end of the current Ohio-class's 
service life. Navy's PB-16 submission also funds Nuclear Command, 
Control, and Communications (NC3) modernization, Trident D5 ballistic 
missile Life Extension Program (LEP) to maintain a 2017 Initial 
Operational Capability (IOC), and Common Missile Compartment 
development on a 2019 delivery timeline. Continued Congressional 
support for Naval Reactors' Department of Energy (DoE) funding is 
essential to maintain life-of-the-ship core reactor design and 
development synchronization with our Ohio Replacement shipbuilding 
schedule, which ensures lead ship procurement in 2021, and refueling of 
the land-based prototype. Naval Reactors' DoE budget also includes the 
second year of funding for the Spent Fuel Handling Project (SFHP), 
recapitalization of which is critical to the Navy's refueling and 
defueling schedule of nuclear-powered aircraft carriers and submarines.
Defend the Homeland and Provide Support to Civil Authorities
    PB-16 will maintain an appropriate capacity of aircraft carriers, 
surface combatants, amphibious ships, and aircraft that are not 
deployed and are ready for all homeland defense missions.
Conduct Humanitarian, Disaster Relief, and Other Operations
    Navy's global presence and training is sufficient to conduct these 
operations.
                             modernization
    The following paragraphs describe specific PB-16 programs that 
influence our ability to conduct the missions required by the DSG, and 
the impact of programmatic action:
Shipbuilding
    Navy shipbuilding priorities remain largely consistent with PB-15. 
Navy will procure 48 ships across the fiscal year 2016-2020 period. 
Fourteen Battle Force ships will be delivered in fiscal year 2016 
alone. PB-16:
  --Maintains funding to support RDTE and advanced procurement of the 
        first Ohio Replacement SSBN, our highest priority program. 
        Without increased shipbuilding funding in fiscal year 2021 and 
        beyond, Ohio Replacement SSBN funding will consume the majority 
        of Navy's annual shipbuilding budget, and degrade other 
        shipbuilding programs. Appropriations for SSBN recapitalization 
        are historically consistent with the last period of SSBN 
        procurement between 1974 and 1990.
  --Fully funds USS George Washington (CVN 73) refueling and complex 
        overhaul.
  --Procures 10 Arleigh Burke-class DDG (one Flight IIA and nine Flight 
        III) in the FYDP, two per year, resulting in an inventory of 72 
        by 2020. The first Flight III DDG, which will incorporate the 
        advanced AN/SPY-6 radar (formerly called the Air and Missile 
        Defense Radar, or AMDR), will be procured in fiscal year 2016 
        and delivered in fiscal year 2021.
  --Procures 10 Virginia-class SSNs in the FYDP, two per year, 
        resulting in an inventory of 22 Virginia-class submarines (51 
        total SSNs of all types) by 2020.
  --Funds the final nine LCS (Flt 0+) across the FYDP (three per year 
        fiscal year 2016-2018). Then beginning in fiscal year 2019, 
        Navy will procure new Small Surface Combatants (two in fiscal 
        year 2019, three in fiscal year 2020) based on upgraded 
        variants of the LCS that Navy will designate as ``Frigates'' 
        (FF). There will be no construction gap between procurement of 
        the last LCS (Flt 0+) and the first ``frigate.'' The new 
        ``frigate'' will offer improvements in capability, lethality, 
        and survivability.
  --Funds replacement of LSD amphibious ships with the LX(R) starting 
        with advanced procurement in fiscal year 2019 and procurement 
        of the first LX(R) in fiscal year 2020. LX(R) serial production 
        will begin in fiscal year 2022.
  --Procures a twelfth LPD, which will be developed in parallel with 
        the LX(R) program and incorporate targeted design and 
        construction initiatives to increase affordability. Adding LPD 
        28 to the inventory will help mitigate expeditionary capability 
        and amphibious lift shortfalls.
  --Funds four Fleet oilers (T-AO(X)) across the FYDP beginning in 
        fiscal year 2016. T-AO(X) replaces the aging single hull fleet 
        oiler. This new procurement ensures continued combat logistics 
        support to our ships.
  --Funds five Fleet salvage ships (T-ATS(X)) across the FYDP beginning 
        in fiscal year 2017. These new ships replace the two aging 
        salvage class ships with a single class while improving 
        capability and performance.
Combatant Ship Modernization
    In parallel with shipbuilding, PB-16 continues modernization of in-
service platforms to allow our combatants to remain relevant and reach 
their expected service lives. The ship modernization program does not 
keep pace to deal with high-end adversary weapons systems by 2020. 
Flight I and II of the Arleigh Burke-class DDG began mid-life 
modernization in fiscal year 2010; 13 will have completed Hull 
Mechanical and Electrical (HM&E) modernization by the end of 2016, and 
6 of these ships will have also completed combat systems modernization. 
In fiscal year 2017, we will begin to modernize the Flight IIA DDGs. 
However, due to fiscal constraints we were compelled to reduce the 
combat systems procurements of one DDG Flight IIA per year, starting in 
fiscal year 2016. This will result in some destroyers not receiving 
combat systems upgrades when originally planned to allow them to pace 
the threat, particularly in Anti-Air Warfare (AAW) and Ballistic 
Missile Defense (BMD).
    In order to maintain force structure that provides Air Defense 
Commander support to the CSGs, Navy will induct two Guided Missile 
Cruisers (CGs) into phased modernization in fiscal year 2015 and an 
additional two in fiscal year 2016. This will place a total of four 
ships in modernization with the intent that each ship period will be 
limited to 4 years. We are committed to modernizing a total of 11 CGs 
in the current modernization program. Without any phased modernization 
program, the CG class will retire, without replacement, at the end of 
their service lives between 2020 and 2030. Using the Congressionally 
directed 2/4/6 plan, the final retirements will occur between 2036 and 
2039. Under the Navy's original PB-15 plan, the final CG retirement 
would have occurred in 2045, at a significantly reduced cost to the 
Navy, and would have relieved pressure on a shipbuilding account 
largely consumed in the 2030s with building Ohio Replacement SSBNs and 
aircraft carriers. We request Congressional support for Navy's original 
plan.
    Nine of 12 Whidbey Island-class LSDs have undergone a mid-life 
update and preservation program, two are currently being modernized, 
and one more will be inducted into phased modernization in fiscal year 
2016. Modernization of seven Wasp-class large deck amphibious assault 
ships (LHD) was delayed by 2 years, and they will now complete mid-life 
modernization by fiscal year 2024. Modernization of the eighth LHD, USS 
Makin Island, will be addressed in subsequent budget submissions.
                         warfighting capability
Aviation
    PB-16 continues our transition, albeit more slowly than desired, to 
the ``Future Air Wing.'' This transition will dramatically improve our 
capabilities and warfighting capacity across critical ``kill chains.'' 
But, funding shortfalls have stretched (deferred) modernization plans 
in this area. This delay will call into question our ability to deal 
with near peer competitors, especially if directed to carry out our DOD 
campaign plan in the 2020 timeframe. Specifically, we will continue to 
field more advanced land-based maritime patrol aircraft (manned and 
unmanned) to evolve our ISR, ASW, and sea control capabilities and 
capacity. To further these objectives, PB-16 provides the following 
capabilities:
  --Navy Integrated Fire Control-Counter Air (NIFC-CA) Increment I 
        capability will field with the E-2D Advanced Hawkeye aircraft 
        in 2015, with four air wings transitioned to the E-2D by 2020. 
        This integrates aircraft sensor and ship weapons capabilities, 
        improving lethality against advanced air and missile threats. 
        However, we deferred two E-2D outside the FYDP (procure 24 vice 
        26).
  --The F-35C Lightning II, the carrier-based variant of the Joint 
        Strike Fighter, is scheduled to achieve IOC in 2018. However, 
        F-35C procurement will be reduced by 16 airframes (from 54 to 
        38) across the PB-16 FYDP when compared to PB-15. The F-35C, 
        with its advanced sensors, data sharing capability, and ability 
        to operate closer to threats, is designed to enhance the air 
        wing's ability to find targets and coordinate attacks.
  --Continued support for a Service Life Extension Program (SLEP) for 
        the legacy F/A-18A-D Hornet to meet our strike fighter 
        inventory needs while integrating the F-35C. With SLEP 
        modifications, some of these aircraft will achieve as much as 
        10,000 lifetime flight hours, or 4,000 hours and (16 years) 
        beyond their originally designed life.
  --To address Navy electronic attack requirements, EA-18G will reach 
        full operational capability in fiscal year 2017. Replacement of 
        the aging ALQ-99 jamming pods begins in fiscal year 2021, when 
        the Next Generation Jammer (NGJ) Increment I, featuring 
        upgraded capabilities against mid-band frequencies, reaches 
        IOC. NGJ Increment II research and development on low band 
        frequencies remains funded for fiscal year 2016.
  --All components of an improved air-to-air ``kill chain'' that 
        employs infrared (IR) sensors to circumvent adversary radar 
        jamming will be delayed another year. PB-16 increased funding 
        to procure an additional 28 Infrared Search and Track (IRST) 
        Block I sensor pods for F/A-18E/F Super Hornet, for a total of 
        60, across the FYDP; however, the IRST Block I sensor system 
        will field in 2018 (versus 2017 under PB-15) and the improved 
        longer range IRST Block II will not deliver until 2022 (versus 
        2019 under PB-15).
  --Improvements continue to the air-to-air radio frequency ``kill 
        chain'' that defeats enemy jamming at longer ranges. By 2020, 
        380 jamming protection upgrade kits for F/A-18E/F Super Hornets 
        and EA-18G Growler will be delivered. But, we were compelled to 
        defer 180 kits beyond the FYDP.
  --Integrates the Small Diameter Bomb II (SDB II) on the F/A-18 by 
        fiscal year 2020, and procures 1,590 units across the FYDP to 
        enhance carrier air wing precision strike capabilities.
  --V-22 (Navy variant) aircraft have been selected as the solution to 
        the aging C-2 Carrier Onboard Delivery (COD) aircraft. PB-16 
        procures 24 aircraft over the FYDP with an IOC of fiscal year 
        2021. The V-22 (Navy variant) extends the range and in 
        increases the flexibility of Strike Group resupply.
  --Navy's commitment to the Unmanned Carrier-Launched Airborne 
        Surveillance and Strike System (UCLASS) program continues. 
        However, a DOD-wide Strategic Portfolio Review will delay 
        UCLASS Air Vehicle segment contract award by at least 1 year. 
        The remaining UCLASS Carrier Integration and Connectivity and 
        Control System segments will continue and are funded through 
        the FYDP.
Long Range Strike
    Our precision strike capabilities and capacity will be critical to 
success in any foreseeable future conflict. Potential adversaries have 
already fielded and continue to develop advanced, long range weapons 
that will require effective counters. We remain challenged in this 
area. Accordingly, PB-16:
  --Funds Virginia Payload Module (VPM) RDT&E and SCN to accelerate 
        inclusion of VPM on at least one Virginia Class Block V SSN per 
        year in fiscal year 2019 and 2020. VPM will enable Virginia-
        class SSNs to mitigate the loss of SSGN strike capacity as they 
        begin to retire in 2026. VPM will more than triple the Tomahawk 
        Land Attack Missile (TLAM) Block IV strike capacity of a 
        Virginia-class SSN from 12 to 40 missiles.
  --Supports the existing Tactical Tomahawk cruise missile inventory by 
        extending service life through investments in critical 
        capability enhancements and vital parts to achieve maximum 
        longevity. PB-16 adds 100 Tomahawks in fiscal year 2016. 
        Production deliveries will now continue through fiscal year 
        2018, which minimizes factory impact until the start of 
        Tomahawk Block IV inventory recertification and modernization 
        beginning in fiscal year 2019.
  --Invests in future capability by commencing an analysis of 
        alternatives for the Next Generation Land Attack Weapon 
        (NGLAW), with a planned Fleet introduction in the 2024-2028 
        timeframe, at least a decade prior to the sundown of TLAM Block 
        IV in the 2040s.
Anti-Surface Warfare
    Navy remains challenged in this mission area due to both capability 
and capacity shortfalls. To deal with potential adversaries' long-range 
anti-ship cruise missiles and maritime air defenses, PB-16 implements a 
plan to deliver a family of anti-surface warfare (ASuW) capabilities. 
The program maintains current ASuW capability inherent in the Harpoon 
missile, Standoff Land Attack Missile-Expanded Response (SLAM-ER), 
Joint Standoff Weapon (JSOW) C-1, and Mk48 Advanced Capability (ADCAP) 
torpedoes. In the near term, we are pursuing options to develop an 
improved, longer range ASuW capability by leveraging existing weapons 
to minimize technical risk, costs, and development time. Five of ten 
Patrol Craft in the Arabian Gulf have been upgraded with short-range 
Griffin missiles, and the other five will receive them by the end of 
2015. Additionally, PB-16 funds enhanced ASuW lethality for LCS by 
integrating surface-to-surface missiles (Hellfire Longbow) onto those 
platforms starting in 2017. Navy is evaluating which missile to select 
to provide upgraded LCS (``frigates'') an additional and even longer 
range over-the-horizon missile capability. Also, PB-16 continues to 
accelerate acquisition of the Long Range Anti-Ship Missile (LRASM) air-
launched variant, which will achieve early operational capability on F/
A-18E/F aircraft in fiscal year 2019.
Anti-Submarine Warfare
    PB-16 sustains our advantage in the undersea domain by delivering 
the following capabilities, although capacity challenges persist:
  --Procures 47 P-8A Poseidon maritime patrol aircraft, replacing the 
        legacy P-3C Orion's capability, and completing the transition 
        by fiscal year 2019. We continue investments in the development 
        of a high-altitude anti-submarine warfare capability (HAAWC), 
        which is composed of a MK 54 torpedo kit and software support 
        system.
  --Continues installation of ASW combat systems upgrades for DDGs and 
        improved Multi-Function Towed Arrays (MFTA) for DDGs and CGs. 
        Both installations will be complete on all DDGs forward based 
        in the Western Pacific by 2018.
  --Continues upgrades to all our P-8A and ASW helicopters in the 
        Western Pacific with sonobuoys and advanced torpedoes by 2018; 
        however, in PB-16 we were compelled to reduce weapons capacity, 
        which equated to cancelling 240 MK 54 lightweight torpedoes.
  --Procures 145 MK 48 ADCAP torpedoes over the FYDP to reduce a 
        wartime requirement shortfall from 30 percent to 20 percent, 
        and invests in modularity and endurance improvements to enable 
        more efficient production, better performance, and future 
        upgradability.
  --Improves surface ASW capability in the LCS ASW Mission Package by 
        employing an MFTA in concert with variable depth sonar (VDS) in 
        2016.
  --Defers recapitalization of our ocean surveillance ship, T-AGOS(X), 
        from fiscal year 2020 to outside the FYDP, a reflection of our 
        intent to extend the service life of our current T-AGOS 
        vessels.
  --Develops and builds the Large Displacement Unmanned Undersea 
        Vehicle (LDUUV) in the FYDP to augment submarine capabilities. 
        We will use Office of Naval Research Innovative Naval Prototype 
        large UUVs to train our Fleet operators, preparing them for 
        LDUUV Fleet introduction in the early 2020s.
Electromagnetic Maneuver Warfare
    PB-16 puts Navy on a path to maneuver more freely in the 
electromagnetic spectrum, while strengthening our capability to degrade 
adversaries' ability to do so. It maintains our investment in the 
Ships' Signals Exploitation Equipment (SSEE) Increment F, which equips 
ships with a capability to interdict the communications and address and 
offset elements of adversary kill chains by 2020. PB-16 adds an 
advanced geo-location capability to SSEE Increment F, which contributes 
to defeating the ``left side'' of the adversary's ballistic missile 
kill chain and C4ISR systems. It also increases our investment in 
upgraded electromagnetic sensing capabilities for surface ships via the 
Surface Electronic Warfare Improvement Program (SEWIP) Block 2 that 
will deliver in 2016, procuring an additional 14 systems. PB-16 begins 
low rate initial production of SEWIP Block 3 in 2017 to add jamming and 
deception capabilities to counter advanced anti-ship cruise missiles. 
PB-16 also stands up Real-Time Spectrum Operations (RTSO) as a Program 
of Record. RTSO will provide ships and strike groups the ability to 
sense, control, and plan the use of spectrum, detect interference, 
notify the operators of spectrum issues, and provide recommended 
actions allowing for command and control of the electromagnetic 
spectrum.
    Our cyber capability continues to afford the Navy a competitive 
advantage, but we are growing increasingly concerned about potential 
vulnerabilities that could affect combat readiness. Recognizing these 
risks, in fiscal year 2015 the Navy stood up a dedicated task force to 
evaluate our cyber security posture and manage our investment portfolio 
to ensure we are spending money where it matters most. In addition to 
evaluating our cyber risk and informing our budget process, the task 
force will also recommend changes to the Navy's acquisition and 
management of our networks and cyber-connected systems.
Mine Warfare
    To enhance our ability to counter mines in the Middle East and 
other theaters, our PB-16 program sustains investments in the LCS mine 
countermeasures mission package (MCM MP), completing initial testing of 
its first increment in 2015 and achieving full operational capability 
in 2019. The MCM MP provides significantly faster rates of waterspace 
mine clearance over legacy counterparts. PB-16 also sustains our 
interim AFSB, USS Ponce, in service through at least fiscal year 2017. 
USS Ponce provides forward logistics support and command and control to 
MCM ships and helicopters, allowing them to remain on station longer 
and sustain a more rapid mine clearance rate. In the near-term, PB-16 
continues funding for Mk 18 Kingfish unmanned underwater vehicles (UUV) 
and Sea Fox mine neutralization systems deployed to the Arabian Gulf 
today, as well as increased maintenance and manning support for 
forward-deployed MH-53 airborne mine countermeasures platforms and 
Avenger-class MCM ships forward based in Bahrain.
                               readiness
Afloat Readiness
    PB-16 funds ship operations to 45/20 (deployed/non-deployed) 
steaming days per quarter. Overseas Contingency Operations (OCO) funds 
an additional 13/4 days (deployed/non-deployed), providing the training 
and operations required to meet our fiscal year 2016 GFMAP commitment. 
PB-16 baseline funds ship maintenance to 80 percent of the requirement, 
with OCO funding the remaining 20 percent, to continue life cycle 
maintenance reset of CVNs and surface force ships. To address the 
workload to be completed in our public shipyards, Navy funds additional 
workforce (up to 33,500 Full Time Equivalent workers by fiscal year 
2017) and will send selective submarines to private shipyards in fiscal 
year 2016 and fiscal year 2017.
    With respect to the Flying Hour Program, PB-16 achieves deployed 
readiness levels of T2.5/T2.0 (USN/USMC) in accordance with guidance 
for all carrier air wing (CVW) aircraft.\3\ Navy funds Aviation Depot 
Maintenance to 83 percent of the requirement, which puts the depots at 
capacity. As Aviation Depot Maintenance throughput improves, the 
associated F/A-18 flying hours and depot maintenance budgets will 
increase to the more notional level of 77 percent. PB-16 increases Navy 
Expeditionary Combat Command fiscal year 2016 base funding from 42 
percent to 80 percent. OCO funds the remaining 20 percent.
---------------------------------------------------------------------------
    \3\ Due to extended depot repair time, F/A-18A-D availability is 
reduced and shortfalls in aircraft will be borne by non-deployed 
forces. As more legacy F/A-18s approach their 6,000 hour design life 
and are inducted for assessment and life extension to 8,000 or 10,000 
hours, aviation depots are experiencing production challenges resulting 
in longer-than-expected repair cycle times for these aircraft. Navy has 
taken steps to better maintain and repair these legacy aircraft and 
expects to improve depot productivity by 2017, with the backlog fully 
recovered by 2019. In PB-16, Flying Hours for these aircraft will 
reflect the maximum executable profile and achieve T2.0 for deployment, 
with tailored T-ratings through the training cycle.
---------------------------------------------------------------------------
    Year after year, the Navy has consistently provided more global 
presence than authorized and adjudicated by the GFMAP. In 2013 and 
2014, for example, Naval forces provided 6 percent and 5 percent more 
forward presence, respectively, than planned due to emergent operations 
and unanticipated contingencies. This unbudgeted usage amounted to 
greater than 2,200 days in theater over that planned in 2013 and 
greater than 1,800 days in theater over that planned in 2014. We should 
operate the Fleet at sustainable presence levels, in order for the Navy 
to meet requirements while still maintaining material readiness, giving 
ships time to modernize, and allowing them to reach their expected 
service lives.
Ashore Readiness
    To comply with fiscal constraints, we are compelled to continue 
accepting risk in shore infrastructure investment and operations. PB-16 
prioritizes nuclear weapons support, base security, and airport/seaport 
operations while maintaining our commitment to quality of life programs 
for our Sailors and Families. We are funding the sustainment, 
restoration, and modernization of our facilities at a level to arrest 
the immediate decline in the overall condition of our most critical 
infrastructure. Although fiscal year 2016 marks an improvement in the 
facilities funding when compared to PB-15, Navy is still below the DOD 
goal for facilities sustainment. Facilities sustainment also declines 
in the PB-16 FYDP in order to preserve the operational readiness of our 
Fleet. When restoring and modernizing our infrastructure, we intend to 
prioritize life/safety issues and efficiency improvements to existing 
infrastructure and focus on repairing only the most critical components 
of our mission critical facilities. By deferring less critical repairs, 
especially for non-mission-critical facilities, we are allowing certain 
facilities to degrade and causing our overall facilities maintenance 
backlog to increase. We acknowledge this backlog must eventually be 
addressed.
    Navy will exceed the minimum 6 percent in capital investment in 
Naval Shipyards and Depots described in 10 USC 2476, with a projected 
7.4 percent in fiscal year 2016. Additionally, we are on track to 
exceed the target in fiscal year 2015 with a projected 6.3 percent 
investment. Our Naval Shipyards and depots are critical to maintaining 
the warfighting readiness of our force, and Navy will continue to 
prioritize investments to address the most critical safety and 
productivity deficiencies.
Audit Readiness
    Navy is on course to achieve full auditability on all four 
financial statements by the end of fiscal year 2017, a legislative 
mandate. An audit of the Schedule of Budgetary Activity (SBA), began in 
December 2014. This initial audit is a critical step to identify any 
weaknesses in business systems and business processes. The Navy's Audit 
Plan has been greatly improved by lessons learned from our sister 
Service, the United States Marine Corps, which achieved a clean audit 
on their SBA in 2013. The remaining challenge to meeting the fiscal 
year 2017 mandate is to achieve auditability on the other major 
financial statement, Navy's Balance Sheet. Audit readiness on the 
Balance Sheet depends primarily on the accuracy of the multi-billion-
dollar Asset line; the Navy has been executing a plan to bring Service-
wide accountability for major assets (by amounts and value) into 
compliance with financial audit standards. The Navy is confident that 
it will be able to undergo an audit of all of its financial statements 
by fiscal year 2017 to meet the Congressional requirement.
Family Readiness
    Family readiness is fully integrated into our Navy's call to be 
ready. PB-16 continues to provide support for critical programs that 
support our Sailors and their Families so that they can adapt to, and 
cope with, the challenges of balancing military commitment with family 
life. Navy Fleet and Family Support Centers ensure military families 
are informed, healthy, and resilient through robust programs that 
include: relocation assistance; non-medical and family counseling; 
personal and family life education; personal financial management 
services, information and referral services; deployment assistance, 
domestic violence prevention and response services, exceptional family 
member liaison; emergency family assistance and transition assistance. 
Increased stress and longer family separations have amplified program 
demand and underlined the importance of these support programs and 
services to ensure the psychological, emotional, and financial well-
being of our Sailors and their Families.
    Navy Child and Youth Programs continue to provide accessible, 
affordable, and high-quality child and youth development programs 
through child development centers, youth centers, child development 
homes, and contract child care spaces. All Navy child development 
centers are DOD certified and nationally accredited, and provide 
consistent, high-quality care at affordable rates based on total family 
income.
                         military construction
    The PB-16 Military Construction program includes 38 projects valued 
at almost $1 billion to invest in our construction worldwide. We have 
prioritized funding to enable IOC of new platforms such as LCS, P-8A, 
F-35C, MH-60, and MQ-4C through the construction of hangars, mission 
control centers, and various support and training facilities. We are 
also supporting Combatant Commander requirements by constructing a 
land-based Aegis site in Poland and upgrading port facilities in 
Bahrain. A portion of MILCON funds will recapitalize infrastructure in 
three naval shipyards and improve the resiliency of utilities systems 
at seven bases. Three projects will improve the quality of life for our 
Sailors and their Families by addressing unaccompanied housing issues 
in Florida and Maryland and constructing a new child development center 
in Japan.
                          health of the force
    We measure and track the health of our force using Navy-wide 
metrics on recruiting, retention, manning levels; unit operational 
tempo; individual tempo (how often individual Sailors are away from 
home); morale; stress; sexual assault rates; suicide rates; alcohol-
related incidents, and other factors. Based on a comprehensive study of 
these metrics and trends, today we rate the overall health of our Navy 
force as good. Our Sailors are our most important asset, they are our 
``asymmetric advantage,'' and we have invested appropriately to keep a 
high caliber all-volunteer force. At work, the Navy is committed to 
providing our Sailors a challenging, rewarding professional experience, 
underpinned by the tools and resources to do their jobs right. Our 
obligations don't stop at the bottom of the brow. I remain focused on 
dealing with enduring challenges that relate to the safety, health, and 
well-being of our people, no matter where they are located. We also 
support our Navy Families with the proper quality of life in terms of 
compensation, professional and personal development, and stability 
(i.e., deployment predictability). Navy's 21st Century Sailor Office 
(OPNAV N17), led by a flag officer, continues to integrate and 
synchronize our efforts to improve the readiness and resilience of 
Sailors and their Families. Specific initiatives that we continue to 
support in PB-16:
21st Century Sailor Programs
            Suicide Prevention
    Preventing suicide is a command-led effort that leverages a 
comprehensive array of outreach and education. We continue to raise 
awareness regarding the combination of indicators most common to 
suicide-prone individuals such as post-traumatic stress, relationship 
problems, legal and financial problems, periods of transition and 
mental health issues. We have launched several key initiatives 
including: (1) mandatory Operational Stress Control (OSC) skills 
training for units within 6 months of deployment, (2) new guidance for 
Navy unit commanders and health professionals to reduce access to 
lethal instruments under certain conditions, (3) an interactive, 
scenario-based suicide prevention training tool, (4) an OSC curriculum 
specific to our Reserve Sailors, and (5) specialized Chaplain Corps 
professional development training on suicide prevention. Our Sailors 
continue to learn about the bystander intervention tool known as 
``A.C.T.'' (Ask--Care--Treat). We also invest in the resilience of our 
people to help them deal with any challenge.
            Resilience
    Our research shows that a Sailor's ability to steadily build 
resilience is a key factor in navigating stressful situations. 
Education and prevention initiatives train Sailors to recognize 
operational stress early and to use tools to manage and reduce its 
effects. Our Operational Stress Control (OSC) program is the foundation 
of our efforts to teach Sailors to recognize stressors in their lives 
and mitigate them before they become crises. We expanded our OSC mobile 
training teams, developed Bystander Intervention to the Fleet training, 
and deployed resiliency counselors on our aircraft carriers and large 
deck amphibious ships. The 21st Century Sailor Office is also 
conducting a Total Sailor Fitness curriculum review and developing a 
Resilience Management System to automate the collection and reporting 
of all destructive behaviors and better coordinate and integrate our 
resilience efforts. We also launched a new campaign across the Fleet in 
2015 called ``Every Sailor, Every Day,'' which emphasizes personal 
responsibility and peer support, so that Sailors are even more 
empowered to look out for and help other Sailors.
            Sexual Assault
    The Navy continues to pursue a deliberate strategy in combatting 
sexual assault. We continue to focus on preventing sexual assaults, 
ensuring victims are fully supported, improving investigation programs 
and processes, and ensuring appropriate accountability. These efforts 
include making sexual assault forensic exams available on all ships and 
24/7 ashore, having a cadre of professional and credentialed sexual 
assault response coordinators and victim advocates, special victim 
trained investigators and JAGs, and ensuring commands take all reports 
of sexual assault seriously and support the victim. We will enhance our 
response efforts by full implementation of deployed resiliency 
counselors on large deck ships, enhanced NCIS investigative capability 
using specially training Master-at-Arms, and continued legal assistance 
to victims through our Victims Legal Counsel program.
    Sustaining a professionalized response and victim advocacy system 
remains the top priority, but preventing sexual assaults in the first 
place is an imperative. Our strategy focuses on improving command 
climate, strengthening deterrence measures, and encouraging bystander 
intervention. To facilitate the latter, we trained facilitators to lead 
small, peer-group interactive discussions using various scenarios. 
Likewise, we have focused on raising awareness and accountability 
regarding retaliation to reduce the potential for re-victimization. A 
RAND survey of DOD found that 53 percent of retaliation is ``social'' 
or ``peer,'' so we are focusing in on that area. Navy efforts are 
aligned with SECDEF direction to enhance first line supervisor skills 
and knowledge in recognizing signs of possible acts of retaliation. 
Recent Navy survey results show that prevalence of sexual assaults is 
decreasing, but we remain fully committed to creating and sustaining a 
culture where Sailors understand the importance of treating Shipmates 
with dignity and respect at all times, in all places.
Manpower
            End Strength
    PB-16 supports an fiscal year 2016 Navy active end strength of 
329,200 and reserve end strength of 57,400. It appropriately balances 
risk, preserves capabilities to meet current Navy and Joint 
requirements, fosters growth in required mission areas, and provides 
support to Sailors, Navy Civilians, and Families. Programmatic changes 
tied to force structure and fact-of-life additions resulted in modest 
PB-16 active component end strength growth. Examples of force 
structure-related changes include retaining personnel for CVN 73 and 
its air wing, restoring manpower to nine cruisers that will remain in 
operation, and building crews for new construction destroyers (DDG 51, 
DDG 1000) and submarines (Virginia Class). PB-16 end strength remains 
fairly stable across the FYDP, reaching approximately 330, 000 active 
and 58,900 reserves in fiscal year 2020.
            Sea Duty
    Navy continues to emphasize and reward sea duty. Aggregate Fleet 
manning (what we call ``fill'') increased from 93 percent in fiscal 
year 2013 to 96 percent in fiscal year 2014, the equivalent of roughly 
3,500 more Sailors aboard surface ships. Also, we are very close to 
achieving our goal of ensuring that more than 90 percent of our Sailors 
are serving in jobs at the required grade with requisite experience and 
training (what we call ``fit''). Navy is committed to reducing 
deployment lengths to 7 months, but in recognition of those who have 
been experiencing longer deployments (over 220 days), in 2014 we began 
providing additional pay called Hardship Duty Pay-Tempo (HDPT). We have 
also incentivized and rewarded sea duty, in general, by increasing Sea 
Pay.
Personnel Management
            Recruiting and Retention
    Navy recruiting and retention remain strong, although retaining 
personnel in certain critical skills continues to present a challenge, 
particularly as the demands we place on Sailors and their Families 
remain high. The threat of looming sequestration, along with a 
recovering economy, is a troubling combination. We are beginning to see 
downward trends in retention, particularly among pilots, nuclear-
trained officers, SEALs, and highly skilled Sailors in information 
technology, Aegis radar and nuclear specialties. We are using all tools 
at our disposal, including special and incentive pays, to motivate 
continued service in these critical fields.
            Gender Integration
    Integrating women across the force remain top priorities, because 
they allow the Navy to tap into the Nation's rich talent pool. Over 96 
percent of all Navy jobs are currently available to women and we expect 
to open all occupations by early next year. We are also focused on 
retaining women warfighters by increasing career flexibility through 
initiatives like the Career Intermission Program, which allows 
servicemembers to take a hiatus from their careers for up to 3 years to 
pursue personal priorities before re-entering the force. One of our 
major thrusts in fiscal year 2016 is to increase female accessions of 
both officer and enlisted in order to provide greater female 
representation in all operational units by 2025. We are setting a goal 
of increasing female enlisted accessions to 25 percent and changing the 
mix of ratings available to provide greater operational opportunity for 
women to serve. Integration of women into the submarine force is 
tracking well.
            Diversity
    Demonstrating our continued commitment to diversity, Navy recently 
established a Diversity Policy Review Board, chaired by the Vice Chief 
of Naval Operations. Individual community self-assessments focused on 
diversity trend analysis are also vetted at my level to ensure each 
warfighting enterprise remains free of barriers to advancement and 
committed to equal opportunity to our entire talent pool without regard 
to race, gender, country of origin, or religion. Additionally, Navy 
offers a range of Science, Technology, Engineering, and Mathematics 
(STEM) education and outreach programs to generate interest by the 
Nation's youth in these fields and open up opportunities for them to 
consider potential Navy careers where STEM expertise could be applied.
            Quality of Service
    Navy continues to invest in projects designed to improve Sailor's 
quality of service, which has two components: (1) quality of work, and 
(2) quality of life. Further, all funds saved through ``compensation 
reform'' are directly invested in quality of work and quality of life 
programs. PB-16 invests in quality of service initiatives such as 
barracks and training building improvements, greater travel and 
schools, expanded use of tactical trainers and simulators, and 
increased funding for spare parts and tools. It also leverages smart 
technology devices and applications through an ``eSailor'' initiative 
to enhance training, communication and Sailor career management ashore 
and afloat.
            Talent Management
    As our economy improves and the labor marketplace becomes even more 
competitive, the battle for America's talented youth in service 
continues to heighten. Today's generation, while remarkably similar in 
their desire to serve as the rest of us, have different expectations 
for a career of service. Meanwhile, our personnel policies and 
information systems are rooted in the assumptions of a previous era. 
Much like any legacy weapons system, that personnel and learning 
structure is in need of modernization. Thus, we are examining 
initiatives to modernize how we manage our future force, for example: 
(1) phase out strict Year-Group management practices in favor of a 
milestone-based promotion system, (2) improve lateral flows between 
reserve and active components to offer more agile pathways of service, 
and (3) upgrade our information technology, software, and tools to 
enable a more mobile, flexible, and accurate personnel delivery system. 
Further, we plan to build upon our cultural strengths through a number 
of family-centered initiatives, such as expanded child development and 
fitness resources, along with greater career flexibility for dual-
military and dual-professional Families to grow together while serving 
our Nation.
            Transition Assistance
    A new Transition Goals, Plans, Success (GPS) curriculum replaced 
the 20-year old Transition Assistance Program (TAP) to improve career 
readiness standards and assist separating Sailors. The mandatory 5-day 
core curriculum provides Veterans Affairs benefits briefings, the 
Department of Labor employment workshop, financial management and 
budgeting, and military to civilian skills crosswalk. Moreover, the DOD 
Military Life Cycle (MLC) Transition Model, implemented in 2014 in the 
Navy, is working to begin a Sailor's transition preparation early in 
their career, by providing opportunities to align with civilian 
standards long before their intended separation, to achieve their post-
military goals for employment, education, technical training, or 
starting a business.
Character Development
    At all levels in the Navy, we emphasize a culture of integrity, 
accountability, and ethical behavior. All of these make up the 
character of our leaders. Good character enables unconditional trust 
throughout our ranks. This is essential to succeed as a unified, 
confident, and interdependent team. It must be inherent in all our 
operations.
    Navy continues to emphasize character development as a priority in 
our overall leader development efforts, which are outlined in Navy's 
2013 Navy Leader Development Strategy. In 2014, we established the 
Naval Leadership and Ethics Center, which serves as the means by which 
we guide our efforts. This new command, alongside our Command 
Leadership School, Senior Enlisted Academy, and Leadership and Ethics 
programs at the Naval War College, expand and improve character 
development initiatives at every level. We are developing an ethics 
curriculum (courses and modules) that will be embedded in schoolhouses 
across the Fleet. We are also strengthening our Navy Leader Development 
Continuum, which is the way in which we facilitate development of both 
officers and enlisted throughout all phases of their careers. We are 
not learning alone; we draw insights and share best practices with our 
sister Services. The Navy is committed to inculcating into every member 
of our profession the key attribute of good character. It reflects our 
Navy heritage and the citizens of our Nation expect that we uphold the 
highest standards of behavior and performance in the execution of 
duties.
                           navy reserve force
    Our Navy responded to extraordinary challenges over 13 years of war 
with the help of Reserve Sailors. The men and women of our Navy Reserve 
have increasingly put their civilian careers on hold in order to 
operate forward, provide critical support to Fleet and Combatant 
Commanders, and enhance the performance of the Joint Force. The Navy 
Reserve is a valuable hedge against an uncertain and challenging 
security environment; they augment the Fleet with unique skills to see 
us through any challenge. Since 9/11, reserve contributions to the 
active duty Navy component have been significant--over 73,000 Navy 
Reserve Sailors were mobilized in support of global contingency 
operations, providing tens of thousands of ``boots on the ground'' in 
Iraq, Kuwait, Bahrain, Afghanistan, and the Horn of Africa, as well as 
supporting key missions like those at Joint Task Force-Guantanamo Bay. 
On any given day, nearly 25 percent of the Navy Reserve force directly 
supports the Navy worldwide--about 15,000 Sailors.
    Based on our annual assessment of the active/reserve mix, PB-16 
continues investments in expanding critical capabilities within the 
Reserve component including: (1) surge maintenance, by selectively 
targeting reservists who bring specific, valuable civilian skill sets 
to the Navy Total Force; (2) intelligence support, by realigning end 
strength to support this vital mission; (3) cyber warfare, by ensuring 
the appropriate mix of reserve manning to augment the active Navy 
capability; and, (4) high value unit escort, by leveraging the Navy 
Reserve's ability to fill short notice requirements using Reserve 
Coastal Riverine Force units to assume CONUS high value unit escort 
missions from the Coast Guard. PB-16 maintains several vital reserve 
capabilities, including all of the Navy-unique Fleet essential airlift 
assets (C-40A and C-130). These enable the Navy to meet short-notice, 
mission-critical airlift requirements more responsively than any other 
logistics option. It also supports Airborne Electronic Attack by fully 
funding a reserve airborne electronic attack squadron, which is an 
integral component of Navy's cyclic operational expeditionary airborne 
electronic attack deployment capability.
                               conclusion
    For the last 3 years, the Navy has been operating under reduced 
top-lines generating capability shortfalls amounting to $25 billion 
less than the President's budget requests. With each year that the Navy 
receives less than requested, the loss of force structure, readiness, 
and future investments cause our options to become increasingly 
constrained. Navy has already divested 23 ships and 67,000 personnel 
between 2002 and 2012. And we have been assuming significant risk by 
delaying critical modernizations of our force to keep pace and maintain 
technological advantage.
    Unless naval forces are properly sized, modernized at the right 
pace, ready to deploy with adequate training and equipment, and able to 
respond with the capacity and speed required by Combatant Commanders, 
they will not be able to carry out the defense strategy, as written. 
Most importantly, when facing major contingencies, our ability to fight 
and win will not be quick nor as decisive as required. To preclude a 
significantly diminished global security role for the Nation's 
military, we must address the growing mismatch in ends, ways, and 
means.
    The world is more complex, uncertain, and turbulent; this trend 
will likely continue. Our adversaries' capabilities are modernizing and 
expanding. It is, therefore, vital to have an adequate, predictable, 
and timely budget to remain an effective Navy. PB-16 proposes the best 
balance of Navy capabilities for the authorized amount of funding, and 
enables the Navy to conduct the 10 primary missions outlined in the 
President's DSG and the QDR. But, there is considerable risk. PB-16 is 
the absolute minimum funding needed to execute our DSG. Should 
resources be further reduced below PB-16 levels, the DSG will need to 
be revised. If sequestration is implemented in fiscal year 2016, it 
will damage our national security.
    I thank this committee for their abiding support and look forward 
to working together to develop viable options for our Nation's future.

