Senate Report 105-189 - DEPARTMENT OF DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 1999 REPORT

[Senate Report 105-189]
[From the U.S. Government Publishing Office]

Calendar No. 367
_______________________________________________________________________

105th Congress Report
2d Session SENATE 105-189
_______________________________________________________________________

DEPARTMENT OF DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 1999

REPORT

[to accompany s. 2060]

AUTHORIZING APPROPRIATIONS FOR FISCAL YEAR 1999 FOR MILITARY ACTIVITIES
OF THE DEPARTMENT OF DEFENSE, TO PRESCRIBE PERSONNEL STRENGTHS FOR SUCH
FISCAL YEAR FOR THE ARMED FORCES, AND FOR OTHER PURPOSES

together with

ADDITIONAL VIEWS

----------

COMMITTEE ON ARMED SERVICES
UNITED STATES SENATE

May 11, 1998.--Ordered to be printed

Calendar No. 367

_______________________________________________________________________

105th Congress Report
2d Session SENATE 105-189
_______________________________________________________________________

DEPARTMENT OF DEFENSE

AUTHORIZATION ACT

FOR FISCAL YEAR 1999

REPORT

[to accompany s. 2060]

together with

ADDITIONAL VIEWS

__________

COMMITTEE ON ARMED SERVICES

UNITED STATES SENATE

May 11, 1998.--Ordered to be printed

-------

U.S. GOVERNMENT PRINTING OFFICE

48-264 WASHINGTON : 1998

COMMITTEE ON ARMED SERVICES

(105th Congress, 2d Session)

STROM THURMOND, South Carolina, Chairman

JOHN W. WARNER, Virginia CARL LEVIN, Michigan
JOHN McCAIN, Arizona EDWARD M. KENNEDY, Massachusetts
DAN COATS, Indiana JEFF BINGAMAN, New Mexico
BOB SMITH, New Hampshire JOHN GLENN, Ohio
DIRK KEMPTHORNE, Idaho ROBERT C. BYRD, West Virginia
JAMES M. INHOFE, Oklahoma CHARLES S. ROBB, Virginia
RICK SANTORUM, Pennsylvania JOSEPH I. LIEBERMAN, Connecticut
OLYMPIA J. SNOWE, Maine MAX CLELAND, Georgia
PAT ROBERTS, Kansas

Les Brownlee, Staff Director

David S. Lyles, Staff Director for the Minority

C O N T E N T S

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Page
Purpose of the Bill.............................................. 1
Committee overview and recommendations........................... 2
Explanation of funding summary................................... 3
Division A--Department of Defense Authorizations................. 13
Title I--Procurement............................................. 13
Explanation of tables........................................ 15
Subtitle A--Authorization of Appropriations.................. 16
Sec. 107. Chemical Demilitarization Program.............. 18
Chemical Weapons Convention (CWC).................... 18
Chemical Stockpile Emergency Preparedness Project
(CSEPP)............................................ 19
Defense Threat Reduction Agency (DTRA)............... 19
Subtitle B--Army Programs.................................... 20
Sec. 111. Multiyear procurement authority for Longbow
Hellfire missile program............................... 41
Sec. 113. Armored system modernization................... 41
Sec. 114. Reactive armor tiles........................... 42
Sec. 116. Extension of authority to carry out Armament
Retooling and Manufacturing Support Initiative......... 43
Other Army Programs.......................................... 43
Army Aircraft............................................ 43
UC-35................................................ 43
UH-60 blackhawk...................................... 43
C-12 Flight Maintenance System....................... 43
Longbow.............................................. 44
Army Missile............................................. 44
Enhanced fiber optic guided missile.................. 44
Multiple launch rocket system rocket................. 44
Weapons and Tracked Combat Vehicles...................... 45
Small arms programs.................................. 45
Army Ammunition.......................................... 45
Small arms ammunition................................ 45
M919 25mm ammunition................................. 45
M830A1 tank ammunition............................... 46
Other Army Procurement................................... 46
High mobility multipurpose wheeled vehicle........... 46
Family of medium tactical vehicles................... 46
Medium truck extended service program................ 47
Project management support........................... 47
System fielding support.............................. 48
Army data distribution system........................ 48
Single channel ground and airborne radio system
family............................................. 48
Area common user system modernization program........ 48
Night vision equipment............................... 48
Multiple integrated laser engagement system 2000..... 49
Subtitle C--Navy Programs.................................... 50
Sec. 121. CVN-77 nuclear aircraft carrier program........ 76
Sec. 122. Increased amount to be excluded from cost
limitation for Seawolf submarine program............... 76
Sec. 123. Multiyear procurement authority for the medium
tactical vehicle replacement........................... 77
Other Navy Programs.......................................... 77
Navy Aircraft............................................ 77
F-14 pods............................................ 77
AH-1W series......................................... 77
EP-3 spares.......................................... 77
P-3C antisurface warfare improvement program......... 78
Navy Weapons............................................. 78
Penguin missile program.............................. 78
Improved tactical air launched decoy................. 78
Close-in weapon system surface mode upgrade.......... 79
Surface ship gun mount rotatable pool................ 79
Navy and Marine Corps Ammunition......................... 80
Marine Corps ammunition.............................. 80
Navy Shipbuilding and Conversion......................... 80
LHD-8 advance procurement............................ 80
Strategic sealift.................................... 81
Landing craft air cusioned service life extension.... 81
Other Navy Procurement................................... 81
AN/WSN-7 inertial navigation system.................. 81
AN/BPS-15H surface search radar...................... 81
Submarine acoustic rapid commercial off-the-shelf
insertion.......................................... 82
Integration and test facility command and control
initiative......................................... 82
Information Technology-21............................ 82
Submarine connectivity............................... 83
Joint Engineering Data Management and Information
Control System..................................... 84
Aviation life support................................ 84
AEGIS support equipment.............................. 84
Smart ship equipment................................. 84
NULKA assembly qualification......................... 85
Marine Corps Procurement................................. 85
Modification kits for tracked vehicles............... 85
Avenger.............................................. 85
Night vision equipment............................... 85
Communications and electronics infrastructure........ 86
Light tactical vehicle remanufacturing............... 86
Power equipment...................................... 86
Shop equipment contact maintenance................... 87
Material handling equipment.......................... 87
Subtitle D--Air Force Programs............................... 88
Sec. 131. Joint surveillance target attack radar system.. 105
Sec. 132. Limitation on replacement of engines on
military aircraft derived from Boeing 707 aircraft..... 106
Sec. 133. F-22 aircraft program.......................... 107
Sec. 134. C-130J aircraft program........................ 108
C-130J Program Progress.............................. 108
WC-130J.............................................. 109
Other Air Force Programs..................................... 110
Air Force Aircraft....................................... 110
Joint Primary Aircraft Training System............... 110
F-15 220E engine modification........................ 110
ALQ-135 internal countermeasures sets................ 110
F-16 reconnaissance system........................... 111
Theater airborne warning system...................... 111
U-2 sensor upgrades.................................. 111
Air Force Missile........................................ 111
Minuteman III guidance replacement program........... 111
Titan IV space boosters.............................. 112
Other Air Force Procurement.............................. 112
Theater Deployable Communications.................... 112
Defense-Wide Programs.................................... 113
Penetration augmented munition....................... 120
Remote activation munition systems................... 120
Silent Shield........................................ 120
Surgical strike...................................... 120
Maritime equipment................................... 120
National Guard and Reserve Equipment................. 120
Other Items of Interest...................................... 122
Air National Guard Missions.............................. 122
Army aviation modernization.............................. 122
Bradley base sustainment................................. 123
Depleted Uranium Production.............................. 124
Digital information technology testbed................... 124
Domestic Emergency Response Program...................... 124
National Vaccine Stockpile........................... 125
Defense Threat Reduction Agency (DTRA)............... 126
Encapsulated life raft system............................ 126
F/A-18E/F configuration mix.............................. 126
Flight simulators for the Air National Guard............. 127
Full accounting of cost associated with ammunition
procurement............................................ 127
Gun ship modernization................................... 128
Secure facsimile machines................................ 128
Small arms training ammunition........................... 129
Tactical trailers and dolly sets......................... 129
Vertical Takeoff and Landing Unmanned Aerial Vehicles.... 129
Title II--Research, Development, Test, and Evaluation............ 131
Subtitle A--Authorization of Appropriations.................. 132
Subtitle B--Program Requirements, Restrictions, and
Limitations................................................ 133
Sec. 211. Crusader self-propelled artillery system
program................................................ 133
Sec. 212. CVN-77 nuclear aircraft carrier program........ 135
Sec. 213. Unmanned aerial vehicle programs............... 135
Dark Star UAV........................................ 136
Global Hawk.......................................... 136
Sec. 214. Airborne laser program......................... 136
Sec. 215. Enhanced global positioning system program..... 138
Sec. 216. Manufacturing Technology Program............... 138
Sec. 217. Authority for use of major range and test
facility installations by commercial entities.......... 139
Sec. 218. Extension of authority to carry out certain
prototype projects..................................... 140
Subtitle C--Other Matters.................................... 140
Sec. 231. Policy with respect to ballistic missile
defense cooperation.................................... 140
Additional Matters of Interest............................... 141
Army..................................................... 141
Hardened materials................................... 148
Missile technology................................... 148
Scramjet technology.................................. 148
Environmental technology............................. 148
Pollution prevention................................. 148
Software security.................................... 149
Cold regions research................................ 149
Nutrition research................................... 149
Weapons and munitions advanced technology............ 149
Combat vehicle and automotive advanced technology.... 150
Military human immunodeficiency virus research....... 150
Missile and rocket advanced technology............... 150
Advanced tactical computer science and sensor
technology......................................... 150
Tactical High Energy Laser........................... 151
Space and missile defense battle lab................. 151
North Atlantic Treaty Organization (NATO) Research
and Development.................................... 151
Comanche............................................. 151
Advanced threat infrared countermeasure system....... 152
All source analysis system........................... 152
Radar development.................................... 152
Firefinder........................................... 152
Research, development, test and evaluation support... 153
Army test instrumentation and targets................ 153
Survivability/lethality analysis..................... 153
High energy laser system test facility............... 153
Aerostat joint project office........................ 154
Advanced field artillery tactical data system
(AFATDS)........................................... 154
Combat vehicle improvement programs.................. 154
Navy..................................................... 155
Pulse detonation engine technology................... 163
Stainless steel double hull research................. 163
Communications, command and control technology....... 163
Thermal management materials......................... 163
Carbon-carbon heatshield technology.................. 163
Electronic propulsion technology..................... 163
Precision strike and air defense technology.......... 164
Advanced electric systems studies.................... 164
Composite helicopter hangar.......................... 164
Marine Corps warfighting laboratory.................. 164
Freeze dried blood research.......................... 165
Advanced lightweight influence sweep system.......... 165
Studies and experiments for combat systems
engineering........................................ 165
SSGN study........................................... 166
Intercooled recuperated gas turbine engine........... 166
Predator............................................. 167
Vertical gun for advanced ships...................... 167
Naval surface fire support system integration........ 168
Joint Strike Fighter................................. 168
Nonlethal weapons and technologies of mass protection
program............................................ 169
Advanced communications and information technologies. 170
Parametric airborne dipping sonar.................... 170
Commercial off-the-shelf insertion just prior to
critical design review for helicopter improvement.. 171
Integrated defensive electronic countermeasures...... 171
DDG-51 composite director room....................... 171
Laboratories and field activities monitoring efforts. 172
Multi-purpose processor.............................. 172
Non-propulsion electronics system.................... 172
Smart propulsor product model........................ 172
Ship live-fire test.................................. 173
Infrared search and track system..................... 173
NUKLA antiship missile decoy system electro-magnetic
compatibility...................................... 173
Voice instructional devices.......................... 174
Global command, control, communications, computers,
intelligence, surveillance, reconnaissance (C4ISR)
visualization...................................... 174
F/A-18E/F reconnaissance development................. 174
Battle force tactical training....................... 175
Air Force................................................ 176
Friction welding..................................... 185
Integrated high performance turbine engine program... 185
Variable displacement vane pump...................... 185
High frequency active auroral research program....... 185
Night vision technology.............................. 185
ALR-69 radar warning receiver upgrade................ 185
Ballistic missile technology......................... 186
Solar orbital transfer vehicle....................... 186
Micro-satellite technology program................... 186
Range improvements for liquid upper stage testing.... 186
Space control technology development................. 187
Variable stability in-flight simulator test aircraft. 187
EC-130H.............................................. 187
Big Crow program Office.............................. 188
Space maneuver vehicle............................... 188
Theater battle management system..................... 189
C-5 modernization.................................... 189
Aircrew laser eye protection......................... 189
Defense-Wide............................................. 190
University research initiative....................... 198
Chemical and biological defense program.............. 198
Shortcomings in Chemical and Biological Defense
Program........................................ 198
DOD Anthrax Immunization Policy.................. 199
Biological Agent Detection and Identification.... 201
Status of Increased Chem/Bio Defense Funds in
Fiscal Year 1998............................... 201
Defense Threat Reduction Agency (DTRA)........... 202
Ballistic Missile Defense Organization funding and
programmatic guidance.............................. 202
Support technology............................... 203
National Missile Defense......................... 203
Medium Extended Air Defense System............... 204
Theater High Altitude Area Defense (THAAD) system 204
Navy Upper Tier (Theater Wide)................... 205
BMD Technical Operations......................... 205
International Cooperative Programs............... 205
Patriot PAC-3.................................... 206
BMD Targets...................................... 206
Report of the Panel on Reducing Risk in Ballistic
Missile Defense Test Programs.................. 206
Countermeasures to missile defense systems....... 206
Medical free electron laser.......................... 206
Computing systems and communications technology...... 206
Telemedicine......................................... 207
Tactical technology.................................. 207
High definition systems.............................. 207
Mixed mode electronics............................... 208
Weapons of Mass Destruction Technologies............. 208
Core Competencies and Critical Expertise......... 208
Implications of nuclear and conventional
explosions on critical civil and commercial
activities..................................... 208
Structural Response and Blast Mitigation......... 209
Hard and Deeply Buried Underground Structures.... 209
Explosives and conventional demilitarization......... 209
Counterterror technical support...................... 210
Defense Threat Reduction Agency (DTRA)........... 211
Counterproliferation support program............. 211
Counterproliferation Analysis and Planning System 211
Defense Threat Reduction Agency (DTRA)........... 212
Generic logistics research and development technology
demonstrations..................................... 212
Advanced lithography................................. 212
Advanced electronics technologies.................... 213
Maritime technology.................................. 213
Advanced concept technology demonstrations........... 213
High performance computing modernization............. 213
Command, control, and communications systems......... 214
Land warfare technology.............................. 214
Physical security.................................... 214
Advanced sensor applications......................... 215
Integrated data environment.......................... 215
Joint robotics program............................... 215
Defense support activities........................... 215
Defense technical information services............... 215
Joint simulation system.............................. 215
Surgical strike...................................... 215
Maritime equipment................................... 216
Other Items of Interest...................................... 216
Acoustic firefinding system.............................. 216
Army After Next Initiatives.............................. 216
Army multimedia tactical adaptor......................... 216
Brain protection in combat head injury................... 217
Defense imagery and mapping program...................... 217
Dual use applications programs........................... 217
Electronic commerce resource centers..................... 217
Electronic safe and arm devices.......................... 218
Flat panel display technology............................ 218
Global Positioning System alternate master control
station................................................ 218
Joint experimentation plan report........................ 219
Man overboard notification technology.................... 221
Molten salt oxidation waste disposal technology.......... 221
National automotive center............................... 222
National solar observatory............................... 222
National technology alliance............................. 222
Next generation internet................................. 222
Patriot anti-cruise missile defense system............... 223
Rapid acquisition of manufactured parts.................. 223
Report on Department of the Navy applications for high-
performance computing.................................. 223
Report on national security space policy................. 224
Software engineering institute........................... 224
Software productivity.................................... 224
Space weather............................................ 225
Torpedo defense.......................................... 225
Totally integration munitions enterprise................. 225
Trajectory correctable munition.......................... 225
United States-Japan management training.................. 226
Title III--Operation and Maintenance............................. 227
Subtitle A--Authorization of Appropriations.................. 231
Sec. 303. Armed Forces Retirement Home................... 261
Sec. 304. Transfer from the National Defense Stockpile
Transaction Fund....................................... 261
Subtitle B--Program Requirements, Restrictions, and
Limitations................................................ 261
Sec. 311. Special Operations Command counterproliferation
and counterterrorism activities........................ 261
Sec. 312. Tagging system for identification of
hydrocarbon fuels used by the Department of Defense.... 261
Sec. 313. Pilot program for acceptance and use of landing
fees charged for use of domestic military airfields by
civil aircraft......................................... 262
Subtitle C--Environmental Provisions......................... 262
Sec. 321. Transportation of polychlorinated biphenyls
from abroad for disposal in the United States.......... 262
Sec. 322. Modification of deadline for submittal to
Congress of annual reports on environmental activities. 263
Sec. 323. Submarine solid waste control.................. 263
Sec. 324. Payment of stipulated penalties assessed under
CERCLA................................................. 264
Sec. 325. Authority to pay negotiated settlement for
environmental cleanup of formerly used defense sites in
Canada................................................. 265
Sec. 326. Settlement of claims of foreign governments for
environmental cleanup of overseas sites formerly used
by the Department of Defense........................... 266
Sec. 327. Arctic Military Environmental Cooperation
Program................................................ 266
Subtitle D--Counter-Drug Activities.......................... 267
Drug Interdiction & Counter-drug Activities, Operations
and Maintenance........................................ 268
Enhanced Caribbean/Eastern Pacific Interdiction
Initiative............................................. 268
Gulf States Counterdrug Initiative....................... 269
Patrol Coastal Craft for Drug Interdiction by Southern
Command (sec. 331)..................................... 270
Program Authority for Department of Defense Support for
Counter-Drug Activities (sec. 332)..................... 270
Southwest Border Fence (sec. 333)........................ 270
Subtitle E--Other Matters.................................... 270
Sec. 341. Liquidity of working-capital funds............. 270
Sec. 342. Termination of authority to manage working-
capital funds and certain activities through the
Defense Business Operations Fund....................... 271
Sec. 343. Clarification of authority to retain recovered
costs of disposals in working capital funds............ 271
Sec. 344. Best commercial inventory practices for
management of secondary supply items................... 271
Sec. 345. Increased use of SMART cards................... 272
Sec. 346. Public-private competition in the provision of
support services....................................... 272
Sec. 347. Condition for providing financial assistance
for support of additional duties assigned to the Army
National Guard......................................... 273
Sec. 348. Repeal of prohibition on joint use of Gray Army
Airfield, Fort Hood, Texas............................. 273
Additional Matters of Interest............................... 273
Navy..................................................... 273
Ship depot maintenance............................... 273
Tomahawk recertification............................. 273
Dredging operations for the maintenance of ships in
the inactive reserve............................... 274
Naval oceanographic program.......................... 274
Adjustments to civilian personnel education and
training funds..................................... 274
Marine Corps............................................. 274
United States Marine Corps initial issue............. 274
Depot maintenance and corrosion control.............. 274
United States Marine Corps Reserve personal equipment 275
Air Force................................................ 275
Air launched cruise missiles and advanced cruise
missile engineering analysis....................... 275
Air Force combat training range...................... 275
War reserve materials................................ 275
Adjustments to personnel program funds............... 275
Guard and Reserve Components............................. 276
Defense-Wide............................................. 276
National Guard Youth Challenge....................... 276
STARBASE............................................. 276
Defense reform initiative............................ 276
Adjustments to human resource activity funds......... 276
Overseas humanitarian demining and Commander-in-
activities......................................... 277
Cooperative Threat Reduction (CTR) Program........... 277
Defense Threat Reduction Agency (DTRA)............... 277
Operational units readiness resources................ 277
Real property maintenance............................ 277
Civilian personnel levels............................ 278
Foreign currency fluctuation......................... 278
Fuel price reduction................................. 278
Restoration of work years to accomplish essential
finance and accounting services.................... 279
Restoration of 1500 work years (in millions)......... 279
Assistance to local educational agencies that have
benefit dependents of members of the Armed Forces
and Department of Defense civilian employees....... 279
Revolving Funds.......................................... 279
Reserve Mobilization Income Insurance Program........ 279
Other Items of Interest...................................... 279
Defense Threat Reduction Agency (DTRA)................... 279
Defense Special Weapons Agency (DSWA)................ 281
On-Site Inspection Agency (OSIA) and Arms Control
Implementation..................................... 281
Nuclear Weapons Council and Maintaining the Nuclear
Deterrent.......................................... 282
Management and Oversight of the Defense Threat
Reduction Agency................................... 283
Further Efficiencies and Economies................... 283
Department of Defense demolition program and historic
properties............................................. 283
Department of Defense shipscrapping practices............ 284
Environmentally-preferable products...................... 286
Federal facilities....................................... 286
Retread tires and re-refined oils........................ 288
Title IV--Military Personnel Authorizations...................... 289
Subtitle A--Active Forces.................................... 289
Sec. 401. End strengths for active forces................ 289
Sec. 402. Limited exclusions of joint duty officers from
limitations on number of general and flag officers..... 289
Sec. 403. Limitation on daily average of personnel on
active duty in grades E-8 and E-9...................... 289
Sec. 404. Repeal of permanent end strength requirement
for support of two major regional contingencies........ 290
Subtitle B--Reserve Forces................................... 290
Sec. 411. End strengths for Selected Reserve............. 290
Sec. 412. End strengths for Reserves on active duty in
support of the reserves................................ 290
Sec. 413. End strengths for military technicians (dual
status)................................................ 290
Sec. 414. Exclusion of additional reserve component
general and flag officers from limitation on number of
general and flag officers who may serve on active duty. 291
Sec. 415. Increase in numbers of members in certain
grades authorized to be on active duty in support of
the reserves........................................... 291
Sec. 416. Consolidation of strength authorizations for
active status Naval Reserve flag officers of the Navy
Medical Department staff corps......................... 291
Subtitle C--Authorization of Appropriations.................. 292
Sec. 421. Authorization of appropriations for military
personnel.............................................. 292
Other Items of Interest...................................... 292
Army National Guard schools and special training......... 292
Title V--Military Personnel Policy............................... 292
Subtitle A--Officer Personnel Policy......................... 292
Sec. 501. Streamlined selective retention process for
regular officers....................................... 292
Sec. 502. Permanent applicability of limitations on years
of active naval service of Navy limited duty officers
in grades of commander and captain..................... 293
Sec. 503. Involuntary separation pay denied for officer
discharged for failure of selection for promotion
requested by the officer............................... 293
Sec. 504. Term of office of the Chief of the Air Force
Nurse Corps............................................ 293
Subtitle B--Reserve Component Matters........................ 293
Sec. 511. Service required for retirement of National
Guard officer in higher grade.......................... 293
Sec. 512. Reduced time-in-grade requirement for reserve
general and flag officers involuntarily transferred
from active status..................................... 293
Sec. 513. Eligibility of Army and Air Force Reserve
brigadier generals to be considered for promotion while
on inactive status list................................ 294
Sec. 514. Composition of selective early retirement
boards for rear admirals of the Naval Reserve and major
generals of the Marine Corps Reserve................... 294
Sec. 515. Use of Reserves for emergencies involving
weapons of mass destruction............................ 294
Subtitle C--Other Matters.................................... 295
Sec. 521. Annual manpower requirements report............ 295
Sec. 522. Four-year extension of certain force reduction
transition period management and benefits authorities.. 295
Sec. 523. Continuation of eligibility for voluntary
separation incentive after involuntary loss of
membership in Ready or Standby Reserve................. 295
Sec. 524. Repeal of limitations on authority to set rates
and waive requirement for reimbursement of expenses
incurred for instruction at service academies of
persons from foreign countries......................... 295
Sec. 525. Repeal of restriction on civilian employment of
enlisted members-......................................
Sec. 526. Extension of reporting dates for Commission on
Military Training and Gender-Related Issues............ 296
Sec. 527. Moratorium on changes of gender-related
policies and practices pending completion of the work
of the Commission on Military Training and Gender-
Related Issues......................................... 296
Sec. 528. Transitional compensation for abused dependent
children not residing with the spouse or former spouse
of a member convicted of dependent abuse............... 296
Sec. 529. Pilot program for treating GED recipients as
high school graduates for determinations of eligibility
for enlisting in the Armed Forces...................... 297
Sec. 530. Waiver of time limitations for award of
Distinguished Flying Cross in certain cases............ 297
Other Items of Interest...................................... 297
Personal finance training................................ 297
Operation Walking Shield Program......................... 298
Processing of reports of promotion boards................ 298
Recruiting effectiveness and efficiency.................. 298
Management of reserves on active duty in support of the
reserve components..................................... 299
Personnel and finance support of the reserve components.. 300
Investigations of military deaths........................ 301
Management of officers assigned to interagency and
international billets.................................. 302
Title VI--Compensation and Other Personnel Benefits.............. 303
Subtitle A--Pay and Allowances............................... 303
Sec. 601. Increase in basic pay for fiscal year 1999..... 303
Sec. 602. Rate of pay for cadets and midshipmen at the
service academies...................................... 303
Sec. 603. Payments for movements of household goods
arranged by members.................................... 303
Sec. 604. Leave without pay for suspended academy cadets
and midshipmen......................................... 303
Subtitle B--Bonuses and Special Incentive Pays............... 304
Sec. 611. Three-month extension of certain bonuses and
special pay authorities for reserve forces............. 304
Sec. 612. Three-month extension of certain bonuses and
special pay authorities for nurse officer candidates,
registered nurses, and nurse anesthetists.............. 304
Sec. 613. Three-month extension of authorities relating
to payment of other bonuses and special pays........... 304
Sec. 614. Eligibility of Reserves for selective
reenlistment bonus when reenlisting or extending to
perform active guard and reserve duty.................. 304
Sec. 615. Repeal of ten-percent limitation on payments of
selective reenlistment bonuses in excess of $20,000.... 304
Sec. 616. Increase of maximum amount authorized for army
enlistment bonus....................................... 305
Sec. 617. Education loan repayment program for health
professions officers serving in Selected Reserve....... 305
Sec. 618. Increase in amount of basic educational
assistance under all-volunteer force program for
personnel with critically short skills or specialties.. 305
Sec. 619. Relationship of entitlements to enlistment
bonuses and benefits under the All-Volunteer Force
Educational Assistance Program......................... 305
Subtitle C--Travel and Transportation Allowances............. 305
Sec. 621. Travel and transportation for rest and
recuperation in connection with contingency operations
and other duty......................................... 305
Sec. 622. Payment for temporary storage of baggage of
dependent student not taken on annual trip to overseas
duty station of sponsor................................ 306
Sec. 623. Commercial travel of Reserves at federal supply
schedule rates for attendance at inactive duty training
assemblies............................................. 306
Subtitle D--Retired Pay, Survivor Benefits, and Related
Matters.................................................... 306
Sec. 631. Paid-up coverage under Survivor Benefit Plan... 306
Sec. 632. Court-required Survivor Benefit Plan coverage
effectuated through elections and deemed elections..... 306
Sec. 633. Recovery, care, and disposition of remains of
medically retired member who dies during
hospitalization that begins while on active duty....... 307
Subtitle E--Other Matters.................................... 307
Sec. 641. Definition of possessions of the United States
for pay and allowances purposes........................ 307
Sec. 642. Federal employees' compensation coverage for
students participating in certain officer candidate
programs............................................... 307
Sec. 643. Authority to provide financial assistance for
education of certain defense dependents overseas....... 307
Other Items of Interest...................................... 308
Accrual funding of military retirement................... 308
Computation of retired pay for certain service members... 308
Title VII--Health Care........................................... 309
Sec. 701. Dependents' dental program..................... 309
Sec. 702. Extension of authority for use of personal
services contracts for provision of health care at
military entrance processing stations and elsewhere
outside medical treatment facilities................... 309
Sec. 703. TRICARE Prime automatic enrollments and retiree
payment options........................................ 310
Sec. 704. Limited continued CHAMPUS coverage for persons
unaware of a loss of CHAMPUS coverage resulting from
eligibility for medicare............................... 310
Sec. 705. Enhanced Department of Defense organ and tissue
donor program.......................................... 310
Sec. 706. Joint Department of Defense and Department of
Veterans Affairs reviews relating to interdepartmental
cooperation in the delivery of medical care............ 310
Sec. 707. Demonstration projects to provide health care
to certain medicare-eligible beneficiaries of the
military health care system............................ 312
Other Items of Interest...................................... 313
Auto-destruct syringes................................... 313
Health care fraud........................................ 313
Hepatitis C testing...................................... 314
The Psychopharmacology Demonstration Project............. 314
Title VIII--Acquisition Policy, Acquisition Management, and
Related Matters................................................ 315
Sec. 801. Para-aramid fibers and yarns................... 315
Sec. 802. Procurement of travel services for official and
unofficial travel under one contract................... 315
Sec. 803. Limitation on use of price preference upon
attainment of contract goal for small and disadvantaged
businesses............................................. 315
Sec. 804. Distribution of assistance under the
Procurement Technical Assistance Cooperative Agreement
Program................................................ 316
Sec. 805. Defense Commercial Pricing Management
Improvement Act........................................ 316
Sec. 806. Department of Defense purchases through other
agencies............................................... 318
Sec. 807. Supervision of Defense Acquisition University
structure by Under Secretary of Defense for Acquisition
and Technology......................................... 319
Sec. 808. Repeal of requirement for Director of
Acquisition Education, Training, and Career Development
to be within the Office of the Under Secretary of
Defense for Acquisition and Technology................. 319
Sec. 809. Eligibility of involuntarily downgraded
employee for membership in an acquisition corps........ 319
Sec. 810. Pilot programs for testing program manager
performance of product support oversight
responsibilities for life cycle of acquisition programs 320
Sec. 811. Scope of protection of certain information from
disclosure............................................. 320
Other Items of Interest...................................... 321
Defense capability preservation agreement................ 321
Item-by-item waivers to domestic preference requirements. 321
Title IX--Department of Defense Organization and Management...... 323
Sec. 901. Reduction in number of Assistant Secretary of
Defense positions...................................... 323
Sec. 902. Renaming of position of Assistant Secretary of
Defense for Command, Control, Communications, and
Intelligence........................................... 323
Sec. 903. Authority to expand the National Defense
University............................................. 324
Sec. 904. Reduction in Department of Defense headquarters
staff.................................................. 324
Sec. 905. Permanent requirement for quadrennial defense
review................................................. 324
Sec. 906. Management reform for research, development,
test, and evaluation................................... 324
Sec. 907. Restructuring of administration of Fisher
Houses................................................. 327
Title X--General Provisions...................................... 327
Subtitle A--Financial Matters................................ 327
Sec. 1002. Authorization of emergency appropriations for
fiscal year 1999....................................... 327
Sec. 1003. Authorization of prior emergency supplemental
appropriations for fiscal year 1998.................... 327
Sec. 1004. Partnership for Peace information system
management............................................. 327
Subtitle B--Naval Vessels.................................... 327
Sec. 1011. Iowa class battleship returned to Naval Vessel
Register............................................... 327
Sec. 1012. Long-term charter of three vessels in support
of submarine rescue, escort, and towing................ 328
Sec. 1013. Transfers of naval vessels to foreign
countries.............................................. 329
Subtitle C--Miscellaneous Report Requirements and Repeals.... 329
Sec. 1021. Repeal of reporting requirements.............. 329
Sec. 1022. Report on Department of Defense financial
management improvement plan............................ 329
Sec. 1023. Feasibility study of performance of Department
of Defense finance and accounting functions by private
sector sources or other Federal Government sources..... 329
Sec. 1024. Reorganization and consolidation of operating
locations of the Defense Finance and Accounting Service 330
Sec. 1025. Report on inventory and control of military
equipment.............................................. 330
Sec. 1026. Report on continuity of essential operations
at risk of failure because of computer systems that are
not year 2000 compliant................................ 330
Sec. 1027. Reports on naval surface fire-support
capabilities........................................... 332
Sec. 1028. Report on roles in Department of Defense
aviation accident investigations....................... 333
Sec. 1029. Strategic plan for expanding distance learning
initiatives............................................ 333
Sec. 1030. Report on involvement of Armed Forces in
contingency and ongoing operations..................... 333
Subtitle D--Other Matters.................................... 334
Sec. 1041. Cooperative counterproliferation program...... 334
Sec. 1042. Extension of counterproliferation authorities
for support of United Nations Special Commission on
Iraq................................................... 334
Sec. 1043. One-year extension of limitation on retirement
or dismantlement of strategic nuclear delivery systems. 335
Sec. 1044. Direct-line communication between United
States and Russian commanders of strategic forces...... 335
Sec. 1045. Chemical warfare defense...................... 335
Sec. 1046. Accounting treatment of advance payment of
personnel.............................................. 336
Sec. 1047. Reinstatement of definition of financial
institution in authorities for reimbursing defense
personnel for Government errors in direct deposits of
pay.................................................... 336
Sec. 1048. Pilot program on alternative notice of receipt
of legal process for garnishment of federal pay for
child support and alimony.............................. 336
Sec. 1049. Costs payable to the Department of Defense and
other federal agencies for services provided to the
Defense Commissary Agency.............................. 336
Sec. 1050. Collection of dishonored checks presented at
commissary stores...................................... 337
Sec. 1051. Defense commissary agency telecommunications.. 337
Sec. 1052. Research grants competitively awarded to
service academies...................................... 337
Sec. 1053. Clarification and simplification of
responsibilities of inspectors general regarding
whistleblower protections.............................. 337
Sec. 1054. Amounts recovered from claims against third
parties for loss or damage to personal property shipped
or stored at Government expense........................ 338
Sec. 1055. Eligibility for attendance at Department of
Defense domestic dependent elementary and secondary
schools................................................ 338
Sec. 1056. Fees for providing historical information to
the public............................................. 339
Sec. 1057. Periodic inspection of the Armed Forces
Retirement Home........................................ 339
Sec. 1058. Transfer of F-4 phantom II aircraft to
foundation............................................. 339
Sec. 1059. Act constituting presidential approval of
vessel war risk insurance requested by the Secretary of
Defense................................................ 339
Sec. 1060. Commendation and memorialization of the United
States Navy Asiatic Fleet.............................. 340
Sec. 1061. Program to commemorate 50th anniversary of the
Korean War............................................. 340
Sec. 1062. Relocation of frequency spectrum.............. 340
Sec. 1063. Technical and clerical amendments............. 342
Other Items of Interest...................................... 342
Arms control and other national priorities............... 342
Assured strategic command and control.................... 342
Reporting miscellaneous expenses in object classes 25
series (Contractual Services).......................... 343
Reprogramming procedures for the National Reconnaissance
Office................................................. 343
Title XI--Department of Defense Civilian Personnel............... 345
Sec. 1101. Repeal of employment preference not needed for
recruitment and retention of qualified child care
providers.............................................. 345
Sec. 1102. Maximum pay rate comparability for faculty
members of the United States Air Force Institute of
Technology............................................. 345
Sec. 1103. Four-year extension of voluntary separation
incentive pay authority................................ 345
Sec. 1104. Department of Defense employee voluntary early
retirement authority................................... 345
Sec. 1105. Defense Advanced Research Projects Agency
experimental personnel management program for technical
personnel.............................................. 346
Other Items of Interest...................................... 346
Temporary assignments of personnel between Federal
Government, and state or local governments,
institutions of higher education, Indian tribal
governments and other eligible organizations........... 346
Enhanced training for Department of Defense civilian
employees regarding A-76............................... 346
Management by Full Time Equivalents...................... 347
High-grade restrictions.................................. 347
Title XII--Joint Warfighting Experimentation..................... 347
Division B--Military Construction Authorizations................. 349
Title XXI--Army.................................................. 375
Summary...................................................... 375
Sec. 2101. Authorized Army construction and land
acquisition projects................................... 375
Sec. 2102. Family housing................................ 375
Sec. 2103. Improvements to military family housing units. 375
Sec. 2104. Authorization of appropriations, Army......... 375
Sec. 2105. Modification of authority to carry out fiscal
year 1998 project...................................... 375
Other Items of Interest...................................... 375
Improvements of military family housing, Army............ 375
Title XXII--Navy................................................. 377
Summary...................................................... 377
Sec. 2201. Authorized Navy construction and land
acquisition projects................................... 377
Sec. 2202. Family housing................................ 377
Sec. 2203. Improvements to military family housing units. 377
Sec. 2204. Authorization of appropriations, Navy......... 377
Title XXIII--Air Force........................................... 379
Summary...................................................... 379
Sec. 2301. Authorized Air Force construction and land
acquisition projects................................... 379
Sec. 2302. Family housing................................ 379
Sec. 2303. Improvements to military family housing units. 379
Sec. 2304. Authorization of appropriations, Air Force.... 379
Other Items of Interest...................................... 379
Planning and design, Air Force........................... 379
Improvements of military family housing, Air Force....... 379
Consolidation of the Officer Training School, Maxwell Air
Force Base, Alabama.................................... 380
Title XXIV--Defense Agencies..................................... 381
Summary...................................................... 381
Sec. 2401. Authorized Defense Agencies construction and
land acquisition projects.............................. 381
Sec. 2402. Improvements to military family housing units. 381
Sec. 2403. Energy conservation projects.................. 381
Sec. 2404. Authorization of appropriations, Defense
Agencies............................................... 381
Sec. 2405. Modification of authority to carry out certain
fiscal year 1995 projects.............................. 381
Sec. 2406. Modification of authority to carry out fiscal
year 1990 project...................................... 382
Title XXV--North Atlantic Treaty Organization Security Investment
Program........................................................ 383
Summary...................................................... 283
Sec. 2501. Authorized NATO construction and land
acquisition projects................................... 283
Sec. 2502. Authorization of appropriations, NATO......... 283
Title XXVI--Guard and Reserve Forces Facilities.................. 385
Summary...................................................... 385
Sec. 2601. Authorized Guard and Reserve construction and
land acquisition projects.............................. 385
Sec. 2602. Reduction in fiscal year 1998 authorization of
appropriations for Army National Guard military
construction........................................... 385
Planning and design, Guard and Reserve Forces
facilities......................................... 285
Title XXVII--Expiration and Extension of Authorizations.......... 387
Sec. 2701. Expiration of authorizations and amounts
required to be specified by law........................ 387
Sec. 2702. Extension of authorizations of certain fiscal
year 1996 projects..................................... 387
Sec. 2703. Extension of authorization of fiscal year 1995
project................................................ 387
Sec. 2704. Effective date................................ 387
Title XXVIII--General Provisions................................. 389
Subtitle A--Military Construction Program and Military Family
Housing Changes............................................ 389
Sec. 2801. Modification of authority relating to
architectural and engineering services and construction
design................................................. 389
Sec. 2802. Expansion of Army overseas family housing
lease authority........................................ 389
Subtitle B--Real Property and Facilities Administration...... 389
Sec. 2811. Increase in thresholds for reporting
requirements relating to real property transactions.... 389
Sec. 2812. Exceptions to real property transaction
reporting requirements for war and certain emergency
and other operations................................... 389
Sec. 2813. Waiver of applicability of property disposal
laws to leases at installations to be closed or
realigned under the base closure laws.................. 390
Sec. 2814. Restoration of Department of Defense lands
used by another Federal agency......................... 390
Subtitle C--Land Conveyances................................. 390
Sec. 2821. Land conveyance, Indiana Army Ammunition
Plant, Charlestown, Indiana............................ 390
Sec. 2822. Land conveyance, Army Reserve Center,
Bridgton, Maine........................................ 391
Sec. 2823. Land conveyance, Volunteer Army Ammunition
Plant, Chattanooga, Tennessee.......................... 391
Sec. 2824. Release of interests in real property, former
Kennebec Arsenal, Augusta, Maine....................... 391
Sec. 2825. Land exchange, Naval Reserve Readiness Center,
Portland, Maine........................................ 392
Sec. 2826. Land conveyance, Air Force Station, Lake
Charles, Louisiana..................................... 392
Subtitle D--Other Matters.................................... 392
Sec. 2831. Purchase of build-to-lease family housing at
Eielson Air Force Base, Alaska......................... 392
Sec. 2832. Beach replenishment, San Diego, California.... 392
Other Items of Interest...................................... 394
Report on Air Force Plant #3, Tulsa, Oklahoma............ 394
Report on Fort Hunter Liggett, California................ 394
Title XXIX--Juniper Butte Range Lands Withdrawal................. 395
Division C--Department of Energy National Security Authorizations
and Other Authorizations....................................... 397
Title XXXI--Department of Energy National Security Programs...... 397
Subtitle A--National Security Programs Authorizations........ 397
Sec. 3101. Weapons activities............................ 414
Stockpile stewardship programs....................... 414
Stockpile management programs........................ 415
Technology transfer and education.................... 416
Program direction.................................... 416
Construction projects................................ 416
Tritium production................................... 416
Laboratory Directed Research and Development......... 417
Sec. 3102. Environmental restoration and waste management 417
Post 2006 Completion................................. 417
Technology Development............................... 418
Accelerating Cleanup................................. 418
UF6 Stabilization and Reuse.......................... 419
Environmental Validation, Verification and
Engineering Analysis............................... 419
Off-site Disposal of Low Level Waste................. 419
Overdue reports...................................... 419
Sec. 3103. Other defense activities...................... 420
Nonproliferation and verification research and
development........................................ 420
Russian Reactor Core Conversion Program.............. 420
Nuclear Smuggling and Counterterrorism............... 421
Worker and Community Transition...................... 421
Fissile materials.................................... 421
Environment, Safety and Health-Defense............... 422
Naval Reactors....................................... 422
Sec. 3104. Defense nuclear waste disposal................ 422
Sec. 3105. Defense environmental management privatization 422
Subtitle B--Recurring General Provisions..................... 423
Sec. 3121. Reprogramming................................. 423
Sec. 3122. Limits on general plant projects.............. 423
Sec. 3123. Limits on construction projects............... 423
Sec. 3124. Fund transfer authority....................... 424
Sec. 3125. Authority for conceptual and construction
design................................................. 424
Sec. 3126. Authority for emergency planning, design, and
construction activities................................ 424
Sec. 3127. Funds available for all national security
programs of the Department of Energy................... 424
Sec. 3128. Availability of funds......................... 424
Sec. 3129. Transfers of defense environmental management
funds.................................................. 424
Subtitle C--Program Authorizations, Restrictions, and
Limitations................................................ 425
Sec. 3131. International cooperative stockpile
stewardship............................................ 425
Sec. 3132. Prohibition on use of funds for ballistic
missile defense and theater missile defense............ 425
Sec. 3133. Licensing of certain mixed oxide fuel
fabrication and irradiation facilities................. 425
Sec. 3134. Continuation of processing, treatment, and
disposition of legacy nuclear materials................ 426
Sec. 3135. Authority for Department of Energy federally
funded research and development centers to participate
in merit-based technology research and development
programs............................................... 426
Sec. 3136. Support for public education in the vicinity
of Los Alamos National Laboratory, New Mexico.......... 426
Subtitle D--Other Matters.................................... 427
Sec. 3141. Repeal of fiscal year 1998 statement of policy
on stockpile stewardship program....................... 427
Sec. 3142. Increase in maximum rate of pay for
scientific, engineering, and technical personnel
responsible for safety at defense nuclear facilities... 427
Sec. 3143. Sense of Senate regarding treatment of
Formerly Utilized Sites Remedial Action Program under a
nondefense discretionary budget function............... 427
Other Items of Interest...................................... 427
Asset disposition........................................ 427
Improving collaboration between the Department of Defense
and Department of Energy laboratories.................. 428
Los Alamos Non-proliferation Center...................... 428
Robotics and intelligent machines........................ 429
Title XXXII--Defense Nuclear Facilities Safety Board............. 431
Title XXXIII--National Defense Stockpile......................... 433
Title XXXIV--Naval Petroleum Reserves............................ 435
Title XXXV--Panama Canal Commission.............................. 437
Sec. 3501. Short title; references to Panama Canal Act
of 1979................................................ 437
Sec. 3502. Authorization of expenditures................ 437
Sec. 3503. Purchase of vehicles......................... 437
Sec. 3504. Expenditures only in accordance with treaties 437
Sec. 3505. Donations to the Commission.................. 437
Sec. 3506. Agreements for United States to provide post-
transfer administrative services for certain employee
benefits............................................... 438
Sec. 3507. Sunset of United States overseas benefits
just before transfer................................... 438
Sec. 3508. Central Examining Office..................... 440
Sec. 3509. Liability for vessel accidents............... 440
Sec. 3510. Placement of United States citizens in
positions with the United States Government............ 441
Sec. 3511. Panama Canal Board of Contract Appeals....... 442
Legislative Requirements......................................... 443
Departmental Recommendations..................................... 443
Committee Action................................................. 444
Congressional Budget Office Cost Estimate........................ 444
Regulatory Impact................................................ 444
Changes in Existing Law.......................................... 444
Additional Views of Senator John McCain.......................... 445
Additional Views of Senator Carl Levin........................... 450
Additional Views of Senator Jeff Bingaman........................ 454
Additional Views of Senator John Glenn........................... 456