    Senator Cochran. Thank you very much.
    General Dunford, any comments on the budget request?
STATEMENT OF GENERAL JOSEPH F. DUNFORD, JR., 
            COMMANDANT, U.S. MARINE CORPS
    General Dunford. Mr. Chairman, distinguished members of the 
committee, thanks for the opportunity to appear before you 
today. I am honored to be here with Secretary Mabus and Admiral 
Greenert and represent your marines.
    I will begin by thanking the committee for your steadfast 
support. Due to your leadership, we feel it is the best trained 
and equipped Marine Corps our Nation has ever sent to war.
    I know this committee and the American people have high 
expectations for marines as our Nation's expeditionary force in 
readiness. You expect your marines to operate forward, engage 
with our partners, deter potential adversaries, and respond to 
crises. And when we fight, you expect us to win. You expect a 
lot from your marines, and you should.
    This morning, as you hold this hearing, over 31,000 marines 
are forward-deployed and engaged doing just what you expect 
them to do. Our role as the Nation's expeditionary force in 
readiness informs how we man, train, and equip the Marine 
Corps. It also informs how we prioritize and allocate the 
resources that we get from Congress.
    Over the past few years, we prioritized the readiness of 
our forward-deployed forces. Those are the forces that you can 
count on for immediate crisis response. Those are the forces 
that supported the recent evacuation of U.S. citizens in the 
Sudan, Libya, and Yemen. Those are the forces currently 
conducting strikes in Syria, in Iraq, training the Iraqi army, 
and protecting our Embassy in Baghdad. And those are the 22,500 
marines that are west of the International Date Line in the 
Pacific.
    I can assure you that your forward-deployed marines are 
well-trained, well-led, and well-equipped. But we have had to 
make tough choices to deal with the effects of two wars, 
sequestration in 2013, and reduced budgets in 2014 and 2015.
    In order to maintain the readiness of our forward-deployed 
forces, we have not sufficiently invested in our home-station 
readiness, our modernization, our infrastructure sustainment, 
or our quality-of-life programs.
    As a result, approximately half of our nondeployed units, 
and those are really the ones who would respond to unforeseen 
contingencies, suffer personnel, equipment, and training 
shortfalls. In a major conflict, those shortfalls will result 
in a delayed response and/or the unnecessary loss of young 
American lives.
    Over time, underinvesting in modernization will result in 
maintaining older or obsolete equipment at higher costs and 
degraded capabilities. It will eventually erode our competitive 
advantage, and we don't ever want our marines and sailors in a 
fair fight.
    The readiness challenges we have today provide context for 
my message this morning. We can meet the requirements of the 
Defense Strategic Guidance with the President's budget, but 
there is no margin. BCA funding levels, on the other hand, will 
exacerbate the challenges that we have today. It will also 
result in a Marine Corps with fewer available Active-Duty 
battalions and squadrons than would be required for a single 
major contingency. And perhaps more concerning, it will result 
in fewer marines and sailors being forward-deployed and in a 
position to immediately respond to a crisis involving our 
diplomatic posts, American citizens, or U.S. interests.

                           PREPARED STATEMENT

    As we saw in the wake of Benghazi, the American people 
expect us to respond to today's crises today. We can only do 
that if we are properly postured to respond.
    In closing, my assessment is that funding below the 
President's budget level will require that we develop a new 
strategy.
    Thank you once again for the opportunity to appear before 
you this morning and for your leadership in addressing today's 
fiscal challenges.
    Mr. Chairman, I look forward to your questions.
    [The statement follows:]
           Prepared Statement of General Joseph Dunford, Jr.
                              introduction
    The Marine Corps is the Nation's expeditionary force-in-readiness. 
Congress, specifically and uniquely, structured and prescribed the role 
of the Marine Corps as a ``. . . balanced force-in-readiness, air and 
ground . . . to suppress or contain international disturbances short of 
large scale war.'' Under this mandate, Marines are forward-deployed, 
forward-engaged, and postured to shape events, manage instability, 
project influence, and immediately respond to crises. As an inherently 
joint combined arms team, Marines assure access and enable heavier 
contingency forces to deploy from the United States in response to a 
major contingency.
    Also, to meet the intent of the Congress, the Marine Corps must 
maintain a high state of combat readiness. We look at readiness through 
the lens of our 5 pillars of readiness--high quality people, unit 
readiness, capacity to meet the combatant commanders' requirements, 
infrastructure sustainment, and equipment modernization. These pillars 
represent the operational and foundational components of readiness 
across the Marine Corps. Our role as America's 9-1-1 force informs how 
we man, train, and equip our force, and how we prioritize and allocate 
resources across the pillars of readiness. While we will always ensure 
that our forward deployed Marines and Sailors are properly manned, 
trained and equipped, we seek to maintain balanced investment across 
the pillars to ensure current and future readiness. We emphasize that 
all Marines and all Marine units are physically and mentally ready to 
deploy to any clime and place, at any time.
    The Marine Corps is a force of economy. For 6.0 percent of the 
defense budget, the Marine Corps provides 21 percent of the Nation's 
infantry battalions and 15 percent of the fighter/attack aircraft. 
These capabilities, organized as Marine Air Ground Task Forces with an 
organic logistical element, provide the Nation with affordable 
insurance and a strategic hedge in an era of uncertainty and 
unprecedented complexity.
                          strategic landscape
    The challenges of the future operating environment will demand that 
our Nation maintains a force-in-readiness that is capable of global 
response. The strategic landscape will be characterized by competition 
for natural resources, violent extremism, natural disasters, social 
unrest, cyber-attacks, regional conflict, and proliferation of advanced 
weaponry and weapons of mass destruction. The expansion of modem 
conventional and cyber weapons to a broader range of state and non-
state entities, along with the erosion of U.S. technological advantages 
in areas where we have long enjoyed relative superiority, is likely to 
continue. Further, the actions of transnational criminal organizations 
and violent extremist groups will continue to contribute to regional 
unrest and instability that directly threaten U.S. interests through 
piracy, trafficking and terrorism. The U.S. must expect a security 
landscape characterized by volatility, instability and complexity, and 
a growing potential among adversaries to employ weapons of mass 
destruction.
    As Marines, we view global security challenges from a maritime 
perspective. The majority of these challenges reside in the congested 
and diverse areas where the sea and land merge--the littorals. Today, 
more than 80 percent of the world's population currently resides within 
100 miles of a coastline and this proportion is continuing to rise. 
Most maritime activities such as commercial shipping, fishing, and oil 
and gas extraction take place within 200 miles of the shore. It is no 
accident that the so-called ``Arc of Instability'' encompasses the 
littoral areas of South Central Asia, the Middle East, Africa. These 
geographic and demographic trends indicate a future security 
environment with a significant maritime element.
    We expect that the next 10 years will be largely characterized by 
small-scale crises and limited contingencies in and around coastal 
environments. Should major operations and campaigns occur, they are 
likely to involve a significant maritime and littoral dimension. Ready, 
responsive, flexible and strategically mobile naval forces are 
essential to ensuring continued access and security in the global 
commons. The increased likelihood of operations in the littorals 
demands the Marine Corps focus on its Title 10 responsibilities to be 
organized, trained and equipped to come from the sea across the range 
of military operations.
    America's responsibility as a world leader requires an approach to 
the current and future strategic landscape that leverages the forward 
presence of our military forces in support of our diplomatic and 
economic approaches. As stated in the 2012 President's Defense 
Strategic Guidance, ``The United States will continue to lead global 
efforts with capable allies and partners to assure access to and use of 
the global commons, both by strengthening international norms of 
responsible behavior and by maintaining relevant and interoperable 
military capabilities.'' The Marine Corps' unique capabilities support 
this strategic approach.
                              your marines
    In 2014, Marines responded to crises around the world and remained 
forward-deployed and forward-engaged managing instability, building 
partner capacity, strengthening alliances, and projecting influence. 
Your Marines demonstrated the relevance of expeditionary naval forces 
by executing more than 30 amphibious operations, 150 Theater Security 
Cooperation (TSC) events, and 130 exercises around the globe. While we 
have drawn down our forces in Afghanistan, our operational tempo 
remains extraordinarily high. Most Marines in the operating forces are 
deploying for 7 months and spending at or below 14 months at home 
before redeploying. There is a strong demand signal for Marines and 
tailored Marine Air Ground Task Forces.
OEF-Afghanistan
    In 2014, the Marine Corps contributed to the mission in Afghanistan 
by training, advising and assisting the Afghanistan National Security 
Forces (ANSF) and supporting the fight against terrorism in Southwest 
Asia. Our operations focused on ensuring the success of the Afghanistan 
elections in the summer of 2014 and transitioning security 
responsibilities to the ANSF. With Marines serving in an advisory 
capacity, the ANSF retained control of all district centers in Helmand 
Province. Regional Command (SW) also turned over operational 
responsibilities to the International Security Assistance Force Joint 
Command facilitating redeployment of Marine Expeditionary Brigade-
Afghanistan (MEB-A) to home station. Today, a residual Marine presence 
continues to support the Resolute Support Mission (NATO)/OPERATION 
FREEDOM'S SENTINEL (U.S.) in Afghanistan.
    In more than 13 years of combat operations, 377 Marines were killed 
and 4,946 injured in Afghanistan. We remember their selfless service 
and many sacrifices. Our success in RC-SW is directly related to the 
high quality men and women in our ranks, the training that prepared 
them to face the rigors of combat, and the equipment that provided 
protection and a tactical edge over the enemy. Due to the enduring 
support of Congress and the American people, the Marines who fought in 
Afghanistan had the training and equipment necessary to accomplish the 
mission. The full support of Congress for a variety of initiatives such 
as Mine Resistant Armor Protected Vehicles (MRAPs) and upgraded 
individual protective equipment saved lives and enhanced combat 
effectiveness.
Amphibious Ready Group/Marine Expeditionary Unit (ARG/MEU) Operations
    Our preferred method of deploying our Marines is aboard Navy 
amphibious ships to form ARG/MEU Teams. These are the Nation's most-
ready, forward-postured forces. This capability provides strategic 
speed, agility, and options to our National Command Authority. They 
operate in international waters retaining flexibility for the 
Geographic Combatant Commander (GCC) while respecting the sovereign 
territory of individual nation states. The ARG/MEU team can respond 
faster from longer ranges with greater capabilities across the ROMO 
than any other conventional forces in the Department of Defense and are 
also capable of enabling Joint, interagency and coalition forces. In 
2014, the 11th, 13th, 22d, 24th, and 31st Marine Expeditionary Units 
(MEU) deployed and contributed to combatant commander requirements by 
participating in numerous exercises and operations throughout the 
CENTCOM, PACOM, AFRICOM, and EUCOM areas of responsibility (AORs). When 
required, the ARG/MEU has the scalability and versatility to respond to 
simultaneous emergencies. Last summer, the 22d MEU/Bataan ARG was 
operating in the CENTCOM AOR conducting operations in Yemen. When 
needed, elements of the ARG/MEU rapidly transited into the 
Mediterranean Sea to support the suspension of Embassy operations in 
Libya and relocation of its staff. During their return, they launched a 
force over 1200 miles to contribute to the initial response to counter 
ISIS. Concurrently, elements of the ARG/MEU continued to support U.S. 
operations in Yemen. Over the last year, we have also increased 
collaboration with SOF, significantly improving our complementary 
capabilities.
    Due to their forward presence, flexibility, ability to respond 
quickly and the decision space they afford our leaders, ARG/MEU's 
continue to be in high demand. Unfortunately, the Navy and Marine Corps 
can meet less than half of the GCC ARG/MEU crisis response force demand 
based on the ARG shipping available for tasking. Today, available 
expeditionary Navy/Marine Corps forces stand ready aboard ships to 
assure allies, deter potential adversaries, and provide persistent U.S. 
presence. Our Marines are forward deployed, with little to no footprint 
ashore, to respond and protect U.S. national security interests around 
the globe.
Special Purpose Marine Air Ground Task Force--Crisis Response (SPMAGTF-
        CR) Operations
    With the high demand for Marine crisis response capabilities and 
the shortage of amphibious platforms from which to forward deploy 
forces, SPMAGTF-CRs were developed. While they don't provide the 
flexibility and responsiveness of an ARG/MEU, they mitigate a 
capability gap for the combatant commanders. Our SPMAGTF-CRs are 
tailored to respond to crisis and also conduct security cooperation 
activities with partner nations in order to develop interoperability, 
facilitate access, build partner capacity and security relationships, 
and gain regional understanding. This past year, SPMAGTF-CR units 
assigned to AFRICOM positioned forward in Moron, Spain and Signonella, 
Italy safeguarded the lives of our diplomatic personnel and conducted 
military-assisted departures from the U.S. Embassy in South Sudan in 
January and our Embassy in Libya in July. The Marine Corps SPMAGTF-CR 
unit assigned to CENTCOM (SPMAGTF-CR-CC) became fully operational on 1 
November 2014 and deployed to the CENTCOM AOR. Since November, SPMAGTF-
CR-CC conducted Embassy reinforcement, TSC exercises, and provided 
critical aviation and ground capabilities in the fight against ISIL. 
Most recently, Marines from SPMAGTF-CR-CC supported the evacuation of 
our Embassy in Sana'a, Yemen. A third SPMAGTF deployed in support of 
Southern Command from June to September aboard USS America on her 
transit around the South American continent and executed partner-nation 
activities, key leader engagements and security cooperation activities. 
The placement of these Marine Corps tailored task force capabilities 
forward, where GCC's need them, provides enhanced diplomatic protection 
and additional crisis response options.
Marine Corps in the Pacific
    The Marine Corps' activities in the Pacific are led by III Marine 
Expeditionary Force headquartered on Okinawa, Japan. This past year, 
III MEF conducted 52 operations and exercises. In 2014, III MEF 
conducted Exercise SSong Yong--the largest amphibious exercise of the 
year with our Korean allies further demonstrating the U.S. commitment 
to South Korea. III MEF plays an important role in maintaining 
stability in East Asia and significantly contributes to peace and 
prosperity throughout the region. A number of TSC exercises were 
conducted using Maritime Prepositioning Ships (MPS). While these 
platforms were designed to deliver heavy equipment for a major 
contingency, adapting them for day-to-day engagement enabled us to 
better support the combatant commander's theater campaign plan and 
mitigated the number of amphibious lift in the Pacific.
    The Marine Corps continues to rebalance its force lay-down in the 
Pacific to support the Defense Strategic Guidance (DSG). The 
Distributed Laydown's planned end state of four geographically 
distributed, politically sustainable and operationally resilient MAGTFs 
in the Pacific (Australia, Guam, Japan, and Hawaii) is a long term 
effort that will span the next 15 years. In 2014, we met the Secretary 
of Defense's guidance to have 22,500 Marines west of the International 
Date Line, forward based and operating within the Asia-Pacific Theater. 
Marine rotational force-Darwin (MRF-D), based at Robertson Barracks, is 
in its third year of execution, and has rotated 1,263 Marines through 
Darwin conducting bi-lateral training and exercises. This rotational 
force provides MARFORPAC and PACOM with a ready and deployable MAGTF 
capable of Humanitarian Response/Disaster Relief (HA/DR), TSC, and 
crisis response operations. MRF-D has strengthened our alliance with 
our Australian allies and provided the GCC an immediate response option 
in the wake of an unforeseen crisis.
Black Sea Rotational Force, Embassy Security Forces, and Theater 
        Security Cooperation (TSC)
    Marine Corps operational commitments span across all GCCs 
contributing to stronger alliances, stable international order, and 
security for our diplomatic stations. In the Republic of Georgia, the 
Marine Corps prepared three Georgian infantry battalions for their 
deployment to Afghanistan. There, the Georgian forces provided force 
protection and executed Quick Reaction Force (QRF) missions as the ISAF 
mission transitioned to the Resolute Support Mission (RSM). Enabling 
the deployment of Georgian battalions reduced the requirement for U.S. 
forces in Afghanistan while providing the Commander with the requisite 
capabilities.
    In support of our strong commitment to the security and stability 
in Europe, Marines of the Black Sea Rotational Force (BSRF) mission 
conducted hundreds of TSC activities in EUCOM and provided a 
significant crisis response option for the EUCOM commander. 
Additionally, Fleet Anti-Terrorism Security Teams (FAST) provided 
forward-deployed platoons to four Geographic Combatant Commanders in 
support of dynamic mission tasking such as Embassy reinforcement in 
Baghdad, Iraq and Sana'a, Yemen.
    The 2015 President's National Security Strategy emphasizes the 
security of American citizens. This past year the Marine Corps worked 
closely with the State Department to increase baseline security at high 
risk embassies and consulates. Today Marines are routinely serving at 
173 embassies and consulates in 141 countries around the globe. In 
2014, the Marine Corps Embassy Security Group added 237 Marine Security 
Guards (MSG) to new and current posts including Iraq, Lebanon, and 
Turkey. These Marines represent our initial installment towards the 
additional 1,000 MSG requirement from Congress. The Marine Security 
Augmentation Unit (MSAU) also deployed 29 times at the request of the 
State Department executing 16 Embassy/Consulate security missions and 
13 VIP (POTUS/VPOTUS/SECSTATE) security missions. MSAU Marines deployed 
to Iraq, Israel, South Korea, Chad, China, Poland, Philippines, France, 
Bahrain, Romania, Australia, Brazil, United Kingdom, Kenya, Ukraine, 
South Sudan, Turkey, Mexico, and Thailand.
                   fiscal year 2016 budget priorities
    The President's Budget for fiscal year 2016 (PB16) allocates $24 
billion to the Marine Corps' baseline budget. To meet our 
responsibilities as the Nation's 9-1-1 force, we prioritized near-term 
readiness while assuming risk in our home station readiness, 
modernization, infrastructure, and quality of life programs. We will 
attempt to reestablish an acceptable balance across the 5 Pillars of 
Readiness across the future year's defense plan. The following is a 
detailed description of the Marine Corps' budget priorities supported 
by PB16 of Force Structure, ACV, JLTV, JSF, CH-53K, C4 and naval 
programs of interest.
Force Structure
    In 2010, the Marine Corps' internal force structure review 
concluded that the USMC's optimal size to meet the requirements of the 
President's National Security Strategy was 186,800. This optimal size 
gives the Marine Corps the capacity we need to meet current steady 
state demand with a deployment-to-dwell (D2D) ratio greater than 1:2. 
We continue to support this review and conclusion. Today, the Marine 
Corps continues to execute its end-strength reductions that began 
during fiscal year 2012, reducing the Corps from a high of 202,000. The 
Marine Corps is adjusting its active duty end-strength to 182,000 
Marines by 2017, emphasizing the enduring requirement to provide crisis 
response forces that meet today's demand. We can meet the DSG at this 
level, but with less than optimal time between deployments to train and 
allow Marines to be with their families.
    Our most significant readiness challenge is the gap in the numbers 
of unit leaders with the right grade, experience, technical and 
leadership qualifications associated with their billets. Specifically, 
our current inventory of Non-Commissioned Officers (NCOs) and Staff 
Non-Commissioned Officers (SNCOs) is not meeting our force structure 
requirements. This dynamic directly affects our training, maintenance, 
and discipline resulting in degraded readiness and combat 
effectiveness. The Marine Corps' PB16 military personnel budget funds a 
fiscal year 2016 end-strength of 184,000 in our base and supports 
right-sizing our NCO corps to provide our Marines the small unit 
leadership they deserve.
Amphibious Combat Vehicle (ACV)
    The Marine Corps appreciates the support of the Congress in 
restructuring the ACV program in the fiscal year 2015 appropriations 
bill. That action has set us on a path to publishing a Request for 
Proposals (RFP) to industry in March of this year and enables a truly 
'streamlined' acquisition process. Leveraging the stability of the 
Services' requirements and the mature technologies of non-
developmental, modern, wheeled, armored combat vehicles, the combat 
developers and acquisition professionals have developed a way forward 
to field a capability for the Marines in as little as 6 (vice 13 or 
more) years. Consistent with Marine Corps Ground Combat and Tactical 
Vehicle Strategy (GCTVS) and Expeditionary Force 21, the Amphibious 
Combat Vehicle (ACV) will be developed and procured in phases to 
incrementally field modern replacements for the aging Amphibious 
Assault Vehicle (AAV).
    The program is based on the most current threat projections and 
anticipated operational requirements, and is fully informed by the real 
world challenges that our Marines have faced during 14 years of 
sustained combat. The ACV will provide our ground maneuver forces the 
ability to negotiate the challenging urban and cross-country terrain of 
the littorals while protecting them from ballistic and explosive 
threats and supporting them with precision heavy machine gun fire.
    The President's budget fully funds ACV 1.1 within the FYDP. PB16 
will buy 86 vehicles over the FYDP or approximately 42 percent of the 
204 ACV 1.1 vehicles in the Approved Acquisition Objective (AAO). When 
Full Operational Capability (FOC) is achieved in fiscal year 2023, we 
will have modernized two Assault Amphibian (AA) Companies currently 
equipped with four decades old AAVs with 204 new vehicles. ACV 1.1 plus 
the 1.2 increment are currently planned to modernize 6 of 10 AA 
Companies. With PB16 funding, the Marine Corps will achieve Initial 
Operational Capability (IOC) which consists of an ACV platoon of 21 
armored vehicles, providing protected amphibious lift to an infantry 
company. IOC is achieved when the platoon is fully equipped, the unit 
is fully trained and judged combat ready for deployment, and the 
required maintenance and support personnel are in place to sustain the 
unit.
    The need for self-deploying, high-water speed vehicles remains our 
ultimate objective. The capability to come from the sea and operate in 
the littorals will be significantly dependent on the speed at which we 
can maneuver. ACV 1.1 provides a responsible and effective approach to 
mitigating the age of our AAV fleet while investing in needed 
capabilities for tomorrow. We will continue to prioritize our science 
and technology efforts to field an amphibious combat vehicle that will 
fully support our operating concepts in the future.
Joint Light Tactical Vehicle (JLTV)
    Over the past 14 years of combat, we found that the HMMWV utility 
vehicle was not adequate for the modern battlefield due to its 
vulnerability to improvised explosive devices (IEDs). In 2006, we began 
development of a light tactical vehicle that could combine the land 
mobility performance, transportability profile and payload of the HMMWV 
with the protection of a combat vehicle within the weight constraints 
of the expeditionary force. Today, the Joint Light Tactical Vehicle 
Program has three exceptionally strong designs in competition that will 
realize the initiating concept in production and deployment while 
increasing the protected mobility of the highest risk portion of the 
light combat and tactical vehicle fleet.
    The JLTV program is in the engineering and manufacturing 
development (EMD) phase with Milestone C and the low rate initial 
production contract award scheduled for fiscal year 2015. The PB16 
supports the Marine Corps' strategy to reach IOC for JLTV in the 4th 
quarter of fiscal year 2018 and FOC in the 4th quarter of fiscal year 
2021. IOC consists of one infantry battalion fully fielded with the 
JLTV plus a training element.
    Maritime Prepositioning Force (MPF), MARSOC, and critical 
supporting establishment training units will also be allocated a 
portion of PBI6 funded vehicles. Vehicles will be allocated by unit 
based on the JLTV Fielding Plan, currently in development in support of 
Milestone C decision in 4th quarter of fiscal year 2015. PB16 will buy 
4,476 vehicles over the FYDP, or approximately 80 percent of the 
increment I--5,500 vehicles--Approved Acquisition Objective (AAO).
Joint Strike Fighter (JSF)
    Our tried and true F/A-18s, AV-8Bs and EA-6B Prowlers have 
performed magnificently in combat in Iraq and Afghanistan, providing 
our Marine riflemen the fires they needed, in every clime and place 
from sea bases large and small, and expeditionary bases ashore. With 
the help of Congress, we have kept these aircraft as modern as possible 
and extracted every ounce of readiness we can from them; however, the 
high operational tempo has pushed these aircraft to more rapidly 
approach the end of their service lives. Due to the uncertainty 
prevalent in today's global security environment, the Nation requires 
we maintain a capability to respond quickly in contested regions 
regardless of weather conditions. The F-35 Joint Strike Fighter, as 
part of the MAGTF, meets the Nation's needs.
    The Marine Corps remains committed to the recapitalization of our 
aging TACAIR fleet through the procurement of the F-35. The JSF brings 
a new capability to the battalion sized forces that sail with our 
Marine Expeditionary Units. Today, there are a multitude of high risk 
regions where a crisis response operation would require large Joint 
strike packages to soften or blind the threat. These packages would 
have to include cruise missiles, fighter aircraft, electronic warfare 
platforms, aircraft which specialize in suppression and destruction of 
enemy air defenses, and strike aircraft--just for U.S. forces to gain 
access. Such strike packages require coordination across services and 
combatant commands and take weeks and months to assemble. This same 
kind of access can be attained with a single detachment of 4 to 8 F-
35s--the same sized detachment which will reside with a Marine 
Expeditionary Unit. For major contingencies, a surge of F-35Bs to our 
amphibious carrier decks and forward austere bases enables even greater 
options and striking power. The F-35 provides a transformational 
capability to the Marine Corps and the Joint Force. It gives our Nation 
a day one, full spectrum capability against the most critical and 
prohibitive threats.
    The Marine Corps prioritizes putting our TACAIR as close to our 
infantry as we can by basing them from Amphibious Carriers or austere 
Forward Operating Bases (FOBs) and Forward Arming and Refueling Points 
(FARPs) ashore. This places the F-35's transformational capabilities in 
the hands of the infantry Marine. The Marine rifleman is now supported 
immediately with close air support, electronic warfare capabilities, 
and intelligence, surveillance, and reconnaissance support in threat 
and weather conditions which previously would have denied aviation 
support. The F-35's ability to develop, process, and display 
information to the pilot and disseminate it at tactical, operational, 
and strategic levels is what makes the platform truly unique, ``a 
server in the sky'' for the MAGTF. The sensors and communications 
equipment of our F-35s allow pilots and forward air controllers to see 
through the clouds to exchange high fidelity pictures in environments 
we would consider a no go today. Enhancing the C2, strike and intel 
capabilities of the MAGTF commander, the F-35 transforms the MAGTF into 
an element capable of penetrating any AOR in the world to set the 
conditions necessary to enable follow-on forces.
    The Marine Corps has maintained the lead in this transformational 
platform. The F-35B and C models will replace the over 23 year old F/A-
18 Hornet, 18 year old AV-8B Harrier and the 27 year old EA-6B Prowler; 
the same aircraft that have been passed from fathers to sons and 
daughters now serving. We have stood up our first two squadrons of F-
35Bs and will stand up a third in 2016. PB16 supports the Marine Corps' 
timeline to achieve IOC of its first F-35B squadron later this year and 
complete full transition by 2031. With the optempo expected to remain 
high, we will transition to F-35s as rapidly as possible. Continued 
Congressional support for this transition is key to increasing our 
degraded aviation readiness and minimizing our exposure to ever 
increasing operations and support costs for aged aircraft.
CH-53K
    The CH-53E, the Marine Corps' heavy lift helicopter, is the only 
vertical heavy lift helicopter in the Department of Defense (DOD). Like 
its predecessors, the CH-53A/D, the CH-53E has continued a proud 
lineage of worldwide support of the Marine rifleman and Joint Force in 
various tactical and logistical capacities. Though a workhorse for the 
Marine Air Ground Task Force since its acquisition, the CH-53E does not 
have the capacity to support the Marine Expeditionary Brigade of 2024 
with the payloads and ranges required to support the ship-to-objective 
maneuver concepts outlined in Expeditionary Force 21. Our CH-53 
recapitalization effort is instrumental in maintaining a true heavy 
lift capability for the Marine Corps and the Nation for the future. 
Developmental testing is currently underway and the first flight of the 
CH-53K is scheduled for 2015 with an Initial Operational Capability in 
2019. PB16 is instrumental in providing critical funding for the last 
test articles in support of a Milestone C decision in 2016.
    The CH-53K will meet all of the requirements of the modern Marine 
Expeditionary Unit and Marine Expeditionary Brigade and remain the only 
heavy lift rotary wing asset in the DOD inventory. The CH-53K is a 
state of the art heavy lift vertical connector providing increased 
reliability, range and lift for the Marine Air Ground Task Force and 
Joint Force. The mainstay for the CH-53K will remain heavy lift 
external operations. To this end, its Key Performance Parameter (KPP) 
is the ability to externally transport a load weighing 27,000 pounds 
110 nautical miles, nearly three times the capability of the CH-53E. 
Additionally the CH-53K will incorporate a triple hook system, 
facilitating the delivery of three independent loads, to three 
different locations, in support of three separate units dispersed 
across the battlefield. The new cabin will support the transportation 
of the DOD standard 463L pallet enabling more efficient ``tail to 
tail'' logistical transitions with C-5s, C-17s and C-130s. The 
implementation of civil sector logistical advancements will facilitate 
near real time situational awareness of all cargo and passengers 
embarked and delivered by the CH-53K. The CH-53K will provide precision 
and tempo for the Marine rifleman, enabling mission success.
    PB16 provides Research, Development, Test and Evaluation (RDT&E) 
funding for the continued CH-53K System Development Demonstration 
contract which includes continued design, part qualification, 
developmental and operational test. Additionally, PB16 provides RDT&E 
funding for the incremental procurement of System Demonstration Test 
Articles 5 and 6, which will be used to ensure production readiness, 
quality system verification, and production planning and validation. We 
remain committed to our Program of Record of 200 CH-53Ks in order to 
keep Marine Corps' heavy lift assets relevant and effective for the 
Marine on the ground in the future MAGTF.
Command, Control, Communications and Computers (C4)
    Deployed warfighters require access to the right data at the right 
place at the right time. The demand for information will not tolerate a 
break in access. With the speed in which technology evolves today, we 
must continue to grow C4 capabilities down to the operational level. 
Information must be available through multiple mediums, from flag pole 
to fighting hole. Our end state is to enable command and control in an 
information enterprise that supports the way the Marine Corps operates, 
which includes a range of missions from crisis response to supporting 
our Expeditionary Force 21 concept--all characterized by mission-
tailored forces. A single Marine Corps network will support the Marine 
Corps' component of the Joint Information Environment.
    Our main focus today is unifying our networks to seamlessly connect 
the deployed and engaged forces to Joint information and data. This 
provides our Marines, Sailors, and supporting personnel the persistent 
information needed to conduct operations. We continue to increase our 
cyber capacity with trained personnel and emergent technology to 
protect this critical data.
    The Marine Corps must retain the ability to rapidly support the 
extension of the Marine Corps' information and data services to enhance 
our rapid response to crisis, provide contiguous command and control to 
a disaggregated force, and scale to support theater security and major 
combat operations. We will continue to invest in C4 down to the 
Corporals and Sergeants. This will allow our front line Marine rifleman 
to be more agile, lethal and responsive by directly leveraging the 
capabilities of the F-35 and communicating better with special 
operations forces.
Naval Integration and Programs of Interest
    As the service with primary DOD Directive and Title 10 
responsibility for the development of amphibious doctrine, tactics, 
techniques, and equipment, our capabilities are reliant on the Nation's 
investment in our partnered Navy programs. Naval integration will 
increasingly form an important component of our exercise and 
experimentation programs. The Marine Corps fully supports the Secretary 
of the Navy and CNO's efforts to balance amphibious platforms and 
surface connectors that facilitate operational maneuver from the sea 
and ship-to-objective maneuver with the other service requirements of 
the Navy.
    The President's Budget investments in LPD-28, LX(R), and ship-to-
shore connectors demonstrate our commitment to global maritime presence 
and the Nation's mandate to sustain an amphibious capability that can 
respond to deter, deny, and defeat threats on a global scale. We 
appreciate Congress providing a substantial portion of funding to 
procure a 12th LPD. The enhanced mission profiles of these new and 
additional platforms create operational flexibility, extended 
geographical reach, and surge capabilities to the Geographical 
Combatant Commands.
    Naval investments in alternative seabasing platforms expand access 
and reduce dependence on land bases, supporting national global 
strategic objectives and providing operational flexibility in an 
uncertain world. The naval seabasing investments in the Mobile Landing 
Platform, the Large Medium-Speed Roll-on/Roll-off Ship (LMSR) strategic 
sealift ship, and the T-AKE Dry Cargo and Ammunition Ship as part of 
the Maritime Prepositioning Ship Squadrons, coupled with the Joint High 
Speed Vessel (JHSV) and connectors, provide the additional lift, speed, 
and maneuver necessary to augment Navy and Marine Corps future security 
capabilities. Although not a substitute for amphibious warships, these 
alternative lift platforms will complement amphibious ships.
    While the President's Budget moves us in the right direction, it 
will take many years and a sustained effort to address the risk in the 
current number of amphibious ships and to address the material 
readiness of our current inventory. The Marine Corps will continue to 
work closely with the Navy to implement the 30 year ship building plan 
and to address the current readiness challenges.
                               readiness
    Proper balance across the 5 Pillars of Institutional Readiness is 
the most effective means of achieving a force capable of rapidly 
responding to challenges across the range of military operations while 
remaining good stewards of the Nation's resources. The 5 Pillars of 
Institutional Readiness involves operational readiness (i.e. Unit 
Readiness, and Capacity and Capabilities to Meet Requirements pillars) 
and foundational readiness (i.e. our investments in High Quality 
People, Infrastructure Sustainment, and Equipment Modernization 
pillars). The Marine Corps' ability to remain ready is enabled by the 5 
pillars of readiness.
    Our current funding level protects near-term readiness; however, it 
does so at the expense of long term modernization and infrastructure, 
threatening future readiness. We are funding critical readiness 
accounts to include: operating forces; depot, intermediate and 
organizational maintenance; repair and sustainment of training ranges, 
training and education, exercises, and fuel and repair parts. The 
Marine Corps is not adequately resourcing our non-deployed units; it 
will take time and sustained funding to address the deficiencies in 
personnel, equipment and training. This is a rational choice given the 
current fiscal situation, but it is not sustainable over time. 
Imbalance amongst the pillars for long periods will hollow the force 
and create unacceptable risk for our national defense. During these 
fiscally constrained times, we must remain ever vigilant in the 
allocation of resources to ensure the holistic readiness of the 
institution and ensure every dollar is going where it is needed most. 
Since 2012 our accounts are auditable. This gives confidence to the 
American people and commanders that we ask only for the amount of 
funding required to provide a lean, highly capable, mobile and ready 
force.
High Quality People
    Our Marines and civilians are the foundation of all that we do. We 
succeed because of our focus on people. They are the primary means by 
which the Marine Corps meets its defense responsibilities. The 
resources we dedicate to recruiting, retaining, and developing high 
quality people directly contribute to the success of our institution. 
Our commitment to quality must never waver.
    Our success in maintaining an elite force begins with recruiting 
young men and women who possess the character, mental aptitude, 
physical and psychological fitness, and desire required to earn the 
title ``Marine.'' The Marine Corps is committed to recruiting and 
retaining high-quality people who meet prescribed physical and mental 
standards, and are ready in mind, body and spirit to execute their 
duties in the defense of our Nation.
    Today, the Marine Corps does not have the proper level of personnel 
stability or cohesion in our non-deployed units. The practice of moving 
Marines between units to meet manning goals for deployments creates 
personnel turbulence, inhibits cohesion, and is not visible in our 
current readiness assessment tools. This personnel turbulence affects 
our combat readiness and our ability to take care of Marines. Moving 
forward, we will improve cohesion by increasing our preparedness across 
the force and emphasizing consistency of leadership, personnel 
stability, and sustained readiness across the force. The overhaul of 
our manpower management and readiness reporting models, systems, 
policies, and processes will allow us to minimize personnel turbulence, 
increase unit stability, and develop cohesion. We ask Congress to 
support these measures through appropriations of the funds we have 
requested in PB16.
    Our civilian workforce continues to be a significant force and 
readiness enabler to our institution. They reflect the same high 
quality standard that propels a ready force with many having previously 
worn the uniform of our Nation--68 percent are veterans. They also 
remain a lean portion of our organization at a ratio of only 1 
appropriated funded civilian to every 10 active duty Marines. Our 
civilians are contributing where we need them most. With 95 percent 
working outside the National Capitol Region, our civilians are directly 
supporting Marines and the mission at our bases, stations, depots, and 
installations. Without these civilians, we would be forced to assign 
uniformed Marines to these tasks taking away leadership and capacity in 
operational units.
    Our civilian workforce grew post-9/11, in large part due to 
military-to-civilian conversions, which allowed Marines to move from 
support billets to the operating force. A Department-wide focus on 
insourcing, new requirements (e.g. cyber), and necessary support for 
our military surge to 202,000 also played a role in the growth. In 
2009, the Marine Corps proactively began reducing civilian structure 
and personnel, and we are continuing to reduce our workforce by another 
10 percent, including 20 percent at headquarters.
    A key element in our overall readiness is family readiness. The 
family members of our Marines are very much a part of the Marine Corps 
family. Their sacrifices and support are not taken for granted. As we 
return from 14 years of major combat operations, the Marine Corps is 
repositioning our capabilities to deliver core programs and services 
that best meet the needs of today's Marines and families. We are 
renewing our programs and services consistent with our reduced end 
strength, changing demographics, mission, and budget environment. We 
are emphasizing the importance of maintaining a high level of 
readiness. Our Marine and Family Programs exist to support unit mission 
readiness, and individual health and wellness goals. In order to 
maintain the high standard of family support, we will develop a plan 
with a bias toward decentralizing decisionmaking and resource 
allocation. These programs and their impact on our Marines will 
continue to be an area we focus on to judge our readiness. We thank the 
Congress for your continued support of Marine and Family Readiness 
programs at the PB16 level.
Unit Readiness
    Our operational tempo since September 11, 2001 has been high and 
remains high today. We expect this trend to continue. Your Marines 
serving today in the operating forces are either deployed, getting 
ready to deploy, or have recently returned from deployment. Congress 
directed the Marine Corps to be the Nation's force-in-readiness. The 
current fiscal environment challenges the Marine Corps' ability to meet 
this mandate. In these circumstances, the Marine Corps has assumed some 
risks to fund unit readiness in the near term. The Corps provides units 
ready to meet core and assigned missions in support of steady state and 
crisis/contingency requirements. Our ability to sustain assigned 
mission requirements with units ready to deploy must be carefully 
managed while we continue end-strength reductions.
    Over half of home-station/non-deployed units report unacceptable 
levels of readiness; nevertheless, the Marine Corps excels at 
generating ready units to meet operational requirements. Deployed units 
report high levels of readiness for core and assigned missions. 
Alternately, the ability of non-deployed units to conduct full spectrum 
operations continues to degrade as home-station personnel and equipment 
are sourced to protect the readiness of deployed and next-to-deploy 
units. We must remain cognizant that our home-stationed units 
constitute the ``ready forces'' that would surge to conduct full 
spectrum operations required in major contingencies. As the Nation's 
first responders, the Marine Corps' home stationed units are expected 
to be in the same high state of readiness as its deployed units.
    Our home station units' ability to train is challenged. Time is an 
essential component required to fix worn equipment and train units to 
standard. Lower end-strength and unit deployment to dwell (D2D) ratios, 
shortages in personnel and equipment at the unit level, and the paucity 
of amphibious and maritime prepositioning ships contribute to degraded 
full spectrum capability across the Service. For example, a D2D ratio 
of 1:2 means your Marines are deploying for 7 months and home for 14 
months before deploying again. During that 14 month ``dwell,'' units 
are affected by personnel changes and gaps, ship availability 
shortfalls, equipment reset requirements, degraded supply storages, 
training scheduling challenges and more. These challenges factor into 
every unit's mission to remain consistently ready.
    Marine Aviation contains some of our most stressed units. The 
Marine Corps has 55 Active Component squadrons, three of which (2 VMM, 
and 1 VMFA) are in transition. Of the remaining 52 squadrons, 33 
percent are deployed and 17 percent are in workups to deploy. Our 
minimum readiness goal to deploy is T-2.0. Deployed squadrons/
detachments remain well trained and properly resourced, averaging T-
2.17. Next-to-deploy units are often achieving the minimum goal of T-
2.0 just prior to deployment. Non-deployed squadrons experience 
significant resource challenges which manifest in training and 
readiness degradation, averaging T-2.96.
    The Marine Corps is applying resources to maintain the readiness of 
deployed and next-to-deploy units. Our focus is to continue to meet 
current requirements, while addressing the personnel, equipment, and 
training challenges across the remainder of the force. We are in the 
midst of a comprehensive review of our manning and readiness reporting 
systems. We will develop a detailed plan to enhance our overall 
readiness during 2015.
Capacity to Meet Combatant Commanders' Requirements
    We are committed to meet the expeditionary requirements of our 
combatant commanders. The Marine Corps' PB16 military personnel budget 
funds a fiscal year 2016 end-strength of 184,000 on the way to 182,000 
in fiscal year 2017. The Marine Corps of 182,000 includes the 1,000 
additional MSG Marines directed by Congress to protect more of our 
embassies abroad, the Marine contribution to the special operations 
component, Marine Cyber forces, and SPMAGTF's assigned to support 
multiple COCOMs. Marines assigned to Marine Special Operations Command 
and Marine Forces Cyber Command continue to significantly contribute to 
the needs of the COCOMs through specialized capability sets and as 
enablers for the joint force.
    In order to meet COCOM requirements, the Marine Corps will sustain 
a D2D ratio in the active component force of 1:2 vice a more 
sustainable D2D ratio of 1:3. That is the fundamental difference 
between an optimal force structure of 186,800 Marines and 182,000. The 
Marine Corps has some high demand/low density units that maintain a 
current D2D ratio of less than 1:2. The Marine Corps will continue to 
provide ready forces to meet COCOM demands, but we are carefully 
assessing the impact of reduced D2D ratios on our training and quality 
of life.
Facility Investments
    The President's budget for fiscal year 2016 funds 81 percent of the 
OSD facilities sustainment model requirement for the Marine Corps (an 
increase over the fiscal year 2015 level). The OSD guideline is to fund 
90 percent of the requirement. We remain aware that underfunding 
facilities sustainment increases the rate of degradation of Marine 
Corps infrastructure, which leads to more costly repairs, restoration 
and new construction in the future.
    Our installations are critical to our ability to train forces and 
be ready. They provide our training ranges and care for Marines and 
their families. However, we are forced to take risk in sustaining 
current infrastructure in support of operational readiness. With the 
help of Congress, the Corps has made significant progress over the last 
8 years in replacing old, unsatisfactory buildings. Our MILCON is now 
focused primarily on new platforms and PACOM force relocation efforts.
    The most important mission of our installations is to enable 
operating force readiness. We do this by being responsible stewards of 
land, air and water resources, and by being good neighbors in our local 
communities. These conservation efforts maintain our valuable training 
ranges and much needed air and sea maneuver corridors. A consistent 
emphasis on community partnering and engagement creates good-will, 
enhances family quality of life and reduces encroachment risks to our 
bases and stations. Congressional support and community partnering have 
resulted in the addition of training areas at the Townsend Bombing 
Range in Georgia, the Chocolate Mountains Aerial Gunnery Range in both 
Arizona and California, and the Marine Corps Air Ground Combat Center 
in California. We are also making great strides in reducing energy 
consumption on our bases and stations. By lowering utility use we are 
reducing costs, protecting the environment, improving the resiliency of 
energy-dependent infrastructure and ultimately enabling operational 
readiness.
Equipment Modernization and Innovation
    For the last 14 years, the Marine Corps has focused our resources 
on providing the Marines what they need for the current fight. 
Readiness remains our #1 priority to meet our national security 
responsibilities; however, our focus on the current fight coupled with 
our declining budget, has forced the Marine Corps to make difficult 
choices and reduce investment in modernization to maintain current and 
near term readiness. In today's fiscal environment, the Marine Corps is 
investing only in essential modernization, focusing on those areas that 
underpin our core competencies.
    Though emphasis is placed on new or replacement programs such as 
the ACV, JLTV, CH-53K and JSF, much of our modernization resources are 
focused on improving the capabilities and extending the life of current 
systems in order to fill the capabilities gaps that can be exploited by 
today's threats. These modernization efforts span from our AAV's to our 
current legacy aviation platforms.
    In order to balance modernization across the capabilities of the 
MAGTF, our top priorities for recapitalization and upgrades are the ACV 
and the F-35B. Programs like ACV 1.1 with science and technology 
efforts for high-water speed, AAV survivability upgrades, Network On-
The-Move (NOTM), Ground/Air Task Oriented Radar (G/ATOR), JLTV, and 
aviation platforms such as the MV-22, CH-53K, and F-35B are required to 
modernize capabilities and provide the technology required to dominate 
our adversaries.
    Modernization consists of three elements: development of new 
technologies, the procurement of new capabilities, and investment in 
legacy systems. An over commitment in one element creates missed 
opportunities in another. The Marine Corps is investing heavily in 
legacy systems partially due to the time required to recapitalize 
needed capabilities. This necessary allocation with limited resources 
in turn results in less investment in areas needed for a rapidly 
changing world (i.e. live virtual training, digital interoperability, 
and connectivity across Service components). For example, the 
subcomponent shortfalls and age of the AAV fleet has led to lower 
reliability and increased risk in operational mission profiles. The 
need for recapitalization of the 42 year old AAV is critical and the 
Nation cannot afford to gap this capability. The application of fiscal 
resources that would otherwise be focused on recapitalization and 
modernization is necessarily directed toward sustainment. Current 
maintenance for AAVs averages approximately $575,000 per AAV, per year 
with future depot maintenance costs growing to $700,000 per AAV in 
fiscal year 2016. This required allocation of precious resources works 
against our other modernization and recapitalization efforts.
    For our legacy aircraft platforms, the focus is on modernization to 
keep them relevant in today's fight while providing a bridge to our 
aviation recapitalization efforts. Rapid procurement of these new 
systems is critical to solving both our serious current and future 
readiness problems. Reduced modernization investment has also stretched 
our program timelines to the limit of their acquisition baseline. Any 
further extension of our program baselines could result in a Nunn-
McCurdy breach and reduce industry interest in producing limited 
production items. We have also delayed the procurement of other major 
programs like CAC2S so that we now will not reach full operational 
capability until fiscal year 2022 vice fiscal year 2018.
    Limited to essential modernization efforts, the Marine Corps 
forecasts critical issues due to underfunding in several areas 
including:
  --Recapitalization of our 30 year old TRC-170 system needed to 
        provide alternate communications networks in degraded spectrum 
        contested environments.
  --The Marine Corps' Composite Tracking Network resulting in the 
        MAGTF's eventual inability to communicate with the Navy's 
        network and participate in their Cooperative Engagement 
        Capability.
  --Our ability to maintain Joint Interoperability with other Services 
        through the Tactical Communications Modernization (TCM) 
        program.
  --Continued underfunding of the Networking On-The-Move (NOTM) program 
        leaving two thirds of our operating forces without the ability 
        to conduct mobile networking in distributed environments. 
        Failure to procure military satellite communications 
        (MILSATCOM) kits for, all fielded NOTM systems, will result in 
        continued reliance on expensive (leased) commercial satellite 
        communications (SATCOM) services.
    Modernization and innovation are more than just procurement 
programs. We must invest in MAGTF experimentation and test new tactics, 
techniques, procedures, gear and concepts that will allow us to meet 
future challenges. Inadequate resources toward modernization will 
further close the technological gap between our capabilities and our 
adversaries. Our adversaries continue to develop new capabilities 
seeking any technology overmatch in specific domains and functions. 
Increasingly capable threats, the proliferation of A2/AD weapons, and 
the aging of key material capabilities create challenges where we will 
pursue Science and Technology (S&T) to maintain our decisive 
technological advantage. We are maintaining our commitment to S&T, and 
we continue to look for opportunities to expand our efforts in this 
critical area.
                        special interest topics
Marine Corps Force Integration Program (MCFIP)
    Since January 2013, the Marine Corps has opened 5,998 previously 
closed positions to women. We now have 94 percent of our Military 
Occupational Specialties (MOS's) available to women. Some positions 
remain closed--mostly within infantry, artillery, tanks, and assault 
amphibian vehicle specialties. These specialties are the focus of 
ongoing Marine Corps research to establish occupationally specific, 
operationally relevant, gender-neutral physical standards.
    The Marine Corps continues its deliberate, measured and responsible 
approach toward integrating female Marines into previously closed 
occupational fields to the maximum extent possible. As the Marine Corps 
has studied gender integration, we have remained committed to high 
standards and combat effectiveness--from recruiting and entry-level 
training (ELT) to performance in the operating forces.
    During this effort, the Marine Corps has evaluated gender 
integration from ELT to full mission profiles as a complete ground 
combat arms integrated unit. Since this time last year, the Marine 
Corps has established the Ground Combat Element Integrated Task Force 
(GCEITF). The GCEITF is a gender-integrated, ground combat arms unit 
designed specifically to support the most in-depth, detailed study of 
the physical demands associated with ground combat and the associated 
physical performance standards as well as the physiological predictors 
of success. The results from the GCEITF research will inform the 
establishment of occupationally specific, operationally relevant, 
gender-neutral standards based on the required individual physical 
contributions to mission-oriented collective tasks.
    The GCEITF along with our other research and assessment efforts 
will inform a recommendation on further integration to the Secretary of 
the Navy and the Secretary of Defense. That recommendation will be 
provided in late 2015.
Sexual Assault Prevention and Response (SAPR)
    The Marine Corps' Sexual Assault Prevention and Response mission is 
to develop and manage an evidence-based program that eliminates sexual 
assault within our ranks and provides world-class care to victims. 
Since fiscal year 2012, the Marine Corps has expended more than $16 
million toward SAPR and special victim legal training initiatives.
    The Marine Corps continues to see an overall positive trend in 
closing the gap between the actual number of sexual assaults and those 
that are reported. While the prevalence of Marines experiencing 
Unwanted Sexual Contact (USC) dropped from approximately 3,300 in 
fiscal year 2012 to approximately 2,300 in fiscal year 2014, the Marine 
Corps has seen an 89 percent increase in reports during that same time 
period. Closing the reporting gap is essential to both tackling the 
problem and providing supportive services to victims.
    The addendum to the SAPR Campaign Plan launched in 2012 was 
approved in April 2014 to build upon the positive momentum of the 
campaign thus far by extending the sustainment phase and incorporating 
additional tasks that strengthen SAPR capabilities. In July 2014, the 
Marine Corps released new training called ``Step Up'' that is designed 
specifically for junior Marines, our highest at-risk population for 
sexual assault.
    The Marine Corps continues to improve victim services such as the 
credentialing and up staffing of SAPR victim advocates and the 
development of the Victims' Legal Counsel Organization, which has 
provided dedicated victim legal services to more than 680 clients 
including 388 victims of sexual assault. On the heels of positive 
indicators of SAPR progress, Headquarters Marine Corps' SAPR division 
is expanding its reach with an increased focus on prevention. Our goal 
is to eliminate sexual assault from our ranks. We believe that 
preserving the commanders' ability to lead in this area is a vital 
element of our continued improvement in this current issue.
Suicide Prevention
    Each tragic loss to suicide has far-reaching impact on families, 
friends and our entire Marine Corps community. The Marine Corps 
embraces prevention efforts through a series of actions to foster hope 
and connection to those at risk for suicide. Community Counseling 
Services located on Marine installations worldwide increase access to 
care and assist Marines, attached Sailors and their families with 
navigating available support resources. The Marine Corps' Marine 
Intercept Program (MIP) uses licensed clinical providers in care 
coordination and outreach services for Marines who are identified as 
having suicidal ideation or have attempted suicide. The DSTRESS 
resource also provides phone, chat and Skype support 24 hours a day, 7 
days a week, 365 days a year. The Marine Corps continues to support 
DSTRESS as a critical resource in suicide prevention.
    Suicide prevention remains a priority for the Marine Corps, and we 
will continue to apply the resources necessary to combat this difficult 
issue.
Wounded Warriors
    The Marine Corps' commitment to our wounded Marines and their 
families is unwavering. Since 2007, the Wounded Warrior Regiment has 
provided meaningful recovery and transition assistance to wounded, ill 
and injured (WII) Marines, Sailors in direct support of Marine units, 
and their families. Additionally, the WWR administers the Marine Corps' 
federally mandated Recovery Coordination Program, which seeks to 
integrate Marines' medical and non-medical care.
    While the Marine Corps' reduced presence in Afghanistan will result 
in fewer combat casualties, non-combat injuries and illnesses will 
likely remain stable. In addition, instances of PTS and TBI will 
continue to increase due to delayed onset and as Marines often delay 
seeking help.
    Our comprehensive capabilities create the optimal care to meet 
individual Marine's needs. These capabilities include: Recovery Care 
Coordinators, District Injured Support Coordinators, WWR Transition 
Specialists, WWR Liaison Officers and Wounded Warrior Hope and Care 
Centers. Our costs in personnel are more than just numbers. Ultimately, 
the cost of 14 years of war is calculated in lives. From March 2003 
through 7 January 2015, 1,483Marines have given their lives and 13,992 
have been wounded in the service of our Nation. We remember their 
service and sacrifice and thank Congress for their continued support of 
our Wounded Warriors and their families. The Marine Corps will not 
forget the sacrifices our Marines and Sailors have made for the Nation.
Transition Readiness
    The Marine Corps makes Marines, wins battles, and returns 
responsible citizens following active service. Every year, the Marine 
Corps returns approximately 35,000 Marines to the civilian sector. The 
transition from uniformed service to contributing members of America's 
prosperity as civilians is significant to the economic health of the 
Nation. The technical expertise that Marines have learned during their 
service has significant application value to the country in the 
civilian sector.
    Our transition readiness program is designed to prepare Marines for 
transition to civilian life by preparing and connecting them with 
resources to successfully meet educational, employment or 
entrepreneurship goals. Implementation of transition readiness seminars 
(TRS) and separate ``track options'' classes that align Marines future 
personal and professional goals with hands-on application have created 
an enhanced transition experience for Marines. In fiscal year 2014 and 
the first quarter of fiscal year 2015, TRS attendance exceeded 42,500.
    In fiscal year 2015, Marine Corps Credentialing Opportunities On-
Line (COOL) was launched. COOL is a credentialing awareness, 
information and resources capability for all Marines, translating their 
Military Occupational Specialties into career development credentialing 
opportunities during and beyond their service. A leading example of the 
21st Sailor and Marine initiative, the establishment of Marine Corps 
COOL with the Navy also established the Department of the Navy (DON) 
COOL as a platform for the Navy/Marine Corps Team. DON COOL has, in 
turn, inspired an Office of the Secretary of Defense (OSD) initiative 
for a similar department-wide landing page for all the Services.
    The Marine Corps also launched the Spouse Transition and Readiness 
Seminar (STARS) at all USMC installations in September 2014. This 
seminar addresses the transitional challenges and opportunities 
specifically for spouses as they prepare to transition with their 
Marines into the civilian world. STARS has been embraced by OSD as a 
model for other services to consider emulating.
    We have fully funded transition assistance in PB16. Effective 1 
October 2014, a new Personal Readiness Seminar (PRS) is being delivered 
to all incoming active duty Marines upon check-in at their first 
permanent duty station. PRS provides an overview of the Marine For Life 
cycle, including personal and professional development programs and 
services, and introductory personal finance topics.
                               conclusion
    The unpredictability of the future security environment facing our 
Nation today reaffirms the wisdom of the 82nd Congress--the United 
States must maintain a force-in-readiness. The Marine Corps remains 
that expeditionary force-in-readiness. We maintain a high state of 
readiness and remain postured for immediate crisis response across the 
globe. With the continued support of Congress, we will maintain balance 
across our pillars of readiness and deliver ready, relevant, and 
capable Marines and Marine Air Ground Task Forces to our Nation today--
and tomorrow. During this period of budget austerity, we will set the 
standard for stewardship--every dollar will count. In the end, we will 
do what Marines have always done--innovate for the future, adapt to 
overcome, and always win.