Calendar No. 367

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105th Congress Report
2d Session SENATE 105-189
_______________________________________________________________________

_______

May 11, 1998.--Ordered to be printed

_______________________________________________________________________

Mr. Thurmond, from the Committee on Armed Services, submitted the
following

R E P O R T

together with

ADDITIONAL VIEWS

[To accompany S. 2060]

The Committee on Armed Services reports favorably an
original bill to authorize appropriations during the fiscal
year 1999 for military activities of the Department of Defense,
for military construction, and for defense activities of the
Department of Energy, to prescribe personnel strengths for such
fiscal year for the armed forces, and for other purposes, and
recommends that the bill do pass.

PURPOSE OF THE BILL

This bill would:
(1) authorize appropriations for (a) procurement, (b)
research, development, test and evaluation, (c)
operation and maintenance and the revolving and
management funds of the Department of Defense for
fiscal year 1999;
(2) authorize the personnel end strengths for each
military active duty component of the armed forces for
fiscal year 1999;
(3) authorize the personnel end strengths for the
Selected Reserve of each of the reserve components of
the armed forces for fiscal year 1999;
(4) authorize the annual average military training
student loads for the active and reserve components of
the armed forces for fiscal year 1999;
(5) impose certain reporting requirements;
(6) impose certain limitations with regard to
specific procurement and research, development, test
and evaluation actions and manpower strengths; provide
certain additional legislative authority, and make
certain changes to existing law;
(7) authorize appropriations for military
construction programs of the Department of Defense for
fiscal year 1999; and
(8) authorize appropriations for national security
programs of the Department of Energy for fiscal year
1999.

Committee overview and recommendations

In the Second Session of the 105th Congress, the Committee
on Armed Services continued its efforts to ensure, within the
constraints of the new balanced budget agreement, an adequate
balance between the current and long-term readiness of the
armed forces. While this historic agreement between the
Congress and the President to achieve a balanced budget by
fiscal year 2002 protects our military forces from ``top line''
cuts, it does not guarantee immunity from the unplanned costs
that have served to undermine programmed investments in our
military. Accordingly, the committee remains concerned that the
funding levels for defense may not be sufficient to sustain the
military capability required to support the current foreign
policy as well as the personnel, quality of life, readiness,
and modernization programs critical to our armed forces.
The committee believes that the limitations of the balanced
budget agreement and the continual, demanding requirements of
increasingly frequent contingency deployments have stretched
our military forces to the breaking point. A disparity in
outlay estimates for fiscal year 1999 between the Office of
Management and Budget and the Congressional Budget Office
required a decrease in recommended authorizations that will
further strain our military. The committee is obligated to
assess the impact of these factors on our military forces and
recommend adjustments to the funding level for defense in the
balanced budget agreement when necessary.
In the National Defense Authorization Bill for Fiscal Year
1999, the committee worked to achieve an appropriate balance
between near-term and long-term readiness through investments
in modernization, infrastructure and research; the development
and maintenance of sufficient endstrengths for all grade levels
and specialties; policies supporting the recruitment and
retention of high quality personnel; fielding of the types and
quantities of weapons systems and equipment needed to fight and
win decisivelywith acceptable risk to our troops; and ensuring
an adequate, safe and reliable nuclear weapons capability.
The committee modified the budget request to improve
operations and achieve greater efficiencies and savings. The
committee sought to eliminate defense spending that does not
contribute directly to the national security of the United
States. Savings were realized by accelerating programs where
appropriate, and by limiting new program starts.
The committee worked to protect the quality of life of our
military personnel and their families. Quality of life
initiatives include provisions designed to provide equitable
pay and benefits to military personnel, including a 3.1 percent
pay raise and the restoration of appropriate levels of funding
for the construction and maintenance of troop billets and
military family housing.
The committee notes with concern the combined effects of
supporting operations and maintenance at the expense of
essential modernization along with a foreign policy that
imposes high operational tempos on increasingly scarce military
resources. There is clear evidence that the combat readiness of
the armed forces is at greater risk due to two key factors:
older and harder-to-maintain equipment resulting from
inadequate modernization and the overuse of a smaller force
structure. To ensure that the United States remains the
preeminent military power in the world, current readiness
requirements must be adequately funded without diverting
critical funding from procurement and research, development,
testing and evaluation accounts. The committee believes that a
more robust, progressive modernization effort will not only
provide the requisite capabilities for future military
operations, but will also lower future operational and
maintenance costs.
The committee has increased investment in a broad spectrum
of research and development activities to ensure that U.S.
military forces remain superior in technology to that of any
potential adversary. The committee believes that effective
development of advanced technologies will be a key factor in
ensuring U.S. armed forces dominate any future battlefield,
whether it be primarily on the ground, on the sea, in the air,
in space, or in cyberspace. A program of stable, long-term
investment in science and technology will remain vital to
guaranteeing U.S. dominance of threats in any medium.
The committee continues to monitor the resources provided
to the reserve components. While the Department of Defense
continues to provide testimony on the importance of these
components, and has improved integration of reserve component
requirements, their chronic underfunding has been apparent in
several critical areas. The ability of reserve component forces
to be ready and relevant depends on proper funding to reduce
backlogs in maintenance and repair of equipment; provide an
appropriate quantity and quality of training; enhance
infrastructure and base operations programs; and maintain
adequate stocks of supplies, repair parts, fuel, and
ammunition. Additionally, America's citizen-soldiers have been
ordered to active duty in substantial numbers and for
substantial periods of time in support of ongoing contingencies
and operations, and the effects of repeated call-ups for such
missions are forcing reservists to choose between being
``citizens'' or ``soldiers.'' The committee strongly cautions
against any policy that drives a wedge between our community-
based force and the grassroots support of the American public.
The Department's template for the future--the 1997
Quadrennial Defense Review (QDR)--is based on a strategy that
retains the requirement for a capability to win two concurrent
major regional contingencies. However, even with the higher
funding provided in the outyears of the budget agreement, the
QDR recommended paying for essential modernization by
eliminating up to 130,000 military personnel as well as
reducing other key modernization programs. Given the effects of
the high operational and personnel tempos due to the operations
in Bosnia and Southwest Asia, and other ongoing activities, the
committee is concerned that the armed forces, even if enhanced
with the capabilities envisioned in the QDR, may not be able to
execute the strategy without excessive risks and casualties.
The committee intends to provide adequately for our men and
women in uniform to defend our nation even within the balanced
budget agreement. The committee will continue to examine the
adequacy of the funds allocated to our national security, and
provide increases when necessary. At the same time, the
committee strongly encourages the Department of Defense to
continue its efforts to improve the efficiency and
effectiveness of defense programs to achieve savings that can
be devoted to the operational needs of our armed forces.
National security remains the federal government's most
important obligation to its citizens. The Committee on Armed
Services recognizes its critical role within the Senate in
carrying out the constitutional powers of the Congress to
provide for the ``common defense.'' The members of the
committee further understand the importance of the committee's
jurisdiction within the Senate over matters relating to the
Department of Defense, the military departments, and the
national security programs of the Department of Energy.
Accordingly, in developing defense authorization legislation
for fiscal year 1999, the committee, in its traditional
bipartisan manner, placed the national security interests of
the United States and the American people above other
considerations. The National Defense Authorization Bill for
Fiscal Year 1999 reflects a bipartisan approach to these
priorities, and continues the committee's efforts to provide a
clear basis and direction for U.S. national security policies
and programs into the 21st century.

Explanation of funding summary

The administration's budget request for the national
defensefunction of the federal budget for fiscal year 1999 was
$270.9 billion (as estimated by the Congressional Budget Office), of
which $200.1 billion was for programs which require specific funding
authorization.
The following table summarizes both the direct
authorizations and equivalent budget authority levels for
fiscal year 1999 defense programs. The columns relating to the
authorization request do not include funding for the following
items: military personnel funding; military construction
authorizations provided in prior years; and other small
portions of the defense budget that are not within the
jurisdiction of this committee or which do not require an
annual authorization. As explained above, funding for military
personnel is included in the amounts authorized by the
committee, but not in the total funding requested for
authorization.
Funding for all programs in the national defense function
is reflected in the columns relating to the budget authority
request and the total budget authority implication of the
authorizations in this bill. The committee recommends funding
for national defense programs totaling $270.6 billion in budget
authority, which is consistent with the fiscal year 1999 Budget
Resolution.

DIVISION A--DEPARTMENT OF DEFENSE AUTHORIZATIONS

TITLE I--PROCUREMENT

The Department of Defense modernization program, as
currently outlined, cannot be sustained. Former Secretary of
Defense James Schlesinger, in recent testimony before the
committee on the report of the National Defense Panel, stated
``quite simply you can't get there, that desired point in the
21st century, from here given the apparent fiscal limits.''
Both General Shalikashvili and General Shelton, the former and
current Chairmen of the Joint Chiefs of Staff, after
consultation with service chiefs, established a baseline
requirement of $60 billion dollars per year to meet essential
modernization priorities. Unfortunately, the Administration has
yet to submit a budget request for the Department of Defense
that satisfies this requirement even though the Future Years
Defense Program indicates that the requirement would be
satisfied in fiscal year 2001.
For the last several years, testimony before the
congressional defense committees suggests that our forces are
living on the edge and relying on investments made years ago in
modernization accounts. In brief, it is fairly clear that the
Department of Defense is continuing to suffer from a series of
procurement deficient budgets. This is explained, in part, by
continually planned but unrealized savings from
``efficiencies'' projected by the Department of Defense.
However, the costs associated with continued extended
deployments not resourced by supplemental funding, especially
when it forces the displacement of funds from modernization
accounts to operation and maintenance accounts, are also
crippling service modernization programs, and thereby our
current and future military capabilities.
The committee is becoming increasingly concerned that,
despite these continued delays in meeting minimum modernization
funding levels, the services continue to program for
modernization requirements that cannot be supported by the
elusive date associated with meeting the $60 billion dollar
procurement goal, phantom ``efficiencies,'' and uncertain
acquisition reform and future BRAC savings. Department of
Defense plans to develop future generation systems, when tied
to future funding of legacy system modernization requirements,
have caused what many have referred to as a procurement ``bow
wave.'' Continued annual delays of procurement create a very
large and insurmountable unfunded procurement requirement.
In an effort to quantify the scope of the bow wave problem
for one of the services, the committee requested extended
planning program data for the 2004 through 2010 time frame for
that service's research, development, and acquisition programs.
In reply, the committee received a copy of a memorandum, signed
by the service secretary, that stated that the data ``had not
been adequately reviewed by the Service and OSD leadership.''
The only conclusion that can be drawn is that the Department of
Defense has not even tried to quantify the nature and scope of
the bow wave problem.
Recent independent analysis suggests that the Department of
Defense modernization plan could exceed available funding by as
much as $26 billion a year during the ten-year period following
that covered by the 1999 through 2003 future years defense
program. While some argue that there has always been a mismatch
between available or projected funding and funds called for in
service modernization programs, it is clear that the funding
limitations will cripple active programs and delay, if not
prevent, the military transformation called for by both the
Quadrennial Defense Review and the National Defense Panel.
The committee believes that the time has come for the
Department of Defense, along with the services, to review both
modernization plans and projected resources available in future
years and make the tough calls necessary to better align
programs with funding. The committee believes this review
should be conducted in a joint environment that considers
future warfighting requirements, efficiencies resulting from a
focus on joint warfighting, and enhancements that future
technologies may provide. Until this happens, the Congress will
be forced to continue to make critical decisions on how to
allocate increasingly scarce resources without insight into the
overall scope and nature of the modernization ``bow wave'' and
how service programs are linked to transformation initiatives.

Overview

The committee continues to give priority to buying
essential core requirements, investing to achieve savings and
investing in the future. Particular emphasis was given to
Marine Corps programs in response to the level of concern
raised by General Krulak in his testimony before the committee
and in his March 25, 1998 letter to the Congress. It is clear,
however, that the Department of Defense modernization plan in
existence today cannot be supported by even the best case
projections of available research, development, and acquisition
funding.
The committee was pleased with the level of funding
provided in the budget request for the reserve components. In
the fiscal year 1999 request, the Department requested more
funding for reserve component modernization than had been
previously provided for reserve component shortfalls in
previous years, even after Congressional increases. The
committee recognizes that both active and reserve component
funding shortfalls are likely to continue, but believes that
the fiscal year 1999 budget request reflects a good faith
effort to move in the right direction. The committee believes
that both components must continue to work together to meet the
common goal of ensuring our total force is prepared for a
challenging future.

Explanation of tables

The tables in this title display items requested by the
administration for fiscal year 1999 for which the committee
either increased or decreased the requested amounts. As in the
past, the administration may not exceed the amounts approved by
the committee (as set forth in the tables or, if unchanged from
the administration request, as set forth in the Department of
Defense's budget justification documents) without a
reprogramming action in accordance with established procedures.
Unless noted explicitly in the report, all changes are made
without prejudice.
SUBTITLE A--AUTHORIZATION OF APPROPRIATIONS

Sec. 107. Chemical Demilitarization Program.

The budget request for the Army included $855.1 million for
the chemical agents and munitions destruction program for
operation and maintenance ($531.7 million), procurement
($140.7), and research and development ($182.8 million).
The Congress directed in section 1412 of the National
Defense Authorization Act for Fiscal Year 1986 (P.L. 99-145)
that the Secretary of Defense carry out the destruction of the
lethal chemical agents and munitions in the U.S. stockpile.
Pursuant to that direction, the committee recommends that the
chemical agents and munitions destruction program continue to
be funded in the defense accounts. The committee recommends the
following reductions to the budget request: $40.0 million for
operation and maintenance, $25.0 million for procurement, and
$10.0 million for research and development.
The committee recommends that an additional $3.0 million in
the budget request for research and development be made
available to accelerate the development and fielding of the
Army's mobile munitions assessment systems.
The committee also recommends a provision that would amend
section 1412(g)(2) to require the Department of Defense to
provide an annual report on the travel costs of members of the
Chemical Demilitarization Citizen's Advisory Commission.

Chemical Weapons Convention (CWC)

On April 29, 1997, the Chemical Weapons Convention entered
into force for countries that ratified the Treaty. As a State
Party to the CWC, the United States is obligated to carry out
all requirements of the Treaty. In May 1997, the United States
submitted the required General Destruction Plan to the
international monitoring agency, the Organization for the
Prevention of Chemical Weapons (OPCW). Under the CWC, the
United States is required to destroy its declared chemical
stockpile by April 29, 2007 for the unitary stockpile and 2004
for the non-stockpile items.
In fiscal year 1997, the Congress provided authority in
section 8065 of Public Law 103-208 for the Department of
Defense to conduct a pilot program to identify and demonstrate
no fewer than two alternative technologies for the destruction
of assembled chemical weapons.
The Secretary of Defense is required to submit a report to
the congressional defense committees on the effectiveness of
each alternative technology identified and demonstrated under
the pilot program and its ability to meet applicable safety and
environmental requirements. Funds for construction of baseline
incineration facilities at Pueblo Chemical Depot, Colorado and
the Blue Grass Depot, Kentucky may not be obligated until 180
days after receipt of the Secretary's report.
A decision by the Department on the technology to be
implemented at the two facilities, whether it be incineration
or an alternative, is required not later than June 30, 1999.
The committee understands that the Army has continued with
the necessary environmental activities to implement an
incineration-based technology at Pueblo and Newport. However,
no decision will be made on which technology to implement until
the Assembled Chemical Weapons Assessment (ACWA) program is
completed.

Chemical Stockpile Emergency Preparedness Project (CSEPP)

In order to enhance the protection of the
communitiessurrounding the stockpiles, workers involved in the
destruction effort, and the environment during storage, movement and
destruction of the U.S. unitary chemical stockpile, the Chemical
Stockpile Emergency Preparedness Project (CSEPP) was established in
1988. Since that time, both the Army and the Federal Emergency
Management Agency (FEMA) have assisted the civilian communities
surrounding the eight chemical stockpile storage locations to enhance
their emergency response capabilities.
The committee understands that the Army and FEMA have
reached an agreement on management of the CSEPP. As a result of
the agreement, FEMA will have authority and responsibility for
the off-post communities, while the Army remains responsible
for on-post emergency preparedness. The committee understands
that both the Army and FEMA agree that coordination,
integration and the joint nature of the CSEPP, particularly at
the community level, must be preserved. Of the funds available
for CSEPP in the Department of Defense operation and
maintenance account, $25.0 million is available to FEMA for
off-post community activities.

Defense Threat Reduction Agency (DTRA)

In November 1997, as part of its Defense Reform Initiative
(DRI), the Department of Defense recommended the establishment
of a single agency, the Defense Threat Reduction Agency (DTRA),
to carry out programs to counter proliferation and reduce
threats posed by weapons of mass destruction and to provide
nuclear weapon stockpile and related support. The formation of
this agency is to be accomplished through the consolidation of
several agencies, and several functions from the office of the
Secretary of Defense (OSD) involved in the management of
associated programs, to including the chemical and biological
defense program and the counterproliferation support program.
Consistent with the DRI recommendation, the committee
recommends the transfer of the chemical demilitarization
program to the Defense Threat Reduction Agency (DTRA).
SUBTITLE B--ARMY PROGRAMS

Sec. 111. Multiyear procurement authority for Longbow Hellfire missile
program.

The committee recommends a provision that would authorize
the Army to enter into a multiyear procurement contract,
beginning in fiscal year 1999, for procurement of the Longbow
Hellfire missile. The committee understands this action can be
accomplished with existing funds for this program and that this
multiyear authority will ultimately reduce program costs.

Sec. 113. Armored system modernization.

The committee recommends a provision which would prohibit
the expenditure of $20.3 million of the funds authorized to be
appropriated to the Army for Weapons and Tracked Combat
Vehicles and intended for the M1A1D (Applique Integration Kit)
modification to the Abrams tank until such time as the Army
provides an assessment and justification for its M1A2 fielding
plan and an assessment of armored system modernization
requirements through the 2020 time frame.
The committee is concerned about Army plans for continued
tank modernization as it moves toward its objective of the Army
After Next (AAN). Army budget documents provided to the
committee indicate that the M1A2 System Enhancement Program
(SEP) upgrade program will be terminated in 2003, having
produced a total of 1,150 M1A2 SEP tanks, but leaving two-
thirds of the active Army and all of the National Guard with
less capable tanks.
The committee is aware that the National Defense Panel
(NDP) has called for a lighter, quicker, and more agile tank
for the Army After Next and has questioned continuing the
upgrade of the M1A1 tank. For risk mitigation, however, the NDP
did recommend that the M1A2 be deployed to III Corps and the
forward based force while the balance of the Army transitions
to the Army After Next.
While reserving judgment on the design and technologies
associated with a future tank, the committee believes the Army
should consider a range of alternatives in its modernization
review, including a possible concentration of modernized, and
not simply digitized Abrams tanks in III Corps. Current Army
plans call for the six active heavy divisions to be composed of
one brigade of M1A2 SEP tanks and two brigades of M1A1D tanks
with applique digitized capability. This would force a division
commander to contend with a high-low mix of tanks with vastly
different operational capabilities and substantially different
logistical support requirements.
The committee also understands that Army plans for the two
major theater-of-war contingencies allocate roughly half of the
Army's heavy divisions and National Guard Enhanced Brigades to
each of the contingencies. Should the second contingency not
materialize, and if the Army continues with the planned
distribution of M1A2 SEP tanks throughout the active heavy
divisions in limited numbers rather than concentrating them in
one corps, the Army may face the situation of fighting a war
with nearly half of its most modern tanks not committed to the
fight, or of concentrating all modernized brigades in committed
divisions at the last minute, thereby degrading the
cohesiveness of units forged through habitual relationships in
peacetime training. The committee believes it reasonable to
take some risk that the second contingency would not
materialize, and concentrate M1A2 tanks in completely
modernized divisions allocated to the first contingency. This
option would also facilitate a subsequent Army decision, should
it be feasible, to adopt another of the NDP's recommendations
and move more rapidlywith the remainder of the Army toward AAN
organizations and weapon systems, eventually leaping in capability over
the modernized Army XXI divisions and corps.
From a broader perspective, although the committee supports
the long term goal of AAN, testimony before the committee
clearly indicates that the technological foundation required to
produce a future combat system to replace the current tank may
not be available until at least 2020. This suggests that
continued modernization or upgrade of the Abrams tank should be
considered to ensure that a viable industrial base is
maintained to support the operational forces until the required
technologies become available to begin procurement of a future
combat system.
The committee is aware that alternatives currently
available for consideration by the Army include a proposal to
modernize III Corps with a combination of M1A2 SEP tanks and
M1A2 SEP Part 1 tanks and provide a digitized capability by
2004. This alternative would appear to meet the Army's goal of
a digitized corps by its self-imposed deadline, as well as
field a vastly more capable corps equipped entirely with
modernized M1A2 tanks. The committee understands that a
decision to concentrate the M1A2 Abrams tanks in III Corps
would have to be made in a larger context of fielding all of
the armor-related modernized combat systems, including the M2A3
Bradley fighting vehicle. However, the committee believes that
the Army should give this alternative serious consideration.
The committee directs the Army to identify alternatives for
continued modernization of its primary ground combat systems,
conduct an assessment of those alternatives and provide a
report to the defense committees by January 31, 1999.
Additionally, the committee further directs the Army to ensure
that the armored system assessment includes a review of future
warfighting capabilities, the impact of joint warfighting
efficiencies, and overall armored system modernization
requirements through the 2020 time frame. This report should
outline requirements, budget projections, and industrial base
implications for future service modernization requirements.

Sec. 114. Reactive armor tiles.

The committee recommends a provision that would require the
Secretary of Defense to conduct, with input from the Army and
Marine Corps, a detailed assessment of requirements for
reactive armor tiles for Army and Marine Corps armored
vehicles. This study will assess requirements for reactive
armor tiles and provide a cost-benefit analysis of the
procurement and installation of tiles on selected armored
vehicles. The Secretary of Defense shall include the comments
of the Secretaries of the Army and the Navy on the results of
this study, and for those vehicles for which a requirement
exists for reactive armor tiles, the Secretary of Defense shall
make recommendations on the number of vehicles that should be
equipped with such tiles. The Secretary of Defense will provide
the results of this study and his corresponding recommendations
to the Congressional defense committees no later than April 1,
1999. This provision would preclude any expenditure of funds
for reactive armor tiles until 30 days after the date on which
the Secretary of Defense submits the results of the study to
the Congress.

Sec. 116. Extension of authority to carry out Armament Retooling and
Manufacturing Support Initiative.

The committee recommends a provision that would extend the
armament retooling and manufacturing support initiative through
fiscal year 1999.

OTHER ARMY PROGRAMS

Army Aircraft

UC-35

The budget request did not include funds for UC-35A
aircraft (formerly known as the C-XX). The UC-35A is a fast,
medium range air transport aircraft. The Army has a requirement
for 35 UC-35A's, and has a total of 17 UC-35 aircraft either on
hand or on order. The committee notes that there is an approved
Mission Needs Statement and Operational Requirements Document
to support the program, and that the Army has programmed for
the procurement of the aircraft in the Future Years Defense
Program. The committee recommends an increase of $15.9 million
to procure an additional three UC-35A aircraft in fiscal year
1999.

UH-60 Blackhawk

The budget request included $243.8 million to procure 22
UH-60 Blackhawk helicopters. The committee continues to be
concerned about the pace and scope of the Army aviation
modernization effort. The committee notes the recently
acknowledged requirement to procure an additional 90 UH-60
Blackhawk helicopters to meet requirements for a third assault
company in each light division as identified in the recent
total Army analysis, and is concerned that only 50 aircraft
have been funded in the future years defense program (FYDP).
Additionally, the committee notes that combined Army and Navy
procurement falls eight short of the economic production rate
of 36 aircraft per year. Therefore, the committee recommends an
increase of $78.5 million to procure eight additional UH-60
aircraft to achieve the most economical production rate. The
committee expects the Army to fund the remaining 32 aircraft,
currently unfunded in the FYDP, in future budget submissions.

C-12 Flight Maintenance System

The budget request included $2.6 million for C-12 aircraft
modification program. The Army operates a fleet of 93 C-12
fixed wing aircraft, which have been procured over the years
and comprise four different models with cockpit instrumentation
from the 1960's. The varied configurations require frequent
retraining for aviators operating the aircraft. With a modest
investment, the entire fleet could be brought to a common
configuration, while replacing outdated systems with a modern,
digital flight management system. The upgrade will provide for
better standardization and decreased operational costs.
Accordingly, the committee recommends an increase of $6.0
million to complete the C-12 modification program in the
shortest practical time.

Longbow

The budget request included $607.0 million to support
ongoing modification efforts for AH-64 Apache Longbow
helicopters. The committee notes outstanding requirements for
Longbow training devices and an ongoing program to convert the
T701 engine to the T701C configuration. Longbow training
devices are required to support operator and maintenance
training at institutional training facilities. The committee
understands that these training devices will promote an
estimated $4.0 million each year in cost avoidance savings.
The engine conversion effort is necessary to provide
commonality in the fleet and additional power for the aircraft.
The committee notes an outstanding requirement to conduct
qualification tests on T701C engine conversion kits.
Application of these kits will be necessary to enhance the
performance of existing engines required to support the
application of fire control radars to Army National Guard
Apache Longbow aircraft.
The committee recommends an additional $38.7 million for
Longbow training devices and an additional $1.5 million to
procure two engine kits and fund qualification testing that
will establish the viability of upgrade kits and avoid costly
procurement of new engines that would otherwise be required.
The committee recommends a total authorization of $647.2
million for Apache Longbow requirements.

Army Missile

Enhanced fiber optic guided missile

The budget request included $13.7 million to procure 96
enhanced fiber optic guided munition (EFOG-M) rockets. The
committee is still concerned about ongoing development and
fielding plans for the EFOG-M system and escalating costs for
EFOG-M missiles. The committee notes problems encountered with
recent Army testing of the missile system and has seen no
indication that the Army intends to pursue fielding this system
beyond those capabilities obtained to support the advanced
concept technology demonstration (ACTD). The committee also is
concerned about the large number of precision guided munitions
either in development or in the field and believe that the
current Army program cannot be sustained by future budgets. The
committee, therefore, recommends a decrease of $13.7 million to
eliminate procurement of EFOG-M missiles.

Multiple launch rocket system rocket

The budget request includes $16.5 million to procure
extended range multiple launch rocket system (MLRS) rockets.
The committee is concerned about excessively high costs
associated with specific rocket components and believes the
Army should reconsider planned procurement of the extended
range rocket in 1999 and solve component cost issues before
resuming production. Clearly, the Army's ultimate objective is
to begin production and ultimately field the guided MLRS rocket
in 2002 which will increase the range and accuracy of this
system and provide a quantum leap in capability. The committee
also notes that ongoing domestic production and projected
international production requirements are sufficient to meet
minimum production levels for 1999. Therefore, the committee
recommends a decrease of $16.5 million to eliminate procurement
of extended range rockets for fiscal year 1999 and directs the
Army to provide a report to the defense committees on the
resolution of component cost issues no later than January 31,
1999.

Weapons and Tracked Combat Vehicles

Small arms programs

The committee continues to monitor the small arms
industrial base and continues to be concerned about the ability
of current and future budgets to sustain this industrial base.
The budget request included $6.5 million to procure 673
M240B machine guns and $12.2 million for the MK-19 Grenade
machine gun. The committee notes an unfilled requirement to
provide a more rapid fielding of this weapon to both active
Army units and Army National Guard Enhanced Brigades. The
committee also notes an unfilled requirement for new mounts for
the MK-19 to meet prepositioned equipment requirements.
The committee, therefore, recommends an increase of $6.5
million to stabilize M240B procurement and meet critical
warfighting requirements and an increase of $3.0 million to
procure 800 of the MK64 mounts for the MK-19 Grenade machine
gun required to support Army requirements.

Army Ammunition

Small arms ammunition

The committee is concerned with the impact of dramatic
changes in ammunition procurement on the small arms ammunition
industrial base. The skyrocketing procurement of 5.56 mm and
7.62 mm ammunition over the past few years demonstrates one
side of these dramatic changes. The administration's budget
request for each of these has grown by approximately 300
percent (from $29.7 million to $91.6 million) between fiscal
years 1997 and 1999. The committee believes that the Army
should seek to stabilize funding for these programs and take
greater advantage of the training opportunities afforded by
available small arms simulation devices. Therefore, the
committee recommends a reduction of $28.1 million in the budget
request for 5.56 mm, and $6.4 million in the budget request for
7.62 mm ammunition. This will provide the same level of funding
for these two programs that was provided for fiscal year 1998.

M919 25mm ammunition

The M919 25mm cartridge is used by the Bradley Fighting
Vehicle and, therefore, would likely receive extensive use in
any major theater of war. Unfortunately, there is a
``significant shortage of the M919 cartridge'' currently in the
Army inventory. Therefore, the committee recommends an increase
of $20.8 million to procure additional rounds in order to
reduce this shortage.

M830A1 tank ammunition

The committee supports the recent decision of the Army to
convert 4,500 rounds of its M830A1 tank ammunition into
demolition rounds for potential obstacles in the Korean War
scenario. Unfortunately, this has led to a shortfall in the
Army's war reserves for these rounds. Therefore, the committee
recommends an increase of $15.0 million to the Army's budget
request in order to eliminate this shortfall.

Other Army Procurement

High mobility multipurpose wheeled vehicle

The budget request included $12.1 million to modify 100
high mobility multipurpose wheeled vehicle (HMMWV) chassis and
10 enhanced cargo vehicles by installing armor protection and
support fielding requirements. The committee notes a shortage
of 18,000 vehicles for the Army, ongoing analysis of future
requirements and alternatives, and a requirement to maintain a
viable production line for both Army and Marine Corps future
requirements. The committee, therefore, recommends an increase
of $65.7 million for a total of $77.8 million for HMMWV
production and support.

Family of medium tactical vehicles

The budget request included $332.0 million for procurement
of family of medium tactical vehicle (FMTV) trucks. The
committee continues to strongly support the fielding of new
FMTV trucks to replace an aging fleet that suffers from
escalating operations and maintenance costs. The committee
notes that existing funding for the FMTV program is inadequate
to meet economic production rates and meet both active and
reserve shortfalls. This issue is compounded with the stated
Army intent to qualify a second source for future FMTV
procurement. A fixed defense budget and overly ambitious
modernization program suggest the Army does not have the
resources necessary to continue to qualify a second source for
FMTV. In fact, dual sourcing is normally required only when a
current producer cannot meet production demands or provide a
product at a fair price. In fiscal year 1999, FMTV funding
constraints will create a short break in production and
extremely low production rates while at the same time, the
trucks that are being fielded have been well received by
soldier operators, are affordable, and are saving precious
operations and support funding. The committee directs the
Secretary of the Army to review the proposed second source
initiative and conduct a cost and benefit analysis on the costs
associated with continuing on the present course to qualify a
second source. If it is determined that the second source
initiative will result in cost savings to the government, the
Secretary of the Army will provide certification of that fact
to the Congressional defense committees. For fiscal year 1999,
the committee believes that the production break should be
eliminated and recommends an increase of $88.0 million to meet
a production rate of 200 per month, while reducing unit costs
by at least 5 percent. The committee directs that the vehicles
procured with this additional funding be fielded to high
priority National Guard and Reserve units. The committee
encourages the Army to ensure that minimum production levels
are maintained in future budget submissions.

Medium truck extended service program

The budget request included $37.2 million for medium truck
remanufacture requirements necessary to reduce operation and
support costs of an aging truck fleet. Current Army funding for
new truck procurement is not adequate to meet force
requirements and mandates that a portion of the existing fleet
be remanufactured to support operational requirements and
reduce operating costs. The budget request for 1999 includes
$10.8 million for five ton truck requirements and $26.4 million
for two and one-half ton truck requirements. The committee
understands that funding requested for the two and one-half ton
truck requirement is inadequate and recommends an increase of
$93.9million to meet medium truck extended service program
minimum economic rate requirements and field critically needed trucks
to the reserve components. Of this increase, 30 percent will be
available for the National Guard to support an ongoing effort to
determine the viability of National Guard depots to perform a portion
of this work to established standards at reduced cost.
The committee further directs the Secretary of the Army to
review the medium tactical vehicle extended service program to
determine whether it is cost effective to continue with this
effort. The committee supports the remanufacturing program as a
means to provide reserve component units with much needed
upgrades to an aging fleet. The committee understands that the
goal for this program is to remanufacture a portion of the
truck fleet, at a cost significantly lower than new vehicle
procurement, in order to reduce operations and maintenance
costs until new trucks could be manufactured in sufficient
quantities to meet all active and reserve component
requirements. The committee notes that this program has been
underfunded for the past two years and that future funding
projections also fall far short of minimum sustaining rate
requirements. If this program is considered to be a viable
program by the Army, the committee would expect the Army to
fund it at the level required to sustain production. If the
Army is unable to meet these minimum funding requirements, the
committee would expect this effort to be terminated. The
committee directs the Secretary of the Army to report on the
results of this assessment and report findings to the defense
committees no later than January 31, 1999.

Project management support

The budget request included $2.4 million for program
manager support functions. The committee notes the proposed
funding is to be used, in part, for planning and control
purposes for two programs with limited activity in 1999. These
programs include the Armored Security Vehicle and the High
Mobility Multi-purpose Wheeled Vehicle Extended Service
Program. The committee, therefore, recommends a decrease of
$1.0 million for a total authorization of $1.4 million in 1999.

System fielding support

The budget request included $4.2 million for system
fielding support requirements. The committee notes no fielding
requirements for one of the systems supported by the requested
funding. Therefore, the committee recommends a decrease of $1.0
million in 1999 and authorizes a total of $3.2 million.