    Senator Cochran. Thank you very much, General. We 
appreciate your presence and your contribution to the hearing.
    I want to recognize Senator Shelby. He was first and the 
next most senior in line.

                 SEQUESTRATION IMPACTS TO SHIPBUILDING

    Senator Shelby. Thank you, Mr. Chairman.
    Secretary Mabus, the President's 2016 budget request 
funding for nine ships, you are very familiar with. How might 
sequestration affect funding for these ships? And what impact 
would that have on mission capabilities? And what specific 
steps are you going to take to protect shipbuilding from 
possible budget cuts? We understand we are dealing as 
appropriators up here, too, sharing the same challenge.
    Secretary Mabus. Thank you, Senator.
    Building ships is a very long-term process, very complex, 
and requires specific skill sets. If you miss a year building a 
Navy ship, you never make it up.
    We are dealing today with decisions made 10, 15 years ago, 
in terms of what ships to build. And for that reason, as I said 
in my opening statement, I am going to do my utmost to protect 
shipbuilding. It is simply not reversible. If we miss a Navy 
ship because of lack of funds, and the next year we get more 
funds, we can't make it up.
    However, having said that, as you protect shipbuilding and 
protect those numbers, because we do have to have that properly 
sized fleet, other things begin to break. Our readiness gets 
stretched. The surge capacity gets stretched. Our forces are 
deployed longer, and for more hazardous missions.
    To give you an example of how we are stretching today, in 
the early 1990s, we had a fleet of about 400 ships. We had 100 
ships forward-deployed at any given time. Today, we have a 
fleet of about 280 ships, building to 300, but today it is 
about 280. We still have 100 ships forward-deployed.
    So the specific actions I am going to take, in any budget 
decision, shipbuilding is protected until the very last, until 
the last dog dies. But doing that causes and exacerbates 
problems in many, many other places.
    Senator Shelby. Admiral, do you want to comment briefly on 
what it does, your inability to project force and so forth? If 
you don't have ships, you are in trouble, aren't you?
    Admiral Greenert. Yes, sir. It underwrites everything.
    As the Secretary said, you can't recover. If you say you 
are not going to build a ship today, they take 6 or 7 years to 
build, sometimes 5, if you are lucky, if you have a multiyear. 
You can't make that up the next year because we have money.
    So therefore, we will look at modernization, munitions, 
because we can recover from that more quickly, Senator.
    Senator Shelby. Secretary Mabus, it is my hope that the 
Navy will continue to equitably, whatever that means, 
distribute work between the two LCS shipyards. Could you 
describe to the committee the Navy's acquisition strategy 
through 2019 for the remaining LCS ships, number 25 through 32?
    Secretary Mabus. Yes, Senator.
    We have found that having two shipyards and having two 
variants of the littoral combat ship has been very helpful in a 
number of ways. One, it keeps competition in the program, and 
it has driven costs down considerably. Two is it gives us 
different capabilities. Each ship brings some unique 
capabilities and capacities that the other one doesn't. And 
third, we are able to train our sailors pretty much on common 
systems for these two ships without duplicating effort.
    So for the ships through 2019, we plan to continue the 50-
50 split between the two yards. And the Small Service Combatant 
Task Force, which we chartered and which came through, and 
which recommended some upgrades in lethality and survivability 
for ships past 2019, for ships through 52, we are hopeful that 
we can move that up some, that we won't wait until 2019 because 
it is a modification, not a new build. And it is our plan to 
keep procuring both variants, again, competitively, but both 
variants through the entire 52 buy.
    Senator Shelby. This is a high priority for the Navy, is it 
not?
    Secretary Mabus. It is a very high priority.
    Senator Shelby. Thank you, Mr. Chairman. My time is up.
    Senator Cochran. Thank you very much, Senator.
    I know the next Senator who came to the hearing was Senator 
Reed, and Senator Collins soon thereafter, so I will recognize 
Senator Reed first.

                 SUBMARINE SHIPBUILDING LESSONS LEARNED

    Senator Reed. Thank you very much, Mr. Chairman.
    Gentlemen, thank you for your great service.
    First, let me recognize the Chief of Naval Operations and 
thank him for an extraordinary career.
    Thank you for your service, sir.
    And, Secretary Mabus, I will see you Saturday in Quonset 
Point, Rhode Island, for the keel laying of the USS Colorado, 
one of our new attack submarines. I look forward to it.
    And, General Dunford, I just got back from Afghanistan, and 
your extraordinary leadership is evident there in everything we 
are doing. So thank you very, very much.
    The only thing I would say is, I have a feeling General 
Campbell occasionally has some fun when he sits down with the 
President. I don't think you can say that.
    Mr. Secretary, one of the successful programs in 
shipbuilding has been the Virginia-class, under budget, ahead 
of schedule. Can you indicate some of the lessons that we have 
learned as we go forward to the next major submarine project, 
which is the Ohio-class replacement, and what your plans are?

                   NATIONAL SEA-BASED DETERRENCE FUND

    Secretary Mabus. The first lesson we have learned is that 
if we can do a multiyear--and thanks to this committee and to 
Congress, we have been able to do that--our shipyards are able 
to buy material in economic order quantities. They are able to 
smooth out their workload. They are able to do the training and 
the infrastructure that they need.
    Because of that, the contract that we signed last summer to 
buy 10 Virginia-class submarines over the next 5 years, we got 
10 submarines for the cost of nine. We got a submarine for 
free, which is like having one of those little punchcards, 
although with a bigger return, in the end.
    Going forward, in building the Ohio-class replacement, 
there are lessons we are learning in terms of technology. There 
are lessons we are learning in terms of how we build these 
submarines.
    But regardless of how much we can drive the cost down of 
the Ohio-class replacement, regardless of what we can do to the 
schedule, if we don't either pay for this as a national 
program, or plus-up Navy shipbuilding to account for it, then 
it is going to have a very harmful, I can't stress how harmful 
the effects will be on either the fleet or everything else in 
Navy, and that includes attack submarines.
    Senator Reed. Mr. Secretary, last year, in the National 
Defense Authorization bill, we created the National Sea-Based 
Deterrence Fund, which the goal really was to, from a national 
perspective, help defray the cost of not just our seaborne 
deterrence, but subsequently, the rest of the triad, air and 
land. But we are now in the beginning of reconstituting our 
seaborne deterrence. I would hope that this committee will look 
very favorably on providing funds through that mechanism, which 
could be applied, to the point you made, which would be to 
supplement your shipbuilding funds.
    Secretary Mabus. Senator, we very much appreciate the 
establishment of that fund, and we think that it is a great 
first step in that direction.
    And I would point out that, historically, the first two 
times we built ballistic missile submarines, 41 for Freedom in 
the late 1950s, early 1960s, the Ohio-class from 1976 to 1992, 
Navy shipbuilding did receive pretty dramatic increases to 
account for that.
    However, the increases were not enough to shield the rest 
of shipbuilding. And from 1976 to 1980, when we first began the 
Ohio-class, our fleet went down by 40 percent.
    Senator Reed. And just to underscore the point that this is 
a national asset. Basically, this is the most invulnerable part 
of our triad. The demand far exceeds the supply today even, 
Admiral Greenert, in terms of STRATCOM's needs to keep deployed 
and conceal these vessels. Is that clear to you?
    Admiral Greenert. Yes, sir. We have an alert and then we 
have a modified alert, and then we have a nonalert. So the 
nonalert is larger than we provide, but with agreement with 
STRATCOM, we provide alert and mod-alert. We have always met 
that requirement. It is a strategic requirement, as you said.
    However, it is a fairly big demand signal, and the Ohio is 
getting older. The youngest Ohio submarine is 17 years old, so 
they are aging up. We really do have to make this change. It is 
physics and engineering.
    Senator Reed. Thank you very much.
    My time has expired. Thank you, Mr. Chairman.
    Senator Cochran. Thank you, Senator.
    Senator Collins.

          SHIP MULTI-YEAR CONTRACTING AND SEQUESTRATION IMPACT

    Senator Collins. Thank you, Mr. Chairman, and thank you for 
holding this important hearing.
    As the consideration of the budget moves forward, I look 
forward to working with you, Mr. Chairman, with the ranking 
member, and all of the members of this subcommittee, to achieve 
the goals of avoiding the terrible effects of sequestration 
that we have heard described today, and also to achieve an 
outcome that is consistent with longstanding commitments, 
including what is known as the 2002 swap agreement that 
sustained the two shipyards in the large surface combatant 
industrial base. And I look forward to working with you on 
those issues.
    Turning to my questions for today, Mr. Secretary, I was 
very impressed when I heard your track record of placing a 
large number of ships under contract, I believe you said 70, 
within the constrained budgets that you have been provided with 
during your tenure as Secretary.
    One of the ironic aspects of sequestration is that it could 
actually increase your cost per ship or for a submarine, as 
well. Could you explain the importance of the multiyear 
contract to holding down the cost per ship, and what the impact 
of sequestration would be on your ability to have cost-
effective multiyear contracts, whether it is the 10 DDGs or the 
submarines that you described with Senator Reed.
    Secretary Mabus. Thank you, Senator. As I described to 
Senator Reed, those multiyear buys are some of the most 
effective weapons in our arsenal, in terms of bringing costs 
down, in terms of keeping the industrial base stable, in terms 
of allowing industry to do the things they need to do, the same 
thing with block buys on the littoral combat ship.
    If sequester occurred, one of the dangers is that you may 
break those multiyears. If you do, the ironic and awful result 
is you get fewer ships for more money. So you would end up 
paying more, but getting fewer ships in return, because you 
simply can't plan the way shipyards need to. You can't buy the 
material in the quantities that they need to. You can't do the 
training in the way that they need to. We can't give them some 
assurances that they need.
    Again, I will do everything in my power to protect 
shipbuilding and to protect these multiyears, because it does 
protect not only the industrial base, not only the Navy, it 
protects the taxpayers, because of how we are driving these 
costs down.
    Senator Collins. Thank you. That is one reason I think 
sequestration, in addition to being such a blunt instrument, is 
such a mistake, because it actually ends up, as you said, with 
our paying more for fewer ships.

                            DDG-1000 PROGRAM

    Admiral Greenert, first let me thank you for your many 
trips to Maine. I know that it has meant a great deal to the 
workers at Bath Iron Works when you toured the DDG-1000.
    One of the advantages of this ship is that it requires a 
greatly reduced crew size. At the time when the Pentagon is 
very concerned about personnel costs, that is significant.
    There are other capabilities that are going to be 
particularly useful to the Navy, which I understand is likely 
to base all three of the DDG-1000s in the Asian-Pacific region.
    Could you enumerate some of the advantages this cutting-
edge destroyer will give you?
    Admiral Greenert. Yes, Senator. Thank you.
    Firstly, as you said, the crew is one third, so that is 
about 150 versus a cruiser today of close to 450, right off the 
bat.
    The power required to run the ship and all of its systems 
is only 50 percent of the capacity of the ship. So this thing 
can grow as we get more payload. It has tremendous growth.
    It is radar-evading, as they say. It is stealthy. So on 
radar, it looks about the size of a tugboat, if you would 
imagine.
    And then, of course, there is an acoustic element. If you 
are under the water and you are listening to it, it does not 
sound like a cruiser or a destroyer. It sounds like a very, 
very small craft. So there is another evading piece.
    It has a tremendous cruise missile capability, anti-air 
capability. It has dual-band radar. That means it can track 
ballistic missiles while protecting itself from cruise 
missiles, that dual band.
    It has a gun that goes three times as far, right now about 
70 miles versus the best we can do today is about 15 miles. So 
that is five times, excuse me.
    It goes on, Senator. This thing is a quantum leap in 
capabilities.
    Senator Collins. Thank you, Mr. Chairman.
    And thank you, Admiral, again, for your service to your 
country.
    Senator Cochran. Thank you.
    Thank you, Senator, for your contribution to the hearing.
    Senator Collins. Thank you.
    Senator Cochran. Senator Schatz.
    Senator Schatz. Thank you, Mr. Chairman.
    Secretary Mabus, Admiral Greenert, General Dunford, I 
appreciate you being here today, and I share the concerns of 
the members of the committee and the people at the dais about 
the effects of sequester on the Navy and Marine Corps. It is 
going to undermine our ability to commit to our strategy in the 
Asia Pacific, and it will hurt our sailors, marines, and their 
families.

                     USMC ASIA-PACIFIC REALIGNMENT

    General Dunford, I want to discuss the realignment of the 
Marines from Okinawa. This is a major part of our rebalance in 
Asia. Moving the Marines from Futenma is consistent with the 
wishes of the people of Okinawa. And in my view, it is part of 
how we continue a strong, lasting security alliance between the 
United States and Japan. And a more distributed laydown gives 
the Marine Corps some strategic flexibility in the Pacific.
    I do have some concerns about the cost of the proposal to 
move the Marines to Guam, and I know you are in the middle of a 
process working to cut costs.
    Could you compare for the committee the cost of training 
and basing marines on Guam with the cost of training and basing 
them in Japan, Australia, Hawaii, elsewhere?
    General Dunford. Senator, thanks for that question.
    First, I have been involved in the Pacific laydown off and 
on for the last 10 years. When I first started to work the 
relocation to Guam, the cost was actually more than twice of 
what it is today. It is now down at around $8 billion, which 
the Japanese pay a significant part of that.
    So we have worked very hard. I think a lot of that comes 
from redesigning the plan, and a lot of that comes from 
collaboration between the Air Force, the Navy, and the United 
States Marine Corps, in order to do that.
    I can't give you, right now, but I will take for the 
record, the specific cost comparisons between each of those 
locations. Although what I can tell you today is that, as a 
result of a lack of training opportunity on Okinawa and 
mainland Japan, we actually relocate our training throughout 
the Pacific anyway. So much of the cost for training, Senator, 
really comes from moving things and moving equipment to 
training locations. We actually experience many of those costs 
today.
    [The information follows:]

    The cost of training and basing out of the continental United 
States (CONUS) is dependent on a number of factors including: the 
number of Marines and their associated training requirements, area cost 
factors, and host nation contributions. The varying sizes of the Marine 
Air-Ground Task Forces and unique training environment of each location 
render direct cost comparisons very difficult to achieve. As the 
initiative to relocate Marines off of Okinawa has matured, the Marine 
Corps worked to balance cost, training capacity, and other factors to 
revise our requirements. The 2012 laydown adjustments to the Guam 
master plan reduced the footprint in Guam to :4700 Marines, with an 
even steeper reduction in dependents from :8,000 to :1700. It also 
changed the nature of the force on Guam from one of a primarily 
permanent change of station, to that of a rotational force. The 
distributed laydown relocates 9,000 Marines from Okinawa, to Guam, 
Australia, Hawaii, and a small number to CONUS.
    The Guam master plan, delivered to Congress last spring, placed 
costs for Guam at $8.7 billion--a bill which is shared with the 
Government of Japan ($3.1 billion)--a significant reduction from the 
initial estimate of nearly $19 billion. Additionally, the Guam 
relocation will provide for robust training opportunities for Marines 
permanently and rotationally assigned to Guam as well as enhanced 
training opportunities during regional exercises. The Hawaii master 
plan, which is in development and will be delivered to Congress upon 
its completion, will provide an initial planning estimate for costs to 
relocate 2,700 Marines from Okinawa to Hawaii. The rotational force in 
Darwin is a phased build up to 2,500 Marines. Department of State and 
Defense negotiations are ongoing to determine facility cost and cost 
share arrangements with the Government of Australia.
    The Guam master plan also includes a robust training capacity for 
PACOM forces in the Commonwealth of the Northern Mariana Islands. This 
joint training range will fill current PACOM training deficiencies and 
will allow PACOM to conduct bilateral and multilateral training with 
partner nations on U.S. soil, a key component of our regional 
engagement objectives. The nature of the requirements for training and 
dispersion throughout the Pacific have informed the decisions for the 
laydown and driven the costs.

    One of the things that will be available at Guam and in the 
Northern Marianas, in general, will be training facilities that 
will meet our aviation requirements, which are going to be 
conducted in that area anyway, due to constraints up in 
mainland Japan and also some live-fire ranges and so forth that 
will better support our overall Marine Air-Ground Task Force 
training.
    Senator Schatz. Thank you, General. And on the total number 
of marines on Guam, the number I think briefed to Congress last 
year was 5,000, down from 8,000. Can you tell me how you got to 
the 5,000 and whether that number is now firm, or do you 
anticipate that it could float up or down?

               AMPHIBIOUS LIFT CAPACITY AND REQUIREMENTS

    General Dunford. That number is correct, Senator, first. It 
is 5,000; 3,000 of them are rotational forces; 2,000 are 
permanent personnel.
    We got to that number by looking very carefully at the 
laydown, meeting the Pacific Commander's desires for 
resilience, both politically and operationally. So it really is 
part of an overall laydown that includes Australia, it includes 
Guam, it includes mainland Japan, Okinawa, Hawaii. And they are 
all together in a package.
    So we think that the size of the Marine Air-Ground Task 
Force there is integrated with the overall strategy that 
supports the Pacific Commander.
    Senator Schatz. Thank you. And in your judgment, is there 
sufficient lift capacity to support this laydown plan?
    General Dunford. Senator, at this time, there is not. That 
is one of our major concerns, and that is something we are 
working very closely with the Secretary and the Chief of Naval 
Operations, as well as Transportation Command, on.
    Senator Schatz. Okay, thank you.
    Secretary Mabus, I have a question about credentialing of 
your sailors. I know your first priority is to make sure that 
your sailors and airmen are prepared to prevent and, when 
necessary, win wars. But there has been a discussion 
increasingly about dual credentialing, so that when your 
sailors retire, they are prepared to enter the Merchant Marine 
opportunities that are available.

             TRANSITION AND MILITARY CREDENTIALING PROGRAMS

    Can you talk a little bit about the DOD's military 
lifecycle transition model, and talk about how we can move 
forward and make sure that your sailors have opportunities in 
the private sector, if that is what they want to pursue?
    Secretary Mabus. That is one of the most important things 
that I think we are doing, Senator.
    Number one, the transition, both in the Navy and in the 
Marine Corps, we try to start a transition a year out, so that 
we make sure that people know what is available, make sure that 
they get the training, make sure that they get the information 
that they need to go through it.
    We have different tracks you can go down, whether to get 
more education, whether to become an entrepreneur, whether to 
get a trade certificate. This interoperability, the dual 
credentialing, things like Merchant Marine, things like EMTs 
for our corpsmen, nurses, things like that, we have actually 
done a good bit of that. And I know we are working hard to make 
sure that people can take the skills that they have learned, 
the leadership that they have learned, to the civilian sector.
    Senator Schatz. Thank you.
    Senator Cochran. Thank you, Senator.
    The distinguished Senator from Missouri, Mr. Blunt.

                       TACTICAL AVIATION PROGRAMS

    Senator Blunt. Thank you, Chairman. Thank you for holding 
this hearing.
    Admiral Greenert, I understand that you are reviewing the 
tactical aviation inventory. I think last week in a House 
hearing you talked about this and how it might relate to a 
couple of planes that we make in our State.
    Can you talk a little bit about the Super Hornets, as they 
may fill a gap here or not? And then any comments you want to 
make about the electronic attack aircraft, the Growler, I would 
like to hear that.
    Admiral Greenert. Yes, sir, Senator. The situation is, we 
are in the middle of a transition from what we call the legacy 
Hornet, that is the A through D, to the Super Hornet, the E/F. 
That transition requires that we retain a certain number of the 
legacy Hornets, but they are old. They were built to fly 6,000 
hours. They are well beyond that. We are trying to get them out 
to 10,000 hours.
    We put this program in place 3 years ago. There were 
caveats. How complicated was it going to be? What kind of skill 
did we need? And we assumed the depots would all be opened with 
skilled workers. Then sequestration hit, and we found as we are 
opening and looking at these A through Ds, there is more 
corrosion. It is more complicated than we thought. It is taking 
longer.
    In the meantime, they are not getting through the depots 
and out into the fleet. They represent about 20 percent of the 
fleet. The 80 percent are the Super Hornets. So we are using 
them up more than we originally intended. A great aircraft, it 
is a great aircraft.
    So as we look out into the future, we say, hey, we are 
using these up more than we thought. We have to look out ahead 
to the hours on the Super Hornet, because this is a piece of 
our strike fighter package, our enterprise into the 2020s and 
2030s, as we bring in the Joint Strike Fighter.
    So here's the conundrum. Can we get these legacy Hornets 
out and in time, so that we don't wear out the Super Hornets 
prematurely? Balancing that becomes the deal, as I go through 
these next 3 or 4 years, where we will have the legacy Hornets.
    So right now, we have a plan in place to get our way 
through this. But there are risks. And I just described the 
plan. There are risks to all of that. Can we get the artisans? 
Can we get the engineers? Can we get these Super Hornets 
through in time?
    So we have a shortfall in Super Hornets. We do. And we are 
going to have to work our way through here in order to manage 
it.
    Would we have bought more? It was a matter of a budgetary 
decision, an endgame to compare our TAC Air with the other 
requirements in the budget.
    And I listed in my statement, regrettably, some of the risk 
we have been taking is in aircraft procurement.
    To electronic attack, as I came before the committee last 
year, I said I am concerned we won't have enough electronic 
attack aircraft. The Growler is the Department's primary 
aircraft, the only aircraft in this area.
    The committee responded. The Congress responded. And I 
thank you for that, Senator, for your part in that.
    I requested that we get a study done this summer and 
unambiguously declare what the requirement would be. It didn't 
get done. It is in progress for this next year.
    So, with your help, and the committee's help, we have what 
we need today. What I don't know yet, until we finish this 
study and get an unambiguous declaration, what will the 
electronic capabilities requirement be in the future.
    Senator Blunt. On the Super Hornets, do you have a sense of 
what your shortfall may be?
    Admiral Greenert. I think probably the equivalent of two or 
three squadrons, it might be. It could manifest to that. I have 
to see how that turns out.
    Now, shortfall means that would be the ultimate, if you 
will, the sweet spot of the number we have. We can work through 
a certain number of shortfall, 70, 80, and we have done this 
before.
    But the question remains, as we work through this legacy 
piece, how many hours are we using up on the Super Hornets that 
we didn't intend as we started this journey?
    Senator Blunt. When do you think that review will give you 
some more specific information, as to where you are, compared 
to where you thought you would be?

             TACTICAL AVIATION PROGRAMS--DEPOT MAINTENANCE

    Admiral Greenert. The real issue becomes getting the legacy 
through those depots. In about 15 months, I will have a much 
better feel, because they are starting to pick up speed now, 
fortunately, as we go along.
    But the world is getting a vote, as we say, and we are 
flying long missions overseas now into Afghanistan and even 
into Iraq and Syria. It is a long flight.
    Senator Blunt. Of course, I don't need to remind you, but 
keeping the line open here becomes critical, with no orders 
beyond what we put in on the Growler, and the Growler and the 
Super Hornet use that same capacity and facility.
    I want to continue to talk to you about this, so when you 
have more information, I am sure the committee will be glad to 
hear it, but I would particularly be glad to hear more as that 
study develops.
    Admiral Greenert. Will do, Senator.
    Senator Blunt. Thank you.
    Thank you, Chairman.
    Senator Cochran. Thank you very much, Senator.

                 AMPHIBIOUS SHIP CONSTRUCTION PROGRAMS

    General Dunford, while the current shipbuilding plan only 
calls for 33 amphibious ships, requests from combatant 
commanders call for up to 54 amphibious ships to meet 
operational demands. In light of this deficiency, do you 
believe it would be wise to accelerate the build plan of 
certain amphibious ships to ensure that we have the ships 
needed to execute the National Defense Strategy and meet 
operational readiness challenges?
    General Dunford. Chairman, thanks very much for that 
question. I think what you did last year to help us, this 
committee, with the 12 LPDs, is a key part of trying to address 
that amphibious capability gap you mentioned. But not only 
accelerating that ship and then replacing the LSD, we are 
working very closely with the Secretary and the Chief of Naval 
Operations on a plan to do that, but also one of the things we 
are doing to mitigate that gap is using alternative platforms, 
the mobile-landing platform, afloat staging base. We now have 
the third one in place that will be available here in a couple 
years.
    So alternative platforms are also a key part, as well as 
accelerating amphibious ships, chairman.
    Senator Cochran. Thank you very much.
    The Senator from Alabama.
    Senator Shelby. Thank you, Mr. Chairman.

                 LONG-RANGE ANTI-SHIP MISSILE PROGRAMS

    Admiral Greenert, the President's budget for 2016 proposes 
accelerated acquisition of the long-range anti-ship missile, so 
that it can reach early operating capability by 2018 or 2019, 
is my understanding.
    Could you discuss just briefly the importance of continuing 
to fully fund development of a long-range anti-ship missile, 
and what it means to the Navy, what it will mean to the Navy?
    Admiral Greenert. Thanks, Senator.
    Senator Shelby. It is cutting-edge technology, isn't it?
    Admiral Greenert. Yes, sir. It is.
    Today, our primary cruise missile is the Tomahawk. She has 
served well for three decades. There comes a limit to what--it 
is an air-breathing missile. That means it is not hypersonic. 
It doesn't go faster than the speed of sound.
    The missile you described is what we call hypersonic. It is 
really fast. It is hard to target. When it reaches its target, 
it does a very high speed----
    Senator Shelby. It would be hard to stop, too, wouldn't it?
    Admiral Greenert. Come again, sir?
    Senator Shelby. It would be hard to intercept?
    Admiral Greenert. Very hard to intercept and evasive. So we 
need to move out in that regard.
    Senator Shelby. Okay.

                  LITTORAL COMBAT SHIP AVIATION ASSETS

    Secretary Mabus, the USS Fort Worth, a littoral combat ship 
deployed to Singapore in November 2014, just a few months ago, 
has thus far successfully, it is my understanding, employed a 
mixed aviation detachment, which combines manned and unmanned 
systems.
    Can we expect to see more mixed aviation detachments like 
this in the future? And are they the future?
    Secretary Mabus. I think the short answer is yes to both of 
those questions. Yes, you can expect to see more of it. And 
yes, that is pretty much the future.
    By combining that manned and unmanned craft on a single 
littoral combat ship, you get the best of both worlds. You get 
the fire scout, the unmanned system that can do very dangerous 
tasks and very long-term tasks that, if you put a person in the 
helicopter, you couldn't do.
    By pairing that with an MH-60 helicopter, which has 
incredible antisubmarine capabilities, and antisurface, you do.
    And we have carried out the first crew swap on the Fort 
Worth very successfully, and that is the first of the ships 
that will remain in Singapore. They won't be homeported there, 
but they will be forward-deployed there. We will reach four 
LCSs by 2017 that will be in that region full-time.
    Senator Shelby. It gives you a lot of firepower you 
wouldn't have, would it not?
    Secretary Mabus. It gives you incredible firepower, 
incredible flexibility.
    And the concern was that it needed to do what a frigate 
did. So when you put what a frigate does next to what the 
upgraded LCS does, that is why I renamed the upgraded LCS a 
frigate. It's the same ship.
    Senator Shelby. It just changes the game, doesn't it?
    Secretary Mabus. It does, with speed and with lethality.