Army data distribution system

The budget request included $24.0 million to procure 201
additional enhanced position location reporting system (EPLRS)
radios and continue fielding of prior year hardware
procurements. The committee has consistently supported fielding
of EPLRS units and understands that outstanding requirements
exist for both active and reserve component units. The
committee also recognizes the importance of the EPLRS system to
ongoing digitization activities. The committee, therefore,
recommends an increase of $28.0 million for a total of $52.0
million to procure additional EPLRS units required for both
active and reserve component units.

Single channel ground and airborne radio system family

The budget request included $13.2 million for single
channel ground and airborne radio system (SINCGARS) system
support. The committee notes that the Army has outstanding
requirements for SINCGARS Advanced System Improvement Package
(ASIP) radios for the reserve components that have not been
filled. In light of evolving demand for digitization
communication pipelines for voice and data transmission within
the Enhanced Brigades, the committee recommends an increase of
$61.9 million to support procurement of SINCGARS ASIP radios
necessary to meet critical requirements within the Army
National Guard.

Area common user system modernization program

The budget request included $97.1 million to support
ongoing efforts to provide ground-based, networked, battlefield
communications support required by the Army digitization effort
and Force XXI command and control systems. The committee notes
that, although programmed funding supports the fielding
requirements of the first digitized division by 2000, unfunded
aspects of this program remain. Specifically, the committee is
concerned that Army efforts to downsize the shelters for
warfighter information network systems is currently unfunded.
The committee, therefore, recommends an increase of $47.8
million to continue the critical downsizing effort necessary to
ensure the effectiveness of fielded warfighter information
network systems.

Night vision equipment

The budget request included $29.6 million for night vision
equipment. The committee recognizes the advantage that modern
night vision equipment provides to ground force effectiveness
on the battlefield and believes that continued fielding of
these devices is essential. The committee recommends an
increase of $13.5 million to procure the following:
(1) $9.0 million for AN/PEQ-2A infrared target
pointer/illuminator devices;
(2) $4.5 million for AN/PEQ-4C infrared aiming light
devices.

Multiple integrated laser engagement system 2000

The budget request contained $56.8 million for Army
training systems. Of this amount, $16.1 million is for
procurement of the Multiple Integrated Laser Engagement System
(MILES) 2000. The committee is concerned about inadequate Army
plans to procure these training device upgrades. The Army
currently uses a legacy MILES system that is rapidly aging and
is becoming increasingly difficult to maintain. However, the
committee notes significant problems with the new MILES 2000
training devices throughout the development and testing phase
and the subsequent Army decision to delay the obligation of
$34.4 million in fiscal year 1998 funding due to problems that
occurred in user testing. The committee believes that
replacement of MILES training devices is critical to support
training requirements yet does not believe that the Army
development and fielding plan has reviewed all available
options. In fact, the committee notes the availability of at
least two other training systems that could be used for this
purpose. The committee therefore recommends a decrease of $16.1
million for fiscal year 1999 procurement and directs the Army
to use fiscal year 1998 funding to meet short term testing and
fielding requirements. The committee also directs the Army to
review current procurement plans that call for ``attrition-
based'' replacement of MILES training devices and provide the
Congress, no later than 1 March 1999, with an assessment of
both Army and Joint Service requirements, alternative training
device systems, and procurement options to support fielding of
fully functional training devices.
SUBTITLE C--NAVY PROGRAMS

Sec. 121. CVN-77 nuclear aircraft carrier program.

The budget request included $124.5 million for CVN-77
Advance Procurement. The National Defense Authorization Act for
Fiscal Year 1998 contained a provision that authorized $50.0
million for the advance procurement and construction of
components for CVN-77. To continue the effort begun in fiscal
year 1998 to produce savings in the CVN-77 program, the
committee recommends a provision that would authorize $124.5
million for the advance procurement and construction of
components, including nuclear components, for the CVN-77
aircraft carrier program.

Sec. 122. Increased amount to be excluded from cost limitation for
Seawolf submarine program.

The National Defense Authorization Act for Fiscal Year 1998
contained a provision requiring $272.4 million to be excluded
from the cost limitation for the Seawolf submarine program for
initial class design costs that were previously allocated to
other canceled ships in the class. In addition, the Department
of Defense Inspector General (DOD IG) was directed to provide a
report which included the following:
(1) audit $745.4 million identified by the Secretary
of the Navy as having been obligated for canceled
Seawolf-class submarines;
(2) construction cost growth of SSN-21, SSN-22 and
SSN-23 that had not been reported to Congress before
the date of the DOD IG report; and
(3) current cost estimates for the completion of SSN-
21, SSN-22 and SSN-23.
The committee received the DOD IG audit March 13, 1998,
which reported the following:
(1) of the $745.4 million audited, the Navy obligated
$557.6 million in costs that did not result in
components that the Navy could use in the construction
of the Seawolf class submarine;
(2) the Seawolf program has not experienced an
unreported cost growth in the Shipbuilding and
Conversion, Navy funding levels since Congress
established the cost limitation in fiscal year 1996;
and
(3) the Seawolf Program Management Office estimates
the cost to complete construction of the SSN-21, SSN-
22, and SSN-23 at the cost limitation and the Seawolf
Independent Cost Review Team estimate is $67.3 million
under the cost limitation.
The DOD IG verified that a total of $557.6 million
obligated did not result in components the Navy could use in
construction of the SSN-21, SSN-22, or SSN-23. Therefore, the
committee recommends a provision that would amend section
123(a) of the National Defense Authorization Act for Fiscal
Year 1998 by striking the amount of $272.4 million and
replacing it with the amount of $557.6 million as the amount
excluded from the Seawolf cost limitation.

Sec. 123. Multiyear procurement authority for the medium tactical
vehicle replacement.

The committee recommends a provision that would authorize
the Marine Corps to enter into a multiyear procurement
contract, for a term of up to five years and beginning in
fiscal year 1999, for procurement of the medium tactical
vehicle replacement. The committee understands this action can
be accomplished with existing funds for this program and that
this multiyear authority will ultimately reduce program costs.

OTHER NAVY PROGRAMS

Navy Aircraft

F-14 pods

The budget request included $223.7 million for F-14
modifications. Included in those modifications is an
initiative, called the F-14 precision strike program, to
fulfill an urgent fleet requirement to maintain a capacity for
long range high payload strike missions in the F-14. The
precision strike program makes use of an Air Force developed
forward looking infrared (FLIR) pod, called a low altitude
navigation and targeting infrared at night (LANTIRN) pod. To
lower cost and shorten schedule, the Navy uses the pod as a
stand alone sensor.
The committee understands that the incorporation of these
nondevelopmental pods could be accelerated, but that
constrained funding prevented the most efficient acquisition of
the pods and associated test equipment. Accordingly, the
committee recommends an addition of $8.0 million to the budget
request for that purpose.

AH-1W series

The budget request included $9.1 million for the Marine
Corps AH-1W Super Cobra attack helicopter. The committee notes
a requirement to complete installation of night targeting
systems for 10 additional aircraft and meet the established
acquisition objective of 188 systems. The night targeting
system kit provides night/adverse weather and autonomous
missile capabilities for AH-1W attack helicopter platforms. The
committee recommends an additional $11.0 million to procure the
remaining 10 kits and meet acquisition objectives.

EP-3 spares

The budget request included $5.4 million for EP-3
modifications. The EP-3 is a land based, long range aircraft,
with electronic intercept devices. The budget request includes
funds to improve EP-3 operational capability through expanded
frequency coverage, as well as for flight tests of the high
band prototype of the joint signals intelligence avionics
family (JSAF). It is anticipated that those tests will shortly
lead to an operational deployment of the system. However, the
committee understands that the EP-3 funding request did not
include sufficient funds for spares to support that operational
deployment. Accordingly, the committee recommends an increase
of $2.0 million to the EP-3 request to ensure sufficient spares
are available for the deployment.

P-3C antisurface warfare improvement program

The budget request included $120.7 million for the
procurement of P-3C antisurface warfare improvement program
(AIP) kits and for associated installation, logistics support,
engineering change proposals and training. While the primary
mission of the aircraft during the Cold War was antisubmarine
warfare, its role as a surveillance asset is now emphasized.
The P-3C antisurface warfare improvement program (AIP), begun
in fiscal year 1994, is designed to provide a commercial off-
the-shelf (COTS)/nondevelopmental item (NDI) upgrade to the
Navy's existing fleet of P-3C aircraft to improve its
capability to conduct antisurface warfare (ASUW), over-the-
horizon (OTH) targeting, and command and control interface with
other command centers and fleet units. The P-3C AIP gives the
aircraft a much better capability to execute littoral warfare
missions at a reasonable price.
An operational requirement calls for the procurement of 68
kits between fiscal years 1996 and 2001 at an economical
procurement rate of 12 kits per year. The committee recommends
an increase of $12.2 million for procurement of P-3C AIP kits.

Navy Weapons

Penguin missile program

Neither the budget request nor the Future Years Defense
Program included funding for additional procurement of Penguin
missiles.
The National Defense Authorization Act for Fiscal Year 1997
contained a provision that authorized the Navy to enter into a
contract for multiyear procurement of not more than 106 Penguin
missiles and limited the amount that could be expended for such
procurement to $84.8 million. This provision was based on the
existing shortfall in Penguin missile inventory and the premise
that the Navy would be able to negotiate a very favorable price
at around 55 percent of the average unit procurement cost for
previous lots. Congress subsequently appropriated $7.0 million
to procure Penguin missiles in fiscal year 1997 and $7.5
million in fiscal year 1998.
Penguin is the only operational Navy helicopter-launched
missile in the Navy's weapon inventory. It provides Navy
surface combatants with a defense against surface threats armed
with antiship missiles. A principal operational advantage of
Penguin is its relatively long operational range, which permits
a helicopter armed with Penguin to remain outside the launch
envelopes of potential targets.
The committee has concluded that additional funding in
fiscal year 1999 could be used to exercise a procurement
initiative that takes advantage of labor learning and
production stability. The committee recommends an increase of
$7.5 million for procurement of additional missiles to satisfy
outstanding inventory objectives for both the tactical and
telemetry variants.

Improved tactical air launched decoy

The Navy budget request included $0.3 million for drone and
decoys. The request included no funds for procurement of the
improved tactical air launched decoy (ITALD). The committee
understands that there is an approved operational requirements
document for buying more of the ITALD units. However, the Navy
has informed the committee that the Department chose not to buy
any in fiscal year 1999 because of competing budget priorities.
The ITALD simulates a fighter/attack size aircraft better
than current decoys. The present tactical air launch decoy is
becoming less capable even when encountering existing threat
integrated air defense systems (IADS). The committee believes
that likely improvements in threat IADS require that the Navy
have a more capable decoy than is currently available.
Therefore, the committee recommends an increase of $10.0
million for the acquisition of 70 ITALDs. The committee
understands that this increase, in addition to ITALDs already
funded, will yield roughly enough systems to support two
carrier battle groups. The Navy has informed the committee that
additional funding for ITALD beyond fiscal year 1999 will be
needed to complete this procurement.

Close-in weapon system surface mode upgrade

The budget request included no funds for procurement of
Phalanx surface mode (PSUM) upgrade kits for the close-in
weapon system (CIWS). The committee has received information
from at- sea commanders that the Block I upgrade to CIWS to
include the PSUM capability would solve two long-standing
surface ship war fighting deficiencies:
(1) engaging close-in, fast moving, small boats with
an all-weather, unmanned stabilized weapon; and
(2) engaging a slow moving, close-in helicopter.
The National Defense Authorization Act for Fiscal Year 1998
authorized $15.0 million for PSUM. The committee recommends an
increase of $10.0 million for procurement and installation of
the surface mode upgrade.
The Secretary of the Navy is directed to report to the
congressional defense committees no later than December 1, 1998
on the Navy's plan to procure and install PSUM in Navy ships.
The Secretary's report should also describe how the Navy
intends to satisfy this mission requirement on those ships that
will not receive a CIWS installation, or are scheduled to have
CIWS equipment replaced by rolling airframe missile (RAM)
installations.

Surface ship gun mount rotatable pool

The budget request included $900,000 for procurement and
installation of safety shock ordnance alterations to the 5-inch
54 gun installed on surface combatants. The Navy intends to
upgrade the 5-inch 54 Mk 45 guns on AEGIS class cruisers as
part of the cruiser conversion program which begins in fiscal
year 2001. The conversion plan includes retrofitting two guns
per ship to the Mod 4 version. To ensure timely removal and
subsequent installation, it is prudent for the Navy to
establish a rotatable pool of guns. Establishment of a pool of
two guns in fiscal year 1999 will reduce risk in the cruiser
conversion program and maintain critical gun overhaul skills at
the gun overhaul facility. Therefore, the committee recommends
an increase of $15.0 million for test facility preparation,
procurement of long lead material and establishment of a 5-inch
54 Mod 4 rotatable gun pool.

Navy and Marine Corps Ammunition

Marine Corps ammunition

The committee is concerned that the budget request includes
inadequate funding for ammunition procurement. Ammunition is an
important contributor to military readiness; for training and
in anticipation of conflict. The committee recommends the
following adjustments to the budget request for Marine Corps
ammunition procurement:

Item Millions
5.56 mm....................................................... $0.5
7.62 mm....................................................... 0.7
9 mm.......................................................... 1.0
25 mm......................................................... 1.0
50 cal........................................................ 0.5
Fuze.......................................................... 2.5
Grenades...................................................... 1.0
SMAW.......................................................... 18.0
120 mm Tank................................................... 4.8
Subtotal.................................................. 30.0

Navy Shipbuilding and Conversion

LHD-8 advance procurement

The Navy's current plan is to conduct a service life
extension program (SLEP) overhaul on the Tarawa class
amphibious assault (LHA) ships when they reach the 35 year
point in their operating life. The SLEP would provide another
15 years of life at a cost of nearly $1.0 billion per SLEP. The
SLEP would extend the machinery operating life and provide
communications upgrades. However, stability would remain a main
concern and the LHA has limited capabilities to support 21st
century littoral warfare systems such as the landing craft air
cushion (LCAC) and MV-22Osprey tilt-rotor aircraft.
The LHA can transport one LCAC when the LCAC is placed in
the well deck sideways, while the Wasp class amphibious assault
(multipurpose) (LHD) ship carries two LCACs which drive in and
drive out of the well deck fully loaded. The LHD has 20,000
more cubic feet storage capacity but 5,000 square feet less
vehicle storage than an LHA. The LHD has more hangar and deck
space than an LHA giving the LHD the capacity to carry three
more CH-46 helicopters than the LHA. A Marine Expeditionary
Unit (MEU) with an LHA as the large deck amphibious ship
requires three additional ships to provide the capabilities
required of an MEU. When an LHD is the large deck amphibious
ship in the MEU, one to two fewer ships are needed to support
the MEU.
Replacing the LHA with an LHD would provide a platform with
the capability to support 21st century requirements. The
service life estimate for a LHD is 35 years while the LHA SLEP
will add an additional 15 years of life. From a force
capitalization perspective, the Navy will have 20 more years of
ship life at a drastically reduced procurement cost per year of
life by building the LHD instead of performing a SLEP on the
LHA. In addition, authorizing construction of a new LHD will
leverage efficiencies gained by continuing an experienced
workforce which will be completing LHD-7. The committee
recommends an increase of $50.0 million for procurement of long
lead materials for the construction of LHD-8 in lieu of a
future SLEP for LHA-1.

Strategic sealift

The budget request included $251.4 million in the
Shipbuilding and Conversion, Navy (SCN) account for one large
medium-speed roll-on/roll-off (LMSR) strategic sealift ship.
Section 2218 of title 10, United States Code, establishes the
National Defense Sealift Fund (NDSF) to fund construction of
sealift vessels.
Therefore, the committee authorizes the procurement of one
LMSR and the $251.4 million requested for that purpose, but
provides that authorization in the NDSF account.

Landing craft air cushioned service life extension

The budget request did not include any funding for landing
craft air cushioned (LCAC) service life extension. The
committee notes that funding for the LCAC service life
extension activity is currently programmed for fiscal year 2000
and beyond. The LCAC currently serves as a primary conveyance
of Marine Corps equipment and personnel from ship to shore.
LCAC upgrades are required as these craft approach 15 years of
service life with requisite increases in operating costs and
decreases in availability. The committee believes that the
service life extension program should be accelerated and
recommends an increase of $16.0 million to complete upgrades to
two LCACs in fiscal year 1999.

Other Navy Procurement

AN/WSN-7 inertial navigation system

The budget request included $21.8 million for procurement
of AN/WSN-7 ring laser inertial navigation systems. The AN/WSN-
7 continuously and automatically determines and indicates a
ship's position, attitude (heading, roll, and pitch), and
velocity. This system replaces three legacy navigation systems,
providing equipment commonality between surface combatants,
submarines, and aircraft carriers. The annual operating cost of
the AN/WSN-7 is projected to be only 10 percent of the cost of
operating the legacy navigation systems it replaces.
Accelerated procurement of the AN/WSN-7 could produce a
substantial savings in maintenance costs.
The committee recommends an increase of $12.0 million to
the budget request for the procurement and installation of
additional AN/WSN-7 navigation sets.

AN/BPS-15H surface search radar

There was no funding included in the budget request for the
procurement of AN/BPS-15H submarine radar navigation sets. The
Navy has been procuring the AN/BPS-15H, a commercial off-the-
shelf (COTS) variant of the AN/BPS-15 radar navigation set, and
its associated mast assembly for installation on new
construction submarines and for backfit on SSN-688 class
submarines. Procurement of the COTS variant has produced a
substantial cost savings over a comparable system built to
military specifications, has enhanced operational performance,
and has improved navigational safety. The Navy established a
new specification to eliminate the manpower intensive
requirement for paper navigation charts on ships. Instead of
paper charts, all ships will have the Electronic Chart Display
Information Systems (ECDIS-N). ECDIS-N requires an upgrade to
navigation radar systems. Therefore, the committee recommends
an increase of $9.0 million for AN/BPS-15(H) software and
hardware upgrades to bring them into ECDIS-N compliance.

Submarine acoustic rapid commercial off-the-shelf insertion

The budget request included $70.0 million for submarine
acoustic rapid commercial off-the-shelf insertion (A-RCI). This
program provides cost-effective rapid insertion of technology
which enables the operating submarine fleet to maintain
acoustic superiority. A-RCI reduces operations and maintenance
costs resulting in significantly lower life-cycle costs. The
committee recommends an increase of $25.0 million to accelerate
the introduction of A-RCI to the operating fleet.

Integration and test facility command and control initiative

The Navy is continuing an initiative to provide fully
integrated and supportable command, control, communications,
computer, and intelligence (C4I) systems at its integration and
test facilities. These facilities are used for architecture
design, systems engineering, integration, and to provide life-
cycle support for the fleet's C4I systems.
The committee learned that the Navy's East coast in-service
engineering Space Warfare System Center (SWSC) began the
operation of the Integrated Product Center (IPC). The IPC has
the ability to be configured to support almost every Navy
laboratory including the Maritime Battle Center (MBC).
Additional communication nodes and terminal devices, as well as
an increase in existing network bandwidth to accommodate
additional users, would permit the facility to support the wide
variety of operational protocols and physical interfaces
associated with new fleet tactical C4I systems.
The committee recommends an increase of $4.0 million above
the budget request for engineering design; hardware and
software procurement; and installation, testing, and
documentation of the additional technical networking
infrastructure for continued development of the SWSC's
Integrated Products Center. Of this amount, $2.0 million would
be for procurement and $2.0 million would be for operations and
maintenance.

Information Technology-21

The budget request includes $74.7 million in ship
communication automation procurement, $168.2 million in
satellite communications ship terminals, and $71.7 million in
Naval Shore Communications for Information Technology-21 (IT-
21) equipment procurement and installation. IT-21 is a fleet-
driven initiative, which is providing accelerated introduction
of command, control, communications, and computer (C4I)
innovations from the commercial marketplace.
Both the Quadrennial Defense Review and the National
Defense Panel Report state that future information technologies
have the potential to revolutionize Naval Warfare. Network
centricity provides the capability to make sweeping changes in
the way the services exchange and use information. Network
centric operations will require connectivity sufficient to
support offensive distributed firepower, to establish an
intermediate and robust common tactical picture, conduct
archival data retrieval for multi-warfare targeting, conduct
two to three simultaneous video teleconferences, maintain a
continuous equipment monitoring data transmission path, conduct
distance learning and virtual immersion training, and establish
afloat networked training communications paths. However, the
committee believes that the information exchange required to
enable these types of changes will require significant
increases in data transfer rates.
The committee is concerned that the military satellite
communications architecture may not be robust enough to support
the high data rates required for future information exchange.
Additionally, current high-bandwidth satellite communications
(SATCOM) antennas are too large and unwieldy for installation
on most surface combatants. However, future commercial systems
such as low earth orbit (LEO) constellations offering high
bandwidth communication paths are promising alternatives which
may help solve the connectivity challenges. In addition,
advanced technologies are being demonstrated that might result
in significantly smaller high data rate antennas.
Visits to the first ships and staffs deploying with IT-21
revealed that IT-21 training is not phased properly with IT-21
equipment installation. In some cases, no IT-21 training was
provided to ships ready to deploy with new IT-21 capabilities.
The Navy is directed to provide IT-21 training to units
scheduled to receive IT-21 equipment.
The committee is aware that Year 2000 software and hardware
development has resulted in realignment of some IT-21
resources. To assist the Navy in achieving its goal of a fully
outfitted fleet by the year 2000, the committee recommends an
increase of $20.0 million for ship communication automation and
an increase of $20.0 million in naval shore communications for
IT-21 procurement, installation and training.

Submarine connectivity

The budget request included $64.6 million for submarine
communications equipment. Submarines are vital to network
centric warfare and fighting in the littorals in the 21st
century. Establishing communications between the submarine and
operational commanders leverages the submarine's stealth and
firepower with other assets available in the area of
operations. Increasing the submarine's ability to transmit and
receive tactical data is a key to information exchange which
will result in operational commanders controlling the battle.
Therefore, the committee recommends an increase of $15.0
million for the procurement and installation of high data rate
antennas and extremely high frequency (EHF) kits to improve
communications connectivity equipment for submarines.

Joint Engineering Data Management and Information Control System

The budget request included no funding for Joint
Engineering Data Management and Information Control System
(JEDMICS), the designated Department of Defense standard system
for management, control and storage of engineering drawings. It
is designed as an open, client-server architecture and is
nearing full deployment for global access to the data in its
repositories. The 1998 program for JEDMICS will start
procurement of a commercial off-the-shelf (COTS) security
system to preventunauthorized access to JEDMICS data. The
committee recommends a $10.0 million increase for the continued
security system procurement, integration and accreditation surveys for
the JEDMICS system.

Aviation life support

The budget request included $22.3 million to procure
aviation life support and night vision systems. The committee
is aware of the limited capabilities that existing AN/AVS-6
OMNI II and III night vision goggles provide in overcast skies
or in urban environments. The committee notes that an OMNI IV
system virtually doubles the gain of currently fielded night
vision goggles and that this system is critical to the overall
effectiveness of Marine Corps rotary wing squadrons. The
committee recommends an additional $22.6 million to meet
retrofit requirements for the OMNI IV in all Marine Corps AN/
AVS-6 night vision goggle systems.

AEGIS support equipment

The budget request included $83.2 million for AEGIS support
equipment. The committee understands that the AEGIS Training
and Readiness Center has introduced a new lesson authoring
system that can operate in different computer operating
environments to meet the Navy's embedded tactical training
requirements. This lesson authoring system operates on the
fleet's standard display console, the AN/UYQ-70, and is capable
of providing multimedia, speech recognition and technologies
for distant learning networks. Using such a system could permit
the Navy to avoid spending critical resources to modify and
update proprietary software systems to accommodate new
technology applications. The committee recommends an increase
of $8.0 million to expand this lesson authoring system to other
tactical warfare systems, such as the Advanced Tomahawk Weapon
Control System (ATWCS), Naval Surface Fire Support System
(NSFSS), and the Joint Maritime Communications Information
System (JMCIS).

Smart ship equipment

The budget request included $12.8 million to procure and
install proven Smart Ship technology in operational Navy ships.
The Navy's Smart Ship initiative is managed at fleet level and
is designed to reduce crew workload and lower operating and
support costs.
The committee has concluded that Smart Ship has proven
considerable reductions in operating costs of the Navy's fleet
units with no loss in operational effectiveness.
The committee recommends expanding Smart Ship to all AEGIS
cruisers and Arleigh Burke class destroyers. Therefore, the
committee recommends an increase of $12.0 million to procure
and install Smart Ship equipment in AEGIS.

NULKA assembly qualification

The budget request included $21.5 million for procurement
and installation of the NULKA antiship missile decoy program.
NULKA depot maintenance presently requires the shipment of
NULKA rounds to an overseas location. The overseas shipment is
more expensive than performing the maintenance in the United
States. The committee recommends an increase of $1.0 million to
outfit and qualify a NULKA assembly facility in the United
States.

Marine Corps Procurement

Modification kits for tracked vehicles

The budget request included $5.7 million for modification
kits required to ensure the reliability, maintainability, and
safety of Marine Corps tracked vehicles. The committee notes an
outstanding requirement for a muzzle boresight device (MBD)
that improves the accuracy of the M1 Abrams tank main gun.
Escalating prices for these devices have created a shortfall in
procurement. Additionally, the committee understands that the
Marine Corps has been having problems with M1 tank nuclear,
biological, and chemical (NBC) protection devicess that have
occasionally caused fires on board due to inherent design
deficiencies. The committee recognizes ongoing efforts to
replace these devices with modern and safe components and
believes this effort should be accelerated. The committee,
therefore, recommends an increase of $4.6 million for a total
authorization of $10.3 million. This increase will buy 403 MBD
systems and 403 NBC modification kits.

Avenger

The budget request included $200,000 for Marine Corps
Pedestal Mounted Stinger equipment support. The committee notes
existing obsolescence and electro-magnetic interference
problems with the forward looking infrared (FLIR) system found
on this air defense platform. The committee understands that 81
of 235 fielded systems have received a fully modernized FLIR
that eliminates the electro-magnetic interference problem. The
Marine Corps still has an unfilled requirement to upgrade the
remaining 154 Avengers with the fully modernized FLIR
configuration. The committee, therefore, recommends an increase
of $7.6 million to complete Marine Corps Avenger FLIR upgrade
requirements in fiscal year 1999.

Night vision equipment

The budget request included $11.6 million for Marine
Corpsnight vision equipment. The committee believes that modern night
vision equipment serves as a combat multiplier and strongly supports
night vision equipment procurement for land forces. Noted are
outstanding requirements for night vision equipment. The committee
recommends an increase of $11.1 million to procure the following:
(1) $6.1 million for generation III tubes to retrofit
existing night vision equipment;
(2) $1.4 million for laser aiming modules;
(3) $2.6 million for medium power laser illuminators;
and
(4) $1.0 million for borelights.

Communications and electronics infrastructure

The budget request included $57.9 million to support
communications infrastructure activities. Of this amount, $16.3
million is for ongoing upgrades to Marine Corps base
telecommunications infrastructure. The committee continues to
support Marine Corps efforts to provide a modern backbone
information transmission system at every Marine Corps base and
station. This communications backbone will ensure that all
installations are able to electronically transfer automated
information. The committee notes an opportunity to complete
upgrades for the entire Marine Corps infrastructure in fiscal
year 1999 and recommends an increase of $64.1 million for this
purpose. Additionally, the committee notes a critical
requirement established by the Marine Corps to address the year
2000 compliancy issue for service computers. In support of an
overall Marine Corps solution to this issue, the committee also
recommends an additional $20.0 million to procure the 8,000
computer workstations necessary to meet the year 2000
compliance requirements. The committee recommends a total
authorization of $142.0 million for communications and
electronics infrastructure activities.

Light tactical vehicle remanufacturing

The budget request included $39.3 million to support
efforts to replace aging high mobility multipurpose wheeled
vehicles (HMMWVs). The committee continues to be concerned
about an aging fleet of HMMWVs in the Marine Corps and
understands that a recent analysis by the service established a
critical replacement program that will procure new A2
configuration HMMWV's in lieu of upgrading the existing fleet.
The A2 configuration HMMWV will improve safety, reliability,
maintainability and will insert corrosion prevention measures
in the manufacturing process necessary to protect these
vehicles from the harsh environments in which they may operate.
The committee recommends an increase of $37.0 million to
accelerate the replacement process and field an additional 672
HMMWVs.

Power equipment

The budget request included $5.1 million for Marine Corps
power generation equipment. The committee notes an ongoing
joint program to provide clean and reliable mobile electric
power to support command, control, and communications
requirements. This Department of Defense program currently
procures tactical quiet generators to replace existing military
standard systems. The committee believes that replacement of
existing systems should be accelerated and recommends an
increase of $9.5 million to procure an additional 1,311
generators.

Shop equipment contact maintenance

The budget request included $6.0 million for the Marine
Corps shop equipment contact maintenance (SECM) program. The
committee notes an opportunity for the Marine Corps to achieve
the acquisition objective for SECM platforms in fiscal year
1999. The committee, therefore, recommends an increase of $5.4
million to accelerate the final procurement of 47 systems and
complete this program one year early.

Material handling equipment

The budget request included $6.5 million for material
handling equipment. Material handling equipment is critical to
Marine Corps logistics capabilities in support of unit
deployments. The committee understands that rough terrain
container handlers and 10,000 pound forklifts are old and need
to be rebuilt or replaced. The Army has an existing program
that rebuilds this equipment at roughly one third the cost of
new vehicle procurement. The committee believes the Marine
Corps should take advantage of this existing contract to begin
rebuilding its existing fleet. The committee recommends an
increase of $10.4 million for this purpose.
SUBTITLE D--AIR FORCE PROGRAMS

Sec. 131. Joint surveillance target attack radar system.

The budget request included $463.1 million for procuring
two E-8C Joint Surveillance/Target Attack Radar System (JSTARS)
aircraft, and $67.5 million for buying JSTARS spare parts. The
request also included $123.8 million to continue various
development efforts, including a new program to improve the
JSTARS radar, called the radar technology insertion program
(RTIP). The budget request does not include any funds for
closing the JSTARS production line.
The Air Force planning originally included a force level of
19 JSTARS aircraft until the Quadrennial Defense Review
(QDR)reduced that number to 13 operational aircraft. The QDR
recommendation was based, at least in part, on an assumption that the
North Atlantic Treaty Organization (NATO) would buy from four to six
JSTARS aircraft for the NATO airborne ground surveillance (AGS)
program. However, NATO did not accept the U.S. proposal to procure
JSTARS.
The budget request included funding for the last two
aircraft of the QDR-mandated fleet size of 13 JSTARS. The
budget request did not include long lead funding to continue
production past aircraft number 13.
The committee understands that the JSTARS is high on
operational commanders' list of priorities because of its joint
application to battle space surveillance and management.
Department of Defense (DOD) witnesses testified that a review
would be conducted this year to decide how DOD would meet the
war fighting requirement that would have been met with 19
JSTARS aircraft. The Department's options include: development
of a space-based capability; increased capabilities of unmanned
aerial vehicles; and continued procurement of the current
JSTARS systems. Unfortunately, it is unlikely that the
Department will have completed its analyses before the Congress
will have to act on the fiscal year 1999 budget request.
Without long lead funding available in fiscal year 1999, there
will be a break in the JSTARS production line, making that
option unnecessarily expensive.
Therefore, the committee recommends an addition of $72.0
million to protect the option of producing two additional
JSTARS aircraft in fiscal year 2000. However, the committee is
mindful that roughly $450 million would be required in fiscal
year 2000 to buy two additional JSTARS aircraft. The committee
is also aware that these funds are not currently in the Future
Years Defense Program (FYDP).
Should the Department decide against acquisition of further
JSTARS aircraft, the Department shall use the $72.0 million for
a combination of:
(1) fund the termination expenses for JSTARS
production; and
(2) augment funds in the RTIP development effort to
accelerate incorporation of that capability into the
JSTARS fleet.
Accordingly, the committee recommends a provision that
directs the Secretary of Defense to report to the congressional
defense committees on the decision related to the future of the
JSTARS program no later than March 1, 1999. The report will
outline the decision making process, as well as the
Department's long range plans to provide for overhead battle
management and surveillance.

Sec. 132. Limitation on replacement of engines on military aircraft
derived from Boeing 707 aircraft.

The budget request included $57.3 million to re-engine two
RC-135 aircraft. The fiscal year 1999 budget request is the
first in many years to provide funding for this high priority,
high payoff initiative. The committee notes that the Department
of Defense initiative followed several years of congressional
funding adds and requirements to study the issue.
The RC-135 re-engining effort merits attention because of
the Department's decision to commit funds to the program. The
current program is outfitting all models of RC-135's with CFM-
56 engines. Through a combination of prior year funding adds
(fiscal years 1996-1998) and the Air Force future years defense
plan, 19 of the 23 aircraft are programmed to be refitted with
new engines. However, a funding shortfall exists to complete
the last four aircraft. Accordingly, the committee recommends a
total of $113.3 million to acquire re-engining kits for RC-135
aircraft.
The committee has been concerned about this issue, and
initiated a requirement for the Department to provide a report
on the broader subject of re-engining 707-type aircraft. This
requirement was mandated by Congress in section 133 of the
National Defense Authorization Act for 1998 (Public Law 105-
85). The report was supposed to analyze re-engining to assess
the requirements and the costs and benefits of such a program.
The report would help ensure that:
(1) this vital requirement is not ignored in future
planning and programming;
(2) the Congress understands the Department's
priorities; and
(3) the Congress has a quantitative basis for
determining the most efficient ways to prolong the life
of so many vital airborne platforms.
Although section 133 required the Department to submit a
report by March 1, 1998, the Department failed to submit the
report as of the end of April. The committee expects the
Department to comply with all reporting requirements in a
timely fashion. The Department has indicated that the re-
engining study results have been delayed because the Air Force
had to wait for data requested from the various engine
contractors. The committee has not been able to confirm that
assertion. Although the committee would prefer to operate
otherwise, it notes the Department's improved responsiveness
when report requirements are accompanied by funding limitations
or restrictions. Accordingly, the committee recommends a
provision that would restrict funding for re-engining until
receipt of the report required by section 133.
The committee notes that more than one engine manufacturer
has expressed interest in competing for re-engining work. The
committee expects that the Department would use competitive
procedures for future 707-type engine replacement to ensure
that the Department can select options that could provide the
best value for the government.

Sec. 133. F-22 aircraft program.

The budget request included $668.1 million for F-22
procurement, and $190.2 million for advance procurement. The
budget request also included $1,582.2 million for F-22
engineering and manufacturing development (EMD). These funds
provide substantial building activity separate from any early
award of production contracts. The fiscal year 1999 EMD effort
includes $828.0 million for air vehicle assembly of test
aircraft. Specifically, the EMD program provides funds to
complete air vehicle 3, to continue on air vehicles 4-6, and to
initiate assembly of air vehicles 7-9. The EMD request also
includes $461.0 million for avionics development, $174.5
million for engine development, and $119.2 million other
government costs.
In response to the National Defense Authorization Act for
Fiscal Year 1998 (Public Law 105-85), the Comptroller General
submitted a report that assessed the progress of the EMD phase
of the F-22 program and its prospect of completion under the
cost cap. The General Accounting Office (GAO) report and recent
program progress was the subject of a hearing held by the
AirLand Subcommittee to review tactical aviation modernization
issues. During the hearing, the GAO gave the F-22 program a
positive assessment of the progress made since the program was
restructured in response to the recently completed Quadrennial
Defense Review (QDR). However, the GAO also noted that
contracts for procurement of lot I production aircraft had been
accelerated when compared with last year's plan, and that
actual program progress had fallen behind. Moving contracts
ahead of demonstrated performance directly contradicts the Air
Force's previous emphasis on event-based decision making. When
the GAO witness noted that moving the production contract from
June 1999 to December 1998 did not change actual production,
the Assistant Secretary of the Air Force for Acquisition
testified that the change in signing contracts was, ``* * * to
get the base locked in * * *.''
In 1995, a Defense Science Board report on the F-22, which
included Rand Corporation study results, concluded that when
major program problems occur, it is usually within the first
10-20 percent of flight testing. The Board noted in its report
of only that the F-22 program had substantial tests programmed
before moving into production:

To put this in perspective, we looked at the current
schedule of the F-22, and at 20 percent of full scale
development testing. The Lockheed schedule calls for
approximately 25 hours per month, with approximately
400 hours of flight testing scheduled by December 1997
(10 months, using 1.5 aircraft) and approximately 1,400
hours by December, 1998 (using 4 aircraft).

The present reality is far different from that original
prediction. By December of 1997, only three flight test hours
had been flown of the planned 400 hours. The program is now
scheduled to complete 183 flight hours by December 1998. The
committee is concerned that the contract awards are being
accelerated, while testing is decelerating. The following table
reflects how flight test hours before production award have
eroded:

Comparison of F-22 Flight Test Hours Planned
------------------------------------------------------------------------
Percent of
Flight test flight test
Total hours hours
Flight hour schedule as of flight test planned planned
hours before before
planned production production
award award
------------------------------------------------------------------------
November 1994.................... 5,191 1,400 27
May 1997......................... 4,337 601 14
February 1998.................... 4,337 183 4
------------------------------------------------------------------------

In a recent press conference, responding to the concerns
raised in the AirLand Subcommittee hearing, the Under Secretary
of Defense for Acquisition and Technology (USD(AT)) announced
that the F-22 production decision would slip one year, and
would be addressed in December 1999. The reason given for the
delayed production decision was to complete more testing before
committing production funds. The committee supports the
approach taken by the USD(AT) and recommends a provision to
provide clear guidance for the timing of that decision to
proceed into production in fiscal year 2000.
The committee notes that funds have not been taken from the
program, and are available for obligation once flight testing
has been completed to a modest degree--less even than projected
by the Joint Estimating Team (JET). Should testing go faster
than presently planned, the funds would be immediately
available and would not have to be reprogrammed or added to
future budget requests.
The committee must see demonstrated results in accord with
the minimum requirements represented to the committee in the
Defense Science Board report of April, 1995, or have
substantial assurance from the Secretary of Defense that
anything less than that has his full confidence. The committee
agrees with the USD(AT) that the production decision should
only be made when sufficient testing has been completed.

Sec. 134. C-130J aircraft program.

The budget request included $63.8 million for oneC-130J.
While the budget request did include funds for spares and logistics for
C-130J's elsewhere, those funds are not yet sufficient to account for
prior omissions. Air Force briefers have acknowledged that the present
logistics program is not executable through the Future Years Defense
Program (FYDP). Shortfalls in logistics and support include $30 million
for a flight simulator, $27.0 million for modifications to C-130J's
into the WC-130J configuration, and $15.0 million for modifications to
C-130J's into the EC-130J configuration. Though funding for
modifications is also not sufficient for the program, funds available
from prior years are sufficient to begin the modifications of C-130J
aircraft into the WC and EC-130J configurations.