                  JOINT HIGH SPEED VESSEL REQUIREMENTS

    Senator Shelby. Thank you.
    Mr. Secretary, one last question. The Navy in October 2008, 
we know that is 7 years ago, nearly, the Navy affirmed an 18-
ship requirement for the joint speed vessel, JHSV. The Navy, I 
understand, is expected to put under contract the 11th one.
    Where are you and where is the Navy on this now? Are you 
going to push for the 18 ships? What is going to happen? Or 
does a lot of it depend on what we do?
    Secretary Mabus. Well, part of it, we took a look, I 
believe in 2010, and reduced the number from 18 to 10. That was 
done on what the combat commander needed and how we could move 
troops around.
    Thanks to this committee, thanks to Congress, we got an 
11th high speed vessel in 2015, which we very much appreciate.
    We are going to keep a continuous look on that, because, as 
General Dunford said today, we don't have adequate lift, 
particularly in the Pacific. The joint high-speed vessel is one 
of the solutions to that. Now that we have our first JHSVs out 
in the fleet operating, not only to carry marines but also to 
do theater security cooperation, we have one in South America 
today, we will continue to evaluate the need for how many we 
need in the future.
    Senator Shelby. Thank you.
    Thank you, Mr. Chairman.
    Senator Cochran. The distinguished Senator from Maine.
    Senator Collins. Thank you, Mr. Chairman.

                      U.S. NAVY SHIP REQUIREMENTS

    Admiral, am I correct that when you survey the combatant 
commanders, that they actually tell you that you would need 450 
ships in order to meet all of the military requirements that 
they have identified?
    Admiral Greenert. You are correct, Senator.
    Senator Collins. So we need more of all kinds of ships and 
submarines in order to meet those military requirements.
    What is the projected plan for where we would be on the 
number of ships 5 years from now?
    Admiral Greenert. Well, we will be at 304 ships in 2020 
with the President's budget. And as you said, it is not just 
the numbers; is it the right kind of ship. So we are building 
the right kind of ships because we are doing multiyears for 
destroyers, the Swiss Army knife of the fleet. It does it all, 
our early Burkes.
    And in submarines, we have to build two a year to get out 
of an inevitable divot. And, of course, the littoral combat 
ship, that is our small surface combatant. We have about half 
of the number that we need.

             U.S. MILITARY FORCE REQUIREMENTS--AFGHANISTAN

    Senator Collins. Thank you. That is very helpful.
    General, you spent a great deal of time in Afghanistan as 
commander, and I thank you for that service. I noticed you were 
there for, I think, 14 months, which is a long tour of duty.
    In your personal, professional opinion, should we have a 
residual force left in Afghanistan at the end of next year?
    General Dunford. Senator, I believe we should. And the most 
important thing that we need is an effective counterterrorism 
partner in the region, in Afghanistan, in that particular 
region. We also need an effective counterterrorism platform, 
which Afghanistan would be, if we developed the kind of 
relationship that we are working on now with the Afghans, as 
well as building their own capacity.
    So I do think some residual capacity at the end of next 
year is going to be critical for us to protect our own national 
interests.
    Senator Collins. And how many troops do you think is an 
appropriate number for that residual force?
    General Dunford. Senator, I prefer to probably talk to you 
about that in private, at this point, because I know that my 
successor now is in the process of providing best military 
advice to the President, and I wouldn't want to publicly get 
out in front of the individual who is actually on the ground 
now working with that issue.
    Senator Collins. I understand. Thank you.
    Senator Cochran. The distinguished Senator from Alabama.
    Senator Shelby. I have concluded mine, Mr. Chairman.
    Senator Cochran. The Senator from Missouri.
    Senator Blunt. Thank you, Chairman.

               TACTICAL AVIATION MAINTENANCE REQUIREMENTS

    General Dunford, back to planes again, how many F-18 
aircraft do you have on the out-of-reporting status?
    General Dunford. Fifty percent, Senator, of our F-18s right 
now are out of reporting. That is over 100 aircraft.
    Senator Blunt. Is there any comparative number to what 
would normally be acceptable there?
    General Dunford. Well, we would seek to have somewhere 
around 80 percent of our aircraft available.
    Senator Blunt. As opposed to the 50 percent?
    General Dunford. As opposed to 50 percent.
    Senator Blunt. What risk does that establish with only 50 
percent available?
    General Dunford. Senator, it is risk in a couple areas. 
First and foremost, it is risk in our ability to respond to a 
major contingency. That is one of the components. When I talked 
about the readiness of our forces that are home stationed, 
their nondeployed status or the nondeployed units and their 
readiness status, their ability to respond to a contingency in 
the Korean Peninsula or some other major adversary would be 
challenged as a result of the loss of those aircraft.
    It also impacts our ability to train pilots to the right 
standards, because there aren't enough aircraft available on a 
day-to-day basis to be able to do that.
    Senator Blunt. And what are you trying to do to mitigate 
the problem?
    General Dunford. A key piece of that, Senator, is what 
Admiral Greenert spoke about. As a result of sequestration in 
2013, our depot maintenance was backlogged. That is one of the 
reasons--that is one of the major contributing factors to our 
out-of-reporting F-18s today.
    So getting depots back up and operating and maximizing 
their throughput, which includes a more detailed approach to 
triaging aircraft to get them into the facilities and get them 
up more quickly, is one of the major things we are doing to try 
to accelerate that. And, of course, for Marine aviation, a key 
piece is accelerating the F-35 and transitioning to the F-35, 
which is the future for Marine aviation.

                AIRBORNE ELECTRONIC ATTACK REQUIREMENTS

    Senator Blunt. And one question just, Admiral Greenert, on 
that F-35 topic, back to the Growlers that are in process now. 
I believe you said last year that you thought that electronic 
product that the Growler produces was a key part of the future 
package that involved F-35s and that would be defense system-
wide, not just Navy planes, not just Navy, but that would add 
an important electronic warfare component to an F-35 package.
    Do I remember that correctly?
    Admiral Greenert. You did, Senator. The Growler with the 
pod, that is the real jammer, is the electronic attack 
capability for the Department of Defense from the air, tactical 
air.
    Now, an F-35 by itself can provide for itself, if you will. 
But we go in as a package. We go in suppress, do the business, 
get access, and come back. So you had it right, Senator.
    Senator Blunt. Okay. Thank you.
    Thank you, Chairman.
    Senator Cochran. Thank you, Senator.
    Are there other questions of the panel?

                     ADDITIONAL COMMITTEE QUESTIONS

    Senator Cochran. In closing, then, let me thank our 
distinguished panel of witnesses for your testimony and your 
continued assistance to the committee.
    We are grateful for your service to our Nation. We look 
forward to continuing a dialogue throughout the fiscal year 
2016 in connection with the appropriations process.
    If there are any additional questions from members of our 
committee, they will be submitted to each of you for your 
responses.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]
                 Questions Submitted to Hon. Ray Mabus
               Question Submitted by Senator Thad Cochran
    Question. The Navy's current sustainment plans for Reactive Skin 
Decontamination Lotion (RSDL) kits are at levels significantly below 
the Total Service Requirement (TSR) originally established by the 
Service. Although the DOD's Joint Program Executive Office--Chem Bio 
Defense (JPEO-CBD) initially provided the Navy a full inventory of RSDL 
decontamination kits (359,620 kits), it is my understanding that the 
Navy has not properly replenished its inventory. Nearly 100,000 of the 
RSDL kits provided to the Navy by the JPEO-CBD have reached their 
expiration date, but the Navy has only purchased 26,160 new kits. It is 
my understanding that by fiscal year 2019, all of the RSDL currently on 
hand in the Navy's inventory will have expired. Indications exist that 
the Navy intends to replenish less than half of the TSR-mandated kits. 
The Navy recently acknowledged that its sustainment plans for RSDL are 
below TSR, but stated that they are ``employing innovative cost savings 
approaches, such as centralized sustainment, to optimize requirements 
and readiness.''
    How will ``employing innovative cost savings approaches, such as 
centralized sustainment'' ensure that Navy personnel have sufficient 
quantities of RSDL to protect them from chemical warfare attack? Has 
the Navy reduced its Total Service Requirement (TSR) for chemical 
warfare decontamination kits? What is the rationale for this reduction? 
Has the threat of chemical warfare attack diminished? What would the 
Navy require to maintain its RSDL inventory to meet the Total Service 
Requirement (TSR) level?
    Answer. Bottom Line upfront: The Navy is procuring sufficient 
quantities and effectively managing its inventory of Chem-Bio defense 
consumables to ensure all Navy personnel are adequately protected.
    The Navy took delivery of 359,629 Reactive Skin Decontamination 
(RSDL) kits procured via the JPEO-CBD between fiscal year 2010-2012. 
During fiscal year 2013-2014, Navy purchased 18,040 new RSDL kits to 
replenish the centralized pool inventory under the Navy Centralized 
Sustainment Program. In addition, Navy requested and received 100,000 
RSDL kits from the JPEO-CBD in fiscal year 2014. JPEO-CBD was able to 
support this request due to re-distribution of assets that became 
available due to the drawdown of U.S. Ground Forces in CENTCOM. This 
re-distribution supports Navy's Fleet requirement from fiscal year 2015 
until 2nd quarter, fiscal year 2017.
    Navy is efficiently utilizing its RSDL inventory and manages the 
RSDL kits through the Centralized Sustainment Program. RSDL sealed 
boxes are fielded to ships according to closest expiration date, and 
are stored in temperature controlled shipboard repair lockers until 
needed. Following a ship's return from deployment, these RSDL kits are 
inspected and returned to the Navy centralized pool. These efficiency 
practices extend RSDL lifecycle from 6 months to 5 years.
    In fiscal year 2014, Navy reduced TSR for RSDL by 20 percent. This 
reduction was made possible through an assessment of the effectiveness 
of the Collective Protection System (CPS). Navy platforms outfitted 
with CPS have high personnel protection levels against Chem-Bio attack. 
Sailors assigned to ships equipped with CPS have the dual protection 
afforded by this system as well as individual protective equipment 
(IPE). For non CPS-equipped platforms, Navy has continued to maintain 
100 percent fielding of RSDL kits. The threat of chemical attack has 
not diminished; Navy has maintained robust capability to defend against 
such an attack.
    Starting in fiscal year 2017, the Navy will require $2.8 million 
per year to maintain the RSDL inventory at the current TSR. The Navy 
will continue to maintain an adequate inventory of RSDL and other 
consumables necessary to protect personnel against CBRN attack. This 
will include service funding, OCO requests and request(s) to JPEO-CBD 
for asset redistribution.
                                 ______
                                 
                Questions Submitted by Senator Tom Udall
    Question. Describe the role of the Navy's Chief Information Officer 
(CIO) in the development and oversight of the IT budget for the Navy. 
How is the CIO involved in the decision to make an IT investment, 
determine its scope, oversee its contract, and oversee continued 
operation and maintenance?
    Answer. The Department of the Navy CIO provides overarching 
programming guidance for IT and reviews the department's IT budget 
prior to submission to OSD. The DON CIO reviews the business cases for 
all proposed IT investments and collaborates with the DON Deputy Chief 
Management Officer to develop the annual DON Organizational Execution 
Plan for IT, a business value review that identifies what IT 
investments the department will sustain, and which it will retire. The 
DON CIO is also a full participant in the DON Two Pass, Six Gate review 
process for all IT acquisition programs or programs containing 
significant IT components.
    Question. Describe the existing authorities, organizational 
structure, and reporting relationship of the Chief Information Officer. 
Note and explain any variance from that prescribed in the newly-enacted 
Federal Information Technology and Acquisition Reform Act of 2014 
(FITARA, PL 113-291) for the above.
    Answer. The Department of the Navy Chief Information Officer's (DON 
CIO) authorities, position in the Department, and reporting 
relationship are those appropriate to a Military Department CIO per 
FITARA. The DON CIO ranks as a staff assistant to the Secretary and the 
Under Secretary. Though the office is aligned administratively as part 
of the Office of the Deputy Undersecretary for Management, the CIO has 
a direct line of communication with the Secretary on those matters 
required by law, regulation, and policy. The DON CIO is the DON's 
senior information management, information technology (IT), and 
information resources management official, and participates in the DON 
processes for approval of contracts for IT and for reprogramming of IT 
funds.
    Question. What formal or informal mechanisms exist in the Navy to 
ensure coordination and alignment within the CXO community (i.e., the 
Chief Information Officer, the Chief Acquisition Officer, the Chief 
Finance Officer, the Chief Human Capital Officer, and so on)?
    Answer. The Department of Navy Business Transformation Council 
serves as the senior governance forum for cross-functional management 
issues. The forum is chaired by the Under Secretary of the Navy/Chief 
Management Officer and includes the Assistant Secretaries of the Navy, 
Deputy Under Secretaries of the Navy, Vice Chief Of Naval Operations, 
Assistant Commandant of the Marine Corps and DON Chief Information 
Officer. Since its inception in 2009, the Business Transformation 
Council has effectively resolved a variety of management issues and is 
used to coordinate across functional areas.
    To strengthen the coordination and integration between strategy, 
business operations, and information technology, in 2014 the Secretary 
of the Navy realigned the Chief of Business Operations, Chief 
Information Officer and Chief of Strategy and Innovation under the 
Deputy Under Secretary of the Navy (Management). This restructuring 
ensures information technology and business functions are properly 
aligned to the strategic goals of the Department of the Navy.
    There are also a variety of informal mechanisms that are used to 
coordinate across functional areas. One example includes the Chief 
Management Officer's Advisory Group. This forum provides flexible 
options to address specific management issues and is comprised of 
Senior Department of Navy personnel, organized around a specific 
management issue. For example, the advisory group was used to establish 
comprehensive policy for accountable property management in the 
Department of Navy.
    Question. According to the Office of Personnel Management, 46 
percent of the more than 80,000 Federal IT workers are 50 years of age 
or older, and more than 10 percent are 60 or older. Just 4 percent of 
the Federal IT workforce is under 30 years of age. Does the Navy have 
such demographic imbalances? How is it addressing them?
    Answer. At present, the demographics of Department of the Navy's 
(DON) civilian IT workforce closely tracks with the overall Federal 
workforce. With more than 14,000 members in the DON IT functional 
community, percentages are as follows: 46.7 percent are 50 years of age 
or older, 10.3 percent are 60 or older and 5.5 percent are under the 
age of 30.
    The Department is actively engaged in utilizing special hiring 
authorities to attract, hire and retain employees in Information 
Technology as well as the field of Cyber Security. Of particular note 
is that although 57 percent of our IT workforce is age 50 or older, 
more than 40 percent of our workforce has 5 years of Federal civilian 
service or less. This is a clear indication that the DON is seeking out 
and bringing new employees into the civilian service. Further, the 
percentage of IT employees under age 50 is more than 40 percent 
workforce.
    The DON's goal is to always ensure it has the right skills in the 
right place to meet its mission requirements. The DON remains focused 
on workforce planning initiatives, and more than 30 percent of our IT 
workforce is in lower-level training and developmental positions, 
receiving mentoring and guidance from more senior employees. This is an 
effective way to create and develop the future IT workforce of the 
Department.
    Question. How much of the Navy's budget goes to Demonstration, 
Modernization, and Enhancement of IT systems as opposed to supporting 
existing and ongoing programs and infrastructure? How has this changed 
in the last 5 years?
    Answer. The Department of the Navy's (DON) IT budget is split into 
Development/Modifications of IT systems and Current Services. For 
fiscal year 2016, approximately $1.3 billion or 16 percent of the total 
IT budget supports development/modifications of IT systems. The 
remaining $6.6 billion supports current services of existing and 
ongoing programs and infrastructure. Over the past 5 years, DON's 
development/modifications spending on IT systems has consistently 
decreased with every budget submission. This decrease can be partially 
attributed to the completion of major development programs over the 
last 5 years; programs that not only reduced legacy IT but left the 
development/modification stage and are now in sustainment.
    Question. What are the 10 highest priority IT investment projects 
that are under development in the Navy? Of these, which ones are being 
developed using an ``agile'' or incremental approach, such as 
delivering working functionality in smaller increments and completing 
initial deployment to end-users in short, 6-month timeframes?
    Answer. The top 10 highest priority Department of Navy IT 
investments are as follows. Note: This includes systems that are also 
in sustainment. Due to the mission impact and resources associated with 
these systems, they are considered top priority investments for the 
Department of Navy.
    1. Next Generation Enterprise Network (NGEN) Increment 1.--NGEN is 
an enterprise network which will provide secure, net-centric data and 
services to Navy and Marine Corps personnel and represents the 
continuous evolution of information technology at the Department of 
Navy. NGEN was developed using a Lowest Price Technically Acceptable 
(LPTA) contracting approach to ensure functionality was delivered in a 
timely manner.
    2. Consolidated Afloat Network Enterprise Services (CANES).--CANES 
will replace existing afloat networks and provide the necessary 
infrastructure for applications, systems, and services to operate in 
the tactical domain. The initial delivery of CANES meets initial or 
threshold capabilities but since CANES is a Commercial-Off-The-Shelf 
(COTS) integration program, it has been funded for regular, periodic 
technology refresh to mitigate obsolescence and emerging cyber threats.
    3. Base-Level Information Infrastructure (OCONUS Navy Enterprise 
Network (ONE-NET)).--ONE-NET provides a fully integrated, interoperable 
and secure information technology (IT) infrastructure to our forward 
deployed OCONUS bases, stations, homeports and OCONUS/CONUS piers. ONE-
NET was developed using an incremental Government Owned/Contractor 
Operated (GO/CO) contracting approach to ensure functionality was 
delivered in a timely manner.
    4. Multifunctional Information Distribution System (MIDS).--MIDS is 
a jam-resistant, secure, digital (voice/data) information distribution 
system enabling rapid integrated communications, navigation and 
identification for tactical and command and control (C2) operations. 
MIDS is being developed using the waterfall systems development life 
cycle approach.
    5. Navy Enterprise Resource Planning (Navy ERP).--Navy ERP was 
established to transform and standardize Navy business processes for 
key acquisition, financial, and logistics operations. Navy ERP was 
developed using a spiral acquisition approach to ensure functionality 
was delivered in a timely manner.
    6. Naval Tactical Command Support System (NTCSS).--NTCSS is a suite 
of applications supporting Navy and Marine Corps supply and maintenance 
activities, both ashore and afloat, in a common computing 
infrastructure. NTCSS manages non-tactical information resources, 
including logistics, maintenance, administrative, and supply 
management, to meet the force readiness and sustainment requirements of 
the Navy and Marine Corps. NTCSS is being developed using an agile 
approach to ensure functionality is delivered in a timely manner.
    7. Global Combat Support System-Marine Corps (GCSS-MC) Logistics 
Chain Management Increment 1.--GCSS-MC is a portfolio of systems that 
supports logistics elements of command and control, joint logistics 
interoperability, and secure access to and visibility of logistics 
data. GCSS-MC is being developed using a spiral approach to ensure 
functionality is delivered in a timely manner.
    8.  Common Aviation Command and Control System (CAC2S) Increment 
1.--CAC2S Increment 1 is a coordinated modernization effort to replace 
the existing aviation command & control equipment of the Marine Air 
Command and Control System and provide the Aviation Combat Element with 
the necessary hardware, software, equipment, & facilities to 
effectively command, control, & coordinate aviation operations. CAC2S 
Increment 1 is being developed using a phased approach to ensure 
functionality is delivered in a timely manner.
    9.  Tactical Data Network-Data Distribution System (TDN-DDS).--The 
TDN-DDS augments the existing Marine Air Ground Task Force (MAGTF) 
tactical communications infrastructure to provide the MAGTF commander 
an integrated data network. TDN DDS acquires and fields COTS components 
in two increments, achieves Full Operational Capability during March 
2015, and will go through periodic tech refresh.
    10.  Enterprise Procurement System (EPS).--EPS will replace the 
legacy Standard Procurement System and provide contract writing 
capability to the entire Department of Navy. EPS is being developed 
using a phased approach to ensure functionality is delivered in a 
timely manner.
    Question. To ensure that steady state investments continue to meet 
agency needs, OMB has a longstanding policy for agencies to annually 
review, evaluate, and report on their legacy IT infrastructure through 
Operational Assessments. What Operational Assessments have you 
conducted and what were the results?
    Answer. Each year, the Department reviews its operational IT 
investments for business value, alignment with the overall 
architecture, return on investment, and efficiency & effectiveness. 
Based upon the reviews, investments are designated for either continued 
operation and sustainment or retirement. These designations are 
included in the DON Organizational Execution Plan submitted to DOD CMO 
to support the Department's request for certification of its IT funds. 
At latest count, the reviews have resulted in 337 investments being 
selected for retirement.
    Question. What are the 10 oldest IT systems or infrastructures in 
the Navy? How old are they? Would it be cost-effective to replace them 
with newer IT investments?
    Answer. Identification of the 10 oldest systems is less beneficial 
than understanding the comprehensive manner in which the Department of 
Navy (DON) assesses which systems should be replaced, not the least of 
which would be cyber security concerns and contribution to enterprise 
solutions. The DON continues to assess its IT systems and 
infrastructures through the budgeting process as well as through the 
acquisition process, using tools such as business case analyses to help 
inform decision makers.
    The Department has been working to eliminate and reduce the number 
of IT systems and their related infrastructure. For IT investments, the 
DON does look at cost as a factor in the decisionmaking process, along 
with other aspects such as functionality, capability and cyber posture. 
The objective is to determine where best to invest resources to ensure 
the Department's IT enterprise is as effective and cyber resilient as 
possible. For example, the Next Generation Enterprise Network (NGEN) 
program has already absorbed numerous outdated IT systems ashore and is 
on track to transition-in the entirety of the legacy Outside the 
Continental United States Navy Enterprise Network (ONE-NET)/Base Level 
Information Infrastructure (BLII) by the end of fiscal year 2017.
    The Consolidated Afloat Network Enterprise Services (CANES) program 
is replacing and consolidating several legacy afloat networks and 
provides the necessary infrastructure for modern applications, systems 
and services to operate in the tactical domain. CANES takes advantage 
of Commercial-Off-The-Shelf (COTS) technology and was structured to 
incorporate periodic technology refresh cycles to mitigate obsolescence 
and emerging cyber threats.
    In the business system arena, the DON fielded its Enterprise 
Resource Planning (ERP) system several years ago, which eliminated over 
80 legacy systems. Finally, there is funding in the fiscal year 2016 
budget to develop new IT systems, such as the future enterprise 
contracting system, aimed at replacing the old Standard Procurement 
System managed by OSD.
    Question. How does the Navy's IT governance process allow for the 
Navy to terminate or ``off ramp'' IT investments that are critically 
over budget, over schedule, or failing to meet performance goals? 
Similarly, how does the Navy's IT governance process allow for the Navy 
to replace or ``on-ramp'' new solutions after terminating a failing IT 
investment?
    Answer. Department of the Navy (DON) IT program cost, schedule, and 
performance are constantly monitored and regularly reviewed under the 
processes established by the Defense Acquisition System and the DON's 
policy for implementation and operation of that system. Deviations from 
baseline parameters are addressed with actions prescribed from the 
range available under that system--which includes termination if deemed 
appropriate by the Acquisition Executive. If a program is terminated, 
the capability requirement it was undertaken to answer still exists, 
and that requirement would have to re-enter the Joint Capabilities 
Integration and Development System for new program approval.
    Question. What IT projects has the Navy decommissioned in the last 
year? What are the Navy's plans to decommission IT projects this year?
    Answer. The Department conducts business case analyses each year as 
part of the development of the budget submission. The objective is to 
determine where best to invest resources to ensure the Department's IT 
enterprise is as effective and cyber resilient as possible.
    The Navy's Consolidated Afloat Network Enterprise Services (CANES) 
program is replacing and consolidating numerous legacy afloat networks. 
These legacy systems/networks are end-of-service/end-of-life. CANES 
provides the necessary infrastructure for modern applications, systems 
and services to operate in the tactical domain. CANES takes advantage 
of Commercial-Off-The-Shelf technology and was structured to 
incorporate periodic technology refresh cycles to mitigate obsolescence 
and emerging cyber threats. To date, we have completed 19 CANES 
installations on 15 Unit Level platforms (e.g. CGs, DDGs, LSDs) and 
four Force Level platforms (i.e. 3 CVNs and 1 LHD), with twelve 
installations ongoing this year for another seven Unit Level and five 
Force Level platforms.
    The USMC has retired or replaced a number of IT systems in the last 
year. These include:
  --The Commanding Officers Readiness Reporting System was 
        decommissioned and its functionality is now available within 
        the Installation Statistics, Analytics, & Reporting (iSTAR) 
        module of GEOFidelis. GEOFidelis is the USMC Installation 
        Geospatial Information and Services program for Installation 
        and Environmental geospatial products and services.
  --The Non-Appropriated Funds (NAF) Electronic Point of Sale (EPOS) 
        system was replaced by the Retail Point-of-Sale System (RPOS).
  --The Tactical Hydrographic Survey Equipment was superseded by a new 
        requirement, the Diver Reconnaissance Vehicle (DRV), which is 
        the result of a requirements revalidation by USMC Combat 
        Development and Integration.
    The USMC will continue to retire and/or replace aging systems in 
the coming year, including: Mechanization of Warehousing and Shipment 
Processing (MOWASP), Automated Set Assembly (ASA) and Material Returns 
Program Marine Corps (MRP MC).
    Question. The newly-enacted Federal Information Technology and 
Acquisition Reform Act of 2014 (FITARA, PL 113-291) directs CIOs to 
conduct annual reviews of their IT portfolio. Please describe the 
Navy's efforts to identify and reduce wasteful, low-value or 
duplicative information technology (IT) investments as part of these 
portfolio reviews.
    Answer. The DON Deputy Chief Management Officer and the DON CIO 
collaborate on the department's annual Organizational Execution Plan 
(OEP). The OEP is a review of IT investments that considers their 
alignment with the DON Business Enterprise Architecture, business 
value, cost, return on investment, and efficiency and effectiveness. 
After also considering operational necessity for warfighter support, 
investments are designated for either continued operation and 
sustainment or retirement. The completed OEP is submitted to the DOD 
DCMO to support the DON's request for certification of IT funds.
    Question. In 2011, the Office of Management and Budget (OMB) issued 
a ``Cloud First'' policy that required agency Chief Information 
Officers to implement a cloud-based service whenever there was a 
secure, reliable, and cost-effective option. How many of the Navy's IT 
investments are cloud-based services (Infrastructure as a Service, 
Platform as a Service, Software as a Service, etc.)? What percentage of 
the Navy's overall IT investments are cloud-based services? How has 
this changed since 2011?
    Answer. In 2011 and 2012, there were a few small pockets of private 
cloud solutions being developed within the Navy. As with any emerging 
technology, cloud computing had to be put through the development and 
testing paces for our environment. Also, adjustments to our financial 
systems were necessary to capture the various categories related to 
cloud computing for our required IT investment reporting. At the same 
time, DOD was just developing cybersecurity requirements to ensure the 
security of our commercial cloud solutions.
    We have increased our spending on cloud services each year since 
fiscal year 2013. Though it only represents less than 1 percent of our 
total IT investment, we are still in the pilot and early adoption 
stages of cloud computing. Most of our cloud investments to date have 
been in commercial pilots, private solution activity, and recently, 
DISA's cloud service. DISA published the first version of the DOD Cloud 
Computing Security Requirements Guide in January of this year. Prior to 
that, the DOD rule sets for cloud computing had not been established.
    We are currently developing guidance and standardized processes to 
assist our mission owners, and we expect our cloud adoption to 
accelerate in the coming months as FedRAMP and DISA authorize more 
commercial cloud offerings.
    Question. Provide short summaries of three recent IT program 
successes--projects that were delivered on time, within budget, and 
delivered the promised functionality and benefits to the end user. How 
does the Navy define ``success'' in IT program management? What ``best 
practices'' have emerged and been adopted from these recent IT program 
successes? What have proven to be the most significant barriers 
encountered to more common or frequent IT program successes?
    Answer. The Department of the Navy (DON) defines ``success'' in IT 
program management as delivering IT capability within cost, schedule 
and performance parameters to meet customer/war fighter requirements. 
Clarity, specificity and stability of requirements are critical. 
Because IT programs are enterprise in nature with multiple 
stakeholders, effective governance and communication with a broad 
concurrence on objectives are essential given that requirements can 
evolve as new technologies become available or cyber threats emerge. 
The governance structure can ensure appropriate trades between cost, 
schedule and performance can be accomplished as necessary.
    Three recent successful IT programs/initiatives include:
1. Department of the Navy Enterprise Software Licensing (DON ESL):
    The Department of the Navy Enterprise Software Licensing (DON ESL) 
Program Office leads a joint Navy and Marine Corps strategic sourcing 
effort to consolidate, centralize and streamline the acquisition and 
management of DON ESL agreements and provide significant savings from 
previous years.
    In support of the Department of Defense Chief Information Officer 
(DOD CIO) IT consolidation roadmap and DON CIO IT efficiency efforts, 
the Marine Corps leverages the combined buying power of the Navy and 
Marine Corps to improve the DON's IT/cyberspace investment decision 
practices as well as enterprise-level evaluation, funding, management 
and tracking of current and future requirements for all enterprise-
designated software vendors and products. Five agreements have been 
awarded to date with five more planned for award over the next 2 years.
    One best practice is to resource DON ESL agreements as enterprise 
requirements vice funding on an individual user basis; identifying and 
receiving the funds from individual sources has been a barrier to 
previous efforts.
2. Next Generation Enterprise Network (NGEN):
    Naval Enterprise Networks (NEN) Program Office manages the 
acquisition life-cycle of the DON's enterprise-wide IT networks. NEN's 
portfolio includes the Next Generation Enterprise Network (NGEN) 
contract, which delivers shore-based IT networks and related services 
to the more than 700,000 users of the Navy Marine Corps Intranet 
(NMCI), the world's largest purpose built network. NGEN also provides 
the Department's path to the Joint Information Environment. Although 
faced with exorbitant challenges related to the intricacy of the 
network and the existing Contractor Owned and Contractor Operated 
network model, in September 2014 NEN completed a seamless transition of 
NMCI assets and users being supported by the NMCI Continuity of 
Services Contract to the new Government Owned and Contractor Operated 
environment acquired through the NGEN contract.
    The NGEN acquisition involved one of the most innovative, 
comprehensive, and complex Request for Proposals (RFP) ever written for 
an IT network. The 1,100-page RFP constituted a fundamental shift in 
business and service delivery model required that the government 
carefully de-compose and identify every element of the existing network 
into the underlying services, technologies, and processes utilized to 
acquire, manage, secure, and operationally support/maneuver the 
network. The NGEN contract award represented the first re-compete of 
the NMCI since its establishment 12 years prior, and will save DOD 
billions of dollars across the Future Years Defense Plan (FYDP), while 
improving operational IT capability.
    The innovative acquisition strategy, based on a Lowest Price 
Technically Acceptable approach that maximized industry competition, 
will not only achieve the Navy's operational and acquisition 
objectives, but it will also reduce the cost to operate the Navy's core 
IT network by over $1.3B across the FYDP--an incredible force 
multiplier in an era of declining budgets. Real savings generated 
through the NGEN contract can now be redirected to other DON 
priorities.
    NEN managed the seamless transition of all NMCI seats to the new 
NGEN contract on schedule (01 October 2014). The NGEN contract 
transition was a significant achievement in the evolution and delivery 
of the Navy and Marine Corps' enterprise network. The transition was 
completely transparent to end-users and occurred without disruption or 
loss of service. Through careful planning and solid teamwork between 
PMW 205, the Naval Network Warfare Command, and service providers, the 
team successfully transitioned all users to the NGEN contract 90 days 
ahead of schedule, which allowed the DON to realize an additional $60 
million in savings ($20 million per month).
3. Consolidated Emergency Response System (CERS):
    Consolidated Emergency Response System (CERS) provides Marine Corps 
Installation Commanders an enterprise and integrated emergency dispatch 
center, supporting law enforcement, structural fire, and emergency 
medical resource coordination for day-to-day and emergency operations 
responding to All-Hazards incidents and civil mutual aid agreements. 
Marine Corps Systems Command and Marine Corps Installations Command 
established full E911 capability for all Marine Corps installations by 
end of 2014 (including overseas). This met DOD's E911 mandate following 
the Ft. Hood shooting incident of 2009 and was accomplished within the 
acquisition framework of a program funded in 2012. The post E911 
fielding strategy is to continue to build upon the E911 capability with 
Computer Aided Dispatch, improved Fire Station Alerting and other 
capabilities that add to force protection services aboard Marine Corps 
installations worldwide.
    The ``best practices'' that emerged and were adopted from this IT 
program success included efforts to aggressively guard against modified 
commercial-off-the-shelf (COTS) or custom implementation. The 
architecture was managed with tailored technical reviews that focused 
on the integration and non-developmental deployment of commercial 
components. This insures a complete specification defined by commercial 
practices and provides the most efficient means to sustain over the 
life of the program. Where COTS solutions are used, success is defined 
in terms of performance equivalent to local government solutions but 
capable of meeting DOD's higher Cyber Security and interoperability 
requirements at costs competitive with civilian implementations.
    The ``most significant barriers'' to IT program successes are tied 
to requirements. Lack of complete requirements and complete 
understanding of the requirements is a common occurrence so it is vital 
to have a tightly integrated team representing the developmental, 
requirements and customer perspectives on a project with a well-defined 
scope and objectives. Given requirements can evolve, it is key to 
develop good working relationships between the requirements, resource 
and acquisition communities so trades can be made between cost, 
schedule and performance as needed. In the case of E911 these 
relationships allowed the basic services to be provided with the 
expectation that incremental improvement to force protection 
capabilities will be made through supplemental fielding efforts.
    Question. Terry Halverson, the DOD Chief Information Officer (CIO), 
has outlined a vision for DOD use of cloud computing that empowers the 
military departments and components to procure their own cloud 
computing solutions. How will the implementation of this transition to 
cloud computing be rationalized across the Navy to ensure that common 
standards, data portability and other enterprise-wide issues are 
properly managed and addressed?
    Answer. The Department of the Navy's cloud transition is being led 
by the DON CIO, which is developing a data-centric cloud strategy that 
will be implemented and managed in accordance with DOD CIO guidelines. 
To ensure common standards and portability are properly addressed, the 
DON Data Center Consolidation Team will be realigned under the Program 
Executive Officer, Enterprise Information Systems (PEO-EIS), which has 
been given the primary role for executing the forthcoming Cloud 
Transition Plan. This re-alignment will enable better collaboration 
with the Navy Marine Corps Intranet (NMCI) and Consolidated Afloat 
Networks and Enterprise Services (CANES) program offices and take 
advantage of our existing enterprise network contracts and governance 
structures.
    Question. The desert ship at White Sands Missile Range is an 
important national asset. Can you please outline the tests that the 
Navy hopes to conduct during fiscal year 2015 and 2016 utilizing the 
Desert Ship and White Sands Missile range? Which R&D budget lines 
support these tests?
    Answer. The Desert Ship is a U.S. Navy asset located at White Sands 
Missile Range and operated by Naval Sea Systems Command (NAVSEA).
    The tests that will be conducted are as follows:
Fiscal Year 2015
  --Guided Test Vehicle (GTV)-2 (November 2014) was a developmental 
        test for the STANDARD Missile 6 BLK 1A program (completed).
  --Live Fire Test (LFT)-3 is a developmental test for the Naval 
        Integrated Fire Control Counter Air (NIFC-CA) Project (June 
        2015). Several tracking exercises are being conducted to 
        prepare for LFT-3.
Fiscal Year 2016
  --GTV-3 is a developmental test for the STANDARD Missile 6 BLK 1A 
        program.
  --There is a LFT scheduled for September of 2016 for the NIFC-CA 
        Project with several tracking exercises to prepare.
    Desert Ship is not an element of the Major Range and Test Facility 
Base (MRTFB) and therefore is not funded through MRTFB and Test 
Resource Management Center (TRMC). Desert Ship is funded by the 
programs and projects that use it for testing.
    The NIFC-CA Project is funded through Research Development Test and 
Evaluation (RDT&E) funding line PE 0604378N.
    The SM-6 BLK 1A program is funded through Navy RDT&E, funding 
details are classified.
    Question. What are the national security objectives that the Navy 
hopes to address in the tests outlined in the question above?
    Answer. Navy flight testing at the Desert Ship supports the air and 
maritime security national security objective. The Navy utilizes the 
Desert Ship to conduct risk reduction and early developmental live fire 
testing on a controlled range prior to live fire testing aboard U.S. 
Navy ships. The Navy also utilizes system test data to assess mission 
capabilities in an overland environment.
    Question. How does the Navy's future budget support the upkeep and 
modernization of the desert ship and does the Navy plan to use the 
Desert ship into the future?
    Answer. The Desert Ship is funded through the life of the NIFC-CA 
Project through PE 0604378N. Desert Ship is upgraded with the latest 
Aegis Combat System software load on an annual basis and will be 
modernized to accomplish ACB 16 testing to begin in fiscal year 2018.
    Question. How does the Desert ship's testing capabilities translate 
to use in the fleet, and what are some of the successes that the Navy 
can highlight for the subcommittee?
    Answer. The Desert Ship has been instrumental in performing risk 
reduction testing that led to fielding the NIFC-CA capability in fiscal 
year 2015. Past test events for the NIFC-CA project are as follows: 
Joint Land Attack Cruise Missile Defense Elevated Netted Sensor System 
(JLENS) Demonstration, LFT-1, and LFT-1A. The Desert Ship was also 
instrumental in the fielding of various STANDARD Missile variants by 
supporting early developmental flight testing; most recently SM-6 Block 
1. Successful live fire test events for the SM-6 Block 1 program 
included: GTV 1-3, CTV-1, FTR-25, FTR 27-27A and D1J. Early 
developmental testing of SM-6 Block 1A is currently in progress: GTV-1 
and GTV-2 have been successfully completed and GTV-3 is scheduled for 
fiscal year 2016.
                                 ______
                                 
              Questions Submitted by Senator Brian Schatz
    Question. I appreciate the attention that the Navy is giving to our 
shipyards. Our shipyard workers are the backbone of the fleet and the 
investments we make in that workforce will pay dividends to our 
readiness by ensuring that we can cut down on the Navy's maintenance 
backlog, reduce downtime, and get our ships and subs back out on 
deployment.
    We can always do more to reduce the operating costs at our 
shipyards and make them more competitive. We can do this by finding 
creative ways to make use of cutting edge technologies to revolutionize 
their business operations, such as through 3D printing and other 
advanced manufacturing techniques, or by deploying renewable energy 
technologies that can cut their energy costs. I understand the Navy is 
already finding creative ways to reduce costs, including by using 
Energy Savings Performance Contracts at some of its shipyards.
    Can you describe what the Navy is doing in this year's budget to 
help improve the competitiveness of our shipyards, including by making 
use of renewable energy and other cutting edge technologies to reduce 
operating costs?
    Answer. The table below shows seven infrastructure investment 
projects at the Naval Shipyards that will improve energy efficiency by 
$12.6 million.

------------------------------------------------------------------------
                                                               Cost
       Naval Shipyard                Project Title          (thousands)
------------------------------------------------------------------------
Norfolk Naval Shipyard        Energy--Exterior Lighting            4,057
Pearl Harbor Naval Shipyard   Shipyard Lighting Retrofit           2,876
 & Intermediate Maintenance
 Facility
Portsmouth Naval Shipyard     Energy and Building                  1,332
                               Repair, B74
Portsmouth Naval Shipyard     Energy and Control                     572
                               Upgrades B20
Portsmouth Naval Shipyard     Variable Refrigerant Flow              804
                               (VRF) Cooling System
                               Communications Hub B13
Portsmouth Naval Shipyard     Retrocommission Submarine            1,318
                               Preplanning Facility, M1
Portsmouth Naval Shipyard     Retrocommission Shipyard             1,722
                               Command Center B86
    Total                     ..........................         $12,681
------------------------------------------------------------------------

    The Navy continues to investigate opportunities to pursue Energy 
Savings Performance Contracts at the Naval Shipyards to reduce energy 
use.
    Likewise, the Naval Shipyards use a variety of process-improvement 
programs and initiatives to identify and implement innovative 
technologies. This includes formal programs such as Navy's repair 
technology (REPTECH) and the Department of Defense's corrosion 
reduction and collaborative initiatives, such as Industrial Communities 
of Practice and Warfare Center Innovation support. New technologies 
play a critical role in maintaining a capable and competitive 
industrial base as well as improving employee quality of work life. 
Below are some examples of recent and ongoing technology initiatives 
focused on improving Naval Shipyard industrial capabilities.
Exoskeleton Technology for Improved Industrial Ergonomics
    This initiative will expand the use of commercial off-the-shelf 
(COTS) exoskeleton arms and use exoskeleton suits to improve the 
ergonomics of Naval Shipyard industrial work. This technology helps to 
remove much of the weight and strain from the shipyard mechanic while 
performing strenuous work processes. This helps to reduce workplace 
injury and improve productivity.
High Pressure Water Jet for Improved Surface Preparation
    This is a toolset developed and deployed to improve the coatings in 
ship tanks that have a history of coating failure. This technology 
saves money in the preparation of the tanks and greatly improves the 
life and performance of the coating.
3D Scanning for Ship Checks
    This initiative uses 3D scanning technology to more effectively and 
efficiently perform pre-availability ship checks. Additionally, this 
initiative is pursing the use of 3D scanning technology to allow for 
prefabrication of piping systems before a ship arrives for drydock 
work.
Additive Manufacturing for Training Mock-ups and Prototypes
    The Naval Shipyards are using Additive Manufacturing for rapid 
prototyping and fit checking of parts and tools. Additionally, Additive 
Manufactured parts are being used to perform training on components 
before the actual work commences. This technology is saving time 
through reduced rework and material waste.
Electronic Technical Work Document (eTWD) Initiative
    This initiative makes information technology (IT) systems available 
to mechanics and supervisors at the deckplate and thus allows for 
increased efficiency. It will standardize forms, instructions, and 
processes across the enterprise and increase productivity by enabling 
the non-stop execution of work.
    Question. In my view, the Jones Act is essential to sustaining a 
robust U.S. flag fleet that can support our national defense. These 
U.S. flag vessels can be called on to support America's war fighters 
during wartime, serving as the Navy's auxiliary fleet to transport mail 
and other goods to troops in combat during times of war, allowing the 
Navy to save its limited cargo space for essential materials.
    Do you agree that the Jones Act is important to the national 
defense mission?
    Answer. The Jones Act is still relevant, important and supported by 
the Department of the Navy (DON). New construction of commercial ships 
in the U.S. benefits domestic shipbuilders and suppliers, and helps to 
maintain the Nation's shipbuilding industrial base. U.S. flag manning 
requirements under the Jones Act foster the demand for and safeguards a 
ready merchant marine force of qualified civilian mariners for 
contingencies. A strong domestic shipbuilding and repair industrial 
base helps maintain DON's ability to continue to build the future 
Fleet.
    The Defense Strategic Guidance and Quadrennial Defense Review 
clearly rely on maritime assets in the execution of the National 
Security Strategy. The military strategy of the United States relies on 
the use of commercial U.S. flag ships and crews and the availability of 
a shipyard industrial base to support national defense needs. The 
retention of a minimum core of shipbuilders and ship operators, and 
their skills and capabilities, ensures availability in times of 
emergency.
    The Jones Act supports the Nation's shipbuilding industrial base 
and maintains a national maritime infrastructure that ensures ample 
U.S. sealift capacity. U.S. flagged vessels provide employment to 
trained American Merchant Marine officers and seamen, who could be 
available to crew government-owned or civilian vessels in support of 
sealift efforts in times of war or national emergency. This 
availability limits the DON's need for procuring and maintaining 
comparable vessels in the government-owned fleet of cargo vessels, 
which could constitute a significant additional cost to the DON. The 
existence of a healthy U.S. maritime industry ensures the U.S. is not 
subjected to the dictates of foreign ship owners and operators, or 
foreign mariners when ships and mariners are needed to respond to 
contingencies such as disasters or in support of national security.
                                 ______
                                 
          Questions Submitted to Admiral Jonathan W. Greenert
                Questions Submitted by Senator Roy Blunt
    Question. The fiscal year 2016 President budget proposes funding 
for only 100 Tomahawk Missiles, 96 short of the Minimum Sustaining 
Rate. Does the Navy agree that this results in an approximately 24 
month production gap prior to the start of recertification in 2019?
    Answer. The Navy does not agree. There is no production gap before 
beginning of the Tomahawk recertification program in fiscal year 2019. 
The Department of the Navy will procure 100 All-Up-Rounds (AUR) with 
appropriated fiscal year 2016 resources in combination with 47 AURs 
from fiscal year 2015 Overseas Contingency Operations (OCO) resources 
(replenishment of Tomahawk combat firings during Operation Inherent 
Resolve) and up to 18 AURs via replacement-in-kind from the sale of 
excess USN Tomahawk Torpedo Tube Launch (TTL) AURs to the United 
Kingdom for a total of up to 165 tactical AURs in fiscal year 2016. The 
final deliveries of these 165 AURs is anticipated near the end of the 
4th QTR of fiscal year 2018, and the Tomahawk Recertification program 
initiates in the 1st QTR of fiscal year 2019. Therefore, there is no 
production gap.
    Question. What new analysis did the Navy conduct to determine that 
a production gap in 2018-2019 is more manageable than a 3 year 
production gap?
    Answer. There is no production gap prior to the start of the 
Tomahawk Recertification program in the 1st QTR fiscal year 2019 since 
the last of the fiscal year 2016 All-Up Rounds (AURs) deliver in 4th 
QTR of fiscal year 2018. Helping to inform the overall programmatic and 
industrial base risks, the Defense Contract Management Agency conducted 
an independent Tomahawk Production Base Health Assessment. The results 
of the assessment confirm that the Navy's missile production and 
recertification program strategy has low to moderate risk. The 
production line, major spares procurements in support of 
recertification, modernization, non-recurring engineering, and the 
depot will maintain activity across the Tomahawk industrial base 
enabling a smooth transition from a production phase to a 
modernization/recertification/depot phase of the program.
    Question. The fiscal year 2011 NDAA required all military equipment 
using GPS purchased after fiscal year 2017 to be M-Code capable. The M-
Code enables such devices to operate in a GPS jammed environment. As 
the Navy looks at the recertification of the Block IV Tomahawks, will 
the Navy take advantage of this opportunity that will push recertified 
Tomahawks through 2034? If not, when will the Navy seek to upgrade 
Tomahawks to M-Code requirements?
    Answer. The current Block IV Tomahawk has multiple navigation tools 
for precision navigation including GPS, terrain contour matching, and 
digital scene matching and correlation. Additionally we have high 
confidence in the fidelity of the Tomahawk GPS receiver in an anti-
access/area denial environment. This information can be provided in a 
classified document if required. Threats are constantly evolving 
however, and we perform periodic assessments of our capability against 
those threats. Based on those assessments, the Navy may choose to 
incorporate an M-Code capable GPS receiver in Block IV Tomahawk at some 
point during the recertification depot process.
    Question. The Navy recently tested the potential of synthetic 
guidance capability on the Tomahawk Missile. What kind of implications 
were derived as a result of this test and does the Navy plan to pursue 
some sort of seeker enhancement capability for insertion in the 
Tomahawk?
    Answer. The synthetic guidance demonstration was an important 
initial step in understanding the viability of long-range 
communications for position updates of moving targets and extending the 
reach of Tomahawk beyond traditional fixed and re-locatable targets to 
maritime moving targets. This is consistent with our strategy to 
develop advanced capabilities by leveraging existing technologies.
    We are in the process of completing an Offensive Anti-Surface 
Warfare (OASuW) Analysis of Alternatives (AoA) update and completing a 
Capabilities Based Assessment for the Next Generation Land Attack 
Weapon. The results of these analyses, and technology demonstrations 
such as the Tomahawk synthetic guidance test firing, will help inform 
the Department of the Navy's cruise missile strategy and long-term 
path-forward, which will include evaluating the requirement for a 
seeker.
    Question. In the fiscal year 2015 President budget, the Navy 
commented that production of the JSOW C-1 was a focus because of low 
inventory. In fiscal year 2016, the Navy stated there was an adequate 
inventory of JSOW C and C-1s in inventory. Was the Navy able to make up 
the previous year's shortfall? If not, how do you justify the change in 
numbers?
    Answer. Response is classified and will be provided via separate 
means.
    Question. Previously, the Navy had planned to pause production of 
the JSOW, rather than terminate. Did the Nunn-McCurdy statute 
contribute to the termination of JSOW by OSD? Does the termination 
affect international orders or the fiscal year 2015 award in any way?
    Answer. The Navy's plan to pause JSOW production in fiscal year 
2017-2019 was due to higher Department priorities under the current 
fiscal environment. The fiscal year 2016 President's budget request was 
informed by the results of the fiscal year 2015 and fiscal year 2016 
Naval Munitions Requirements Process (NMRP) which resulted in a reduced 
JSOW weapon inventory requirement and subsequent reduction in 
procurement.
    The Nunn-McCurdy statute did not contribute to the termination of 
JSOW.
    The production termination has not resulted in a negative effect on 
international orders or the fiscal year 2015 contract award. The 
decision has not affected current FMS Letters of Agreement (LOA) or the 
Department's plan to transition to sustainment after the completion of 
JSOW C-1 Operational Test and fiscal year 2015 procurement.
    Question. Operational testing for the JSOW C-1 and Joint Strike 
Fighter is planned for this year. How does the Navy intend to support 
future requirements for the Net Enabled Capabilities critical for JSOW 
use without a funded program?
    Answer. JSOW C-1's Operational Testing (OT) will occur this year on 
the threshold platform, the F/A-18E/F Super Hornet. The Joint Strike 
Fighter is an objective platform and will integrate JSOW in accordance 
with the JSF weapons roadmap.
    Net enabled capabilities will not diminish due to reduced JSOW 
procurement. Termination of procurement does not mean the JSOW program 
is unfunded. The program is funded for sustainment and JSOW will be the 
first Net Enabled Weapon (NEW). The Fleet's net enabled capabilities 
are supported with the integration of numerous weapon systems, 
including JSOW, Small Diameter Bomb II, and Harpoon II+.
    Question. Provide results of the Future Electronic Warfare 
Requirement study.
    Answer. The Navy is conducting a study titled, ``Joint Requirements 
for E/A-18G and Information Operations,'' which will be complete in 
April 2015. A previous study titled, ``CVW E/A-18G Squadron Size,'' 
determined the Navy-only Growler requirements. The current study will 
identify Joint force E/A-18G missions and determine additional future 
Joint force missions for the E/A-18G. Each mission will be analyzed to 
determine the minimum and optimum number of E/A-18Gs required. The 
study will also assess the effect of Information Operations on the 
Joint fight and determine how these effects influence overall force 
structure in the context of both Navy and Joint force missions. Once 
complete, the study will be available for release.
                                 ______
                                 