C-130J Program Progress

The committee views with concern the slow progress of the
C-130J program, the increased expense of developing the
aircraft, which could be borne by the Department in higher
prices for production C-130J's, and notes the Department's
failure to provide a report on remanufacture of existing C-130
airframes. The C-130J program was initiated by the manufacturer
as a commercial development, which would produce an
inexpensive, pragmatic, and rapidly developed follow-on to
previous C-130 models. Development costs were to be spread over
the first 120 aircraft sold, rather than billed to the
government as a developmental program. Development costs were
initially estimated at $350 million, and introduction of the
new model forecast to begin in mid-1997. Since the program is a
commercial one, exact cost accounting has not been available to
the Department to date. However, it has been estimated that the
program has cost more than $900 million and is over two years
behind schedule. Considering the delay in the development of
the aircraft and reported overruns in developmental costs, the
committee views with concern the future of the C-130J program.
Accordingly, the committee recommends a provision that would
require the Secretary of Defense to report to the congressional
defense committees on the impact of delays and overruns.
In the statement of managers accompanying the National
Defense Authorization Act for Fiscal Year 1997 (S. Rept. 104-
267), the committee directed the Secretary of Defense to
provide a report, by March 1, 1997, on the net benefits of
pursuing a program to design, develop, and produce renewed C-
130 aircraft through remanufacture of existing airframes. The
Secretary submitted the report on April 30, 1997 and did not
answer the question. Accordingly, the statement of managers
accompanying the National Defense Authorization Act for Fiscal
Year 1998 (S. Rept 105-340) restated the direction for an
examination of C-130 remanufacturing alternative, as originally
requested. As of the middle of April 1998, the report had not
been received from the Department.
The committee notes that reports from the Department
provide important insights in technical and policy matters, and
gives the Department an opportunity to examine issues and
report the findings to the Congress. Absent any response from
the Department, the committee assumes that the Department
cannot address the issue in any meaningful way and provides the
following direction for C-130 modernization. (Funds for the
simulator are shown in line 12 of the P-1 exhibit, combined
with the additional C-130J's.)

Fiscal Year 1999 C-130 Program
(In millions of dollars)
----------------------------------------------------------------------------------------------------------------
C-130J EC-130J WC-130J Simulator Total
----------------------------------------------------------------------------------------------------------------
Budget Request \1\.................................. $63.8 - - - $63.8
(Quantity).......................................... 1 1
Committee Recommendation............................ 191.4 $85.0 $75.4 30.0 $381.8
Quantity............................................ 3 1 1 1 5
----------------------------------------------------------------------------------------------------------------
\1\ The budget request included $62.0 million for C-130J initial spares in Budget Activity 06.

WC-130J

The scope and cost of modifications to airframes to the WC-
130J configuration are not yet clearly defined or prices
negotiated. The committee notes the prior years' authorization
of modification funds on hand to begin the program. Once the
program is defined and contracts are in place, the remaining
requirements for modification can be authorized.

OTHER AIR FORCE PROGRAMS

Air Force Aircraft

Joint Primary Aircraft Training System

The budget request included $107.1 million to procure 19
JPATS aircraft. JPATS is a joint Air Force/Navy program to
replace T-37 and T-34 primary flight training aircraft and the
associated ground based training systems.
The committee understands that the present contract for
JPATS allows for an increase of three aircraft in fiscal year
1999 without future year implications or additional
requirementsfor funding. An additional three JPATS aircraft
would increase the contract to its maximum number under the existing
variations in quantity (VIQ) matrix and lead to reduced unit costs as
well as an enhanced learning curve in the early production of JPATS.
Accordingly, the committee recommends an increase of $9.1 million to
the budget request to acquire an additional three JPATS aircraft in
fiscal year 1999.

F-15 220E engine modification

The budget request included $196.5 million for F-15
modifications, with $17.8 million dedicated to 220E engine
upgrades. The 220E upgrades the engine controls from analog to
digital technology, making the engine more supportable, and
thus more available.
The committee recommended increased funding in fiscal year
1998 to accelerate the program by one year. Based on the
possible operational savings in years to come and the high
priority assigned to the project by the Chief of Staff of the
Air Force, the committee recommends an increase of $25.0
million to the fiscal year 1999 budget request to further
accelerate the fielding of the 220E upgrade.

ALQ-135 internal countermeasures sets

The budget request included $11.4 million in PE 27134F to
finish development and testing of the ALQ-135 band 1.5 upgrade.
The band 1.5 upgrade would provide low- to mid-band jamming
coverage for the F-15E aircraft. The committee understands that
this capability would be important in protecting aircrews in
high threat environments.
The committee also notes that the band 1.5 equipment shares
a high degree of commonality with circuit card assemblies
associated with the currently fielded band 3 equipment.
Production of the band 3 equipment will be completed in fiscal
year 1998. Unless the Air Force is able to begin low rate
initial production in fiscal year 1999, there would be a 12
month production break.
The committee recommends an additional $25.0 million in
Aircraft procurement Air Force (APAF) modification of inservice
aircraft, line 31 for F-15 modifications. The committee
understands that this amount would be sufficient to provide a
limited operational capability to complete one F-15E squadron,
and would lead to an orderly transition to full production
after a milestone III decision in August 1999.

F-16 reconnaissance system

The budget request included $229.3 million for F-16
modifications. The Air Force has been buying a version of the
Marine Corps' advanced tactical airborne reconnaissance system
(ATARS). In fiscal year 1999, the Air Force was projected to
take delivery of 20 pod systems. Each pod would have included
two sensors: (1) a forward-oblique camera in the front bay; and
(2) a medium altitude elector-optic (MAEO) sensor in the middle
bay. The committee understands that necessary engineering
change proposals have caused the Air Force to scale back the
scope of the contract, which would now include only 5 MAEO
sensors.
The lack of a medium altitude sensor would subject a
significant portion of reconnaissance missions to flying in
riskier, low-altitude regimes. The committee recommends an
increase of $13.3 million for F-16 modifications. The committee
understands that this amount would be sufficient to purchase
the remaining 15 MAEO sensors to outfit each of the new
reconnaissance pods.

Theater airborne warning system

The budget request included no funds for the Theater
Airborne Warning system (TAWS). The committee has supported
this program and continues to believe that it may offer a near-
term means of augmenting Defense Support Program infrared
missile warning data. The committee notes that the Air Force
has yet to complete testing of this system but plans to be
finished with such testing before the end of fiscal year 1998.
Therefore, the committee recommends an increase of $12.0
million in Aircraft Procurement, Air Force to permit the Air
Force to commence the Rivet Joint infrared technology transfer
if the testing is successfully completed. The committee,
however, directs that none of these funds be obligated for TAWS
until the Air Force completes testing and submits a report on
the test results to the congressional defense committees.

U-2 sensor upgrades

The budget request included $152.1 million for the defense
Airborne Reconnaissance Program (DARP). The committee has been
informed by the Department of Defense that even with prior year
funding, additional funds are required to modify U-2 Senior
Ruby, Senior Spear, and Senior Glass-1A sensors to the Senior
Glass-1R baseline. The committee understands that:
(1) economies of scale are possible;
(2) earlier spares procurement would sustain the
common baseline; and
(3) an increase to the budget request would reduce
the impact of vanishing vendor items.
Accordingly, the committee recommends an addition of $17.0
million to continue the reliability and maintainability (R&M)
conversion of 11 Senior Glass sensor systems for the U-2.

Air Force Missile

Minuteman III guidance replacement program

The committee continues to support the Minuteman III
Guidance Replacement Program (GRP). The committee is concerned
by the Air Force's decision to reduce GRP production funding in
fiscal years 1999 and 2000. This decision will result in
significant delay and cost growth. The GRP production effort
would be delayed by two years and the program costs would
increase by approximately $280.0 million. The Minuteman III
guidance systems are currently 10 to 18 years beyond their
original design life of 10 years, and must be replaced as soon
as possible. The committee understands that an increase of
$46.0 million in fiscal year 1999, with an additional increase
in fiscal year 2000, will mitigate this production gap. The
committee therefore recommends an increase of $46.0 million in
Missile Procurement, Air Force for GRP and urges the Secretary
of the Air Force to seek additional funds in fiscal year 2000
to establish a more efficient and expeditious production
program.

Titan IV space boosters

The committee is aware that, due to continuing adjustments
in the Titan IV space boosters program, the budget request
includes funds in excess of what can be obligated in fiscal
year 1999 for Titan IV. Therefore, the committee recommends a
reduction of $10.0 million in Missile Procurement, Air Force,
for Titan IV Space boosters.

Other Air Force Procurement

Theater Deployable Communications

The budget request included $31.1 million for tactical
communications-electronic (CE) equipment, of which $27.3
million would be for theater deployable communications (TDC).
TDC is composed of two components, the lightweight multiband
satellite terminal (LMST) and the integrated communications
access package. Together these two systems provide the
communications infrastructure in deployed bare base
environments. TDC is currently funded at 76 percent of the
requirement to support 100 percent of one major theater war and
30 percent of another.
The TDC replaces existing commiunication suites that
require more manpower to operate and more resources to maintain
and operate. The committee recognizes the efficiencies
associated with accelerated deployment of TDC and the increased
forward deployment capability. The committee recommends an
increase of $17.7 million to procure an additional three TDC
ICAP units.
Defense-Wide Programs

Penetration augmented munition

The committee is aware of the need for the Special
Operations Command's (SOCOM) Penetration Augmented Munitions
(PAMs). The PAM is a multi-stage munition, designed for
attacking and neutralizing heavily reinforced concrete
structures, such as bridges, piers, abutments, bunkers, and
Weapons of Mass Destruction (WMD) infrastructure. It replaces
the need for SOCOM operators to transport and emplace large
quantities of explosives to destroy heavily reinforced,
concrete structures. Currently, SOCOM plans to begin
procurement of this system in fiscal year 2000. The committee
believes that important modernization programs, such as this,
should be accelerated in order to provide a greater near-term
capability, and reduce the strain on out year procurement
budgets. Therefore, the committee recommends an increase of
$6.5 million in line number 57, SOF ordinance acquisition, for
the procurement of additional 400 PAMs.

Remote activation munition systems

The committee is aware of the shortfall in procurement
funds for the remote activation munition system (RAMS). RAMS is
a radio frequency controlled remote initiator. It provides the
special operations community with the capability to remotely
control detonation of demolition charges, or the remote
operation of other items of equipment, such as beacons, laser
markers, radios and weapons. The committee understands that if
an additional $6.0 million were provided for this system in
fiscal year 1999, the Special Operations Command would realize
a 15 percent acquisition savings, or $2.0 million. Therefore,
the committee recommends an increase of $6.0 million in line
number 57, SOF ordinance acquisition, for the procurement of
additional RAMS basic kits and receivers.

Silent Shield

The committee notes an outstanding requirement for Silent
Shield systems. Silent Shield systems provide Air Force special
operations crews with an on-board, real-time source of
situational awareness, threat warning, and target update
information. The committee believes these systems are essential
for the successful employment of special operations aircraft
and recommends an increase of $5.0 million to accelerate
procurement of 10 systems.

Surgical strike

The committee recommends an increase of $5.0 million for
this classified program.

Maritime equipment

The committee recommends an increase of $5.1 million for
this classified program.

National Guard and Reserve Equipment

In light of continued shortfalls in budget authority for
Department of Defense (DOD) modernization, the committee is
pleased to note an increase in the level of funding provided
for Guard and Reserve modernization in the fiscal year 1999
budget request. In an era of overextended Service modernization
programs that cannot be sustained by projected DOD funding
levels, it is clear that the increased funding requested by the
Services for the reserve components reflects a recognition of
the critical role that these forces provide in DOD operations.
The committee believes that reserve component modernization, as
an integral component of overall DOD modernization, should rely
on a collaborative budget development process within the
Department and not on annual Congressional supplemental
funding. In fact, as future defense budget totals have been
determined by Administration and Congressional budget
agreements, if supplemental funding for reserve components was
necessary, it would have to come at the expense of other
programs funded in the budget request.
The budget request for fiscal year 1999 included $1.36
billion for National Guard and Reserve equipment as shown in
the table below:

Appropriation Cost (millions)
Aircraft, Army................................................ 110.2
Missiles, Army................................................ 35.3
Weapons and Tracked Combat Vehicles, Army..................... 12.3
Ammunition, Army.............................................. 182.3
Other Procurement, Army....................................... 502.9
Aircraft, Navy................................................ 41.8
Ammunition, Navy/USMC......................................... 17.3
Other Procurement, Navy....................................... 3.6
Procurement, USMC............................................. 39.9
Aircraft, USAF................................................ 293.3
Ammunition, USAF.............................................. 30.4
Other Procurement, USAF....................................... 85.0
NG&RE, Other Procurement...................................... 9.3
--------------------------------------------------------------
____________________________________________________

Total DOD................................................. 1,363.6

This request reflects a net increase of almost $400.0
million in funding requested for the reserve component
modernization from the fiscal year 1998 budget request.
The committee recommends funding increases in service
programs to support reserve component modernization as follows:

Millions
UH-60 Blackhawk............................................... $78.5
Family of Medium Tactical Vehicles............................ 88.0
Medium Truck Extended Service Program......................... 93.9
SINCGARS family............................................... 61.9
C130 (2 C130J, 1 EC-130J)..................................... 352.1
C130J Simulator............................................... 30.0
--------------------------------------------------------------
____________________________________________________

Total..................................................... 704.4

Additionally, the committee recommends an increase of $60.0
million to the budget request for National Guard and Reserve
miscellaneous equipment:

Millions
Army Reserve: Miscellaneous................................... $10.0
Navy Reserve: Miscellaneous................................... 10.0
Marine Corps Reserve: Miscellaneous........................... 10.0
Air Force Reserve: Miscellaneous.............................. 10.0
Army National Guard: Miscellaneous............................ 10.0
Air National Guard: Miscellaneous............................. 10.0

The committee directs that miscellaneous funding allocated
for the Army National Guard, in consultation with the service
chief, give priority consideration to the following items:
vibration management enhancement system; engagement skills
trainer; night vision equipment; high mobility multipurpose
wheeled vehicles. The committee further directs that
miscellaneous funding allocated for the Air Guard, in
consultation with the service chief, give priority
consideration to procuring airborne firefighting equipment.

OTHER ITEMS OF INTEREST

Air National Guard Missions

In reviewing the many contributions made by the Air
National Guard (ANG), the committee notes the valuable
contribution made by C-130 units to firefighting in the Western
states. The committee understands that older C-130E aircraft
are to be replaced with C-130J aircraft, now on order. The
committeeexpects the Department to ensure that all western
state ANG units have at least the necessary eight aircraft for airlift
missions and special missions, such as counter drug flights and
firefighting, and have a rotating pool of Mobile Aerial Firefighting
Systems (MAFFS) for support of the U.S. Forest Service mission.
The committee is also concerned about the relative
peacetime utilization of C-130 Air National Guard and Air Force
Reserve units. The committee fears that some units may be
experiencing high operational tempo rates participating in
peacetime missions, while others may not be operating with such
a demanding schedule. Such missions include supporting Bosnia
operations and counter drug missions, in addition to domestic
efforts, such as firefighting and disaster relief. Therefore,
the committee directs the Secretary of the Air Force to provide
a report to the congressional defense committees on the balance
among C-130 units for operating tempo. The Secretary shall
submit that report no later than March 31, 1999. The committee
notes that the Air Force provided an assessment last year that
dealt with wartime requirements for tactical airlift. The
Secretary's report should also provide an assessment of whether
these peacetime operating tempos can be accommodated within the
tactical airlift force structure identified as meeting wartime
requirements.

Army aviation modernization

The committee has completed a review of the Army aviation
modernization plan called for in the National Defense
Authorization Act for Fiscal Year 1998. While this plan makes
progress in several areas, it does not adequately prioritize
investment opportunities and leaves many requirements unfunded.
In fact, for portions of the utility helicopter fleet, the plan
failed to describe either a formal plan or details associated
with a range of alternatives called for in the bill provision.
The committee also understands that follow-on modifications to
the plan have significantly changed the nature and scope of
what was presented earlier this year. Consequently, the
committee must assume that the provided plan does not provide a
viable, balanced program for Army aviation.
The committee has several concerns with deficiencies
identified in the current aviation modernization plan. First,
the number one aviation modernization program for the Army is
the ongoing development of the Comanche scout helicopter. If,
in fact, the Comanche helicopter is a top priority, it is hard
to understand why the Army continues to fund its number one
program at a level so low that it has only resourced one
prototype platform for flight testing. Although a second
prototype will soon be moved to the flight test facility,
current funding limitations will not support flight testing of
this aircraft until January 2001.
Second, the Army is pursuing an inadequate procurement
strategy for both the Apache Longbow and Comanche helicopters.
Missing from the current strategy is adequate funding for self-
protection countermeasures and sensor fusion capabilities which
are key requirements for the survivability and effectiveness of
these high-value platforms and their crews. The committee
believes it essential that the Army ensure that Apache,
Comanche, and other aircraft with similar requirements are
provided with both the latest radio frequency and infrared
countermeasures when procured, even if it means reducing the
rate or number of aircraft procured.
Third, while the modernization plan would retire AH-1
aircraft in attack battalions more quickly than originally
planned, it would still leave a sizeable number in the cavalry
squadrons. An even lower density aging aircraft will be more of
a maintenance and support challenge. The committee believes
that the Army should seek to retire the entire AH-1 fleet on an
accelerated schedule.
Fourth, utility helicopter requirements are acknowledged,
but not resourced in a balanced manner. The committee
understands a further analysis of requirements has convinced
the Army of the need for an additional 90 Blackhawks for the
Army National Guard, but only 50 are currently funded in the
future years defense program. However, the readiness of the
Army National Guard's UH-1 fleet is a source of serious
concern. The fleet is currently grounded and undergoing
inspections and necessary repairs on spur gears. Even if this
action returns the fleet to service, it does not address the
modernization requirement for over 500 UH-1 aircraft remaining
in the force. While reserving judgment until the Army analysis
is complete, the committee is skeptical that the Army can
afford to procure 145 commercial-off-the-shelf aircraft for the
light utility helicopter role and conduct a service life
extension program on the rest of the UH-1 fleet. The committee
believes the Army must address this issue and assist the
Congress in understanding how these requirements should be met.
The committee directs the Army to review the aviation
modernization plan provided to the Congress earlier this year
and provide an update to this plan that addresses the issues
discussed in this report. The results of this review and update
shall be provided to the congressional defense committees no
later than January 31, 1999, to support a review of the
President's fiscal year 2000 budget request.

Bradley base sustainment

The budget request included $285.8 million to support
Bradley base sustainment. The committee recognizes a
requirement for the Army to measure the wear on the bore of the
Bradley's 25mm cannon to ensure troop safety and identify when
barrels need to be replaced. The committee understands that
there are new bore erosion gauges available today that can
accurately measurebore wear and provide an improved and cost
effective means to ensure weapon accuracy and extend the service life
of the Bradley main gun. The committee believes that alternative bore
erosion gauges should be evaluated and directs the Secretary of the
Army to investigate any potential benefit of new bore erosion gauges
and report to the Congress no later than January 31, 1999.

Depleted Uranium Production

The committee supports the Army's efforts to preserve the
tank ammunition production base. However, it also recognizes
that the Army must downsize the base to be cost effective. This
includes the proposed reduction from two to one producer of
tank depleted uranium penetrators. The committee is concerned
that the decontamination and management of Government furnished
equipment at the commercial facility which will no longer
produce these penetrators has not been clearly identified, and
that there will not be adequate funds to ensure that the
decontamination will be accomplished either by the Army or by
the contractor on a timely basis. Therefore, the committee
directs the Secretary of the Army to provide a report to the
congressional defense committees discussing the Army's
management plan for this Government furnished equipment,
including decontamination and disposition as appropriate. This
report should be provided no later than March 31, 1999.

Digital information technology testbed

The committee supports Department of Defense initiatives to
develop and field information management systems that will meet
the needs of an information centered military. The committee
notes ongoing Department efforts to review architecture
alternatives for automated electronic storage, retrieval,
dissemination, and downgrading or declassifying government
data. The committee is pleased to note the success achieved by
the Army through the digital information technology testbed
(DITT) in developing a prototype electronic data management
system. The DITT system allows for storage of voluminous
amounts of data, user friendly access to data at multiple
levels of security, rapid dissemination of time-critical
information, automatic downgrading or declassification and
redaction. The committee understands that the Army plans on
funding DITT hardware and software procurement in the 2000
timeframe. The committee directs the Department of Defense to
provide a report to the Congress, no later than 1 March 1999,
on how the DITT model might be used to meet defense-wide
requirements for an automated electronic storage and retrieval
capability.

Domestic Emergency Response Program

The budget request included $99.0 million to develop a
program to prepare and enhance Federal, state and local
response capabilities to terrorist incidents involving weapons
of mass destruction (WMD), $49.8 million in the Department of
Defense and $49.2 million in the Department of the Army
budgets.
The Assistant Secretary of Defense for Special Operations
and Low Intensity Conflict (ASD(SO/LIC)) has been assigned
responsibility by the Secretary of Defense for policy and
resource oversight. Responsibility for procurement has been
assigned to the Assistant to the Secretary of Defense for
Nuclear, Chemical and Biological Defense programs. The
Secretary of the Army has been designated by the Secretary of
Defense to serve as Executive Agent for coordinating DOD
training assistance to Federal, state and local officials.
Additionally, the Secretary of the Army is also responsible for
training state and local first responders to respond to
terrorist threats involving chemical and biological agents and
weapons; identifying, neutralizing, dismantling and disposing
of chemical and biological weapons and related materials and
technologies; and for developing and implementing planning
guidance, plans, and procedures for the Domestic Emergency
Preparedness Program.
Following the Quadrennial Defense Review (QDR), the
Secretary of Defense recommended that the Reserve Components
should play a more active role in responding to domestic WMD
terrorism. The committee agrees with the assessment of the
Secretary of Defense, that the Reserve Components could be the
first military responders on the scene to support local and
state governments in managing the consequences of a terrorist
use of WMD.
The committee understands that the funds included in the
Department of the Army budget request for the Reserve
Components are for activities to begin addressing increased
support requirements associated with terrorist use of WMD in
the United States. These activities include the following:
establishment of 10 Rapid Assessment and Initial Detection
(RAID) teams; establishment of WMD patient decontamination
teams from existing Guard and Reserve chemical companies and
medical decontamination teams; training and equipping of
Reserve Components to conduct WMD search, survey, surveillance
and sampling activities; development of additional versions of
the Army's Medical Management of Chem/Bio Causualties course;
increased training days to improve coordination of interagency
planning; upgrading existing Army Reserve simulation systems to
include WMD effects capabilities, and the design and conduct of
a proof-of-concept exercise; and establishment of a Reserve
Component program office under the Director of Military Support
(DOMS) to oversee WMD response activities.

National Vaccine Stockpile

The committee understands that the Department of Defense
has a limited stockpile of vaccines, medical supplies and
protectivegear which could be used in response to a terrorist
incident involving WMD, subject to approval by the Secretary of
Defense. During testimony before the committee, the Assistant Secretary
of Defense for Special Operations and Low Intensity Conflict testified
that the Secretary of Defense could authorize the use of this stockpile
under certain circumstances. The committee directs the Department to
report to the congressional defense committees by December 1, 1998 on
the circumstances under which the Secretary of Defense might authorize
the use of the stockpile for a domestic WMD incident. The report should
also contain information on the availability of vaccines, antiserums
and antidotes in other Federal Government entities, such as the Centers
for Disease Control (CDC), that could be used in such an emergency.
Lastly, the report should discuss the advisability of establishing a
national stockpile of vaccines, antiserums and antidotes, how the
Department of Defense could contribute to that effort, and the
estimated cost.

Defense Threat Reduction Agency (DTRA)

In November 1997, as part of its Defense Reform Initiative
(DRI), the Department of Defense recommended the establishment
of a single agency to carry out programs to counter
proliferation and reduce threats posed by weapons of WMD and to
provide nuclear weapons stockpile and related support.
Consistent with the DRI recommendation, the committee
recommends that the mission, function and resources for fiscal
year 1999 for the defense domestic preparedness program be
transferred to the Defense Threat Reduction Agency (DTRA).

Encapsulated life raft system

The committee is concerned by delays in the procurement of
a 25-person encapsulated life raft system to replace the aging
MK-6 life raft. Due to safety, support, cost and operational
benefits of a new system, the committee encourages the Navy to
complete a competitive source selection for this program. The
Navy is directed to provide the committee, no later than
December 1, 1998, a schedule for production and installation of
these systems.

F/A-18E/F configuration mix

The budget request included $2,876.1 million for the
procurement of 30 F/A-18E/F aircraft. Among the 30 aircraft,
the Navy would buy 14 single seat aircraft (F/A-18E) and 16 two
seat aircraft (F/A-18F). During the Quadrennial Defense Review
(QDR), the Defense Department reduced the planned buy for F/A-
18E/F from 1,000 aircraft to a total of 548-785. The new total
would vary, depending upon how soon the joint strike fighter
(JSF) enters service. Whatever the size of the program for F/A-
18E/F, the total program would now include a greater proportion
of the two seat F/A-18F aircraft. One explanation for the
richer mix has been that the Navy needs more two seat F/A-18s
to replace two seat F-14s that will be retiring.
Following a recent hearing, the committee asked the Navy
for a definition and rationale for the force mix between single
seat F/A-18E aircraft and F/A-18F aircraft. The committee was
very disappointed with the answer provided. Perhaps the
Department did not understand the question. The question was:
``Why does the Navy need a two seat aircraft to replace the F-
14, when it is contemplating a two seat aircraft F/A-18F to
replace the present day EA-6B?'' The EA-6B aircraft is a four
seat aircraft.
The committee recognizes the large strides made in human
factors design of modern cockpits and simplified controls now
available in tactical aircraft. The committee is aware that
such improvements as digital displays, data links, and other
improvements have decreased cockpit workload. For single seat
aircraft, a major improvement has come from the development of
hands on throttle and stick (HOTAS) flight management systems.
HOTAS systems allow pilots to fly tactical aircraft without
removing their hands from the flight controls to operate and
fight the aircraft system. In fact, the Navy has represented
that these technologies will permit the Navy to perform the EA-
6B mission in a two seat aircraft. The committee notes that
such technologies might permit the Navy to replace some two
seat F-14 aircraft with single seat F-18 aircraft. Therefore,
the committee needs to understand more of the reasoning behind
the Navy's F/A-18E/F force mix. Accordingly, the committee
directs the Secretary of the Navy to provide a report to the
congressional defense committees, no later than February 1,
1999, on the F/A-18E/F mix that includes:
(1) an analysis of crew contribution to mission
success in tactical aircraft acquired since 1980, with
due consideration given the technology improvements
that would allow a single pilot to fly a tactical
aircraft and simultaneously operate complex weapons
systems;
(2) a comparison of crew workload and mission
requirements of single and dual seat tactical aircraft
acquired or planned for acquisition from 1980 through
2010; and
(3) a complete description of how a two seat F/A-18F
aircraft will be able to perform the missions of the
four seat EA-6B;
(4) the planned mix of F/A-18E and F/A-18F aircraft
from the fiscal year 1999 budget request through the
end of the program;
(5) a complete explanation of why F-14 aircraft must
be replaced on a one-for-one basis by F/A-18F aircraft;
(6) a complete analysis of the range differential
between the two seat F/A-18F and the single seat F/A-
18E that considers reduced fuel for the second seat,
increased life cycle costs, and any range degradation
associated withwing drop remedies;
(7) an analysis of the intended roles for the single
and dual seat F/A-18's highlighting similarities and
differences in their roles; and
(8) an analysis of F/A-18 capability shortfalls
brought on by network-centered warfare requirements
that could require a second crew member.

Flight simulators for the Air National Guard

The Air National Guard is scheduled to begin operating C-17
airlifters in 2002 is a part of the Air National Guard's
increasingly critical national security role. Just as the
regular component units need to train and prepare for the
transition to C-17 operation, National Guard aircrews will be
required to undergo an initial qualification and continued
training to maintain proficiency. The Air Force is now
programmed to acquire ten flight simulators for the C-17, with
four at one regular component location, but none programmed to
be sited at the National Guard operating base. Accordingly, the
committee directs the Secretary of Defense to ensure that
training plans for the National Guard C-17 unit include
simulator training in a C-17 flight simulator, and that the
simulator will be will be stationed at the National Guard
operating base at least 9 months prior to initial arrival of C-
17 aircraft.

Full accounting of cost associated with ammunition procurement

The committee is concerned that in some cases, the
Department of Defense may not be considering the total cost and
savings to the Federal Government when choosing a contractor
for the production of ammunition. The costs and savings that
may not be considered include retirement liabilities, overhead,
and other administrative costs at Government facilities. The
committee believes that when determining the source of
production for ammunition programs, the Department should take
into account all costs associated with that production, as well
as the overall savings that would be realized if this
production were to utilize facilities or personnel to which the
Federal Government would continue to owe a financial
obligation, whether or not those facilities and personnel were
awarded the production contract.

Gun ship modernization

The budget request did not include funding for buying new
aircraft to modernize the Special Operations Command (SOCOM)
AC-130 gun ships. The committee understands that internal
Department of Defense studies may have identified an inventory
objective that could require additional AC-130 gun ships.
The committee directs the Department of Defense to submit
an analysis of SOCOM AC-130 gun ship inventory requirements to
the congressional defense committees by March 1, 1999. This
report should include the following:
(1) whether there are additional requirements, such
as providing theater commanders with support to perform
force protection, border surveillance, reconnaissance,
airfield and seaport defense, or other missions;
(2) whether additional gun ship capability is the
best way to provide this capability;
(3) the relative costs and benefits of converting
existing C-130 aircraft, buying new C-130J aircraft, or
buying another aircraft altogether;
(4) the relative costs and benefits of assigning any
additional mission requirements to active component
SOCOM units versus assigning these requirements to
reserve component units.

Secure facsimile machines

In the report accompanying the National Defense
Authorization Act of fiscal year 1998, the committee directed
the Army to provide a report on the future requirements for
secure facsimile machines, the costs and benefits of replacing
existing legacy systems with newer technology machines, and the
Department's funding plan for addressing future requirements.
The Army reported that future requirements for secure facsimile
machines had not been determined and will be ultimately based
on testing and evaluation of the communications architecture
projected for the first digitized division. The committee is
aware that some organizations within the Army have already
procured limited quantities of newer technology machines to
meet secure facsimile machine requirements. The committee
supports this action and encourages the Army to consider
procuring additional commercial-off-the-shelf rugged multi-
functional tactical computer facsimile machine peripherals as a
cost saving alternative to maintaining aging legacy systems.

Small arms training ammunition

The committee is aware of Army research and development
efforts to produce lead-free, non-toxic small arms training
rounds to address environmental problems associated with firing
lead rounds in indoor, as well as outdoor training ranges. This
problem impacts readiness by restricting training opportunities
through closure of Department of Defense (DOD) ranges, or
requiring expensive remediation and monitoring efforts at these
ranges.
Furthermore, lead contamination has resulted in the
cessation of operations at military ranges, increasing the cost
of transportation and reducing valuable training time. The
Environmental Protection Agency, Region 1, suspended weapons
training at one of the principal National Guard training sites
in New England.
The committee is aware of the availability of commercial,
lead free, non-toxic frangible ammunition that may address some
of the military's problems in this area. The committee
understands that this ammunition has also been safety tested by
the Army Test and Evaluation Command and approved for use. The
committee urges the DOD to further explore this frangible
ammunition to determine the extent to which it would solve its
environmental problems, and to incorporate it in its training
inventory, if it provides a cost effective solution that would
enable the continued use of training facilities that would not
otherwise be available.

Tactical trailers and dolly sets

The budget request included $12.0 million for procurement
of tactical trailers and dolly sets. The committee notes the
recent approval of a requirement for the self-loading/off-
loading trailer (SLOT) system that will enhance Army logistical
operations. The SLOT multi functional trailer has the
capability to self-load/off-load and transport operable and
inoperable wheeled and light tracked vehicles, material
handling equipment, engineering construction equipment, general
cargo and international standards organization compatible
containers. The committee understands that the basis of issue
for these trailers has yet to be determined but understands the
Army plans on initiating procurement in fiscal year 2000. The
committee strongly supports this program and believes that
these trailers will serve to strengthen the Army's logistics
backbone.

Vertical Takeoff and Landing Unmanned Aerial Vehicles

The committee notes the progress made in conducting a
demonstration of vertical takeoff and landing (VTOL) unmanned
aerial vehicles (UAV), following congressional direction to
investigate the feasibility of a VTOL UAV for use in maritime
or land based environments to provide near-real-time
reconnaissance, surveillance, target acquisition, and battle
field management. The committee expects that lessons learned
from the demonstration will be applied towards potential
acquisition of such a system.
TITLE II--RESEARCH, DEVELOPMENT, TEST, AND EVALUATION

Explanation of tables
The tables in this title display items requested by the
administration for fiscal year 1999 and the committee's actions
in regard to the requested amounts. As in the past, the
administration may not exceed the amounts approved by the
committee (as set forth in the tables or, if unchanged from the
administration request, as set forth in the Department of
Defense's budget justification documents) without a
reprogramming action in accordance with established procedures.
Unless noted explicitly in the report, all changes are made
without prejudice.
SUBTITLE A--AUTHORIZATION OF APPROPRIATIONS

SUBTITLE B--PROGRAM REQUIREMENTS, RESTRICTIONS, AND LIMITATIONS

Sec. 211. Crusader self-propelled artillery system program.

The budget request included $313.2 million for continued
development of the Crusader artillery system. The committee has
watched the development of Crusader over time with great
interest in the capabilities which this system was designed to
provide. The Crusader program was initially developed to be an
advanced technology, liquid propellant cannon offering great
advances in range, targeting, mobility, and resupply
requirements. The committee was concerned when, in March of
1996, the Army elected to switch to an advanced technology
solid propellant and stop work on the liquid propellant concept
due to escalating developmental costs and chronic technical
problems associated with that concept.
The Army Crusader effort was initially prompted by the
establishment of future warfighting requirements and a
realization that the existing self-propelled howitzer system
has been in the inventory for over thirty years. The current
fleet of M109 Paladin artillery systems was first fielded in
its original configuration in 1963 and has undergone a series
of upgrades over time that have brought this system to the
currently fielded M109A6 configuration. Today's Paladin system
is much more capable than the original M109. However, while
additional improvements might be possible, some suggest that
this system has been improved as far as the current
configuration will allow. The committee continues to support
Army efforts to develop and field new systems that will provide
combat overmatch, increased lethality, crew survivability, and
support the Army's ability to fight and win on future
battlefields. However, the committee has several concerns
associated with the Crusader system as it is currently
programmed.
First, the Army decision to terminate the liquid propellant
program due to immature technology and rising costs resulted in
a solid propellant technology that is also unproven and does
not provide the advantages expected of the liquid propellant
system. Some of these advantages included range, reload and
resupply efficiencies, and safety.
Second, a June 1997 GAO report noted that the current
program still suffers from considerable programmatic risks due
to technical challenges faced in developing and integrating
advanced technologies, the potential compression of the program
schedule, the use of a streamlined acquisition approach, and
the absence of defined criteria for entering into low-rate
production. While some of the GAO's concerns are being
addressed, the committee still believes that there is
significant risk in continuing on the current course.
Third, the recently released National Defense Panel (NDP)
report, which focused on the nation's future warfighting
requirements, questioned the numbers of the Crusader system
programmed by the Army. In testimony before the committee in
January of 1998, one of the panel members stated that the
Crusader program lost its luster when the Army elected to
terminate the liquid propellant effort. Panel members also
expressed their concern about the utility of this system as its
weight, estimated to be approximately 60 tons, would likely
preclude it from being deployed in some future scenarios due to
airlift and access problems expected in future conflicts. The
problem of access was seen this year in the Persian Gulf region
where U.S. allies, whom U.S. forces were trying to protect,
would not allow use of their bases to strike Iraq. The NDP
report and panel member testimony also made it clear that
future systems must be lighter, faster, more lethal, and have a
smaller logistics footprint if they are going to be viable in
an increasingly uncertain future.
Finally, the committee is concerned about the ability of
future Army budgets to meet all the acquisition requirements it
has established in its modernization program. The committee is
concerned about a possible, if not probable, procurement bow
wave that cannot be supported by projected resources. The
committee sees an aging aviation fleet in the Army, with some
helicopters already over 30 years old; an old truck fleet; and
escalating requirements for new missiles, weapons, and
ammunition. The committee is concerned that if the bow wave
issue is not adequately addressed, Crusader may become the next
program termination casualty for the Army.
The committee, therefore, believes the Army should revisit
both current requirements and schedule for the established
Crusader program which is estimated to cost over $12.0 billion
to design and procure 824 howitzers and resupply vehicles. The
committee directs the Army to provide a report to the Congress,
no later than March 1, 1999, that describes the following:
(1) assessment of the risk associated with the
current Crusader program technology;
(2) total requirement for Crusader associated with
Army After Next force structure revisions;
(3) cost and benefit analysis of procuring only those
Crusader systems necessary for one heavy corps and
redirecting future procurement funding to develop an
Army After Next compatible artillery system;
(4) potential for reducing system weight by as much
as 50 percent;
(5) potential for propellant and munition
alternatives and the impact of maturing this technology
on the overall program schedule; and
(6) cost and benefit analysis of delaying procurement
of Crusader to avoid affordability issues associated
with the current schedule and allow for maturation of
weight and propellant technologies.
The committee supports continued research and development
and believes an ultimate fielding of an advanced field
artillery system is necessary. However, the committee believes
that the Army's next generation artillery system should meet
the criteria specified in the NDP report, be relevant to future
Army After Next warfighting requirements and challenges, and
should be affordable within future constrained modernization
budgets. It is the affordability of this program in light of a
fiscally unsupportable Army modernization program that
threatens the ultimate fielding of Crusader to the force.

Sec. 212. CVN-77 nuclear aircraft carrier program.

The budget request included $149.5 million for future
aircraft carrier research and development in PE 603512N and
$40.6 million for CV(X) feasibility studies in PE 603564N. The
request also included $38.5 million for CVN-77 contract design
in PE 604567N. The committee is concerned that the limited
funding for CVN-77 design is insufficient for incorporating
into CVN-77 the technologies that can enhance capabilities or
reduce life-cycle costs for both CVN-77 and CV(X). The
committee believes it is prudent to prove as many technologies
as possible prior to insertion into CV(X). These technologies
would be those that have the ability to transition from the
CVN-77 to the CV(X) program; and:
(1) demonstrate enhanced capabilities for the CV(X);
or
(2) mitigate the cost or risk of the CV(X) program.
Because these technologies would benefit both the CVN-77
and the CV(X) program, the committee recommends a provision
that would authorize $50.0 million for future aircraft carrier
system development in PE 603512N to be used exclusively for
CVN-77 development.

Sec. 213. Unmanned aerial vehicle programs.

The budget request included $178.7 million for high
altitude endurance (HAE) unmanned aerial vehicles (UAV). The
two HAE UAVs are the Global Hawk, formerly the Tier II plus,
and the Dark Star, formerly the Tier III minus. Each has
different characteristics, but both are designed for high
altitude extended flights. The programs are presently managed
by the DefenseAdvanced Research Projects Agency (DARPA), and
are differentiated from tactical UAVs, which are designed for shorter
flights, less endurance, and for use by field commanders. The budget
request included $40.5 million for the Dark Star, $90.1 for the Global
Hawk, and $48.1 million for the common ground segment.
The endurance UAVs development has progressed from small,
``disposable'', inexpensive aircraft to multi-million dollar
systems. Through the use of advanced concept technology
demonstrations (ACTD) to field complex, developmental systems,
the Department has found that endurance UAVs barely fit the
definition of mature technologies. While most of the HAE UAV
results have been discouraging, the Global Hawk's recent first
flight suggests that it is an apparently mature, redundant
system that can withstand minor systems problems without
catastrophic results.
Section 216 of the National Defense Authorization Act for
Fiscal Year 1998 (Public Law 105-85) established the following
requirements with respect to the HAE UAV program required:
(1) a cost cap;
(2) a cessation of further air vehicle procurement
pending completion of testing identified in phase II of
the test plan for the ACTD; and
(3) a General Accounting Office report that assesses
the estimated production costs for each vehicle in the
endurance UAV ACTD.
The committee continues to believe that the section 216
requirements are as valid now as when enacted.

Dark Star UAV

The committee has been disappointed by the lack of progress
on the Dark Star UAV. The Dark Star was an ambitious
undertaking for an ACTD, since it involved demonstration of new
technologies under development. The Dark Star is an unfortunate
case of over reach with respect to cost, schedule, and
performance. Regrettably, it has taken too long to complete
development and recover from the crash of the first air vehicle
on its second flight. The committee recommends a decrease of
$40.5 million in the budget request and cancellation of the
Dark Star UAV program.

Global Hawk

While the Global Hawk has been slowed by testing delays and
a cautious development schedule, a successful test flight has
been completed. The Global Hawk is a substantial air vehicle,
with a gross weight of 25,600 pounds and a wing span of 116
feet, capable of carrying a 2,000 pounds of payload, nearly
half of that carried aboard a U-2 reconnaissance aircraft.
Successful development of the Global Hawk may be the most cost
effective and indeed operationally effective solution to the
endurance UAV requirements, should its potential be
successfully demonstrated in testing.
Consistent with the committee's focus on demonstrated
performance, the committee recommends an increase in the Global
Hawk program of $32.5 million to acquire an additional three
air vehicles upon completion of the phase II testing, and in
concordance with Section 216 of the National Defense
Authorization Act for Fiscal Year 1998 (Public Law 105-85).
Section 216 prohibits acquisition of additional air vehicles
until the completion of the testing identified in phase II of
the test and demonstration plan for the advanced concept
technology demonstration of the HAE UAV vehicles.

Sec. 214. Airborne laser program.

The budget request included $292.2 million for the Airborne
Laser (ABL) program. The committee continues to be concerned by
technical and operational issues facing the ABL program. The
program is currently structured such that critical testing data
and other important information will not be available until
after the United States has committed significant funding and
acquired a large amount of equipment that may not be needed to
attain basic data that is now missing. These and other concerns
were first expressed in the committee's report on the fiscal
year 1997 Defense Authorization Bill (S. Rept. 104-267). In
this report, the committee stated that the Air Force had not
``adequately demonstrated the feasibility of the necessary
technology to begin such a significant investment.'' The
committee also questioned whether ``the ABL concept of
operations will allow the system to be cost and operationally
effective.''
Under the current schedule much of the testing necessary to
make well informed judgments about the technical viability of
the ABL program will not begin to occur until fiscal year 2002,
just prior to the program entering Engineering and
Manufacturing Development (EMD). This would require the
expenditure of approximately $1.3 billion, and the acquisition
and outfitting of a 747-400 aircraft, before testing of key
subsystems takes place. The first time the Air Force plans to
collect optical data on the performance of a laser fired
horizontally through the atmosphere is during the last quarter
of fiscal year 2002, during its first attempt to shoot down a
target missile and only a few months prior to a milestone II
review to consider whether the program should be permitted to
enter EMD. The committee also notes that the Air Force plans to
cease the collection of turbulence data in fiscal year 1998
even though this data is currently the sole basis for Air Force
models and estimates. Hence, for the next four years, the Air
Force will cease all collection of environmental data with the
hope that the first live fire test in 2002 will validate
current models.
The Air Force justifies this approach by stating that early
testing of a laser device in an operationally representative
environment would be too costly. The committee believes that
thecost of such a demonstration must be weighed against the
potential waste of funds that would result if the system does not prove
to be operationally viable in the 2002-2003 timeframe when in excess of
a billion dollars will already have been spent.
The committee also does not believe that the Air Force has
adequately made the case that the ABL concept of operations
justifies an investment of $6.3 billion to develop and acquire
this capability, especially with a number of other theater
missile defense (TMD) systems competing for limited TMD
resources. Given the vulnerability of a large, slow platform to
hostile air defenses, the ABL will have to operate at a
significant distance away from enemy lines of defense. Coupled
with the inherent range limitations of a laser fired
horizontally through the atmosphere, the ABL would, in many
scenarios, not have sufficient reach to engage boosting
missiles. Since many of the missiles that ABL is designed to
counter are mobile, and the ranges of such systems are steadily
increasing, it may be possible for opponents to simply
reposition launchers outside of an ABL's lethal range.
The committee believes that the Secretary of Defense must
carefully evaluate these technical and operational issues. The
committee also believes that the Secretary should establish an
independent review of the ABL program. Specifically, the
committee directs the Secretary to task the Panel on Reducing
Risk in Ballistic Missile Defense Flight Test Programs, which
has recently reviewed BMDO's hit-to-kill test programs, to
assess the adequacy of the ABL development and testing program.
In addition, the committee directs the Secretary to seek an
independent assessment of the operational issues facing the
ABL, including, but not limited to, those issues identified
above. The committee believes the Air Force should not proceed
with the acquisition and outfitting of a new aircraft before
such reviews have been completed. The committee notes that due
to the commercial base for such aircraft, and the Air Force's
relationship with the contractor, it is possible for the Air
Force to delay this acquisition without disadvantaging the
government, disrupting contractor production, or undermining
the program's ability to proceed if it passes rigorous review.
The committee recommends a reduction of $97.0 million in PE
63319F, the amount which the Air Force has budgeted for fiscal
year 1999 for air vehicle integration and checkout. The
committee directs the Secretary to ensure that a full
assessment be completed prior to any additional expenditure
related to the acquisition or integration of the ABL aircraft
and submit a report to the congressional defense committees by
March 15, 1999 that outlines his findings and recommendations.
The report should include the findings and recommendations of
the Panel on Reducing Risk in Ballistic Missile Defense Test
Programs, and the findings and recommendations of the
independent panel that reviews ABL operational issues. The
committee further directs that no more than $150.0 million of
the funds remaining available to the ABL program be obligated
until 30 days after the Secretary submits the report specified
above.

Sec. 215. Enhanced global positioning system program.

The committee is concerned that the Department of Defense
has not moved aggressively enough to implement Presidential
policy and statutory requirements to develop an enhanced Global
Positioning System (GPS), the use of which can be denied to
potential enemies while ensuring access to U.S. and allied
military forces and civil users. The committee is aware that
modifications to future GPS satellites to include dynamic
frequency reconfiguration and regional-level directional signal
enhancement are being seriously considered. The committee
strongly endorses the development of such capabilities.
Therefore, the committee recommends a provision that would: (1)
require the Secretary of Defense to develop an enhanced GPS
system as an urgent national security priority; (2) authorize
$44.0 million for fiscal year 1999 in PE 64480F to begin such
development; (3) urge the Secretary of Defense to adequately
fund this initiative in the Future Years Defense Program; (4)
urge the Secretary of Transportation to provide sufficient
funding to support additional civil frequencies and other
enhancements for civil users; (5) extend by five years the
existing requirement to outfit all major Defense Department
platforms with GPS receivers by the year 2000; and (6) require
the Secretary to submit a plan for implementing this provision
by April 15, 1999.

Sec. 216. Manufacturing Technology Program.

The committee supports the goals for the Defense
Manufacturing Technology (MANTECH) program as outlined in the
five-year MANTECH plan submitted to Congress in February 1998.
The committee is encouraged by the positive trends in the five-
year budget projections for each service MANTECH funding line
and work of the military services is evident in the plans for
their fiscal year 1999 program.
However, the committee is concerned that the budget
projections for the program are still inadequate to accomplish
the stated goals for MANTECH. In the National Defense
Authorization Act for Fiscal Year 1998, Congress recommended a
minimum annual spending target for each service's MANTECH
program equal to 0.25 percent of the total amount budgeted in
each service for Demonstration and Validation, Engineering
Manufacturing Development, Procurement, and Operational Systems
Development. The fiscal year 1999 budget request falls short of
this minimum funding level for the Army, Navy, and the Air
Force MANTECH programs. The committee expects the Department of
Defense and the services to fully fund the MANTECH program.
This program provides ``seed funding'' for the development of
moderate to high risk material, process, and equipment
technology to enable production of advanced, high quality
weapon systems with shorter lead times and reduced acquisition
costs.
In an effort to encourage the services to provide greater
support to the MANTECH program, the committee recommends a
provision that would provide more flexibility by modifying cost
share requirements to allow for different levels of cost-share
where appropriate. The provision would eliminate the two-to-one
cost share requirement and allow the competitive bidding
process to establish the level of cost-share; move the cost-
share waiver authority from the Secretary of Defense to the
service secretaries; and require cost-share reporting to track
investment by non-industry MANTECH participants. It is not the
intention of this language to diminish support for cost-sharing
in MANTECH. The committee expects that cost-sharing will remain
an important factor in selection of manufacturing technology
projects.
Furthermore, the committee supports the Secretary's efforts
to leverage MANTECH funds with budget resources from other
federal sources. In particular, the committee expects greater
investment in MANTECH programs by weapon system program
offices. The five-year plan described two MANTECH initiatives
that received direct support from program offices such as the
Joint Strike Fighter program. In the annual MANTECH report due
to Congress with the annual budget submission, the Department
shall include information on the level of direct financial
support by weapons system program offices in MANTECH programs
and a plan to increase the level of investment. The committee
believes that this investment will ensure that the MANTECH
program remains relevant to the programs it is intended to
support.

Sec. 217. Authority for use of major range and test facility
installations by commercial entities.

The committee recommends a provision that would amend
section 2681 of title 10, United States Code, making the
temporary authority to permit commercial use of test and
evaluation centers permanent.
Section 2861 currently allows the Secretary of Defense to
enter into contracts with commercial entities that desire to
conduct commercial test and evaluation activities at major
range and test facility installations, which are designated by
the secretary. Contracts under section 2681 must require the
commercial entity to reimburse the Department of Defense for
all indirect costs to the United States associated with the use
of the facility. In addition, the contract may include a
requirement to reimburse the Department for such indirect costs
as the secretary deems appropriate. Under section 2681(d),
amounts collected for the commercial use are credited to the
appropriation accounts under which the costs associated were
incurred.
The committee makes this recommendation based on the report
issued by the Secretary of Defense in reponse to the
requirement in Section 842 of the National Defense
Authorization Act forFiscal Year 1998 and the assurance in that
report that a directive will be issued in the near future on procedures
to ensure that the major range and test facility installations will not
compete with private sector test and evaluation services.

Sec. 218. Extension of authority to carry out certain prototype
projects.

The committee recommends a provision that would extend the
authority to carry out certain prototyping project specified
under section 845 of the National Defense Authorization Act for
Fiscal Year 1994 (Public Law 103-160), through September 30,
2001. The committee regards the section 845 authority as a
potentially important tool for improving the access of the
Department of Defense to technology innovation by commercial
industry.
In order to make an informed decision on whether the
provision should be codified as permanent authority, the
committee directs the Secretary of Defense to provide a report
to the congressional defense committees, no later than March 1,
1999, that describes each instance in which the authority has
been used, the contractors involved, the dollar amounts of the
transactions, the contractor cost-share, and the specific
circumstances that justify the use of the authority, including
any specific impediments to achieving the same results under
another authority. The report should also identify which
projects have proceeded beyond prototyping into production and
discuss any difficulties associated with the use of the section
845 authority that may have been encountered in making such
transition.

SUBTITLE C--OTHER MATTERS

Sec. 231. Policy with respect to ballistic missile defense cooperation.

The committee has consistently supported a shift in the
U.S.-Russian strategic relationship away from its Cold War
focus on strategic offensive threats to a more balanced and
cooperative relationship. In order to facilitate such a
transition and to encourage cooperation in dealing with related
matters, such as the Anti-Ballistic Missile (ABM) Treaty, the
committee recommends a provision stating that the United States
should seek to foster a climate of cooperation with Russia on
matters related to missile defense, especially in the area of
early warning.
The committee believes that such an approach could lead to
a mutually agreeable evolution of the ABM Treaty, either
modification or replacement by a newer understanding, that
would clear the way for the United States and Russia to deploy
national missile defenses each believes necessary for its
security. If implemented in a cooperative manner, the committee
does not believe that such steps would undermine the original
intent of the ABM Treaty, which was to maintain strategic
stability and permit significant nuclear arms reductions.
ADDITIONAL MATTERS OF INTEREST

ARMY

Hardened materials

The committee recommends an increase of $3.0 million in PE
62105A to continue research in composite structures and
composite shroud assemblies. The committee believes that such
technologies provide significant opportunities for weight
reduction and increased stiffness of critical missile
components such as shrouds, nosetips, heat shields, and
deployment systems.

Missile technology

The committee recommends an increase of $1.5 million in PE
62303A to initiate a missile acoustics technology program. The
committee believes that high frequency vibrations resulting
from aerodynamically generated acoustics can create substantial
electronic noise, and damage or destroy sensitive components in
atmospheric interceptors for theater missile defense. The
missile acoustics technology program may enable the Army to
address these issues in a timely and cost-effective manner.

Scramjet technology

The committee recommends an increase of $3.0 million in PE
62303A to initiate application studies and design of scramjet
technologies for the advanced interceptor technology program.
The committee believes that scramjet technologies, because of
higher engine efficiencies and the lack of need for on-board
oxidizers, are the only available technologies for addressing
flight speeds of greater than Mach 10, which may be required to
counter future threats. The committee directs that all
applicable competitive procedures be used in the award of
contracts or other agreements under this program.

Environmental technology

The committee recommends an increase of $5.0 million in PE
62720A to continue to develop, demonstrate, and validate the
plasma energy pyrolysis system (PEPS) for the destruction of
hazardous waste, with an emphasis on a mobile system. The
purpose of PEPS is to develop an incineration process for
hazardous waste disposition, which minimizes toxic air
emissions and the disposal of ash contaminated with heavy
metals.
The committee also recommends an increase of $3.5 million
in PE 62720A to complete development of an integrated
environmental and pollution prevention management and control
system known as the Radford Environmental Development and
Management Program (REDMAP).

Pollution prevention

The committee continues to support the efforts of the
Department of Defense to shift emphasis away from ``end of
pipeline'' solutions to control and mitigate the effects of
using environmentally harmful materials and procedures. While
the Department has acknowledged the need for prudent
investments in pollution prevention measures, the fiscal year
1999 funding reduction in this area is inconsistent with that
objective.
The committee believes that a greater investment in
pollution prevention would reduce long-term compliance and
cleanup costs, and increase the resources available for the
core requirements of the Department. The committee is very
concerned about the decrease in the Department's budget support
for pollution prevention measures. As a result, the committee
recommends an additional $24.0 million for pollution prevention
research and development initiatives, to be awarded on a
competitive basis by the National Defense Center for
Environmental Excellence (PE 62720A). The committee directs
that all applicable competitive procedures be used in the award
of contracts or other agreements related to the obligation and
expenditure of the $24.0 million, and that cost-sharing
requirements for non-federal participants be utilized where
appropriate.
These funds should be used to develop new materials and
manufacturing processes for the purpose of enhancing weapons
systems performance and reducing lifecycle operations and
maintenance costs. Research and development efforts should
include reduction of hazardous solvents and heavy metals
related to corrosion protection materials and processes,
environmentally benign munitions technology, and green gun
barrel technology. Specifically, the committee expects that
these technologies and materials shall reduce lifecycle
environmental compliance costs, consistent with pollution
prevention objectives of all the military departments.

Software security

The committee recommends an increase of $.5 million to PE
62783A to continue efforts to improve computer security by
developing and testing prototype software security mechanisms.

Cold regions research

The committee recommends an increase of $1.2 million in
PE62784A to support expanded applied research in knowledge based issues
and engineering principles needed to sustain effective war fighting in
winter and in cold regions of the world. The committee notes the
increasing importance of this research to support effective development
of military forces areas, such as Korea and Bosnia.

Nutrition research

The committee recommends an increase of $2.0 million in PE
63002A to continue nutrition research in support of
improvements in the Meals-Ready-to-Eat (MRE) system. The
committee views this research to be of continuing importance
for maintaining the health and readiness of deployed forces in
operations around the world.

Weapons and munitions advanced technology

The committee recommends an increase of $4.5 million in PE
63004A to support operational analysis and to address
producibility and affordability issues with regard to the
precision guided mortar munition program. The committee
believes that these investments in fiscal year 1999 could
significantly reduce the risks involved with the deployment of
this important technology.

Combat vehicle and automotive advanced technology

The budget request included $54.4 million to support
ongoing evaluation of advanced technologies with military
applications. The committee notes a shortfall in funding for
continued exploration of aluminum metal matrix technology that
began last year. The committee, therefore, recommends an
increase of $3.0 million in PE 63005A to complete this
developmental effort and support the transition of this
technology into applications that will strengthen armored track
shoes and engine components at significantly reduced weight.

Military human immunodeficiency virus research

The committee recommends a decrease of $2.6 million in PE
63105A to fund higher priority programs. The committee notes
that this reduction represents the amount proposed by the Army
to expand certain activities under the human immunodeficiency
virus program in fiscal year 1999. The committee supports
continuation of the long-term core program of research and
development.

Missile and rocket advanced technology

The budget request included $86.1 million to support
development of advanced missile technologies. The committee is
concerned about the proliferation of anti-armor missile systems
and the inability of future budgets to sustain the current
number of missile modernization programs. The committee notes
problems encountered with Army testing of the E-FOGM missile
system and rising missile costs. There is no indication that
the Army intends to pursue fielding this system beyond those
capabilities obtained to support the advanced concept
technology demonstration (ACTD). The committee believes that
limited resources must be redirected to more critical programs.
The committee, therefore, recommends a decrease of $35.7
million in PE 63313A allocated for evaluation of the E-FOGM
missile system.
The committee is pleased to note progress with the future
missile technology integration (FMTI) program but is concerned
about the lack of robust testing that is programmed for this
activity. This program manufactures missile component hardware,
using advanced materiel and structures for ground and flight
test evaluation to determine how they might be applied to other
Army development programs. The committee recommends an
additional $6.0 million to support additional flight tests that
will greatly reduce risk and ensure that the technology return
on the $73.0 million invested in FMTI is fully captured. The
committee, therefore, recommends a total authorization of $56.4
million in PE 63313A.

Advanced tactical computer science and sensor technology

The committee recommends an increase of $2.5 million in PE
63772A to fund the application of situational awareness
technology and display techniques with commercially available
palmtop computer technology to provide dismounted soldiers with
map-based intelligence and situation awareness. The committee
notes that there are security issues raised by the emerging
opportunities to provide such capabilities to soldiers in the
forward battlefield areas and that such issues must be
addressed in parallel with technology development and
demonstration. The committee directs that all applicable
competitive procedures be used for any contracts, grants, or
other agreements awarded under this program and that cost-
sharing requirements for non-federal participants also be used,
where appropriate.

Tactical High Energy Laser

The committee continues to support the Tactical High Energy
Laser (THEL) program. The committee notes that the existing
cost-sharing agreement between the United States and Israel
does not include funding to deploy the system in Israel.
Pending a future agreement on cost sharing, the committee
recommends an increase of $10.0 million in PE 63308A to support
continued THEL testing and deployment activities.

Space and missile defense battle lab

The committee has supported the Space and Missile Defense
Battle Integration Center, which has now transitioned to a
Battle Lab. The committee is pleased that the administration
has increased the budget request for fiscal year 1999 to $9.2
million, but does not believe that this amount adequately
supports the Battle Lab. Therefore, the committee recommends an
increase of $7.0 million in PE 63308A for the Space and Missile
Defense Battle Lab.

North Atlantic Treaty Organization (NATO) Research and Development

The budget request included $44.4 million for NATO research
and development in the following accounts: $11.6 million for
the Army (PE 63790A), $11.0 million for the Navy (PE 63790N),
$11.1 million for the Air Force (PE 63790F) and $10.7 million
for the Department of Defense (PE 63790T). The committee
recommends that funds in these activities be maintained at
fiscal year 1998 levels plus inflation, and therefore
recommends the following reductions in the military service and
defense accounts: $2.0 million (Army), $1.1 million (Navy),
$0.4 million (Air Force) and $2.3 million (Defense).

Comanche

The budget request included $367.8 million for continued
development of the Comanche helicopter. The committee strongly
supports the Comanche helicopter development effort and
believes this program should be accelerated. The committee
recognizes that Army funding constraints have prevented the
timely delivery of the second prototype aircraft necessary for
testing and developmental efforts. The Comanche program, as an
integral component of Army digitization, must be fielded as
soon as practicable to support necessary flight test
requirements and development of tactics, techniques and
procedures for the future digitized force. The committee
recommends an increase of $24.0 million for a total of $391.8
in PE 64223A. This increase in funding will support necessary
flight test requirements, development of first digitized corps
enhancements, and risk reduction activities for Comanche.

Advanced threat infrared countermeasure system

The budget request included $86.0 million to support
electronic warfare development programs. The committee
understands that Army efforts to complete the design of an
advanced threat infrared countermeasure and common missile
warning system (ATIRCM/CMWS) installation kit were adversely
affected by a Department of Defense program budget decision
that eliminated funding for the ATIRCM/CMWS installation kit
development effort. The committee supports Army initiatives to
complete work on the installation kits for ATIRCM/CMWS which
will allow this device to be inserted into the lot 6 production
line for Apache Longbow. This action is projected to save the
Army $74,000 per aircraft, or $5.3 million per year, if the
planned installation of ATIRCM/CMWS begins on the Longbow
production line in fiscal year 2001. The committee, therefore,
recommends an increase of $8.6 million in PE 64270A to restore
the program schedule and support completion of the ATIRCM/CMWS
kit design effort.

All source analysis system

The budget request included $28.1 million to support
development of the all source analysis system (ASAS). The
committee continues to support ongoing efforts to enhance the
capabilities of this system and is encouraged to note progress
made to date. The committee understands the Army is continuing
to experiment with the Integrated Battlespace Intelligence
Server (IBIS) to ensure that the technology transition
framework required to support fielded systems remains viable.
The committee, therefore, recommends an increase of $2.2
million in PE 64321A for critical ASAS Block II software
requirements.

Radar development

The budget request included $2.8 million to support
improvements to existing ground based radar systems. The
committee has been pleased with the capabilities provided by
the Sentinel radar system for Army air defense forces. The
Sentinel system acquires targets sufficiently forward of the
forward line of troops to improve short-range air defense
weapons reaction time and allow engagement at optimum ranges.
The integrated identification friend or foe system reduces the
potential for fratricide. The committee notes an outstanding
requirement for the fielding of a passive adjunct sensor
capability as a continuation of an approved pre-programmed
product improvement program. The committee believes this
passive capability should be accelerated and recommends an
increase of $4.0 million in PE 64820A to support this
developmental effort.

Firefinder

The budget request included $19.8 million to support the
Firefinder Block II pre-planned product improvement program by
replacing the antenna transceiver group. The committee
understands that the Army will award an engineering and
manufacturing development contract in 1998 in an effort to
double the current range performance and improve target
accuracy overthe existing radar. The committee recognizes this
program as a force protection enabler and recommends an increase of
$0.9 million in PE 64823A to support incremental funding necessary for
acceleration of software development efforts required by this activity.

Research, development, test and evaluation support

The committee remains concerned about the proportion of
research, development, test, and evaluation (RDT&E) funding
allocated to management, infrastructure, and support. In an
effort to slow this trend until a more comprehensive plan for
RDT&E management reform is initiated, the committee recommends
a total reduction of $27.0 million, to be allocated as follows:

Army: Millions
PE 64759A................................................. $1.0
PE 65301A................................................. 2.0
Navy:
PE 65853N................................................. 11.0
PE 65864N................................................. 5.0
Air Force:
PE 65807.................................................. 4.0
PE 65808F................................................. 2.0
Defense Agencies:
PE 65804D................................................. 2.0

Army test instrumentation and targets

The committee is concerned that aging instrumentation at
its defense test and evaluation facilities will be inadequate
to meet increasingly stringent technical standards for planned
evaluations of cutting edge missile technologies. In order to
effectively evaluate future technology, test instrumentation
must be able to provide faster, more accurate results for
smaller weapons with higher speeds, longer ranges, and higher
altitudes. Aging telemetry and radar equipment at the existing
facilities, first deployed in the 1960s, requires immediate
replacement. Optics equipment must be updated in order to
provide the accuracy levels demanded by high energy weapons and
target systems. Accordingly, the committee recommends an
increase of $7.0 million in PE 65602A to upgrade
communications, optics, radar, and telemetry equipment to
support programmed testing of advanced missile technologies at
existing range facilties.

Survivability/lethality analysis

The committee recommends an increase of $4.0 million in PE
65604A to expand the current information warfare vulnerability
assessments program to determine exploitable weaknesses in the
First Digitized Division and to recommend mitigating solutions
for systems throughout their acquisition cycle. The committee
believes that the Army must aggressively pursue these
assessments if the full benefits of digitization are to be
achieved.

High energy laser system test facility

The committee recommends an increase of $8.0 million in PE
65606A to accelerate development of solid-state laser
technologies for theater missile defense applications. If the
technologies can be demonstrated, solid state laser weapons may
have a number of critical advantages in missile defense
applications, including no requirement for munitions logistics,
a highly favorable cost per kill ratio, and a speed-of-light
kill capability. Recent developments in a variety of related
technologies provide new opportunities for the deployment of a
working system in the relative near-term. The committee urges
the Army to devote at least $1.5 million of the increase to
address issues involving crystal growth manufacturing.

Aerostat joint project office

The committee has supported the development of elevated
sensors for air and missile defense. The committee recognizes
that such sensors are critical to satisfying cruise missile
defense requirements. Notwithstanding this support, the
committee does not believe that the Department of Defense has
adequately integrated its various cruise missile defense
programs into a coherent architecture and development plan.
Given this lack of a comprehensive plan, the committee views
the fiscal year 1999 increase in the joint aerostat program to
be excessive. Therefore the committee recommends a reduction of
$50.0 million in PE 12419A. The committee notes that even with
this reduction, the budget for the joint aerostat program would
grow in excess of 63 percent over the fiscal year 1998
appropriation for this program.

Advanced field artillery tactical data system (AFATDS)

The budget request included $35.1 million to support
development of the AFATDS multi-service fire support command
and control system. The committee recognizes that objective
functionality enhancements are necessary to meet requirements
for airspace deconfliction and technical fire direction
support. AFATDS is a critical system that remains in the early
stages of fielding. The committee recommends an increase of
$12.5 million in PE 23726A to support development of system
improvements and directs the Army to ensure that this program
is adequately funded in future budget submissions.

Combat vehicle improvement programs

The budget request included $94.8 million to support
research and development associated with identifying and
fielding improvements to Army combat vehicles. For the last two
years, the committee has supported the effort to develop new
flat panel display devices to support Army digitization
activities and alleviate a deficiency identified with
experimental systems. The committee notes that the research and
development effort is in its last year and the program will be
ready for transition into production in fiscal year 2000. The
committee recommends an increase of $7.0 million in PE 23735A
to complete the research and development effort on flat panel
displays in fiscal year 1999.
NAVY

Pulse detonation engine technology

The committee is encouraged by the potential of pulse
detonation engine technology for rapid response to time
critical targets and recommends an increase of $1.0 million in
PE 62111N to accelerate the flight demonstration of this
technology.

Stainless steel double hull research

The committee recommends an increase of $3.0 million in PE
62121N for the acceleration of research in stainless steel
double hull technologies. The committee notes the potential of
this technology to reduce acquisition and life-cycle costs and
improve survivability. The committee directs that all
applicable competitive procedures be used in the award of
contracts or other agreements under this program, and that
cost-sharing requirements for non-federal participants be
utilized, where appropriate.

Communications, command and control technology

The budget request includes $65.0 million for
Communication, command and control technology (PE 62332N). The
committee recommends a reduction of $5.0 million in PE 62332N
for the strategic sustainment program in order to fund higher
priority programs.

Thermal management materials

The committee recommends an increase of $1.5 million in PE
62234N for high thermal conductivity carbon fiber material. In
order to fully exploit the advancements in the area of thermal
management for electronics and fully realize the potential for
cost savings and performance, it is essential that these
materials be used in conjunction with commercially available
chips. The committee directs the Navy to pursue dual-use
application and industry cost-sharing to the maximum extent
practicable.

Carbon-carbon heatshield technology

The committee encourages the Navy to continue a robust
program for the development of carbon-carbon heatshields and
insulation materials and recommends an increase of $2.5 million
in PE 62234N in order to specifically address future Navy
reentry body requirements. The committee directs that all
applicable competitive procedures be used in the award of
contracts or other agreements under this program, and that
cost-sharing requirements for non-federal participants be
utilized where appropriate.

Electronic propulsion technology

The committee recommends an increase of $2.0 million in PE
62234N for the development of applied high temperature
superconducting (HTS) technology for electric propulsion and
related auxiliary systems in future surface ships and
submarines. The Office of Naval Research, in conjunction with
the Navy's principal shipbuilders, should build upon the
advances realized in the commercial sector and pursue dual-use
technology and cost-sharing to the maximum extent practicable.

Precision strike and air defense technology

The budget request included $58.3 million for precision
strike and air defense technology, of which $4.9 million would
be for mobile offshore basing (MOB), project R2266. The MOB
effort would develop a concept to provide a means by which
long-term U.S. presence can be maintained. Technology issues
associated with both semi-submersible and mono-hull modules
connected into platforms 1000 and 3000 meters in length will be
explored.
The committee has determined that engineering and design
studies on critical technologies essential to MOB can be
completed more efficiently if accelerated in fiscal year 1999.
Accordingly, the committee recommends an increase of $5.0
million in PE 63238N for MOBS.

Advanced electric systems studies

The budget request included $14.8 million in PE 603508N for
fabrication, demonstration, development and concept studies for
quiet electric propulsion motor technologies. The studies and
intermediate scale development are premature initiatives until
fiscal year 1999 results from the 500KW sub-scale demonstration
model are known. Therefore, the committee recommends a
reduction of $1.0 million to PE 603508N.

Composite helicopter hangar

The budget request included no funding for continuation of
a program to design and fabricate the outer shell of a DDG-51
helicopter hangar structure using composite materials. The
composite helicopter hangar program goals are to leverage
enabling technologies that can lead to reduced radar signatures
and cost and weight savings. Development issues include
fabrication, durability, maintenance and repair, outfitting,
fire survivability in a manned space, and local loading due to
shock from mounted equipment. The committee recommends an
increase of $5.0 million in PE 603508N to continue a
developmental effort to design and fabricate the outer shell of
a DDG-51 helicopter hangar structure using composite materials.

Marine Corps warfighting laboratory

The budget request included $23.6 million within PE 603460M
to support the Marine Corps warfighting laboratory (MCWL). The
MCWL has supported the experimentation process for the Marine
Corps. Last year's effort was highlighted by Hunter Warrior, an
effort to test advanced operational concepts in extended and
dispersed battlefields.
In fiscal year 1999, the Marine Corps intends to conduct
Urban Warrior to test concepts for operating in urban areas.
Later in fiscal year 1999, the Marine Corps will begin the
planning for the experimentation phase called Capable Warrior.
Capable Warrior will attempt to integrate ``lessons learned''
from the previous experiments.
The committee continues to support these warfighting
experiments, and recommends an additional $10.0 million for
accelerating these efforts. Of this amount, $5.0 million will
be for the second phase continued evaluation of the broad-area
unmanned retail and re-supply operation or BURRO. This funding
will allow this joint effort to complete the evaluation process
and have a flying prototype by year 2000.
The committee understands that this series of experiments
is not a normal acquisition program. It is clear that an effort
to inflict robust countermeasures on the experimentation
process could thwart attempts to learn as much as we can from
the experiments about potential operational concepts.
Nevertheless, the committee believes that the Marine Corps and
the MCWL must pay greater attention to the vulnerabilities of
systems used in these experiments to potential countermeasures.
Decisions about changing operational concepts, changing force
structure, or pursuing new hardware developments must be made
with a better understanding of vulnerabilities to potential
countermeasures.
Therefore, the committee directs the Secretary of the Navy
to provide a report on the long-term plan for developing ``red
team'' countermeasures efforts activity to keep pace with the
warfighting experiment efforts. The Secretary should provide
the report to the congressional defense committees by May 15,
1999. The committee further directs that no more than 85
percent of the funds for this program be obligated, before the
delivery of the report.

Freeze dried blood research

The committee recommends an increase of $1.0 million in PE
63706N to continue research on freeze-dried blood processes to
develop a safe and reliable supply of blood for combat
casualties. The technology provides freeze-dry blood platelets
for the purpose of extending shelf-life, destroying potential
contaminating viruses, and reducing space required for storage
of blood stocks. The committee recognizes the commercial
potential of this technology and encourages the Navy to pursue
dual-use application and cost-sharing in this program to the
maximum extent practicable.

Advanced lightweight influence sweep system

The budget request included $4.2 million for advanced mine
sweeping. The advanced lightweight influence sweep system
(ALISS) is focused on developing superconducting magnets and
acoustic transducers to sweep influence mines targeted against
specific classes of Navy ships. The lightweight, modular and
low logistic requirements features make ALISS a candidate for
deployment by a number of Navy platforms. The committee
recommends a $1.0 million increase to PE 603782N to continue
the test and development of ALISS.

Studies and experiments for combat systems engineering

The budget request included $8.6 million for studies and
experiments for advanced combat systems engineering which,
potentially, could be leveraged into new ship class computer
architectures. The committee supports leveraging distributed
architecture, radar technology and information management
concepts when those efforts are directly connected to
correcting a warfighting deficiency or to reducing the costs of
building 21st century platforms. The committee recommends a
reduction of $2.0 million in PE 603382N for studies and
experiments not directly connected to correcting warfighting
deficiencies in 21st century platforms.

SSGN study

In implementing pending strategic arms reduction treaties,
the Navy may remove some of the Trident submarines from active
service as fleet ballistic missile submarines (SSBNs). The
``Report of the National Defense Panel, December 1997'' stated
thatthe Navy should examine converting Trident submarines
coming out of strategic service for use in missions other than at the
strategic level. The committee is aware that these SSBNs would have
several years of service life remaining at the point that START II
would require that they no longer be used as SSBNs. The committee
understands that there are several alternative dispositions of any such
boats removed from active service as SSBNs.
One of these alternatives is to convert these vessels to
carry only tactical missiles (SSGN), including such missiles as
Tomahawk, or the Navy variant of the Army tactical missile
system (NTACMS). The committee believes that this alternative
may have merit for meeting some of the Navy's shore fire
support requirements, but needs more information upon which to
base any decision about a program to convert these SSBNs to
SSGN-configuration.
Elsewhere in this report, the committee has recommended a
provision that would prohibit the retirement or conversion of
any Trident submarines until the START II treaty enters into
force. Nevertheless, the committee believes the Navy must begin
now to develop plans for submarines that will become excess if
the treaty enters into force.
Therefore, the committee directs the Secretary of Defense
to conduct an analysis of converting some of the Trident SSBNs
to SSGN-configuration. This study should identify a schedule
for such an SSGN conversion, the costs of such a conversion,
the benefits that may be derived from such a plan, major
problems areas that may require additional analysis and the
implications of ensuring that such a conversion would be
compliant with all applicable arms control treaties. The
committee recommends an increase of $1.0 million to PE 603564N
and directs the Secretary to provide the report to the
congressional defense committees no later than March 1, 1999.

Intercooled recuperated gas turbine engine

The budget request included $23.4 million to conduct
intercooled recuperated (ICR) gas turbine engine testing. The
ICR naval engine program is a cooperative program being
developed in conjunction with U.S. allies. The ICR engine is a
candidate to provide main propulsion for future ships. The
expectation is that the ICR engine will produce significant
reductions in fuel consumption compared to the gas turbine
engines now in use on Navy ships. ICR engine testing and
evaluation have progressed during seven engine tests with a
cumulative 1200 hours of engine operation. As a result of the
latest testing, combustor and recuperator improvement
development efforts have been identified that must be completed
prior to resumption of testing. The committee believes the ICR
engine should move rapidly to completion of testing to make it
a viable candidate for ship propulsion. Therefore, the
committee recommends an increase of $5.0 million in PE 603573N
for continued development and testing of the ICR engine.

Predator

The committee is concerned about issues raised regarding
the ongoing development of the Predator missile system.
Predator is designed to be a man portable, lethal, fire-and-
forget top attack anti-armor missile. The committee understands
that personnel issues associated with the contractor work force
have resulted in some schedule slippage for the production of
this missile system. For the last two years, the committee has
been compelled to add funding, with a recommendation for $18.0
million in fiscal year 1999 alone, for safety modifications to
the shoulder launched multi-purposed assault weapon to extend
the service life of this system until Predator can be fielded.
The committee believes that the Predator system should be
fielded as soon as possible and understands that necessary
corrective actions have been taken to support continued
development of this critical weapon system. If fact, recent
live-fire tests have been very successful and it appears the
program is back on track. The committee, therefore, recommends
an increase of $4.0 million in PE 63635M to maintain the
previously established development and fielding schedule.

Vertical gun for advanced ships

The budget request included $25.1 million in PE 603795N for
a new initiative to develop a prototype vertical gun for land-
based testing. The Navy intends to use the vertical gun for
advanced ships (VGAS) as the main fire support battery for the
land attack destroyer (DD-21). To meet the DD-21 schedule, VGAS
development would need to be sufficiently mature to support DD-
21 critical design review and procurement authorization in
fiscal year 2003.
The Navy's plan is that the DD-21 would be the first member
of a family of 21st century surface combatants (SC-21). The
committee believes that it would be highly unlikely that the
Navy would develop VGAS for DD-21, and then develop another gun
system for other members of the SC-21 family.
The committee views with concern the fact that the Navy's
request would move forward with the vertical gun design without
adequately analyzing alternative gun designs for DD-21. The
committee notes that a vertical gun would have little or no
ability to ``train and elevate.'' These deficiencies would
limit availability and engagement envelopes for countering
littoral threats, as well as limiting the Navy's choice of
ammunition to a new, Navy-only family of gun ammunition. The
committee believes the Navy should consider war fighting
attributes other than low radar cross-section to justify the
award of a contract for a vertical gun.
In previous reports, the committee emphasized
theadvisability of attempting to meet fire support requirements with
modifications of systems already developed. The Navy has not
reconsidered the Army's multiple launch rocket system (MLRS) as an
option for providing fire support to the Marines. However, the Army has
made significant improvements in MLRS range and launch platform
stabilization since the Navy last reviewed this system to fill the fire
support requirement. The committee believes that another review would
be appropriate.
The Secretary of the Navy is directed to report, prior to
obligating funds for a prototype VGAS, the results of an
analysis of alternatives for an advanced gun system that
includes cost as an independent variable and considers at least
the following:
(1) meeting all war fighting capabilities that will
be required for a gun system on a multi-mission
combatant;
(2) relying on joint ammunition programs that
leverage technology investments by all services, and
the availability and economies of scale of moving to
one family of gun ammunition for Army, Marine Corps,
and Navy fire support missions;
(3) fulfilling some portion of the fire support
requirement with a modified version of the Army's
extended range multiple launch rocket system; and
(4) fulfilling some portion of the fire support
requirement with the Navy variant of the Army Tactical
Missile System (NTACMS).
Until such an analysis is complete, the committee believes
that it would be premature to proceed with VGAS development at
the pace assumed in the Navy's budget request. Therefore, the
committee recommends a reduction of $10.0 million, and directs
the Navy to conduct an analysis of all advanced gun designs, as
well as ammunition availability, in determining the best gun
design for DD-21.