               Question Submitted by Senator Steve Daines
    Question. In 2010 the Administration announced a plan to refocus 
American attention to East Asia, in what would come to be known as the 
Asia Pivot. How has the Navy adjusted its strategy to execute this 
pivot, and how have nations in the region responded to these changes?
    Answer. The rebalance to the Asia-Pacific was one of the drivers 
for the Navy's recently-released A Cooperative Strategy for 21st 
Century Seapower: Forward, Engaged, Ready. This strategy continues the 
Navy's effort to rebalance to the Asia-Pacific, and it broadens the 
aperture of our approach to encompass the Indian Ocean in recognition 
of its strategic relevance to this region. The combination of the 
region's economic importance to the world economy, its proximity to 
U.S. security interests, and its expansive maritime geography compel an 
increased U.S. naval presence to enhance regional stability and 
maintain our commitments to our allies and partners.
    By 2020, Navy will deploy more forces to the Asia-Pacific 
(increasing ship presence from 52 ships today to about 65 ships) with 
plans to base approximately 60 percent of its ships and aircraft in the 
region. In support of the rebalance, we will also field new 
capabilities focused on regional challenges and preferentially deploy 
our most advanced warfighting platforms to the region. These include 
forward deploying an additional SSN to Guam, the most capable DDG and 
an additional CG to Japan, Mobile Landing Platform (MLP), Joint High 
Speed Vessel (JHSV), both Littoral Combat Ship (LCS) variants, MQ-8C, 
P-8A, EA-18G, upgraded F/A-18E/F, and E-2D. MQ-4C Triton high endurance 
unmanned aerial vehicles will operate from Guam in 2017.
    The Navy will enhance and strengthen partnerships through exercises 
and training opportunities that build partner capacity and capability. 
Additionally, the Navy will develop its intellectual capital to sharpen 
our focus on warfighting missions that are most important in the 
region, and to emphasize the unique geopolitical and cultural 
understanding required.
    These efforts, many of which preceded the recent release of the new 
Navy strategy, have helped strengthen cooperation with long-standing 
allies and continue to cultivate partnerships in the Indo-Asia-Pacific 
to reduce the potential for misunderstanding and discourage aggression. 
A recent example, the U.S. Navy joined over 20 Pacific navies--
including the Chinese--in signing the Code for Unplanned Encounters at 
Sea (CUES). To improve our warfighting capability and enhance 
partnerships, capacity, and interoperability with our allies and 
partners in the Asia-Pacific, we host the biennial Rim of the Pacific 
(RIMPAC) exercise, which is the largest multinational maritime exercise 
in the world. RIMPAC 2014 included participation from 22 nations, 49 
surface ships, six submarines, and over 200 aircraft and 25,000 
personnel. For the first time, China was among the participants. 
Exercises like RIMPAC enhance the global network of navies and allow us 
to build mutual understanding and practice how we fight with our allies 
and partners, so that we are better prepared to win should conflict 
arise.
    Many of the partnership and capacity building activities outlined 
in the new strategy have been ongoing for years. While we cannot make 
direct links between these activities and specific actions of our 
partner nations in the region, there have been several increases in 
Asia-Pacific regional rhetoric challenging China's growing military 
strength and recent maritime sovereignty claims. The Philippines, 
Vietnam, and Indonesia have each reiterated their disagreement with 
China's maritime sovereignty claims. In 2014, the Philippines and 
United States signed the Enhanced Defense Cooperation Agreement (EDCA) 
for an initial term of 10 years. During this period, U.S. forces will 
be authorized access to agreed upon locations in the Philippines on a 
rotational basis to undertake security cooperation exercises; joint and 
combined training activities; humanitarian assistance and disaster 
relief activities. The EDCA also grants the U.S. operational control of 
agreed upon Philippines' locations for the purpose of altering, 
improving or constructing facilities. Malaysia recently offered to have 
U.S. Navy P-8 Poseidon aircraft fly out of East Malaysia, providing 
greater access to the South China Sea. Taiwan has continued to push 
developments of a new Corvette ship class and has openly discussed the 
possibility of indigenously producing new submarines. South Korea has 
continued development of JeJu Island as a primary naval base, and the 
Japanese government recently announced its intention to reassess its 
policies regarding collective self-defense, which would allow it to 
more fully participate in regional security. The Navy strategy's 
emphasis on the global network of navies concept, coupled with the 
current regional tensions between China and other Pacific states, will 
likely generate increased regional interest in future partnership and 
capacity building activities.
                                 ______
                                 
               Question Submitted by Senator Patty Murray
    Question. The President's budget request for fiscal year 2016 
budget indicates an increase in the number of P-8A anti-submarine 
warfare aircraft that the Navy wants to procure. I'm pleased to see 
that the Navy is investing in this capability after a cut in last 
year's budget request.
    Can you tell the subcommittee why it is so important to purchase 
the P-8As at the suggested rate this year?
    Answer. The request for sixteen P-8A aircraft in the President's 
budget request for fiscal year 2016 returns the Navy's P-3C to P-8A 
transition plan to the optimal procurement profile required to complete 
the transition in the minimal amount of time, cost and warfighting 
risk.
    The P-8A transition plan is based on a steady procurement profile 
of 16 aircraft per year in fiscal year 2014, 2015 and 2016. Buying 
aircraft at this rate enables the government to gain significant 
savings in per unit cost pricing under the Full Rate Production (FRP) 
schedule. It prevents future transition and warfighting gaps and 
returns the fleet to planned fatigue life utilization rates. This 
request also enables the prime contractor and its sub-contractors to 
execute and maintain steady state production schedules and other 
manufacturing efficiencies.
                                 ______
                                 
                Questions Submitted by Senator Jack Reed
    Question. Can you describe the importance of the Virginia Payload 
Module program to ensuring our undersea strike capability?
    Answer. The ability for undersea forces, with their assured access, 
to be able to provide clandestine strike capability is vital to the 
joint force as adversaries continue to invest in anti-access area 
denial systems. Undersea strike capability complicates adversary 
planning, creates ambiguity, and fosters uncertainty. However, 
retirement of the SSGNs beginning in 2026 reduces undersea strike 
capacity by 60 percent. Virginia Payload Module (VPM) will enable 
Virginia-class SSNs to cost effectively mitigate the loss of SSGN 
strike capacity, thus ensuring the Navy maintains required clandestine 
strike capacity. VPM more than triples the Tomahawk Land Attack Missile 
(TLAM) strike capacity of an SSN from the current 12 missiles to 40 
missiles.
    Question. Why is it so critical to get the Virginia Payload Module 
program into construction for the Virginia-class Block V submarines? If 
there are further reductions in funding, how would that impact the 
timeline to get this capability fielded?
    Answer. Retirement of the SSGNs beginning in 2026 reduces undersea 
strike capacity by 60 percent. Integrating the Virginia Payload Module 
(VPM) within the Virginia-class SSNs is the most cost-effective means 
to minimize the loss of SSGN strike capacity. VPM will more than triple 
the Tomahawk Land Attack Missile (TLAM) Block IV strike capacity of a 
Virginia-class SSN from 12 to 40 missiles. Starting construction of VPM 
capable submarines in 2019 as part of Block V still results in a 
significant reduction in capacity by up to 50 percent until the full 
program of up to 20 VPMs are constructed. Any reductions in funding 
adds risk to completing the design to support an efficient construction 
start, potentially resulting in construction delays or delayed 
integration of VPM into the first Virginia-class Block V in fiscal year 
2019.
    Question. I understand the Navy is beginning to consider the 
feasibility of introducing the Virginia Payload Module program into the 
last hulls of Block IV. What is the reason for this and would it take 
additional funding in fiscal year 2016 to do so? What would the Navy 
and contractor team need to do to ensure that accelerating the Virginia 
Payload Module program installation could be accomplished without 
increased risk to cost and schedule of the overall program?
    Answer. The Navy and its Virginia Payload Module (VPM) Design 
Agent, General Dynamics Electric Boat (GDEB), are currently assessing 
the feasibility of accelerating the VPM design to enable construction 
start in fiscal year 2018, the last year of the previously negotiated 
Virginia Class Submarine (VCS) Block IV fixed price incentive fee 
multi-year procurement contract.
    The assessment is ongoing and is expected to conclude by Summer 
2015.
                                 ______
                                 
                Questions Submitted by Senator Tom Udall
    Question. What is the average time that ships are rotated in and 
out of deployment, and can you provide a breakdown by class of ship and 
homeport?
    Answer. The Navy's service goal is a 1:2 operational deployment 
length to dwell ratio for all active duty units. For example, if a ship 
is deployed for 180 days the goal is to have them in a non-deployed 
status for a minimum of 360 days before their next deployment. The 
fiscal year-2014-2016 fleet dwell average is 1:3.
    Fiscal year 2014-2016 approximate dwell ratios and average 
deployment length by class:

------------------------------------------------------------------------
                                                              Deployment
                                                     Dwell      length
------------------------------------------------------------------------
Aircraft Carriers (CVN):.........................        1:4           8
Amphibious Assault Ships (LHA/D):................        1:3           7
Cruiser Destroyer (CRUDES):......................        1:3           7
Ballistic Missile Defense Capable CRUDES:........        1:3           8
Fast Attack Submariners (SSN):...................        1:3           6
------------------------------------------------------------------------

    We do not track dwell separately by homeport.
    Through the Optimized Fleet Response Plan (OFRP), the Navy will be 
able to achieve a 7-month deployment goal which improves readiness and 
leads to a predictable cycle for maintaining, training and deploying 
our carrier strike groups and amphibious ships.
    Question. How have increased demands on the Navy impacted readiness 
among sailors, and how are these demands impacting the Navy's operation 
and maintenance of ships?
    Answer. Since 2013, many CSGs, ARGs, and destroyers have been on 
deployment for 8-10 months or longer. This comes at a cost to the 
resiliency of our people, sustainability of our equipment, and service 
lives of our ships. Year after year, the Navy has consistently provided 
more global presence than authorized and adjudicated by the GFMAP. This 
unbudgeted usage amounted to greater than 2,200 days in theater over 
that planned in 2013 and greater than 1,800 days in theater over that 
planned in 2014. We must operate the Fleet at sustainable presence 
levels in order for the Navy to meet requirements while still 
maintaining material readiness, giving ships time to modernize, and 
allowing them to reach their expected service lives.
    The pace of operations has resulted in reduced time at home for 
Sailors and a lack of predictability in their family lives. Navy is 
addressing these challenges by transitioning to an Optimized Fleet 
Response Plan, which will enable the delivery of a more predictable FRP 
cycle, stabilized manning, more stable and predictable maintenance 
plan, enhanced quality of life, and fully ready forces trained to a 
single standard. Navy recruiting and retention remain strong, although 
retaining personnel in certain critical skills continues to present a 
challenge, particularly as the demands we place on Sailors and their 
Families remain high. The threat of looming sequestration, along with a 
recovering economy, is a troubling combination. We are beginning to see 
downward trends in retention, particularly among pilots, nuclear-
trained officers, SEALs, and highly-skilled Sailors in information 
technology, Aegis radar and nuclear specialties. We are using all tools 
at our disposal, including special and incentive pays, to motivate 
continued service in these critical fields.
    Assuming a stable budget and no major contingencies for the 
foreseeable future, the Navy estimates it is possible to recover from 
the maintenance backlogs that have accumulated from the high 
operational tempo over the last decade of war and the additional 
effects of sequestration by approximately 2018 for CSGs and 
approximately 2020 for ARGs, 5 plus years after the first round of 
sequestration.
    Question. Are there classes of ships deferring maintenance more 
than others, and does this deferred maintenance potentially impact the 
safety of our sailors and their ability to carry out their missions?
    Answer. The safety of our Sailors and ability to carry out assigned 
missions have always been prioritized, and we have made difficult 
decisions regarding deferral of life cycle maintenance. PB-16 with OCO 
fully funds the ship maintenance requirement, including life cycle 
maintenance reset of CVNs and surface force ships. With the maintenance 
requirement fully funded, no new maintenance deferrals are expected. 
However, a return to BCA-level funding would undermine our ability to 
complete all of the needed maintenance.
    The life cycle maintenance reset requirement is a result of the 
backlog created during the late 1990s through 2009 which was a result 
of high Operational Tempo (OPTEMPO) after 9/11 and a focus on near-term 
readiness. Most of that backlog was developed on Cruiser/Destroyer 
(CRUDES) and amphibious ships, with a smaller amount on aircraft 
carriers. As a result, Navy is focusing reset efforts on CG-47, DDG-51, 
LSD-41/49, LHD-1/8, and CVN-68 classes.
    Additionally, the sequestration reductions in fiscal year 2013 and 
continuing resolutions (which compelled us to reduce both afloat and 
ashore operations) further exacerbated ship and aircraft maintenance 
and training backlogs. While the Navy was able to reprioritize within 
available resources to continue to operate in fiscal year 2013, this is 
not a sustainable course for future budgets. The actions we took in 
2013 to mitigate sequestration only served to transfer bills amounting 
to over $2 billion to future years for many procurement programs--those 
carryover bills were addressed in Navy's fiscal year 2014 and fiscal 
year 2015 budgets.
    Assuming a stable budget and no major contingencies for the 
foreseeable future, the Navy estimates it is possible to recover from 
the maintenance backlogs that have accumulated from the high 
operational tempo over the last decade of war and the additional 
effects of sequestration by approximately 2018 for CSGs and 
approximately 2020 for ARGs, 5 plus years after the first round of 
sequestration.
    Question. Are there classes of ships deferring maintenance more 
than others, and does this deferred maintenance potentially impact the 
safety of our sailors and their ability to carry out their missions?
    Answer. The safety of our Sailors and ability to carry out assigned 
missions have always been prioritized, and we have made difficult 
decisions regarding deferral of life cycle maintenance. PB-16 with OCO 
fully funds the ship maintenance requirement, including life cycle 
maintenance reset of CVNs and surface force ships. With the maintenance 
requirement fully funded, no new maintenance deferrals are expected. 
However, a return to BCA-level funding would undermine our ability to 
complete all of the needed maintenance.
    The life cycle maintenance reset requirement is a result of the 
backlog created during the late 1990s through 2009 which was a result 
of high Operational Tempo (OPTEMPO) after 9/11 and a focus on near-term 
readiness. Most of that backlog was developed on Cruiser/Destroyer 
(CRUDES) and amphibious ships, with a smaller amount on aircraft 
carriers. As a result, Navy is focusing reset efforts on CG-47, DDG-51, 
LSD-41/49, LHD-1/8, and CVN-68 classes.
    Additionally, the sequestration reductions in fiscal year 2013 and 
continuing resolutions (which compelled us to reduce both afloat and 
ashore operations) further exacerbated ship and aircraft maintenance 
and training backlogs. While the Navy was able to reprioritize within 
available resources to continue to operate in fiscal year 2013, this is 
not a sustainable course for future budgets. The actions we took in 
2013 to mitigate sequestration only served to transfer bills amounting 
to over $2 billion to future years for many procurement programs--those 
carryover bills were addressed in Navy's fiscal year 2014 and fiscal 
year 2015 budgets.
    Assuming a stable budget and no major contingencies for the 
foreseeable future, the Navy estimates it is possible to recover from 
the maintenance backlogs that have accumulated from the high 
operational tempo over the last decade of war and the additional 
effects of sequestration by approximately 2018 for CSGs and 
approximately 2020 for ARGs, 5 plus years after the first round of 
sequestration.
                                 ______
                                 
              Questions Submitted by Senator Brian Schatz
    Question. The Navy's Strategic Laydown and Dispersal (SLD) plan for 
2015 proposes to homeport shift two Cruisers from Pearl Harbor to San 
Diego for their modernization. However, the Navy does not plan to 
homeport shift two Destroyers to Pearl Harbor to backfill these 
Cruisers, per the SLD plan for 2014 that was briefed to my office.
    These decisions have strategic consequences. The loss of these 
Cruisers without the replacement Destroyers erodes ballistic missile 
defense (BMD) capability in theatre. It is my understanding these 
decisions are not driven by Combatant Command requirements, but are 
part of the Chief of Naval Operations' plan to level-load the fleet to 
reduce the deployment time for sailors.
    Pacific Command has raised concerns that due to budget cuts the 
services have not been able to provide adequate maritime coverage of 
the type we have traditionally needed in the Asia Pacific and that we 
are assuming risks in the theatre.
    Do you believe that realigning Destroyers to reduce deployment time 
for sailors is strategically the right decision considering that it 
would mean reduced maritime coverage in important theatres, like the 
Asia Pacific?
    Answer. The Navy is putting its most capable, technologically 
advanced and mission ready forces forward. There will not be a 
reduction in maritime coverage in the Asia-Pacific; in fact, the Navy 
is on track to meet its goal of basing 60 percent of the fleet in the 
Asia-Pacific region by fiscal year 2020. In support of the Optimized 
Fleet Response Plan (OFRP), the Navy decided not to backfill the 
Hawaii-based Cruisers with destroyers (DDG) in order to support the 
alignment of training, maintenance, and operations for Carrier Strike 
Group synergy. The Strategic Laydown and Dispersal process will 
continue to evaluate future force laydown based upon Fleet and 
Combatant Commander requirements.
    Question. Are there other ways to meet your goals for sailor 
deployment and dwell time without reducing surface ship presence in the 
Asia-Pacific region?
    Answer. The Navy is not reducing surface ship presence in the Asia-
Pacific region. Navy's Optimized Fleet Response plan is the program of 
record, and its efficacy in meeting desired end states of 
predictability in operations and maintenance will enhance readiness and 
surge capability to meet area of responsibility demands.
    Question. What risks are we assuming by having two fewer BMD-
capable ships forward in the Asia Pacific? In your judgment, are these 
acceptable risks given the instability in the region and the potential 
anti-access/area denial scenarios that the Navy is concerned with?
    Answer. The Navy is increasing the numbers and capability of our 
Ballistic Missile Defense (BMD) forces in the Asia-Pacific. Pearl 
Harbor experienced a one for one swap of USS Lake Erie (CG 70) and USS 
John Paul Jones (DDG 53), as the Navy's BMD test ship in fiscal year 
2014. With the modernization of USS Port Royal (CG 73), Pearl Harbor 
will experience a net loss of one BMD ship, as USS Chosin (CG 65) is 
not BMD equipped. In the Forward Deployed Naval Forces (FDNF) Japan, 
there are five BMD ships assigned now (1 CG and 4 DDGs) and we will 
increase this capability with three additional BMD capable DDGs over 
the FYDP--for a net gain in BMD capability in the Asia-Pacific.
                                 ______
                                 
          Question Submitted to General Joseph F. Dunford, Jr.
               Question Submitted by Senator Steve Daines
    Question. What programs does the Marine Corps have in place, or 
plan on implementing in the future, that lighten and strengthen small-, 
medium-, and large-caliber platforms?
    Answer. The Marine Corps continuously evaluates and improves the 
small arms capabilities that the individual Marine and units carry into 
combat to ensure that they are outfitted with the most reliable and 
relevant weapons systems available. Our small arms modernization 
strategy reflects a cost-conscious incremental approach to improve 
small arms accuracy, lethality, ergonomics and weight reduction in the 
near term, while looking to make larger gains in the same areas through 
pursuit of a next generation capability over the coming decade. The 
desired end state is improved lethality while maintaining, and ideally 
improving, the mobility of the individual Marine and, by extension, the 
Marine Rifle Squad and larger units. The Army is taking a similar 
approach, and the requirements and acquisition communities in both 
Services are sharing their ideas and continue to seek to collaborate 
where requirements and execution profiles coincide.
    The following initiatives were begun in accordance with the above 
intent:
  --Improved 60mm and 81mm mortar systems that utilize an improved 
        alloy (Inconel), resulting in in stronger barrels at much less 
        weight, as well as lightweight bipods and baseplates through 
        replacing steel with aluminum alloys. Weight savings for the 
        60mm mortar system is 9 lbs (20 percent reduction); weight 
        savings for the 81mm mortar system is 17 lbs (19 percent 
        reduction). The 60mm system was fielded in fiscal year 2013, 
        and the 81mm system will begin fielding by early fiscal year 
        2016.
  --Lightweight light/medium machinegun tripod that when fielded in 
        fiscal year 2017 will provide a weight savings of 3.5 lbs (19 
        percent reduction).
  --Pursuit of a shorter, lighter, and stronger barrel for light and 
        medium machineguns that not only reduces weight of a single 
        barrel, but precludes the need to carry an additional, spare 
        barrel.
  --Participation in the Army-led Modular Handgun System Program to 
        provide the Warfighter a best value Modular Handgun System that 
        features increased accuracy, improved ergonomics, and a higher 
        degree of reliability/durability over legacy systems. The 
        Marine Corps is participating to ensure the solution satisfies 
        an anticipated follow-on life cycle decision to replace our 
        current service pistols in the early 2020s.
  --Participation on the Army-led effort to develop requirements for 
        the next generation of squad weapons. Envisioned are an 
        individual carbine, an automatic rifle, and a designated 
        marksman weapon for the squad that utilize a systems approach 
        to incorporate such future capabilities as fire control, 
        integrated data and power, signature suppression, and an 
        improved ammunition configuration. The goal is to field 
        materiel solutions to these requirements in the mid to late 
        2020s.
    Participation in the Small Arms Ammunition Configuration Study 
being conducted by the Army; this study will provide courses of action 
for ammunition configurations that will meet our small arms gaps in 
conjunction with the next generation of squad weapons.

                          SUBCOMMITTEE RECESS

    Senator Cochran. The Defense Subcommittee will reconvene on 
Wednesday, March 11, at 10:30 a.m., and receive testimony from 
the United States Army.
    The subcommittee stands in recess.
    [Whereupon, at 11:34 a.m., March 4, the subcommittee was 
recessed, to reconvene at 10:30 a.m., Wednesday, March 11.]