Naval surface fire support system integration

The budget request included $21.6 million for a new
initiative to develop surface fire support planning and control
systems for the 5-inch 62 gun on DDG-51 ships and the 155mm
vertical gun for the future DD-21 class of ships. The committee
agrees with the need for a planning and control system for the
5-inch 62 gun for DDG-51 ships and considers this a priority to
coincide with the introduction of the Extended Range Guided
Munition (ERGM) to the fleet. The committee agrees with the
Department of Defense's plan to reduce risk by integrating the
5-inch 62 gun into the existing Advanced Tomahawk Weapons
Control System (ATWCS) initially hosted on a separate hardware
processor.
However, initiation of software builds to support vertical
gun requirements is premature and counter to the Navy's plan to
use a ``total systems'' approach in developing the DD-21. The
committee encourages the Navy to pursue, through the DD-21
program and the Joint Maritime Command and Information System
(JMCIS), system engineering for development of surface fire
support system requirements within the DD-21 combat system
architecture. Therefore, the committee recommends a reduction
of $7.7 million to PE 603795N.

Joint Strike Fighter

The budget request included $919.5 million ($463.4 million
in Navy research and development and $456.1 million in Air
Force research and development) for continued development of
the joint strike fighter (JSF).
Section 213 of the National Defense Authorization Act for
Fiscal Year 1998 (Public Law 105-85) required a report on the
order of fielding the variants of the JSF, and that
specifically addressed the acceleration of the naval variant.
The report included a certification that the JSF program
contains sufficient funding to carry out an alternate engine
program that includes flight qualification of an alternate
engine in a JSF airframe.
While not in total agreement with the report, the committee
notes the timely submission and clear presentation of the
Department of Defense priorities and plans. The certification
of a funded program for an alternate engine is a positive
commitment to cost-effective program management. However, the
actual demonstration of the alternate engine in a JSF airframe
has been continuously shifted to the ``out years,'' an action
that threatens to invalidate the whole initiative. If the
alternate engine is not completed for use for the most
stressing of the JSF requirements (the short takeoff/vertical
landing variant), then it may be too late to provide a major
benefit to the program. Accordingly, the committee recommends
an increase of $15.0 million to the budget request to
accelerate the development of an alternative engine for the
JSF.

Nonlethal weapons and technologies of mass protection program

The budget request included $22.5 million for the non-
lethal weapons (NLW) technology demonstration and validation
program (PE 63851M). The committee recommends an increase of
$13.3 million to the budget request.
The committee recommends that of the recommended increase,
$6.3 million be used to accelerate the development and fielding
of near-term, low-tech NLW technologies such as nonlethal
claymore mines, vehicle-mounted 66mm delivery systems,
nonlethal payloads for delivery by unmanned aerial vehicles,
nonlethal foams, and calmative agents. In addition, increased
funding for this activity would be used to accelerate
demonstration of acoustic and electromagnetic directed energy
systems, for medical surveillance and non-lethal casualty data
collection, strategic planning, human effects assessments,
technical studies and analysis, and increased experimentation
in warfighting and battle labs.
The committee understands that it is the intention of the
Department of Defense to expand its review of doctrinal, legal,
policy, and operation issues regarding the research,
development, acquisition, and employment of NLW technologies.
The committee recommends that $2.0 million be made available
from funds authorized for the nonlethal weapons technology
program in fiscal year 1999 to the Human Effects Panel of the
Joint Non-Lethal Directorate for those activities.
The committee recommends that the remaining $7.0 million of
the recommended increase to the budget request be used to
conduct a comprehensive effort to explore and develop nonlethal
tactical denial systems that would provide ground commanders a
wider range of capabilities. Finally, the committee recommends
that $500,000 be made available to complete type classification
of non-lethal weapons technology that can be mounted on
existing weapons assigned to U.S. forces, such as M16s and M4
carbines.
As noted in the statement of managers accompanying the
National Defense Authorization Act for Fiscal Year 1998 (S.
Rept. 105-29), the committee believes it is important that
advanced technologies be developed to provide U.S. military
forces with greater flexibility to manage, shape, deter, or
contain future conflicts, as they are increasingly confronted
by unorthodox, non-traditional, and asymmetrical threats. These
challenges, and an increase in low and medium-intensity
conflict, require the Department of Defense to evaluate new
technologies and doctrine for the use of force. In particular,
the committee believes that the Department should focus on the
development of new and emerging technologies to extend the
scope of possible responses and to facilitate the containment
of conflict across the operational continuum.
Section 230 of the National Defense Authorization Act for
Fiscal Year 1997 (Public Law 104-201) established a program
element that would consolidate and streamline the Department of
Defense and military service nonlethal weapons technology
program, and directed the Department to designate an executive
agent. As part of the Department's Munitions Strategy announced
in September 1996, the Under Secretary of Defense for
Acquisition and Technology highlighted the importance of
equipping U.S. forces with nonlethal weapons to conduct
operations other than war, the focus of which would be to
reduce civilian casualties. At the same, the Department
announced the establishment of a nonlethals weapons technology
program and designated the Marine Corps as the executive agent
for the program.
Despite congressional direction and designation of an
executive agent by the Under Secretary of Defense for
Acquisition and Technology, the committee remains concerned
that the Department and the military services continue to
conduct research and development on NLW activities that benefit
all services outside the purview of the established defense NLW
program and without oversight by the executive agent. The
committee directs the Department and the military services to
implement the congressional direction contained in Public Law
104-201, to consolidate all nonlethal weapons technology
research and development into a single program element, with
management and oversight of the program conducted by the Marine
Corps as executive agent.

Advanced communications and information technologies

The committee continues to support the Advanced
Communication and Information Technologies (ACIT) initiative.
The committee recommends an increase of $3.0 million in PE
64707N for continuation of the ACIT initiative.

Parametric airborne dipping sonar

The budget request contained no funding for the parametric
airborne dipping sonar (PADS). The PADS program is the
continuation of a small business innovative research project
that is designed to develop, demonstrate and evaluate the three
dimensional, stabilized steerable acoustic beams for mine
avoidance and submarine detection in shallow water. It is the
only system that has the potential to provide airborne active
dipping sonar antisubmarine and antimine capabilities for
shallow water littoral operations.
The committee is encouraged with initial results and
potential future antisubmarine and antimine applications of the
parametric airborne dipping sonar. The present program to prove
parametric concepts using a prototype unit is scheduled for
additional demonstrations in fiscal year 1998. Navy analysis
and present plans include the possibility of PADS being a
shallow water adjunct to the airborne low frequency active
sonar system (ALFS).
Continued development of the PADS system to make it a
flightworthy system including reel machine, fiber-optic and
power cable, and signal processor improvements resulting in a
helicopter flight demonstration, is key to fighting in the
littorals in the 21st century. Therefore, the committee
recommends an increase of $8.0 million in PE 604212N for the
continued development of PADS.

Commercial off-the-shelf insertion just prior to critical design review
for helicopter improvement

The budget request included $231.1 million in PE 604212N
for antisubmarine warfare (ASW) and other helicopter
development. A second critical design review (CDR) for the
Light Airborne Multipurpose System (LAMPS) MK III Improvement
has been added to the program and scheduled for the second to
the fourth quarter of fiscal year 1999. Commercial off-the-
shelf (COTS) insertion opportunities for low rate initial
production (LRIP) test articles should occur predominantly
prior to critical design review. The $25.0 million request to
continue efforts toincorporate COTS technology during the two
fiscal quarters prior to CDR appears to be disproportionate when
compared to past efforts ($14.0 million in fiscal year 1998) when four
or more quarters were required to complete the efforts. Therefore the
committee recommends a reduction of $1.0 million to PE 604212N.

Integrated defensive electronic countermeasures

The budget request included $128.6 million for electronic
warfare development. The integrated defensive electronic
countermeasures(IDECM) system is the next generation radio-
frequency countermeasures system (RFCM) intended for the F/A-
18C/D/E/F, B-1B, F-15C/E, and other platforms. The committee
understands and supports the Department of Defense efforts to
apply this joint service technology to as many platforms as
possible. The committee is also aware of the evolving nature of
the operational requirements, which in many cases are driven by
existing operational commitments and technical challenges
inherent in the program. Therefore, the committee recommends an
increase of $10.0 million in PE 64270N for the IDECM RFCM.

DDG-51 composite director room

The use of composites in shipbuilding has the potential to
increase the survivability and reduce the overall weight of
ships and to reduce maintenance. However, issues regarding
composite use in construction in the following areas remain
unanswered: combat repair, corrosion due to differences in the
electric potential of composites and other shipbuilding
materials, and possible toxicity resulting from exposure to
intense heat. The committee believes the potential use of
composite materials in shipbuilding should be pursued. The
committee recommends an increase of $5.0 million in PE 603513N
for continuation of a project to design and test a director
room for the DDG-51 class of ships.

Laboratories and field activities monitoring efforts

The budget request included $132.5 million for surface
combatant combat system engineering in PE 604307N. This request
included $19.2 million for laboratory and field activity
unspecified scientific services for monitoring baseline
efforts. The committee recommends a reduction of $3.0 million
to unspecified scientific services.

Multi-purpose processor

The budget request included $37.2 million for submarine
sonar improvement. The multi-purpose processor (MPP) is the
result of a small business innovative research (SBIR)
initiative developed under the sponsorship of the new nuclear
attack submarine (NSSN) program. The MPP provides a capability
to easily transport new, advanced software to existing hardware
installations. It lies at the heart of the Navy's acoustic
rapid commercial off-the-shelf (COTS) insertion program (ARCI),
a program designed to permit the SSN-688 class to regain
acoustic superiority over the diesel and nuclear submarines of
other navies. The committee recommends an increase of $15.0
million in PE 604503N for continuation of the SBIR follow-on
for advanced development of MPP transportable software
technology, technology insertion, advanced processor software
builds, and for providing MPP units and training throughout the
fleet and the Navy research and development community.

Non-propulsion electronics system

The budget request included $218.8 million for New Attack
Submarine (NSSN) non-propulsion development. The purpose of the
development is to reduce life-cycle costs by investigating and
incorporating open systems architecture, commercial off-the-
shelf software and hardware and advanced ship construction
techniques. The non-propulsion electronics system (NPES) is
comprised of 15 subsystems required to perform warfare
missions. The major systems are sonar, combat control, exterior
communications, electronic support measures and interconnecting
architectures. To attain the possible life-cycle savings that
could accrue, analysis and integration to support the 15
subsystems development is required. The committee recommends an
increase of $12.0 million to PE 604558N for integration of the
15 NPES subsystems.

Smart propulsor product model

The budget request included $7.0 million for continuation
of the development of the smart propulsor product model (SPPM)
for DD-21. The SPPM will provide a complete representation of
the ship's requirements, design and capabilities at each stage
of the life-cycle. The SPPM program is a proposed joint Navy/
industry effort to develop software that will bring together
design, manufacturing, cost and capability modeling for ship
propulsion devices. This development will enable the Navy to
consider innovative propulsion concepts for future ships while
considering life-cycle costs and manufacturing techniques. The
committee recommends an increase of $4.0 million in PE 604567N
for the SPPM.

Ship live-fire test

The budget request included $8.6 million for the second
year of DD-21 live fire test and evaluation prediction. The
program's plan for fiscal year 1998 includes $3.4 million for
the first year of DD-21 live fire test and evaluation
prediction. Subsequent to the enactment of the fiscal year 1998
authorizationfor this program, the first year of full
procurement authorization of DD-21 was delayed one year from fiscal
year 2003 to fiscal year 2004.
The committee believes the total fiscal year 1998 and
fiscal year 1999 DD-21 live fire test prediction plan and
request of $12.0 million to be excessive given the one year
delay in the program. Therefore, the committee recommends a
reduction of $8.6 million in PE 604567N, without prejudice, to
reflect the rephasing of the program.

Infrared search and track system

The budget request included $900,000 for an infrared search
and track (IRST) system. Land-based testing of IRST is
scheduled for fiscal year 1998, followed by at-sea testing in
fiscal year 1999.
Congress has directed the Navy to develop IRST to provide a
passive detection and tracking system. In many previous
reports, the committee has noted the potential of IRST for
complementing, not supplanting, radar, because IRST would
operate in a different portion of the electromagnetic spectrum
from radar. As shown by at-sea testing, IRST systems could
complement existing shipboard radars by continuously scanning
the horizon for threat platforms or sea-skimming missiles.
Horizon search, for which IRST would be optimized, is an area
of relative weakness for active radars.
Although various studies have repeatedly validated that
IRST could provide a major improvement in ship survivability
against sea-skimming cruise missiles, Navy budget requests
continue to emphasize exploitation of the radio portion (radar)
of the electromagnetic spectrum.
The committee believes developing a search and track system
that is not dependent on active transmissions by either
friendly or threat emitters could make an extremely important
contribution to successful naval operations. Therefore, the
committee recommends an increase of $6.5 million in PE 604755N
for continued development of the IRST system.

NUKLA antiship missile decoy system electro-magnetic compatibility

The budget request included $2.3 million for continued
development and testing of the electo-magnetic compatibility
(EMC) upgrade to the NULKA active countermeasures decoy. Having
EMC will permit a more rapid upgrade of the NULKA round to
accommodate new friendly emitters as they enter the fleet, and
also deal with the evolving ASM threat.
The NULKA decoy was developed to improve surface ship
survivability against antiship missiles (ASM). The ASM threat
is growing rapidly. By the year 2000, an estimated 100 nations
will possess more than 40,000 ASMs. These missiles will pose a
potent threat to surface combatants and amphibious ships
involved in littoral operations.
The committee recommends an increase of $2.0 million in PE
604755N to complete the development and operational testing of
the EMC upgrade.

Voice instructional devices

The committee recommends an increase of $1.0 million in PE
64771N for voice instructional device (VID) technology. The
committee notes the progress made in technology that allows for
faster, more efficient medical care in remote or combat
situations and encourages the Navy to include VID technology in
this research. The committee directs that all applicable
competitive procedures be used in the award of contracts or
other agreements under this program, and that cost-sharing
requirements for non-federal participants be utilized where
appropriate.

Global command, control, communications, computers, intelligence,
surveillance, reconnaissance (C4ISR) visualization

The budget request included $13.2 million for space and
electronic warfare surveillance and reconnaissance support. A
continuing problem between the intelligence collectors and war
fighting commanders is the manner in which intelligence is
displayed. Useful information provided in a form that is
quickly understandable and easily accessed is vital to winning
battles. The Command, Control, Communications and Computers,
Intelligence, Surveillance and Reconnaissance (C4ISR) systems
in use provide various products to operational commanders. The
Global C4ISR Visualization (GCIV) project will give operational
commanders a visualization system that integrates information
from all Intelligence, Surveillance and Reconnaissance (ISR)
systems. GCIV will use multi-dimensional commercial off-the-
shelf (COTS) visualization software integrated with a COTS
database server connected to Navy databases. The committee
recommends an increase of $4.0 million in PE 65867N for the
GCIV project.

F/A-18E/F reconnaissance development

The budget request included $1.4 million in research and
development and $43.2 million in procurement to continue the
restructured advanced tactical air reconnaissance system
(ATARS) program. The ATARS total program of $464.9 million
includes $216.3 million in development and $248.6 million in
procurement. The ATARS program will field reconnaissance
systems on Marine Corps F/A-18D aircraft. The approved ATARS
plan calls for fielding a total of 31 ATARS systems. The plan
was restructured as part of a congressional cancellation of the
original the Air Force follow-on tactical reconnaissance system
(FOTRS) program. Congress dropped Air Force and Navy
participation in the ATARSprogram specifically because of the
inadequate support and oversight provided by the two services.
The budget request also included $2.9 million for fiscal
year 1998 and $43.4 million for fiscal year 1999 to begin an F/
A-18E/F tactical reconnaissance development within PE 24136N.
This is a new start program to develop a replacement for the F-
14 tactical air reconnaissance pod system (TARPS). The Navy
intends to spend $398.9 million ($112.4 million in research and
development and $286.5 million in procurement) to field 50 pods
and eight ground stations.
The committee believes that the budget request for tactical
reconnaissance is excessive, particularly in view of other
alternatives that may be available to solve the Navy's tactical
reconnaissance needs. Therefore, the committee recommends a
funding level of $20.0 million for F/A-18E/F tactical
reconnaissance development, a reduction of $23.4 million.
The committee believes that the Navy must conduct an
analysis of alternatives (AOA) before launching upon a program
that would spend another $400.0 million on providing a TARPS
replacement, when a direct one-for-one replacement may not be
the most effective solution to the problem. The AOA should
consider reconnaissance capability to be provided by other
planned or existing systems, such as carrier-capable Marine
Corps F/A-18D aircraft, various unmanned aerial vehicles
(UAVs), and a range of national reconnaissance systems. The
committee directs the Navy to obligate no more than 50 percent
of these funds until 30 days after the Navy submits the results
of the AOA to the congressional defense committees.

Battle force tactical training

The budget request included $5.9 million for the surface
tactical team trainer (STTT). The STTT is designated to further
develop an existing system, the battle force tactical training
(BFTT) system, so it will be able to provide joint warfare
training. A highly successful small business innovative
research (SBIR) project, N96-111, leveraged the capabilities of
commercial off-the-shelf (COTS) operating systems and
processors. The committee recognizes that the rapid development
under the SBIR fast track program did not allow sufficient time
for the Department of Defense to program funding to complete
the development work of converting the software to a personal
computer operating system. The committee recommends an increase
of $7.0 million in PE 204571N for the purpose of SBIR phase III
follow-on work to continue the BFTT operating system
conversion.
AIR FORCE

Friction welding

The committee recommends an increase of $1.5 million to
develop and optimize friction welding techniques for aluminum
and other alloys used by the Air Force and the Department of
Defense, to develop weld repair techniques and establish a
mechanical property data base, including fatigue and stress
corrosion cracking information. The committee directs that all
applicable competitive procedures be used in the award of
contracts or other agreements under this program, and that
cost-sharing requirements for non-federal participants be
utilized, where appropriate.

Integrated high performance turbine engine program

In order to fund higher priorities, the committee
recommends a total reduction of $9.0 million in the integrated
high performance turbine engine program in the following
program elements: $4.0 million in PE 62203F; $3.0 million in PE
63202F; and, $2.0 million in PE 63216F.

Variable displacement vane pump

The committee recommends an increase of $2.0 million in PE
62203F to support durability and damage tolerance testing for
the variable displacement vane pump (VDVP) program. The
committee notes that the variable geometry features of VDVP
simplify aircraft thermal design providing cost and weight
benefits. The committee directs that all applicable competitive
procedures be used in the award of contracts or other
agreements under this program, and that cost-sharing
requirements for non-federal participants be utilized where
appropriate.

High frequency active auroral research program

The committee recommends an increase of $9.0 million in PE
62601F to continue experimentation in the high frequency
auroral research program.

Night vision technology

Night vision goggles have been used in military aviation
for more than twenty years, but are limited by a very narrow
field of view. Attempts to increase the field of view have
resulted in decreasing resolution. Panoramic night vision
technology combines increased field of view (to 100 degrees),
high resolution, integrated symbology, and close-to-face center
of gravity, with human effects improvements, such as reduced
weight, pilot fatigue, and ejection seat safety. The committee
recommends an increase of $3.0 million in PE 63231F to
accelerate the development of panoramic night vision goggles.

ALR-69 radar warning receiver upgrade

The budget request included $25.6 million for
electroniccombat technology research and development (PE 0603270F), but
included no new funds for the precision location and identification
(PLAID) upgrade. PLAID is a low cost upgrade to the existing ALR-69
system that is being developed in project 431G of this program element.
The Air Force uses funding in project 431G to develop and demonstrate
advanced technologies for radio frequency (RF) electronic
countermeasures to enhance survivability of air and space vehicles.
The committee understands that PLAID upgrade program has
undergone successful testing, and encourages such a cost
effective approach to providing radar warning receivers (RWR).
Accordingly, the committee recommends an increase of $14.0
million to continue development of the ALR-69 PLAID upgrade in
fiscal year 1999.

Ballistic missile technology

The committee has supported past missile technology
demonstration (MTD) experiments, which have contributed to the
ballistic missile technology program and demonstrated
capabilities to attack hardened and deeply buried targets. The
committee has also supported this program as a means of
developing capabilities utilizing Global Positioning System
(GPS) for range safety. The committee strongly supports efforts
to develop GPS-based alternatives to existing range radars,
which offer the potential of significant savings in the future.
The budget request did not include funds in the Ballistic
Missile Technology program element. The committee recommends an
increase of $5.0 million in PE 63311F to support the MTD-4
effort and develop GPS-based capabilities for range safety and
tracking.

Solar orbital transfer vehicle

The committee has supported thermionics technology
development for space applications. The solar powered orbital
transfer vehicle program combines thermionic technology for
electricity production and thermal propulsion which can be used
to move spacecraft to higher orbits or new orbits. To continue
this important effort, the committee recommends an increase of
$10.0 million in PE 63401F.

Micro-satellite technology program

Section 215 of the National Defense Authorization Act for
Fiscal Year 1998 (Public Law 105-85) required the Secretary of
Defense to establish a micro-satellite technology development
program that supports a range of space mission areas. The
committee strongly supports the efforts of the Air Force
Research Laboratory (AFRL) to initiate such a program in fiscal
year 1999. In order to accelerate this important effort, the
committee recommends an increase of $10.0 million in PE 63401F
to be applied to developing and flying a series of cooperative
micro-satellite test vehicles (beginning with the so-called
``XSS-10'') with the National Aeronautics and Space
Administration (NASA) to address critical issues of satellite
inspection, protection, servicing, and re-fueling.

Range improvements for liquid upper stage testing

The committee supports efforts by the Air Force to upgrade
existing rocket test ranges to conduct liquid upper stage
flight experiments. To support this effort, the committee
recommends an increase of $5.0 million in PE 63401F.

Space control technology development

The committee has reviewed the Department of Defense's
February 1998 report on the Kinetic Energy Anti-Satellite
Program. The report states that ``DOD is currently examining
potential space control related research, development, and
acquisition options to support the President's policy, satisfy
military requirements within available resources, and address
the architecture.'' In the cover letter to this report, the
Under Secretary of Defense for Acquisition and Technology
states that ``I anticipate that these efforts will culminate in
a comprehensive plan in time for the FY 2000 President's
budget.''
The committee supports the development of such a plan but
is concerned that insufficient resources are available to
support a comprehensive evaluation of various technical
options. Therefore, the committee recommends an increase of
$30.0 million in PE 63438F to support a range of space control
technology activities. The Assistant Secretary of Defense for
Command, Control, Communications, and Intelligence (Space and
Information Superiority) shall be responsible for executing
these resources in support of the ``comprehensive plan''
referenced in the Department of Defense's report.
The committee directs the Secretary of Defense to submit a
report to the congressional defense committees by February 15,
1999 that describes the Secretary's plan for executing the
space control technology funds specified above. The report
should also describe the Secretary's plan for continuing these
efforts in fiscal year 2000 and beyond.

Variable stability in-flight simulator test aircraft

The budget request provided no funds for the variable
stability in-flight simulator test aircraft (VISTA). The VISTA
is a highly adaptable test resource that can be used for many
flight test programs, including the Joint Strike Fighter, F-22,
and others. As a testament to the effectiveness of the VISTA,
the USAF points to VISTA testing of F-22 flight controls, when
reviewing critical testing already completed for the F-22.
TheVISTA, a highly modified F-16 can be programmed to simulate various
aircraft, both real and theoretical, in a cost effective manner.
The committee notes with concern the lack of practical
support for the VISTA, but the eagerness to take credit for its
contributions to F-22 testing. Accordingly, the committee
recommends an increase of $7.3 million to continue VISTA
development of thrust vectoring investigations and to provide
for adequate support for continuing operations.

EC-130H

The budget request included no funds for the EC-130H
Compass Call aircraft (PE 64270F) in fiscal year 1999, even
though funds were included from fiscal years 1994 through 1998.
The Compass Call EC-130H is a wide-area airborne offensive
counter information system. Its mission is to deny, degrade,
and disrupt adversary communications, and is currently fielding
the first of two Block 30 configuration squadrons, a funded
upgrade that includes a software-programmable, commercial off
the shelf-based digital, open architecture. However, due to
accumulated funding reductions and ongoing fiscal pressures,
essential pre- production, system suitability, and integration
activities remain to be completed. Accordingly, the committee
recommends including $20.0 million to accelerate the
development of the Compass Call to complete those initiatives
in a cost effective manner.

Big Crow Program Office

The budget request did not include specific funding for the
Big Crow Program Office (BCPO). The committee understands that
the Department plans to operate the BCPO on a reimbursable
basis, with expenses paid by customers using the BCPO's
services.
The BCPO operates two flying laboratories under a support
agreement with the Air Force 412th Test Wing at Edwards Air
Force Base, California. The Department of Defense uses these
aircraft to evaluate weapons and communications systems under
stressing conditions. The BCPO's capability to implement
electronic warfare (EW) capabilities against systems during
test and evaluation periods and during exercises provides a
vital contribution.
The BCPO provides services to many customers, including the
Navy's AEGIS program, the Ballistic Missile Defense Office, the
Army Patriot air defense program, E-3A Airborne Warning and
Control System (AWACS) program, North Atlantic Treaty
Organization, and North American Air Defense. However, because
of the organizational arrangements for BCPO, there has been
inadequate support for its best use and most economic
operation. This lack of focus could result in the closure of
the BCPO.
If DOD were to lose the BCPO services, the Department would
forfeit the benefits of exposing U.S. weapons systems to a
realistic EW threats. Based on the broad use of BCPO, the
committee directs Secretary of Defense to assign oversight
responsibility for this office to the Assistant Secretary of
Defense for Space and Information Superiority (ASD(SIS)). The
committee expects the ASD (SIS) to provide policy guidance to
ensure sustainable management and employment of the BCPO. The
committee recommends an increase of $10.0 million to the budget
request to ensure the BCPO remains financially sound. The
committee directs the Secretary of Defense to provide the
congressional defense committees with a report, submitted no
latter than March 1, 1999, that describes the Department of
Defense plans for the future BCPO funding policy, and
management.

Space maneuver vehicle

The committee endorses the efforts of the Air Force to work
with the National Aeronautics and Space Administration (NASA)
on developing responsive, reusable space access systems. The
committee believes that an early, high payoff for this work
will be much lower costs for experiments funded in the space
test program. Therefore, the committee recommends an increase
of $10.0 million to the space test program (PE 65864F) to
pursue a joint demonstration with NASA of the ``Space Maneuver
Vehicle'' (SMV), which could serve as a reusable upper stage
for a variety of space test missions.
The committee understands that the Air Force is considering
incorporating the flexible capabilities of the SMV concept into
future Air Force space-based remote sensing programs such as
the space-based moving target indicators (MTI) program. The
committee directs the Secretary of the Air Force to submit a
report to the congressional defense committees by March 1, 1999
that discusses the synergy between a maneuverable, recoverable
SMV and a space-based sensor such as a space-based MTI system.
The report should include a programmatic assessment of this
approach, including the potential funding requirements for
conducting such a demonstration by 2004.

Theater battle management system

The budget request included $27.3 million for theater
battle management command and control research and development.
Theater battle management system (TBM) is designed to integrate
air support for ground forces through the air support
operations center (ASOC). The committee understands that an
additional $5.0 million would:
(1) accelerate TBM ASOC development in fiscal year
1999;
(2) provide for both pre-planned product improvement;
(3) enhanced interoperability with the Marine Corps;
and
(4) field the ASOC's.Accordingly, the committee
recommends an increase of $5.0 million to the budget request for TBM.

C-5 modernization

The budget request included $47.9 million for C-5 airlift
squadrons research and development. The Air Mobility Command
(AMC) has a documented deficiency in outsize cargo carrying
capability, which was identified too late in the planning,
programming and budgeting system (PPBS) for inclusion in the
fiscal year 1999 budget request.
The committee has been informed that an increase of $12.0
million would significantly accelerate the effort to address
the deficiency in outsize cargo carrying capability.
Accordingly, the committee recommends an increase of $12.0
million to the budget request for C-5 airlift squadrons
research and development.

Aircrew laser eye protection

The budget request included $5.3 million in PE 63112F and
PE 63231F to support various efforts to develop laser eye
protection. The use of laser-based systems on the battlefield
has increased. The proliferation of these systems increases the
risk of permanent vision damage to our aircrews, either from
friendly or hostile forces.
The committee supports the Department's efforts in this
area, and believes that there is a need for additional funds to
develop manufacturing process to accelerate potential fielding
of this capability. Accordingly, the committee recommends an
increase of $5.5 million to continue the development of the
aircrew laser eye protection technology.
DEFENSE-WIDE

University research initiative

The committee once again commends the Department of Defense
for including $10.0 million in the budget request to continue
efforts under the Defense Experimental Program to Stimulate
Competitive Research (DEPSCoR) in fiscal year 1999 to broaden
the infrastructure of universities supporting national defense.
The committee believes that support for this competitive,
merit-based program should be increased further. The committee,
therefore, recommends that in addition to the $10.0 million
provided in the budget request, an additional $10.0 million of
the funds authorized to be appropriated in PE 61103D be added
to the budget request for the DEPSCoR program.

Chemical and biological defense program

The budget request included $620.3 million for the
chemical-biological defense program, including $336.4 million
in research and development, test and evaluation and $283.9
million in procurement. The budget request also included $88.0
million for the Defense Advanced Research Projects Agency
(DARPA) biological warfare defense program (PE 62383E), a $26.0
million increase to the program from fiscal year 1998.
The committee recommends an undistributed reduction of
$10.5 million to the budget request for PE 62383E.
The committee recommends an increase of $15.5 million for
the following chemical and biological defense research and
development activities: $5.0 million in PE 61384BP and $5.0
million in PE 62384BP to accelerate research and development
efforts of small, light-weight, manportable chemical and
biological agent detection sensors; $4.0 million in PE 62384BP
for SAFEGUARD to continue the proof of concept testing to
establish sensor performance, initiate packaging and real-time
processing, and conduct platform studies; and $1.5 million in
PE 62383E to demonstrate the use of technologies for the
deployment of telemedicine and other capabilities to the
warfighters.

Shortcomings in Chemical and Biological Defense Program

The committee supports increases in the defense budget to
improve the capability of U.S. forces to detect and defeat
biological and chemical weapons and agents, as well as protect
themselves on the battlefield against the use of chemical and
biological weapons.
The committee believes that commanders in chief (CINCs) in
high threat regions need to remain vigilant to ensure that
adequate force protection in the areas of collective defense
protection, detection and decontamination needs are provided by
the Department of Defense. The committee also believes that the
Department must remain diligent in responding to the chemical
defense and force protection requirements of the CINCs, and
ensure that adequate funding is maintained in Future Years
Defense Program.
In response to recommendations in the Quadrennial Defense
Review (QDR), the Secretary of Defense added almost $1 billion
to the Future Years Defense Program, starting with the fiscal
year 1999 defense budget request. Of this increase, $732.0
million was directly for chemical-biological defenses. While
this represents a substantial investment, it does not eliminate
the threat to U.S. forces posed by adversaries that might
choose asymmetric responses to counter the U.S. superiority in
conventional forces.
Despite the increased emphasis on improving chemical and
biological defenses, deficiencies remain in the program
regarding the provision of force structure and equipment to
protect facilities. The committee is aware that the Department
is attempting to address these deficiencies in doctrine,
policy,equipment and training for the defense of critical
overseas ports and airfields in the fiscal year 1999 budget request.
Because U.S. strategy to fulfill its foreign policy
commitments and national security interests overseas relies on
the projection of power, points where U.S. or allied forces
mass or stage overseas may provide tempting targets for
chemical and biological attacks.
The United States must adapt its strategy to deal with
asymmetric capabilities, so that U.S. forces and its allies are
capable of operating in an environment where chemical and
biological agents and weapons are employed.
A relatively small quantity of a chemical or biological
agent could degrade or halt air operations at airfields that
lack proper defenses. Repeated attacks would exacerbate this
problem by damaging decontamination facilities, limiting access
to the airfields or ports, and by making personnel sick and
unable to wear full individual protective suits. U.S. and
allied forces must also be able to deploy to, reinforce, and
provide logistical support in a conflict where chemical or
biological agents or weapons may possibly be employed.
Lastly, the committee is concerned that there appears to be
no developed Department policy on the return of strategic air
and sea lift which have been contaminated by chemical or
biological agents or weapons. Nor has the administration
developed a policy that determines responsibility for, and
protection of, essential and nonessential civilians.
With regard to the ability to detect biological agents in
garrison, the committee was informed during its March 5, 1998
hearing on transnational threats about the creation of an Army
Biological Integrated Detection Systems (BIDS) company, which
is stationed in the United States, and the Department's plans
to establish two additional companies by 2001. The Under
Secretary of Defense for Policy informed the committee that a
BIDS platoon had been deployed to the region during the recent
crisis with Iraq. However, the committee is concerned that BIDS
units are not stationed in high threat areas overseas, where
they are likely to be needed early in an attack.
The committee requests the Secretary of Defense to report
to the congressional defense committees by December 1, 1998 on
the steps it has taken to correct the remaining deficiencies
identified above, and any steps that it may take to locate BIDS
units on a permanent basis in high threat commands or regions.

DOD Anthrax Immunization Policy

In recognizing the threat to U.S. forces of the use of
biological weapons, the Secretary of Defense and the Chairman
of the Joint Chiefs announced in December 1997 a Department of
Defense initiative to immunize U.S. service personnel against
the biological agent anthrax. The committee understands that
the vaccine that is to be used is approved by the Food and Drug
Administration (FDA), and has been used by cattle and sheep
ranchers since the 1970s.
The vaccine to be administered to U.S. forces was jointly
developed in the 1950s by the United States and the United
Kingdom, and licensed in 1970 by the FDA. The vaccine has a
proven safety record with over 500 doses administered a year,
mainly as boosters, to private workers in the cattle and sheep
industry. The committee understands that this same vaccine was
administered to approximately 130,000 U.S. armed forces
personnel during Operation Desert Shield/Desert Storm.
The committee is aware that concerns have been raised about
the safety of the anthrax vaccine to be administered to U.S.
forces, and whether it has any links to Gulf War illnesses. The
committee has been advised by the Army Surgeon General that the
Department of Defense and agencies not associated with the
Department, to include the Institute of Medicine and the
Presidential Advisory Committee, have found no evidence linking
this anthrax vaccine to Gulf War illnesses. Additionally, the
committee understands that an independent review of the health
and medical issues associated with the anthrax immunization
program was conducted by the special assistant to the President
of Yale University, who concluded that ``the anthrax vaccine
appears to be safe and offers the best available protection
against wild type anthrax as a biological warfare agent.''
The committee has been advised that the anthrax vaccine
that is to be administered is effective, with only limited side
effects such as minor swelling and redness. Of those vaccinated
against anthrax over the past five years, 96-97 percent had no
reaction. Additionally, the committee understands that the
anthrax vaccine will provide protection against regular anthrax
and also against a genetically-engineered anthrax strain.
Since the end of the Persian Gulf War, the committee
understands that selected U.S. forces and government laboratory
workers have been immunized against the biological agent
anthrax with this vaccine. U.S. forces receiving this vaccine
include special operations forces participating in missions and
operations in areas where anthrax is indigenous, members of the
Marine Chemical/Biological Incident Response Force (CBIRF),
members of the Army Technical Escort Unit (TEU), and defense
and energy laboratory workers.
The committee understands that the Department will
centrally procure the anthrax vaccine from the Michigan
Biologic Products Institute (MBPI). The committee also
understands that DOD plans to determine at a future date
whether to extend the immunization program to others, such as
host nation personnel, civilian contractors, and dependents in
high risk areas.
The committee expects the Department to maintain an
efficient inventory control system to ensure that military
personnel receive vaccinations in a timely manner.
Additionally, effective management of the immunization program
is vital to ensure that there are sufficient supplies of
vaccines available, that vaccines older than their one-year
shelf life are destroyed, and that a complete record of
vaccines received, administered and destroyed is kept to
monitor and track the immunization program.

Biological Agent Detection and Identification

There may be no greater threat to the United States today
from external or internal sources than that posed by chemical
and biological weapons. Biological attacks can be devastating
and have widespread consequences. Despite research on vaccines,
internal medicine, protective clothing, and other initiatives
to counter bioagent weapons effects, none are adequate without
critical supporting detection and identification capabilities.
U.S. forces and military and civilian incident response
personnel must have bioagent detectors capable of real-time
detection and identification of specific bioagents of interest.
Combatant commanders, first responders, and hospital
administrators and doctors must know what they are dealing with
in order to better determine courses of remedial action rapidly
for the infected as well as for the facilities, equipment, and
personnel in contact with the infected. It is important for
first responders to know if an agent is present and where it
has spread or is likely to spread in order to take action to
minimize the number infected and, in the case of U.S. forces,
to act quickly to improve a combat readiness posture.
Over the last several years this committee has expressed
strong support for innovative technologies to detect chemical
and biological agents, including mass spectrometry,
upconverting phosphors, and fiber optic devices. Recent field
testing shows that the committee's support of these programs
has been justified.
To optimize the utility of these devices, the Department of
Defense is funding research into a program called aerogel.
Aerogel is a special silica material that acts as a receptor
that allows the rapid collection and transmission of a chemical
or biological agent to an assay technology, such as
upconverting phosphors. The committee understands that with
this technology it is feasible to develop a small, light-weight
sensor system that could collect and identify a biological
agent nearly immediately.
The committee has previously supported research and
development of aerogels to be used in the pollution abatement
system of the chemical agents and munitions destruction
facilities (Public Law 103-337). The committeee continues to
support innovative research in these areas that could lead to
the development of hand-held sensors for U.S. forces, first
responders, and arms control inspectors, or that could be
placed on unmanned aerial vehicles (UAVs) for long-range
detection.

Status of Increased Chem/Bio Defense Funds in Fiscal Year 1998

In response to recommendations in the Quadrennial Defense
Review by the Secretary of Defense to increase funding for the
chemical and biological defense program, Congress appropriated
additional funds in fiscal year 1998 for the following
activities: $25.7 million in research and development
activities; $25.0 million for procurement for increased funding
for individual, protective and decontamination protection,
including Joint Service Lightweight Integrated Suit Technology
(JSLIST); $10.0 million for procurement of chemical and
biological defense equipment for the Marine Corps Chemical/
Biological Incident Response Force (CBIRF); $10.0 million for
collective protective shelters identified as a high priority by
the U.S. Pacific Command; and $10.0 million for the Army
National Guard to conduct a study on expanding its role in
responding to domestic chemical and biological incidents.
The committee is unable to determine from the budget
documents provided to the committee the extent to which the
increased funds appropriated for these activities have been
executed. The committee directs the Department of Defense to
provide a report by July 1, 1998 on the status and execution of
the funds for the recommended activities. In this constrained
budget environment, the committee wants to ensure that
additional funds provided for chemical and biological defenses
are utilized to meet unfunded research, development and
procurement requirements in the area of biological defense,
collective protection procurement, and counterterrorist efforts
to render safe, and to protect against, the use of biological
and chemical weapons of mass destruction.

Defense Threat Reduction Agency (DTRA)

In November 1997, as part of its Defense Reform Initiative
(DRI), the Department of Defense recommended the establishment
of a single agency, the Defense Threat Reduction Agency (DTRA),
to carry out programs to counter proliferation and reduce
threats posed by weapons of mass destruction and to provide
nuclear weapon stockpile and related support. This agency will
consolidate several agencies, and several functions from the
Office of the Secretary of Defense (OSD) involved in the
management of associated programs, including the chemical and
biological defense program and the counterproliferation support
program. Consistent with the DRI recommendation, the committee
recommends the transfer of the mission, function and resources
for fiscal year 1999 for the chemical and biological defense
program to the Defense Threat Reduction Agency.

Ballistic Missile Defense Organization funding and programmatic
guidance

The budget request included approximately $3.6 billion for
the Ballistic Missile Defense Organization (BMDO) for research,
development, test, and evaluation (RDT&E), and procurement.
Thecommittee's recommended funding allocations for BMDO are summarized
in the following table. Additional programmatic and funding guidance is
also provided below.

BMDO FUNDING ALLOCATION
[Millions of dollars]
------------------------------------------------------------------------
Program Request Change Recommendation
------------------------------------------------------------------------
Support Technology................ 253.5 +140.0 393.5
THAAD............................. 821.7 -70.0 751.7
TMD-BM/C3 \1\..................... 22.8 ......... 22.8
Navy Lower Tier \2\............... 289.1 ......... 289.1
Navy Upper Tier................... 190.4 +120.0 310.4
MEADS............................. 43.0 -33.0 10.0
NMD............................... 950.5 ......... 950.5
Joint TMD......................... 176.8 ......... 176.8
PAC-3 \2\......................... 480.5 ......... 480.5
FOS E&I........................... 96.9 ......... 96.9
BMD Tech Ops...................... 190.1 -2.0 188.1
Int'l Coop Programs............... 50.7 -0.7 50.0
Threat/Countermeasures............ 22.1 ......... 22.1
-------------------------------------

BMDO Total.................. 3,588.1 +154.3 3,742.4
------------------------------------------------------------------------
\1\ Procurement only.
\2\ Procurement and RDT&E.

Support technology

The committee continues to support BMDO's wide bandgap
electronics material development program. Higher speed and
higher temperature operation afforded by wide bandgap
electronic materials could enhance the miniaturization and
functionality of advanced sensors and processing systems for
space-based ballistic missile defense (BMD) sensors and ground-
based radar systems. The committee recommends an increase of
$14.0 million in PE 62173C to support this important activity.
The committee continues to support the Atmospheric
Interceptor Technology (AIT) program to develop advanced
interceptors with potential applications for a range of theater
missile defense (TMD) programs. The committee recommends an
increase of $22.0 million in PE 63173C to continue the AIT
program.
The committee commends BMDO and the Air Force for
increasing funding in the fiscal year 1999 budget request for
the Space Based Laser (SBL) Readiness Demonstrator (RD)
program. The committee continues to support the development of
an SBL-RD that could be ready for launch in the 2006-2008
timeframe and urges the Secretary of Defense to provide the
necessary funding in the Future Years Defense Program (FYDP) to
support such a program. In order to support this objective, the
committee recommends an increase of $94.0 million in PE 63173C.
The committee has supported BMDO's efforts to evaluate
innovative launch concepts, especially those utilizing
pressure-fed rocket engine technology. The committee recommends
an increase of $5.0 million in PE 63173C to support the
Scorpius concept and an increase of $5.0 million in PE 63173C
to support the Excalibur concept.

National Missile Defense

The committee notes the existence of some confusion
regarding what, if any, national missile defense (NMD) policy
has been established in law or otherwise endorsed by Congress.
Although the committee recommended a provision on this subject
last year, which was enacted in the National Defense
Authorization Act for Fiscal Year 1998 (section 231 of Public
Law 105-85), this provision did not address NMD deployment
policy nor otherwise endorse the administration's so-called
``three-plus- three'' policy. In its report accompanying the
fiscal year 1998 Defense Authorization Bill (S. Rep. 105-29)
the committee made this matter clear: ``Recognizing the
continuing controversy over NMD deployment policy, the
committee recommends a provision that would strengthen the
option to deploy an NMD system in fiscal year 2003 without
specifically establishing an overarching deployment policy.''
The committee notes further that there is no statutory
expression of policy regarding NMD currently in law. Section
238 of the National Defense Authorization Act for Fiscal Year
1996 (Public Law 104-106) repealed the Missile Defense Act of
1991 (Part C of Title II of Public Law 102-190), but did not
replace it with an alternative policy.
Congress has never endorsed the administration's NMD policy
known as ``three-plus-three'' and the committee remains
extremely concerned by this policy. The committee notes that
the ``three-plus-three'' policy makes NMD the only major
defense acquisition program that does not include a detailed
schedule of milestones beyond initial development. This is a
significant deviation from normal Defense Department
acquisition policy, one which imposes significant risks and
inefficiencies. The committee notes that the Director of BMDO
recently testified that ``three-plus-three'' is an ``extremely
high risk'' program. The committee believes that this policy
should be modified to make NMD a normal defense acquisition
program, regulated by the same kinds of considerations that
regulate all major defense acquisition programs, including
milestone reviews and annual budget reviews.

Medium Extended Air Defense System

Although the committee continues to support the need for a
TMD system to support maneuver forces, the committee is
troubled by the failure of the Department of Defense to
structure a fully-funded development program to satisfy this
requirement. Although the committee would support a coherent
and fully-funded Medium Extended Air Defense System (MEADS)
program, the committee is unwilling to support a MEADS program
that has no funding programmed beyond fiscal year 1999. The
committee notes that the Department of Defense has had ample
opportunity to address this shortfall. In light of the
Department's unwillingness to provide adequate funding in the
outyears, the committee recommends a reduction of $33.0 million
in PE 63869C. The remaining $10.0 million shall be used to
assess alternatives to the current MEADS concept, including the
use of the Patriot PAC-3 system in an air-directed surface-to-
air missile (ADSAM) configuration.

Theater High Altitude Area Defense (THAAD) system

The committee continues to support the development,
production, and fielding of THAAD as a matter of highest
priority, including early fielding of the User Operational
Evaluation System (UOES). The committee supports BMDO's
incremental approach to the execution of the UOES missile
option in order to minimize funding risks associated with
beginning the UOES missile program following a single
successful intercept test. The committee directs that no funds
be obligated for acquisition of THAAD UOES missiles until the
Secretary of Defense certifies to the congressional defense
committees that the THAAD program has successfully completed an
intercept flight test, and that this test has adequately
demonstrated that the THAAD program is ready to proceed with
the production of UOES missiles. The committee supports the
budget request of $497.7 million in PE 63861C for THAAD
Demonstration and Validation (Dem/Val).
Given recent delays in the THAAD testing program, and the
requirement for THAAD to achieve three successful intercept
tests prior to entering Engineering and Manufacturing
Development (EMD), the committee is not convinced that BMDO
will be able to execute the entire THAAD EMD budget request
before the end of the fiscal year. Therefore, the committee
recommends a reduction of $70.0 million from the budget request
for THAAD EMD, for a total of $253.9 million in PE 64861C.

Navy Upper Tier (Theater Wide)

The committee continues to support the Navy Upper Tier
program. The committee urges the Secretary of Defense to
accelerate this important development effort while maintaining
it as a low to moderate risk program. To facilitate this
acceleration, the committee also urges the Navy to begin
allocating funds from within its budget to complement those
already programmed within the BMDO budget. The committee is
concerned that necessary radar improvements have not kept up
with developments in the Navy Upper Tier interceptor missile
system. Therefore, the committee recommends an increase of
$50.0 million for the High Power Discriminator and an increase
of $70.0 million for Navy Upper Tier acceleration, for an
overall increase of $120.0 million in PE 63868C.

BMD Technical Operations

The committee supports the efforts being performed at the
Army Space and Strategic Defense Command's Advanced Research
Center (ARC). The ARC continues to be a valuable tool in
support of the Army's development of both theater and national
missile defense systems. Therefore, the committee recommends an
increase of $5.0 million in PE 63874C for support of the ARC.
The committee notes substantial unexplained growth in
BMDO's system architecture and engineering effort and
recommends a reduction of $5.0 million in PE 63874C.

International Cooperative Programs

The budget request included $37.9 million for BMDO's
Israeli Cooperative Project, which includes funding for the
Arrow ballistic missile defense system. The committee
recommends an increase of $12.0 million in PE 63875C to support
interoperability design so the Arrow can operate alongside
forward deployed U.S. missile defense systems.
The budget request included $12.7 million for the Russian-
American Observation Satellites (RAMOS) program. The committee
is concerned that this program is not funded beyond fiscal year
1999 and that the potential payoff of such an experiment is
questionable. Therefore, the committee recommends no funds for
the RAMOS program in fiscal year 1999.

Patriot PAC-3

At the request of the Director of BMDO, the committee
recommends a zero-balance transfer of $40.0 million from PAC-3
procurement to PAC-3 EMD to properly align funds for the type
of work being performed. The committee notes with concern that
this realignment is the result of significant delays in the
PAC-3 flight test program. Although the committee does not
recommend a reduction in PAC-3 funding at this time, if the
PAC-3 test program does not demonstrate significant
improvement, the committee does not rule out the possibility of
future funding reductions.

BMD Targets

The committee is concerned that current TMD surrogate
targets do not sufficiently represent ballistic missile
threatsbased on liquid fuel engines. Therefore, the committee directs
the Secretary of Defense to assess the need for a new liquid fueled
target, or family of targets, for TMD testing and to submit a report to
the committee by April 15, 1999.

Report of the Panel on Reducing Risk in Ballistic Missile Defense Test
Programs

The committee directs the Director of BMDO to submit a
report to the congressional defense committees by February 15,
1999 on the conclusions and recommendations of the Panel on
Reducing Risk in Ballistic Missile Defense Test Programs, which
recently reviewed a number of BMDO's hit-to-kill interceptor
programs. The report should include discussions of lessons
learned, actions that BMDO intends to take as a result of these
lessons, and areas where the Director of BMDO does not agree
with the report.

Countermeasures to missile defense systems

The committee directs the Director of BMDO to submit a
report to the congressional defense committees by March 15,
1999 on anticipated countermeasures to U.S. ballistic and
cruise missile defense systems. The report should include an
analysis of existing and foreseen countermeasures as well as a
description of the programs and plans that the United States
has developed to overcome any such countermeasures. The
committee acknowledges that such a report will have to be
submitted in a classified form.

Medical free electron laser

The committee recommends an increase of $7.0 million in PE
62227D to ensure reasonable stability for the program in fiscal
year 1999. The committee believes that this program continues
to make breakthroughs in a number of areas of importance to
military medicine, including soft tissue surgery, thermal and
chemical burn treatment, sepia control, and wound healing.

Computing systems and communications technology

The budget request included $69.9 million for a new start
program in PE 62301E for project ST-26, Joint Infrastructure
Protection. The committee recommends a decrease of $30.0
million and a transfer of an additional $10.0 million to PE
33140F from funds requested for the project. With respect to
the transfer of $10.0 million to PE 33140F, the committee
recommends that the transferred funds be used for a cyber-
security program to conduct research and development at
federally funded research and development centers that are
currently working in collaboration on issues relating to
security and information assurance and to facilitate the
transition of information assurance technology to the defense
community.
The committee strongly supports research in information
infrastructure security in accordance with the recommendations
of the President's Commission on Critical Infrastructure
Protection. However, the committee believes that a new start of
$69.9 million in fiscal year 1999 is not warranted given the
steep increase in proposed funding and the lack of definition
of research and development activities to be conducted. The
committee believes that gradual program growth would more
likely result in sound planning and investments, and that a
comprehensive survey of ongoing related research and
development efforts, sponsored by defense agencies and the
military departments, is needed before a new program of this
magnitude is initiated. The committee directs the Secretary of
Defense to prepare a comprehensive plan and funding profile for
information security research and to provide the plan to the
congressional defense committees no later than March 1, 1999.
The plan should serve as the basis for future funding requests
for research in this area.

Telemedicine

The committee recommends an increase of $1.5 million in PE
62383E to initiate and complete a demonstration of the use of
data compression and dynamic bandwidth allocation technologies
for the deployment of telemedicine and other capabilities to
the warfighters. The committee directs that all applicable
competitive procedures be used in the award of contracts,
grants, and other agreements under this program and that the
Defense Advanced Research Projects Agency require significant
cost-sharing from all non-federal participants.

Tactical technology

The committee recommends a reduction of $5.0 million in PE
62702E of the funds requested for increased scope of work on
the micro unmanned aerial vehicle program. The committee
recommends this reduction to fund other higher priority
programs.

High definition systems

Since 1994, the Department of Defense has undertaken a
program of investing in the development of a domestic flat
panel display industry to provide the Department with assured
access to affordable flat panel display technology for defense
applications. As a result of this sustained investment, the
domestic supplier base now numbers over 100 companies. The
committee believes that the military utility of flat panel
display technology has continued to grow because of the proven
durability and low life cycle costs, as compared to other
display technologies. Therefore, the committee believes that
additionalfunding in fiscal year 1999 is warranted and
recommends an increase of $8.0 million in PE 62708E to continue the
development of a domestic infrastructure within the context of the flat
panel display initiative.

Mixed mode electronics

The committee recommends an increase of $6.0 million in PE
62712E for the continuation of the mixed mode electronics
multitechnology insertion program (MIME). The committee
believes that this program has significant potential benefits
for electronics in military applications.

Weapons of mass destruction technologies

The budget request included $203.6 million for weapons of
mass destruction technologies (PE 62715BR) of the Defense
Special Weapons Agency (DSWA) to support and develop the
technology base necessary for national security issues related
to nuclear and other advanced weapons and force application
technologies. In November, 1997, the Department of Defense
(DOD) recommended the establishment of an agency to carry out
programs related to counter proliferation, to reduce threats
posed by weapons of mass destruction, and to provide nuclear
weapon stockpile and related support as part of its Defense
Reform Initiative (DRI). The formation of this agency was to be
accomplished through the consolidation of several agencies,
including the DSWA. Consistent with the DRI recommendation, the
mission, function, and resources for DSWA in fiscal year 1999
have been transferred to the Defense Threat Reduction Agency
(DTRA) for DSWA.

Core Competencies and Critical Expertise

While the end of the Cold War has changed the risk to the
United States from a nuclear weapons attack, the nuclear threat
continues to evolve. The United States now faces potential
nuclear threats from emerging capabilities of terrorists and
third world proliferation. There is also the potential for a
resurgence of superpowers. With continued reductions in the
defense budget, the committee remains concerned about the loss
of technical expertise and the impact on the nation's ability
to analyze the effects of a nuclear weapons attack on military
and civilian infrastructure and systems, as well as the effect
on the ability to provide reliable and timely technical
guidance. The DOD must continue to ensure that the military
services and civilian personnel retain their nuclear core
competencies and critical scientific and engineering skills.
The committee recommends a $10.0 million increase to the budget
request to maintain nuclear core competencies and critical
scientific and engineering expertise.

Implications of nuclear and conventional explosions on critical civil
and commercial activities

The committee remains concerned about the potential
vulnerability of the next generation satellites and high level
technology upon which U.S. forces continue to rely, and the
possibility that an adversary could seriously impair or negate
military operations, as well as critical civil and commercial
activities. The committee recommends an increase of $2.0
million to reduce potential vulnerabilities of the effects of
radiation and electromagnetic pulse (EMP) on advanced
electronic technologies and space systems.

Structural Response and Blast Mitigation

The committee understands that the Technical Support
Working Group (TSWG) is responsible for coordinating the
development of technologies to meet the needs for combating
terrorism, and encourages the Department to utilize the unique
expertise and testing capabilities of the DSWA to accelerate
the fielding of new protective technologies, including
affordable and practical retrofit options for existing
infrastructures. Additionally, the committee encourages the
Department to continue to leverage existing and promising
technologies designed to mitigate earthquake and corrosion
related damage. The committee directs the Department to report
to congressional defense committees by December 1, 1998 on
efforts, commensurate with previous recommendations, to develop
structural engineering design guidelines and standards modeled
after those developed by other federal agencies (similar to
those developed by the Department of State for new embassy
office buildings) to prevent the collapse of buildings and
structures subjected to heavy blast loads.

Hard and Deeply Buried Underground Structures

The committee supports the unique contributions made by
DSWA toward the defeat of hard and deeply buried targets.
Efforts to develop technology to detect and discriminately
attack and destroy or neutralize deeply buried underground
facilities would address a critical gap in the capabilities of
our armed forces. The committee believes that the successful
completion of the proof of principal demonstration of the
``deep digger'' concept by DSWA represents a significant step
forward. Accordingly, the committee recommends an increase of
$3.0 million in PE 62715BR to accelerate the pace and
development of components and subsystems toward a prototype
``deep digger'' system within the larger context of the DSWA
hard and deeply buried target defeat program.

Explosives and conventional demilitarization

Currently, there are over 400,000 tons in the
existingconventional munitions stockpile that are obsolete,
unserviceable, or unusable, and no longer of any use. The Department of
Defense (DOD) expects that the stockpile will grow by an additional
400,000 tons by the end of fiscal year 1999. The munitions storage
depots in the United States are currently at their maximum storage
capacity, without room for new munitions until such time as the
munitions stockpile is reduced.
In September 1996, the Under Secretary of Defense for
Acquisition and Technology announced the DOD Munitions
Strategy. An element of that overall strategy included
conventional munitions demilitarization. The Congress endorsed
the Department's recommendation to expand its demilitarization
program by establishing a new research and development program
to investigate and develop safe, efficient, and environmentally
compliant technologies as alternatives to open burning/open
detonation (OB/OD) to reduce the munitions stockpile. The
Department also included as part of its strategy the increased
reliance on commercial industry to augment demilitarization
capabilities.
The Secretary of Defense was directed in the National
Defense Authorization Act for Fiscal Year 1998 to conduct a
demonstration program utilizing an existing commercial
technology as an alternative to open burn/open detonation. The
committee understands that a commercially available blast
chamber technology is available which is recognized by industry
experts as a viable alternative to OB/OD demilitarization of
conventional munitions. The Congress provided a $4.0 million
increase to the budget request in fiscal year 1998 in the Army
munitions standardization effectiveness and safety program (PE
65805A) to conduct a demonstration using an existing
commercially available blast chamber technology. The committee
recommends an increase of $4.0 million to the budget request to
complete the demonstration program.
There are demilitarization sites in the United States where
small numbers of conventional munitions exist which need to be
destroyed, and where it may not be cost effective, or
practical, to construct a demilitarization facility, such as in
Alaska, South Carolina and California. There are also sites
which are either remote in nature, or are in close proximity to
residences or businesses, such as in Colorado and
Massachusetts. The committee is aware that the capability
exists to design a mobile system utilizing the commercially
available blast chamber technology. The committee recommends an
increase of $1.5 million for this activity.

Counterterror technical support

The budget request included $35.8 million for the
counterterror technical support program for antiterrorism and
counterterrorism projects.
The committee recommends an increase of $5.0 million for
the facial recognition technology program.
In the statement of managers to the National Defense
Authorization Act for Fiscal Year 1998, the conferees directed
the Secretary of Defense to report to the Congress on its
assessment of the operational requirements for a pulsed fast
neutron analysis (PFNA) cargo inspection system. On April 10,
1998, the Secretary of Defense, in concurrence with the
Secretary of the Treasury, reported his assessment to the
Congress that neither the Department of Defense nor the
Department of Treasury had a specific requirement for
developing and fielding a PFNA system.
Funds were provided for the PFNA in the Department of
Defense Appropriations Act for Fiscal Year 1998. The committee
has supported funding for the PFNA technology program in prior
years. However, with the report of the Secretary of Defense
assessing no need for the development or fielding of this
technology, the committee believes that funds appropriated for
this activity should be utilized for unfunded requirements for
operational needs to counter terrorism, such as chemical and
biological detection, neutralization, mitigation and
decontamination.
The committee continues to support collaborative efforts
with allies who have demonstrated counter-terrorism
capabilities, such as Israel and the United Kingdom, which can
provide the United States a cost-effective way of remaining at
the cutting edge of technology. The committee also believes
that the Department should examine retrofit options and develop
design guidelines for new and existing structures, to include
the use of composite systems and retrofit applications
technologies such as those demonstrated for seismic
retrofitting of highway columns and corrosion damage.

Defense Threat Reduction Agency (DTRA)

In November 1997, the Department of Defense recommended the
establishment of an agency to carry out programs to counter
proliferation and reduce threats posed by weapons of mass
destruction and to provide nuclear weapon stockpile and related
support as part of its Defense Reform Initiative (DRI). The
formation of this agency is to be accomplished through the
consolidation of several agencies, and several functions from
the Office of the Secretary of Defense (OSD) involved in the
management of associated programs. Consistent with the DRI
recommendation, the committee recommends the transfer of the
counterterror technical support program to the Defense Threat
Reduction Agency (DTRA).

Counterproliferation support program

The fiscal year 1998 budget request included $80.4 million
for the counterproliferation support program to accelerate
thedevelopment and deployment of essential counterproliferation
technologies and capabilities in the Department of Defense (DOD) and
the military services.
The committee recommends an increase of $7.0 million to the
counterproliferation support program: $3.0 million for the high
frequency active auroral research program (HAARP); $4.0 million
for the continuation of the Counterproliferation Analysis and
Planning System (CAPS) to support theater commanders and
special operations forces in preparing for regional
contingencies involving weapons of mass destruction.
In addition, the committee recommends a $20.5 million
increase to the budget request for defense, including operation
and maintenance ($7.6 million), research and development ($7.8
million) and procurement ($5.1 million), for unfunded
requirements for the U.S. Special Operations Command (USSOCOM)
for equipment to detect and destroy underground facilities and
for training activities to locate, identify, render safe,
destroy, or recover weapons of mass destruction from deep
underground structures.
The committee raised concerns last year in the National
Defense Authorization Act for Fiscal Year 1998 (S. Rept. 105-
29) that funds authorized for HAARP were being diverted to fund
government overhead and Systems Engineering and Technical
Assessments (SETA) support in the range of about 20 percent.
The committee directs that the combined government overhead/
SETA support costs be no more than 10 percent.

Counterproliferation Analysis and Planning System

The proliferation of weapons of mass destruction remains a
continuing national security concern and challenge for the long
term. To address this challenge, the committee has supported
funding for the Counterproliferation Analysis Planning Systems
(CAPS). The committee understands that the Joint Requirements
Oversight Council (JROC) endorsed a funding level for CAPS in
the 2000-2005 Five Year Defense Plan at $12.0 million per year.
To address the fiscal year 1999 shortfall, of the total
increase recommended for the counterproliferation support
program, the committee recommends that PE 65160D8Z be increased
by $4.0 million for CAPS.

Defense Threat Reduction Agency (DTRA)

In November 1997, as part of its Defense Reform Initiative
(DRI), the Department of Defense recommended the establishment
of a single agency, the Defense Threat Reduction Agency (DTRA),
to carry out programs to counter proliferation and reduce
threats posed by weapons of mass destruction and to provide
nuclear weapon stockpile and related support. The formation of
this agency is to be accomplished through the consolidation of
several agencies, and several functions from the Office of the
Secretary of Defense (OSD) involved in the management of
associated programs. Consistent with the DRI recommendation,
the committee recommends the transfer of the
counterproliferation support program to the Defense Threat
Reduction Agency.

Generic logistics research and development technology demonstrations

The committee recommends an increase of $4.0 million in PE
63712S to continue the computer assisted technology transfer
program in fiscal year 1999. The committee directs the Defense
Logistics Agency to develop a plan for deploying any technology
successfully developed under this program broadly throughout
the major systems support infrastructure.

Advanced lithography

Advanced lithography is an important enabling technology
needed to produce advanced integrated circuits. The Department
of Defense has a strong interest in maintaining access to this
technology for application in new and future military systems.
There are presently three basic lithography technologies (based
upon the use of x-ray, electron-beam, and extreme ultra-violet
radiation sources) in various stages of development that are
capable of producing integrated circuits to meet the future
needs of the Department.
The committee understands that the Department is currently
developing an initiative to develop cross-cutting technologies,
such as mask fabrication and defect reduction, metrology,
development of new radiation sensitive imaging materials, and
modeling and simulation, that will be applicable to all three
basic lithography technologies. Because this initiative is
still under development, no funding was provided in the fiscal
year 1999 budget. The committee recommends an increase of $10.0
million to PE 603739E for the advanced mask writer development.
This funding is intended to bridge the gap until the
Department's cross-cutting technology initiative takes effect
in fiscal year 2000. The committee expects that sufficient
funding will be devoted to this initiative in the budget
request for fiscal year 2000 so that consideration of further
increases by Congress will not be necessary.

Advanced electronics technologies

The committee recommends a reduction of $4.0 million in PE
63739E for a portion of new start work in project MT-04 to
allow funding of higher priority research.

Maritime technology

The budget request included $15.0 million in PE 603746E for
the maritime technology (MARITECH) advanced shipbuilding
enterprise (ASE) program. The MARITECH ASE program is a
government, shipbuilding industry and academia cooperative
effort to improve process and products required for ship
design, construction and repair. The effort continues the
MARITECH focus on making U.S. shipbuilders competitive in the
international market and reducing the costs to build Navy
ships. The committee recommends a $5.0 million increase to PE
603746E for MARITECH ASE.

Advanced concept technology demonstrations

The committee recommends a reduction, without prejudice, of
$6.0 million in PE 63739E to allow funding of other priority
initiatives. The committee notes that this reduction will leave
approximately $20.0 million for new start advanced concept
technology demonstrations (ACTD) in fiscal year 1999.
During hearings this year, the committee received testimony
concerning the problem of providing adequate manning for ACTD
participation by the unified and specified commands. One of the
justifications for the ACTD program is its ability to put
mature technologies in hands of the warfighters for evaluation
and possible use in a much more rapid manner than can be
accommodated in the standard acquisition process. The joint
staff has been reluctant to provide the unified and specified
commands with any additional manning to allow for a thorough
evaluation by the warfighter and for support of residual
operational capability should an ACTD prove successful. The
committee commends the efforts of the Office of the Under
Secretary of Defense for Acquisition and Technology to
alleviate this situation through the provision of increased
contractor support and other resources. Unfortunately, such
support cannot substitute for the intensive, necessary
warfighter field evaluation.
The committee directs the Under Secretary of Defense for
Acquisition and Technology to work closely with the joint staff
to develop an approach to improve manning allocation to allow
the unified and specified commands to more effectively support
ACTD execution. The committee directs the Under Secretary of
Defense for Acquisition and Technology to report to the
congressional defense committees no later than February 15,
1999 on the status of these efforts.

High performance computing modernization

The committee recommends an increase of $3.0 million in PE
63755D to initiate a program to address the related challenges
of remote visualization, collaborative exploitation of high
performance computing modernization capabilities, and distance
learning expansion. Advances in telecommunications, high
performance computing, and computer networking have created
opportunities to overcome these challenges, especially to the
extent that the major shared resource centers can increase
collaboration and shared capabilities.
The committee believes that the proposed program would
offer a significant opportunity for participation by
historically black colleges and universities, and other
minority institutions. The committee directs the Department of
Defense (DOD) to seek substantial participation of at least one
minority institution in the program. The committee directs that
all applicable competitive procedures be used for the award of
any contract, grant, or other agreement under this program and
that cost-sharing requirements for non-federal participants be
utilized, where appropriate.
The committee also recommends an increase of $20.0 million
in PE 63755D to sustain operations of supercomputing centers
established with DOD funds. The committee notes that the
increase is $5.0 million less than the amount authorized in
fiscal year 1998 for this purpose and reflects sustainment
funding provided by other users. The committee believes that
any sustainment funding increases provided in fiscal year 2000
for such supercomputing centers should be reduced by a similar
amount to reflect increased support from government and non-
government users, as well as sponsoring institutions.

Command, control, and communications systems

The committee recommends a total reduction of $11.0 million
in PE 63760E to fund higher priority research and development.
The committee intends the reduction to be made in increased
scope of work included in the budget request for projects CCC01
and CCC02.

Land warfare technology

The committee recommends a reduction of $4.0 million in PE
63764E for a new start project in CNW01 to allow funding of
higher priority programs.

Physical security

The committee recommends authorization of $25.7 million for
the physical security program for fiscal year 1999, a $6.0
million reduction to the budget request for force protection
commercial off-the-shelf activities. The committee supports
research and development activities that would provide force
protection to U.S. forces, and recommends that no reductions be
taken out of programs currently underway in this program
element.
The committee is aware of a software technology for
evaluating safeguards and security developed jointly by
industry and the national laboratories known as AnalyticSystem
and Software for Evaluating Safeguards and Security (ASSESS), which has
been used as a primary security modeling tool by the Department of
Energy to analyze the vulnerabilities of its facilities to theft or
sabotage of its nuclear materials. The committee understands that this
software tool can be used to assess physical security vulnerabilities
of existing buildings as well as new construction under design.
The committee believes that the ASSESS technology could be
an integral component to vulnerability assessments conducted at
numerous Department of Defense (DOD) facilities and
installations. The committee recommends that $3.0 million be
made available for a study to analyze how this technology can
best be utilized by DOD, and for upgrades and computer-aided
design enhancements so that DOD agencies can utilize this
technology.

Advanced sensor applications

The budget request included $15.1 million for advanced
sensor applications. The committee recommends an increase of
$2.0 million to continue the high frequency active auroral
research program (HAARP).

Integrated data environment

The committee recommends an increase of $2.0 million in PE
63736D to continue the integrated data environment program in
fiscal year 1999. The committee believes that programs such as
this have the potential to provide cost-effective tools for
reducing life cycle costs and improve logistics support for the
warfighter.

Joint robotics program

The committee recommends an increase of $6.0 million in PE
64709D to allow the Department of Defense to accelerate
engineering and manufacturing development efforts for the
Vehicle Teleoperation Capability, including the Remote Combat
Support System and the transfer of technology, where necessary.
This accelerated transfer of technology has great potential for
avoiding life cycle costs for a family of systems that are of
growing importance to the missions of the warfighters.

Defense support activities

The committee recommends an increase of $2.0 million in PE
65798S to increase the scope of the commodity management system
consolidation (CMSC) program in fiscal year 1999. The committee
believes that the CMSC program is a key part of the efforts to
migrate the Defense Logistics Agency commodity management
system to a common operating environment to support the
logistics vision incorporated in Joint Vision 2010.

Defense technical information services

The committee recommends a reduction of $2.0 million in PE
65801K for expanded activities at the Defense Technical
Information Center in order to fund higher priority
initiatives.

Joint simulation system

The committee recommends an increase of $4.5 million in PE
92740J to accelerate the fielding of the fully capable joint
simulation system. The committee believes that this system has
the potential to provide significant realistic training
capability for the joint field commanders.

Surgical strike

The committee recommends an increase of $7.8 million for
this classified program.

Maritime equipment

The committee recommends an increase of $10.5 million for
this classified program.

OTHER ITEMS OF INTEREST

Acoustic firefinding system

The committee notes that the Army is currently conducting
tests on a system that detects the shock waves of passing
supersonic projectiles to provide real time data to locate and
classify fire in multiple force protection situations. The
committee is aware that the Army Research Laboratory (ARL) is
scheduled to receive five such systems, one of which will be
mounted on a high mobility multipurpose wheeled vehicle. The
program is also in development for participation and evaluation
under the military operations in urban terrain advanced concept
technology demonstration program. The committee urges the Army
to transition the program from ARL to an Army Research,
Development, and Engineering Center effort in fiscal year 2000
should the technology prove successful in current and planned
evaluations.

Army After Next Initiatives

The committee supports the Army's plan to restructure the
2nd Armored Cavalry Regiment as an experimental strike force to
investigate alternative land force organizations for the Army
After Next (AAN) initiative. The committee recommends the Army
expedite this initiative.
Furthermore, in this pursuit of Army After Next
capabilities, the Army will experiment with new armored
vehicles that are lighter, faster, more deployable, and with
similar or increased lethality and survivability. These AAN
systems are not yet available. However, several surrogates are
available to investigate the impact of AAN systems on new
organizational structures and operational concepts that address
21st Century operational requirements. For example, the Army
has already invested over $200.0 million in the development of
the Armored Gun System (AGS) which is C130 aircraft deployable,
has top speeds of 45 miles per hour, modular armor, a reduced
crew size, and a cannon that fires up to 12 rounds per minute.
The committee believes the Army should employ its AGS
prototypes, along with other surrogate systems, in strike force
experimentation activities.

Army multimedia tactical adaptor

The committee believes that the Army Multimedia Tactical
Adapter may have the potential to enhance the warfighter's
survivable wireless communications links by increasing speed
and bandwidth while decreasing the costs of operations during
critical battlefield operations. Additionally, joint
standardization and interoperability of this device have the
potential to benefit all military networks. The committee
directs the Secretary of the Army to review this program and
determine whether additional funding should be provided in the
fiscal year 2000 budget.

Brain protection in combat head injury

The committee is aware of a proposal to research approaches
for using pharmacological intervention mechanisms for reversing
brain injury due to combat head injury or exposure to chemical
weapons. If successful, such research could result in reduction
of combat mortality and morbidity from such causes. The
committee urges the Secretary of Defense to review this or
similar proposals and, if determined to be of sufficient
promise, to include funding for such research in the fiscal
year 2000 budget.

Defense imagery and mapping program

The committee urges the Department of Defense to fund the
defense imagery and mapping system research programs at
adequate levels to sustain critical spatial information systems
research programs. The development efforts will assume
increasing importance to the achievement of national security
objectives as the military services work to enhance battlespace
awareness.

Dual use applications programs

The committee notes that the budget request contains $6.0
million for dual use applications program administered by the
Defense Logistics Agency (DLA). This program differs
fundamentally from other Department of Defense dual use
programs in that it is managed through an agreement with a
single, non-governmental entity for the purposes of
establishing cost-shared pilot programs at selected public
sector maintenance facilities in the areas of commercial
manufacturing technologies and best business practices.
Accordingly, the committee recommends a provision that would
change the name of the program to Commercial Technology for
Maintenance Activities. The committee further directs that, in
managing the program in fiscal year 1999, the DLA shall require
each of the participating services to match on a one-for-one
basis any DLA funds expended for the projects under the
program.

Electronic commerce resource centers

The committee directs that competitive procedures be used,
to the maximum extent practicable, in the award of future
contracts or other agreements, including subcontracts for the
operation of individual regional centers under the Electronic
Commerce Resource Center (ECRC) program, and that cost-sharing
requirements for the non-Federal participants be utilized where
appropriate. The committee further directs that the
establishment of any additional ECRC sites be based on a
Department of Defense analysis that considers the needs of the
Department and the concentration of Defense suppliers,
particularly manufacturing enterprises located near such sites.

Electronic safe and arm devices

The committee is encouraged by the positive results of the
recent Cooperative Research and Development (CRADA) conducted
by the Naval Surface Warfare Center and industry to design and
develop a modular electronic safe and arm device (ESAD) that
could be used in multiple tactical missile systems. The results
of this CRADA parallel a recent initiative conducted by the
Army. This Army program resulted in the development of an ESAD
with common components for the full spectrum of Army tactical
missile systems. This initiative was consistent with the
Department of Defense goalsto develop an affordable multi-
missile manufacturing (AM³) program and was accomplished in
a cost-effective manner in cooperation with industry's missile
manufacturers.
In order to also capitalize on the positive results of the
recent CRADA, the committee needs more information. Therefore,
the committee directs the Navy to provide a report to the
congressional defense committees, not later than December 1,
1998, that outlines the Navy's participation in the
AM³ program, as well as an analysis of the costs and
benefits of integrating these electronic devices in all of the
Navy's tactical missile product lines (both surface and air
launched).

Flat panel display technology

In the statement of managers to accompany the National
Defense Authorization Act for Fiscal Year 1998 (S. Rept. 105-
29), the committee expressed concern that program managers and
contractors were making procurement decisions on flat panel
displays (FPD's) based on cost and schedule constraints without
benefit of life-cycle cost and performance trade-off analysis.
In March 1998, the Department responded to the committee's
direction by submitting a report on the application of flat
panel displays for military applications. The committee
applauds the report as a good first step and encourages the
Department to follow through on its conclusions: to better
coordinate flat panel display activities; to mitigate supply
uncertainty; to promote life-cycle affordability by supporting
programs for sound technology choices; to continue the
development of an integrated product teams approach; and to
address cross-program coordination needs. The committee urges
the Department to develop defense-wide common procurement
training, to generate an FPD technical road-map, and to
establish product standards for use by program managers.

Global Positioning System alternate master control station

Dependence on the Global Positioning System (GPS) in the
military, civil, and commercial sectors continues to grow
exponentially. GPS is vital to the national interests of the
United States and the committee recognizes this system must be
operated and maintained at the highest levels of readiness and
reliability. GPS remains, however, the only critical national
satellite system that does not have an adequate separate and
secure backup ground control station. The committee is pleased
that the Department of Defense and the Air Force initiated
development of an alternate master ground control station at
Vandenberg Air Force Base, California, but urges the Air Force
to evaluate fully any potential vulnerabilities that may exist
at Vandenberg.
The committee urges the Department of Defense and the Air
Force to continue to make GPS a top priority program and ensure
that the alternate master ground control station will be
operational by fiscal year 2001. The committee previously
recognized the need to reduce vulnerabilities of the current
GPS command and control infrastructure and continues to be
concerned that plans to modernize, operate, and maintain the
aging GPS worldwide ground control system are not being
developed on a timely basis. The committee, therefore, directs
the Secretary of the Air Force to submit a report by February
15, 1999 to the congressional defense committees on the
alternate master control station and the plan to modernize the
entire GPS ground control system to ensure GPS will support our
national security and economic interests well into the next
century.

Joint experimentation plan report

The committee is concerned there is too little coherent
focus and effort on joint experimentation. In the National
Defense Authorization Act for Fiscal Year 1998, the Secretary
of Defense was directed to provide a joint experimentation plan
report by March 30, 1998.
The committee conducted hearings this year to address
Department of Defense activities directed at transforming the
armed forces to address operational challenges anticipated in
the early 21st Century. Members of the National Defense Panel
testified that it was ``absolutely critical'' and ``urgent''
that the Department establish a joint experimentation process
to investigate capabilities dealing with these future
challenges.
The committee remains concerned about the progress and
joint oversight of transformation activities across the
Department. The Secretary of Defense submitted the Joint
Experimentation Plan Report to the Congress on April 14, 1998.
This report failed to provide the requested information
relating to a process of joint experimentation, and the
relationship of this process to the experimentation efforts of
the military departments. It is clear that the experimentation
activities of the military departments do not currently provide
an adequate foundation for joint experimentation because they
do not employ a joint headquarters or a consistent set of joint
enablers in command, control, communications and computers
(C4); intelligence; surveillance; reconnaissance (ISR); and
other areas. Therefore, it is necessary that an overarching
process of joint experimentation be established.
The committee supports the initiative of the Secretary of
Defense to approve a charter assigning the mission of joint
experimentation to a combatant commander. This charter provides
necessary clarification in terms of responsibility and
authority among the combatant commanders, services, anddefense
agencies.
The committee notes that the Joint Experimentation Plan
Report states: ``The Department is committed to making rapid
progress on joint experimentation as a central part of our
efforts to pursue the revolution in military affairs (RMA)
through Joint Vision 2010.'' The committee directs the
Secretary of Defense to provide an addendum to his report, no
later than December 1, 1999, that addresses the following
issues:
(1) describe the responsibilities and the authorities
of the Office of the Secretary of Defense and defense
agencies, services, combatant commands, and the Joint
Staff in each of the concept development; assessment/
experimentation; and implementation phases of the joint
experimentation process;
(2) describe the activities of and the results
achieved by the RMA oversight council in accomplishing
its stated tasks to oversee the Department's planned
and current RMA transformation activities, recommend
areas that could benefit from greater jointness, and
direct changes in funding or activities;
(3) describe the responsibilities and authority of
the Department of Defense, unified commands, the Joint
Staff, and the services for the Information Superiority
Implementation and Assessment Plan (ISIAP) and describe
how the ISIAP impacts decisions to modify, accelerate,
or terminate C4ISR;
(4) describe the authority and responsibility of the
joint force experimenter in service experimentation
efforts that include joint elements, the authority and
responsibility for the integration of C4ISR and
developing and assessing the information, sensor, and
engagement grids for service network centric efforts;
(5) estimate the proportion of transformation
activities undertaken in service unique arenas against
the joint venue described in the report, and identify
duplicative efforts;
(6) describe the relationship of vulnerability
assessments conducted in joint experiments with
vulnerability assessments conducted in service
experimentation activities, including a description of
the authority and responsibility of the proponent for
conducting vulnerability assessments in joint
experimentation activities and a description of the
responsibilities of the Director of Operational Test
and Evaluation with respect to those responsible for
conducting vulnerability assessments in service
experiments;
(7) describe the feedback process by which the
results of vulnerability assessments, as well as other
experimentation results, are reflected in future
experimentation, or in changes to doctrine, operational
concepts, organizational structures, or programs for
the development of new technologies; and
(8) identify the joint experimentation activities
which have been completed and describe the command and
control process for each experiment, the budget and
forces employed, capabilities assessed, and impact on
changes in doctrine, operational concepts,
organizational structures, or programs for the
development of advanced technologies.
The committee further directs the General Accounting Office
to investigate the following matters related to the Secretary
of Defense Joint Experimentation Plan Report and report
findings to the committee by March 31, 1999. This review should
include the following:
(1) assess the Joint Vision 2010 Implementation Plan
with respect to the following areas:
(A) whether the Joint Vision 2010
Implementation Plan reflects a viable time
line, adequate resources including forces,
funding and facilities, and the integrating
functions necessary to achieve the operational
concepts of the vision by 2010;
(B) whether the plan incorporates the
operational challenges and desired force
characteristics described in the Report of the
National Defense Panel;
(C) whether the funding for the execution of
the Joint Vision 2010 assessment roadmaps is
adequately reflected in the future years
defense program and whether service plans for
experimentation activities are consistent with
these roadmaps;
(2) assess whether the plan for the development of
joint enablers in areas such as command, control,
communications and computers (C4), intelligence,
surveillance, and reconnaissance (ISR), logistics,
force protection and others is adequate to implement
the operational concepts of Joint Vision 2010 by 2010;
(3) assess whether the Defense Planning Guidance for
fiscal years 2000 through 2005 and the subsequent
budget and planning review process, to include the
Chairman's Program Recommendations and Assessment,
directs the fielding of advanced technologies,
preparation of forces, and funding required for the
joint experimentation plan;
(4) assess the capability and limitations of existing
and developing models and simulations to support the
assessment and experimentation phase of the joint
experimentation process;
(5) assess whether the Defense Science and Technology
Strategy, Basic Research Plan, Defense Technology Area
Plan, and Joint Warfighting Science and Technology plan
are effective in synchronizing thefielding of advanced
technologies across the services to support the development of joint
capabilities; and
(6) compare the charter assigning U.S. Atlantic
Command (USACOM) the mission for joint warfighting
experimentation to the framework for Joint Forces
Command recommended by the National Defense Panel and
assess the capabilities of USACOM to implement this
charter.

Man overboard notification technology

Each year lives are lost at sea as a result of sailors
accidentally falling off ships. The committee encourages the
Navy to investigate the feasibility of integrating a commercial
off-the-shelf water-activated person overboard indicator as a
means of immediately alerting ship control personnel of a
person accidentally falling overboard.

Molten salt oxidation waste disposal technology

The committee is aware of the potential value of molten
salt oxidation (MSO) technology to solve many of the problems
with the disposal of hazardous materials. In particular, MSO
technology, if made cost effective, would certainly be
beneficial in a shoreside shipyard environment. The committee
is aware that a consortium comprised of academic institutions
and the Naval Surface Warfare Center (NSWC) has been developing
a working MSO system at NSWC Indian Head, Maryland. The
committee directs the Secretary of the Navy to provide a report
by February 1, 1999 to the congressional defense committees on
the potential costs and benefits of MSO technology for
shoreside waste disposal and the desirability of continuing
development of the MSO system at Indian Head in order to
develop a working prototype leading to a full scale model.

National automotive center

The committee views the rapid infusion of advanced
commercial technology into military land warfare systems as a
key component of maintaining cost effective U.S. military
dominance in ground combat technology. The committee commends
the Army's National Automotive Center, part of the Tank-
automotive and Armaments Command, for its role as the Army's
focal point for collaborative research and development in the
land combat vehicle arena, including advancements in
alternative propulsion technology. The committee believes that
the National Automotive Center should serve as the focal point
for all Department of Defense shared commercial-military
automotive technology development that is directly applicable
to military land warfare systems, including alternative
propulsion technologies. In support of this goal, the committee
directs that the Secretary of Defense develop and submit an
implementation plan to the congressional defense committees by
February 15, 1999.

National solar observatory

The Air Force provided for the support of the National
Solar Observatory (NSO) for fiscal year 1999 through the Air
Force science and technology program in the amount of $650,000,
which would be transferred to the National Science Foundation
to operate NSO. The committee supports the continuation of this
annual contribution for the support of NSO.

National technology alliance

During the last ten years, the National Technology Alliance
(NTA) has helped the Intelligence community realize cost
savings by providing commercially available information
technology. Prior year funding for the NTA has led to
reductions in operations and maintenance costs, improved
intelligence analysis in the field, and advanced capabilities
for reconnaissance and surveillance. The committee directs the
Secretary of Defense to study the feasibility and desirability
of expanding the NTA into a Defense-wide program and to report
the findings to the congressional defense committees not later
than 90 days after the enactment of this Act.

Next generation internet

The committee supports industry and government efforts to
improve the communications and data transfer capability for
future high speed data networks. The next generation of
computer data networks will have important ramifications for
military communications and technology. Industry is making
considerable investment in the next generation of communication
networks, and the federal government is involved in a
partnership with industry and academia through the Next
Generation Internet (NGI) program to help ensure that the
following generation of technology is accessible to the
military, as well as to the civilian sector.
It is important for the Department of Defense to focus its
efforts and resources on the promising technologies that are
not already the subject of substantial investment by commercial
industry for near-term deployment, but rather to focus on the
next generation of technology that will ensure higher speeds
and higher volumes of data transmission. In this regard, the
committee believes that the Defense Advanced Research Projects
Agency (DARPA), through its NGI program, should investigate the
possibility of placing greater researchemphasis on future
promising technologies in the area of ultra-high speed optical data
networks.
It is widely recognized that wavelength-division-
multiplexed (WDM)systems and access networks are already being
commercialized by industry. However, many consider time-
division-multiplexed (TDM) technologies to be the next phase of
development in high speed communication, and an area in which
the United States should devote increased funding in the near-
term to maintain our technological advantage. Therefore, the
committee urges DARPA to consider focusing more of its near-
term funding to support the development of TDM systems and
access nodes technologies.

Patriot anti-cruise missile defense system

The committee reaffirms its support for fully evaluating
the Patriot anti-cruise missile (PACM) concept and directs the
Secretary of the Army to complete a rigorous test and
evaluation program in fiscal year 1999, using funds previously
appropriated for this purpose, to determine the effectiveness
of the PACM seeker against the full range of advanced cruise
missile threats. Results of this evaluation shall be provided
to the committee in a written report by April 15, 1999. The
report shall also include an assessment of options and
associated costs for utilizing the PACM seeker in future
upgrades to existing Patriot missiles.

Rapid acquisition of manufactured parts

The committee commends the Department of Defense for the
decision to transfer the rapid acquisition of manufactured
parts (RAMP) program to the Defense Logistics Agency (DLA). As
a DLA-sponsored program, RAMP should be fully leveraged to
support the rapid acquisition of non-standard and difficult-to-
acquire spare parts in a timely and cost effective manner. The
committee expects the Department of Defense to continue to
support this important initiative.

Report on Department of the Navy applications for high-performance
computing

The federal government is making substantial investments in
the development of advanced computational capability through
the Department of Energy's Accelerated Strategic Computing
Initiative (ASCI). The hardware and software advances developed
within the ASCI program could be applicable to Department of
Defense requirements, such as integrated, simulation-based
engineering; design and acquisition of complex platforms and
weapons systems; distributed computation for network-centric
warfare; and integrated simulation and database tools to
support a just-in-time, over-the-horizon logistics train.
The committee notes that the Department of the Navy appears
to be well positioned to leverage these unique resources.
Specifically, ASCI is expected to enable significantly advanced
computational fluid dynamics capabilities that could be of use
in the design of high-performance ships, submarines, and
aircraft. Accordingly, the committee directs the Department of
the Navy to deliver a report to the congressional defense
committees, not later than February 1, 1999, on its needs for
high-performance computational capability and the extent to
which it could utilize technology being developed with the ASCI
program.

Report on national security space policy

The National Space Policy, issued in September 1996,
established the goals of the U.S. space program and established
guidelines for national security space policy. The key national
security priorities under the National Space Policy are: (1)
improve our ability to support military operations worldwide;
(2) monitor and respond to strategic military threats; and (3)
monitor arms control and non-proliferation agreements and
activities.
Although the Department of Defense has begun work on a
defense space policy document, such a document has yet to be
produced. As national security grows more dependent on space
for a wide variety of applications, a definitive national
security space policy document is a necessity. Such a document
should be a key underpinning of national security space
programmatic and funding priorities. The committee is concerned
that there is no coordinated and unified national security
space policy. The committee notes that, pursuant to the
National Space Policy, space activities necessary for national
security will be overseen by the Secretary of Defense and the
Director of Central Intelligence, with the assistance of other
departments and agencies as appropriate. Therefore, the
committee directs the Secretary of Defense and the Director of
Central Intelligence, in consultation with other appropriate
departments and agencies, to prepare by September 1, 1999 a
national security space policy document, consistent with the
National Space Policy. The committee also directs the Secretary
of Defense to complete the Department of Defense space policy
document by February 15, 1999.

Software engineering institute

The committee is aware of the important work undertaken by
the Software Engineering Institute (SEI) in promulgating the
use of best software engineering practices throughout the
Department of Defense acquisition and development community,the
defense industry, and supporting software suppliers. Such work is
critical to help maintain the momentum of defense acquisition reform.
The committee understands that the sponsorship of SEI was transferred
in June 1997 from the Defense Advanced Research Projects Agency (DARPA)
to the Office of the Under Secretary of Defense for Acquisition and
Technology, but that the funding request for SEI in fiscal year 1999 is
included within the programs administered by DARPA. The committee
directs that DARPA make no reduction in funding for SEI below any
amounts mandated by congressional authorization.

Software productivity

The committee affirms the importance of applications-
specific software for military systems to enable full systems
performance. The basis for future development of such software
is the result of combining the precision personal software
processes with new developments in software visualization. The
committee urges the Department of Defense to consider moving
rapidly toward the development and implementation of new
software tools based on these theoretical bases. This
development should provide for software resilience and fault
tolerance issues, which are critical for systems that will be
deployed in battlefield environments.

Space weather

The committee is concerned about potential disruptions to
military operations caused by the next solar maximum in the
solar cycle, which will occur in the year 2000. This solar
maximum will bring with it increased instances of solar flares
and geomagnetic storm activity that history has demonstrated
can render considerable damage to fragile space assets and
ground-based infrastructure, such as power grids. The 1989
solar maximum resulted in interference at missile warning radar
sites, temporary loss by U.S. Space Command of over 1,300
objects in space, and the collapse of Quebec Province's power
grid. Given its huge investment in satellites, the United
States can not afford to be unprepared for the effects of space
weather. The committee directs the Secretary of Defense to
submit a report to the congressional defense committees by
April 15, 1999 on the plans of the Department of Defense to
protect these valuable yet fragile assets from the 2000 solar
maximum.

Torpedo defense

The committee strongly supports the torpedo defense
advanced technology demonstration included in the President's
budget request (PE 63792N). The torpedo defense demonstration
will be the culmination of significant research and investment
in this highly versatile weapon. The 6.25'' anti-torpedo
torpedo will significantly enhance surface amphibious and
support ship defense against in-coming torpedoes and give
submarine fleet an in-close weapon as well as an anti-torpedo
capability. The development tests have shown the weapon to be
highly effective and in-water validation should commence
without delay.

Totally integration munitions enterprise

The committee notes that Secretary of the Army has not
included funding in the budget request for the total
integration munitions enterprise, despite indications that this
technology could significantly improve the cost of lower volume
ammunition production. The committee urges the Secretary of the
Army to review the potential of this project and to consider
support for such technologies in future year budget requests.

Trajectory correctable munition

The committee is aware of a new 155 millimeter artillery
system under development by the government of Sweden, known as
the trajectory correctable munition (TCM) program. This program
may have significant potential for unprecedented accuracy
through the ability to correct the course of the projectile in
flight. The committee understands that the senior officials
from the government of the United States and Sweden have met
and are initiating actions to determine common requirements to
achieve interoperability standards through sharing mature
technologies. The committee sees TCM as a potential candidate
for inclusion in the foreign comparative testing program or as
an advanced concept technology demonstration. The committee
urges the Department of Defense to consider TCM for evaluation
and accelerated deployment should the technology be
demonstrated to have sufficient promise.

United States-Japan management training

The committee believes that the United States-Japan
management training program has demonstrated the potential for
preparing U.S. scientists, engineers, and managers for
positions in U.S. defense and commercial industries and
government. The program provides access to Japanese research
and development, institutions, and facilities for the purpose
of learning current Japanese management policies and practices.
The committee expressed its desire for this program to
transition to non-defense support in the statement of managers
to accompany the National Defense Authorization Act for Fiscal
Year 1998 (S. Rept. 105-29). The committee notes the process of
transition is currently under negotiation in accordance with
that guidance. The Secretary of Defense may apply up to $10.0
million from discretionary funds in fiscal year 1999 to enable
the program to complete the transition. The committee
understands that any Department of Defense funding for the
program will be discontinued after fiscal year 1999.
TITLE III--OPERATION AND MAINTENANCE

The Approaching Crisis
Over the past several years, a number of military officers
have expressed deep concerns regarding the trends in the
operational readiness of the armed forces. Last year, these
trends led one military officer to state: ``The storm clouds
are on the horizon.'' This was a year in which most of the
Armed Forces were ready to meet their wartime mission; but in
order to do so in a resource constrained environment, they were
forced to resort to cost-saving practices which could impact
negatively on wartime readiness. For example, the Marine Corps
began using retread tires for some of their vehicles in order
to save funds that are desperately needed for training and
other essential operations. Hopefully, the Marines will never
have to test the performance of retread tires in the desert
heat of the Middle East.
While the overall readiness of forward deployed units
remains adequate, this is increasingly accomplished at the
expense of non-deployed units. According to Vice Admiral
Browne, Commander of the Navy's Third Fleet, ``more today than
in the past, forward deployed readiness is being maintained
with the slimmest of margins and at the expense of CONUS based
training and increased individual PERSTEMPO.'' He went on to
say, ``to get the USS Denver underway early as part of the
Tarawa ARG, two other ships were cannibalized for parts.''
Furthermore, as Colonel Bozarth of the Air Force's 388th
Operations Group stated, ``The people that pay the price,
though, are the folks that are back home. Because if you take a
wing like ours, 5 years ago, in 1993, we were looking at FMC
[Full Mission Capable] rates in the 90's. In the 1995 to 1997
time frame, we are looking at mission capable rates in the
80's. Now we are down in the lower 70's.'' Finally, according
to Captain Kilcline, Commander of Carrier Air Wing 14 which is
preparing for deployment, ``the Air Wing reflects Navy-wide
trends with FMC rates 10 to 15 percent lower than comparable
phases last turnaround cycle. This is due to reduced funding
for spare parts, manning levels and technical expertise, and
aging aircraft.''
Maintaining the readiness of deployed forces at the expense
of CONUS based forces can be accomplished with little
noticeable impact during peacetime. However, the impact on the
ability of the Armed Forces to be able to successfully execute
the requirements of two major theater wars is potentially
significant. Lt. General Hendrix, Commanding General of the
Army's 5th Corps in Europe, commenting on the risk associated
with the readiness of the forces to fulfill these requirements
stated: ``it is certainly a medium to high risk.''
Unfortunately, there are reports that even the readiness of
the forward deployed units is beginning to suffer. According to
Naval officers in the Pacific, 20 percent of the deployed
planes on the carriers are grounded awaiting parts or other
maintenance requirements while cannibalization of aircraft has
gone up by 15 percent over the last three carrier deployments.
In fact, Admiral Browne recently acknowledged that ``Full
Mission Capable (FMC) rates from fiscal year 1996 to fiscal
year 1997 for our deployed aircraft have declined from 62
percent to 55 percent.'' Such grim statistics raise concerns
about the ability of the fleet to carry out a major theater
war, or even maintain a two carrier presence in the Persian
Gulf, unless adequate resources are provided.
The Air Force faces similar problems. In the words of
Colonel Bozarth, ``I am concerned that ongoing operational
commitments, chronic shortages of skilled personnel and
inadequate funding are eroding our readiness. Simply, I don't
feel we're as ready to execute our precision guided munition
(PGM) mission as we were 3 years ago.''
The concerns that these and other military officers raised
are generally rooted in two key problems which threaten the
readiness of the U.S. Armed Forces: a lack of modernization
funding which has led to older and more maintenance intensive
equipment, and the increased commitment of a greatly reduced
force structure.
Maintaining Current Readiness on the Backs of the Troops
It has largely been due to the selfless dedication of the
men and women in uniform that our military establishment has
been able to maintain the standards of readiness necessary to
meet the current high operating tempos of our military forces.
In fact, according to General Butch Neal, Assistant Commandant
of the Marine Corps, ``during these challenging and busy times,
while we are maintaining required readiness standards, and we
are ready for every call, we are doing it on the backs of the
troops * * * we are maintaining readiness on the backs of our
young Marines.'' General Neal is not alone in expressing this
concern. According to General Esmond, Commander of the Air
Force's Air Warfare Center: ``The average workweek has been
extended to 60 to 65 hours * * *.Duty schedules have included
12-hour shifts for the past three years. And this has been
theduty schedule exclusively since October of 1996.''
The demands that have been placed upon military personnel
and their families, along with the increased opportunities in
the private sector, is beginning to erode the retention rates
of enlisted and officer ranks alike. Pilots and highly skilled
enlisted technicians are leaving at extraordinarily high rates
as civilian companies offer better pay, shorter work days, and
no chance of a six month deployment to Bosnia. Perhaps most
disconcerting is that this loss of personnel is true even for
elite and highly motivated groups such as the Navy SEALs, where
lieutenants are departing the service at more than twice the
historic rate, which threatens to undermine the readiness and
future leadership of this elite force.

Balancing Current and Future Readiness

Given the readiness problems faced by the Armed Forces and
the constraints of the Federal budget, the committee carefully
examined the best approach to preserve the national security of
the United States. Unfortunately, the resources available for
the Department of Defense (DOD) are insufficient to prepare for
the most critical national security threats in both the near
and long-term, while simultaneously responding to an extremely
demanding foreign policy. Therefore, a balance must be achieved
in order to minimize the overall risks.
Readiness is jeopardized because the military equipment in
use is increasingly older and more time-consuming and expensive
to maintain. The aging equipment, coupled with increased
deployments for contingency and other operations, is resulting
in reduced equipment readiness that undermines the ability of
the armed forces to perform their mission.
In recent testimony before the committee, General Richard
of the Marine Corps Air-Ground Combat Center stated: ``This
equipment, especially some of the rolling stock, is getting
exceedingly old, and the maintenance to maintain that equipment
is getting more expensive every year.'' He further stated: ``We
are living off past investments. We cannot extend equipment
life forever, particularly when we are using it three to four
times the TEMPO of operational forces gear.''
This point was further reinforced by General Fulford,
Commanding General of the First Marine Expeditionary Force, who
stated, ``I MEF [First Marine Expeditionary Force] operations
and training continue to place extraordinary demands on our
aging equipment; it is wearing out at an exponentially
accelerating rate and increasingly requires more time, effort,
and money to maintain it.'' He went on to say, ``the best
maintained equipment has service life limitations and the best
people can only work so many hours a day.'' This message was
reinforced by General Hendrix when he stated, ``You've got to
get to the future.''
There is a strong desire to follow the traditional approach
of increasing the Operation and Maintenance accounts in order
to rectify near-term readiness problems. However, to do so
could jeopardize the future readiness of the armed forces by
continuing to delay essential modernization. Perhaps General
Neal best captured the readiness impact associated with the
deferment of modernization programs when he said that * * *,
``today's modernization concerns will become tomorrow's
readiness dilemmas.''
For this reason, and because of the need to modernize the
military to ensure that it is prepared to meet the threats of
the future, and because the threats of today, although
dangerous, pale in comparison to the potential threats of the
21st Century, the committee determined that the appropriate
course of action was to dedicate additional resources to the
procurement accounts in order to enhance long-term readiness.
However, the committee recognizes that this limited transfer of
funds will not go far in resolving the bow-wave of
modernization needs that is quickly approaching.
Rather than jeopardizing near-term readiness by cutting the
operations and training funds of the military services in order
to generate the necessary resources for modernization, the
committee recommends a reduction in DOD overhead including the
downsizing of its civilian bureaucracy. The committee notes
that such a reduction is in line with the goals of the Defense
Reform Initiative. Furthermore, in order to preserve the near-
term readiness of the military services in these challenging
times, the committee recommends additional funds for the
operations and training accounts of each active and reserve
component.

Overview

The Operations and Maintenance (O&M) accounts amount to
more than 33 percent of the total Department of Defense budget.
Expenditures from these accounts pay the costs for the day-to-
day operations of our military forces; all individual, unit and
joint training for military members; maintenance and support of
the weapons, vehicles and equipment in the military services;
purchase and distribution of spare parts and supplies to
support military operations; and support, maintenance, and
repair of buildings and bases throughout the Department of
Defense.
The funding in these accounts has a direct impact on the
combat readiness of U.S. military forces. While insufficient
O&M funds would lead to problems with short-term or current
readiness, excessive and unnecessary O&M expenditures for low
priority or non-defense programs only serve to restrict the
availability of funds for modernization programs.
The budget request included $94.2 billion for theoperation
and maintenance of the armed forces and component agencies of the
Department of Defense in fiscal year 1999.
The committee recommends authorization of $93.8 billion for
the O&M accounts for fiscal year 1999, a decrease of
approximately $300.0 million from the budget request.
The recommended amount authorized for the O&M accounts
includes, to the extent provided in an appropriations act,
transfer of $150.0 million from the National Defense Stockpile
Transaction Fund.
The committee recommends authorization of $764.1 million
for the revolving and management funds.
The recommended authorization for fiscal year 1999 is
summarized in the following table:
SUBTITLE A--AUTHORIZATION OF APPROPRIATIONS

Sec. 303. Armed Forces Retirement Home.

The committee recommends a provision that would authorize
$70.7 million from the Armed Forces Retirement Home Trust Fund
to be appropriated for operation of the Armed Forces Retirement
Home during fiscal year 1999.

Sec. 304. Transfer from the National Defense Stockpile Transaction
Fund.

The committee recommends a provision that would authorize
the Secretary of Defense, to the extent provided in an
appropriations act, to transfer $150.0 million from the
National Defense Stockpile Transaction Fund (NDSTF) to the
operations and maintenance accounts. The committee does not
believe that the transfer of $350.0 million from the NDSTF to
the Defense Working Capital Funds (WCFs), as requested by the
administration, was necessary or appropriate, and therefore
does not recommend a provision authorizing this transfer. The
Department of Defense should eliminate its advanced billings
through better management of the WCFs rather than seek relief
through transfers from the NDSTF.

SUBTITLE B--PROGRAM REQUIREMENTS,

RESTRICTIONS, AND LIMITATIONS

Sec. 311. Special Operations Command counterproliferation and
counterterrorism activities.

The committee recommends a provision that would provide
$18.5 million for the unfunded training requirements associated
with the counter-proliferation and counter-terrorism activities
of the Special Operations Command (SOCOM). Furthermore, the
committee recommends an additional $5.0 million in SOCOM's
Operation and Maintenance account for the unfunded maritime
training requirements associated with this mission.
Over the past several years we have witnessed a dramatic
increase in the threat posed to U.S. national security from
terrorists or rogue nations possessing weapons of mass
destruction. For this reason, SOCOM has been assigned an
increased role in countering these threats, which has forced
the command to intensify its training and related operations.
The budget request does not provide sufficient funding to fully
carry out the training that is required to ensure that these
forces are able to effectively perform their assigned missions.
Therefore, the committee has included a provision that would
allow SOCOM to use the funds that are no longer necessary for
the operation of six patrol coastal craft, that will be funded
through the counter-narcotics central transfer account, to
enhance its readiness to meet its counter-proliferation and
counter-terrorism missions.

Sec. 312. Tagging system for identification of hydrocarbon fuels used
by the Department of Defense.

The committee recommends a provision that would authorize
the Department of Defense to conduct a pilot program to
determine if hydrocarbon fuels used by the Department can be
tagged. The tagging of these fuels would help deter theft and
facilitate the determination of the source of surface and
underground pollution in locations having separate fuel storage
facilities from the Department and civilian companies.

Sec. 313. Pilot program for acceptance and use of landing fees charged
for use of domestic military airfields by civil aircraft.

The committee recommends a provision that would authorize a
military service to accept payments for the use of domestic
military and shared use airfields by civil aircraft and to use
those payments for the operation and maintenance of the
airfield.

SUBTITLE C--ENVIRONMENTAL PROVISIONS

Sec. 321. Transportation of polychlorinated biphenyls from abroad for
disposal in the United States.

Based on an administration request, the committee
recommends a provision that would amend Chapter 157 of title
10, United States Code, by adding a new section to permit
Department of Defense agencies to transport to the United
States for disposal, treatment, or storage of foreign
manufactured polychlorinated biphenyls (PCBs) generated by the
Department's overseas activities. The provision would ensure
that the PCB-containing material transported to the United
States is handled in an environmentally responsible manner.
Consistent with Environmental Protection Agency (EPA)
regulations and guidance, the Department previously transported
both domestic and foreign source PCBs at concentrations of less
than 50 ppm. Department of Defense agencies have relied on 40
C.F.R. 761.93(a)(i) as the authority for transporting foreign
manufactured PCBs from overseas locations to the United States
for disposition. Domestic source PCBs have been returned to the
United States pursuant to a November 13, 1980 EPA General
Counsel opinion.
On July 7, 1997, the United States Court of Appeals for the
Ninth Circuit rendered a decision that the EPA General Counsel
has interpreted as banning imports of foreign manufactured PCBs
at any concentration. (Sierra Club v. EPA, No. 96-7-223, slip
op. (9th Cir. July 7, 1997)). Basel Convention limitations on
the transboundary movement of hazardous waste, and the
associated regional or national waste importation bans, renders
third country disposition a very limited option. Without the
authority to transport PCBs to the United States for disposal,
the Department faces the prospect of indefinite storage at
overseas installations with inadequate facilities that may or
may not be available to meet future disposal needs.
The committee understands that the provision would have a
relatively minor impact on the overall level of U.S. disposal
of PCBs generated by the Department of Defense. In fact, the
Department has informed the committee that it anticipates an
annual need to transport approximately 150,000 pounds of
foreign manufactured PCB-containing materials into the United
States for the next five years. In comparison, the Department
has disposed of about 9 million pounds of U.S. manufactured
PCB-containing material in the United States during the past 18
months.
The committee recommends a provision that would resolve a
difficult overseas hazardous waste management issue, without
amending Toxic Substances Control Act (TSCA) or creating any
new standards under that Act. The provision specifically
precludes the use of U.S. landfills for the disposition of
foreign manufactured PCBs, unless the landfill meets all of the
technical requirements set forth in 40 C.F.R. section
761.75(b)(3), without waiver. Consistent with TSCA, the
provision would require a determination of no unreasonable risk
by the EPA Administrator prior to any transportation of foreign
manufactured PCBs into the United States.
The committee directs the Department to submit to EPA and
the congressional defense committees a plan, no later than 60
days after the enactment of this Act, that provides for the
transportation and disposition of foreign manufactured PCBs.
The plan would serve as a basis for public notice and comment,
and for the Administrator's determination in accordance with
the requirements of this provision.

Sec. 322. Modification of deadline for submittal to Congress of annual
reports on environmental activities.

Current law requires the Department of Defense to submit
detailed reports on environmental cleanup and compliance
activities 30 days after the President submits the fiscal year
budget to the Congress. The Department has not been able to
consistently meet that 30 day deadline. As a result, the
administration requested legislation that would amend section
2706 of title 10, United States Code, by extending the annual
reporting deadline. The committee recommends a provision that
would substitute the 45 day annual reporting deadline for the
current 30 day period.

Sec. 323. Submarine solid waste control.

The National Defense Authorization Act for Fiscal Year
1994, section 1003, amended the Act to Prevent Pollution from
Ships (APPS) (33 U.S.C. 1901, et. seq.) by requiring the Navy
to submit a plan to Congress by November 1996 that addresses
compliance with the prohibition against discharging solid waste
(paper, cardboard, metal, and glass) in ``special areas'' (the
Baltic Seas, the North Sea, the Mediterranean Sea, the Red Sea,
the Persian Gulf, and the Antarctic Ocean). The APPS, as
amended in fiscal year 1994, implemented the Annex V of the
International Convention for the Prevention of Pollution on
Ships (MARPOL).
The amended APPS specifically required the Navy to: (1)
install plastic processors aboard U.S. Navy surface ships by
December 31, 1998; (2) comply with the prohibition on plastics
discharges for submarines by December 31, 2008; (3) comply with
the prohibition on discharges of other solid waste (except food
waste) in special areas from surface ships by December 31,
2000; and (4) comply with the prohibition on discharges of
other solid waste (except food waste) in special areas from
submarines by December 31, 2008.
In 1996, the Navy concluded that full compliance with the
APPS was not technologically feasible for surface ships.
Consistent with that determination, the administration
requested legislation in fiscal year 1997 that would amend
section 1902(c) of the APPS to allow for the use of pulpers and
shredders to dispose of non-plastic and non-floating solidwaste
within MARPOL Annex V special use areas. Submersible vessels or
submarines were not addressed in the APPS amendment.
As part of the fiscal year 1999 budget proposal, the
administration has requested a legislative proposal that would
authorize certain submersible vessels owned or operated by the
Navy to discharge, within Annex V special use areas, non-
plastic garbage that has been compacted and weighted to ensure
negative buoyancy. The Navy has determined that compliance with
the special use area requirements of Annex V would impair
submarine operations and operational capability, or would not
be technologically feasible. A comprehensive Navy environmental
analysis revealed that the discharge of non-plastic garbage
from Navy submarines would not have a significant effect on the
marine environment, either within or beyond the limits of
MARPOL Annex V special use areas. Moreover, discharges would
only be authorized beyond 12 nautical miles from land.
The committee recommends a provision that would authorize
continued use of existing submarine solid waste processing
equipment. Such authorization would remain subject to the
requirements of 33 U.S.C. 1902(e)(1), which requires the Navy
to continue development of technologies and practices necessary
to ensure compliance with Annex V on or before December 31,
2008.

Sec. 324. Payment of stipulated penalties assessed under CERCLA.

The Department of Defense (DOD) has entered into Federal
Facility Agreements (FFAs) with environmental regulators for
installations that are on or proposed for inclusion on the
National Priorities List. FFAs are typically three party
agreements between a DOD installation, the state, and the
Environmental Protection Agency (EPA) region. FFAs establish
schedules and milestones for the completion of actions related
to environmental cleanup of DOD installations. The agreements
are intended to establish a working relationship between DOD
and the regulators to facilitate site cleanup, consistent with
the Comprehensive Environmental Response, Compensation and
Liability Act (CERCLA). The FFAs allow for dispute resolution
and the use of stipulated penalties in the event of missed
deadlines. However, stipulated penalties are not available if a
delay is the result of an unforeseen disruptive or force
majeure event.
Payment of stipulated penalties is contingent upon
authorization and appropriation. Subsequent to authorization
and appropriation, stipulated penalties are paid out of the
Defense Environmental Restoration Account (DERA) or the Base
Realignment and Closure Account (BRAC), depending upon the
status of the installation.
On September 5, 1996, McClellan Air Force Base (AFB), a
BRAC installation, informed state and federal regulators of a
contaminated groundwater discharge that exceeded safe drinking
water limits. The FFA for McClellan AFB requires the operation
of a groundwater extraction system (GES) and a groundwater
treatment plant (GWTP). The discharge occurred during the
modification of the GWTP.
In February 1997, the EPA and the State of California
assessed a $15,000 penalty for noncompliance with the FFA.
McClellan AFB acknowledged its failure to meet GWTP sampling
and operational requirements under the FAA and declined to
invoke dispute resolution.
Based on an administration request, the committee
recommends a provision that would authorize payment of the
$15,000 stipulated penalty. The committee expects that the
parties to the FFAs will focus on their evolving partnership
and work out their differences in a manner that avoids
assessment of penalties.

Sec. 325. Authority to pay negotiated settlement for environmental
cleanup of formerly used defense sites in Canada.

In fiscal year 1998, the administration submitted a
legislative proposal that would authorize the Secretary of
Defense to provide an ex-gratia reimbursement to the Government
of Canada in the amount of $100.0 million through annual
payments over a ten year period for the environmental cleanup
of four sites formerly operated by the U.S. Armed Forces in
Canada: 21 Distant Early Warning (DEW) Line sites; Goose Bay
Airfield; Haines-Fairbanks Pipeline sites; and the U.S. Naval
Station, Argentia. The authorization request was based on a
negotiated agreement between the United States and Canada.
The agreement provided for the payment of the $100.0
million into the Foreign Military Sales (FMS) Trust Fund
Account so that the Canadian Government could draw against this
account to purchase unspecified military equipment from an
undetermined manufacturing source. The Congress declined to
authorize the payment in the National Defense Authorization Act
for Fiscal Year 1998.
As part of the fiscal year 1999 budget request, the
administration has renewed its legislative proposal to pay
Canada $100.0 million. Based on information regarding the
unique environmental implications for U.S. border states and
the longstanding U.S.-Canadian national security alliance, the
committee recommends a provision that would allow for the
payment of the $100.0 million reimbursement to Canada, subject
to the annual authorizations and appropriations process. With
each annual request for authorization and appropriation, the
Department shall submit to Congress evidence of aproportionate
Canadian investment in environmental cleanup activities conducted at
the four facilities in question. The funds for each fiscal year shall
be paid from amounts appropriated for Operation and Maintenance,
Defense-Wide, Administration and Servicewide Activities.
It is the specific intent of this committee that the basis
for and the authorization of such reimbursement not extend to
similar claims by other nations. It is also the committee's
intent that the $100.0 million ex-gratia reimbursement of
Canada be paid in full satisfaction of any and all claims
asserted against the United States by Canada for environmental
cleanup of sites in Canada. Finally, the committee understands
that the Canadian Government has committed to spending the
entire $100.0 million of the reimbursement in a manner that
will benefit U.S. industry and workers.

Sec. 326. Settlement of claims of foreign governments for environmental
cleanup of overseas sites formerly used by the Department of
Defense.

The committee recommends a provision that would require the
administration to provide the Congress with advance notice of
any negotiations related to the ex-gratia settlement of
environmental cleanup claims by other countries.

Sec. 327. Arctic Military Environmental Cooperation Program.

The budget request included $5.5 million in the defense
operations and maintenance account to address military
environmental matters in the Arctic region under the Arctic
Military Environmental Cooperation (AMEC) program, to include
environmental restoration activities. The committee understands
that the Department of Defense developed the AMEC program to
address military environmental matters in the Arctic region
with fiscal year 1998 funds appropriated under the Cooperative
Threat Reduction (CTR) program. The committee, however, was not
notified of the obligation of CTR funds, pursuant to existing
legislative requirements. Moreover, the Congress has
consistently precluded the use of funds authorized and
appropriated under the CTR program to promote environmental
restoration.
The committee notes that the statutory notice requirement
and limitations on the use of CTR funds have helped to preserve
the integrity of the program. AMEC is a unique environmental
program in that it is not based on treaty obligations or legal
requirements. Instead, AMEC evolved out of the environmental
concerns underlying the removal, storage, and disposal of
weapons grade materials, directly related to the national
security focus of CTR. Based on the Department's fiscal year
1999 budget request, which is unsupported by a program, plan,
or statutory direction, the committee is concerned that AMEC
has the potential to become the cleanup program for the Arctic
region.
The committee recommends a provision that would authorize
$4.0 million in fiscal year 1999 for AMEC and would direct that
the program address important military environmental issues
related to U.S. national security in the Arctic. The AMEC funds
would be used to continue cooperation with appropriate
international military organizations involved in activities
within the Arctic region, particularly the Russian Federation.
The provision would designate AMEC as a program that would be
subject to the legislative prohibitions and limitations of the
CTR program, to include section 1503 of the National Defense
Authorization Act for Fiscal Year 1997 (Public Law 105-85). The
committee declined to fund the entire requested amount because
there are fiscal year 1999 AMEC projects that would be
inconsistent with section 1503.
The committee directs that the fiscal year 1999 AMEC funds
not be obligated or expended until 45 days after the Secretary
of Defense submits a plan that specifies the conformance of
AMEC projects to existing prohibitions and limitations on the
use of CTR funds. That plan shall also identify overall program
goals, projects, and outyear budget projections. Moreover, the
committee directs that the plan specify a program termination
date.

SUBTITLE D--COUNTER-DRUG ACTIVITIES

The budget request for drug interdiction and other counter-
drug activities of the Department of Defense (DOD) totals
$882.8 million. This includes $727.6 million for the central
transfer account and $155.2 million for the operating budgets
of the military services for authorized counter-drug
operations.
However, these numbers do not accurately represent DOD's
total commitment to the war on drugs. For example, these
numbers do not include a proportionate share of the costs of
procuring military systems that are used to support the war on
drugs. Although originally purchased for different missions,
these systems are also used for drug-interdiction efforts.
Therefore, any analysis of DOD's contributions should take into
account an appropriate portion of these procurement costs, just
as the procurement costs for any equipment that the Drug
Enforcement Agency and the U.S. Customs Service would be
accounted for if used for their counter-narcotics operations.
Furthermore, the drug interdiction budget does not capture
the approximately $130.0 million in personnel costs for the
thousands of active duty service members who are engaged in
counter-narcotics activities at any one time.Moreover, the
budget does not include all depot level maintenance costs for assets
used in counter-drug activities and a proportionate share of base
operation support costs for units assigned to counter-drug activities.
In addition, these numbers do not reflect the value of the
equipment and training that DOD provides to other nations in
support of their counter-narcotics activities pursuant to
section 506 of the Foreign Assistance Act. This section
provides authorization for up to $75.0 million worth of
counter-narcotics support to foreign governments each year. The
committee is concerned that this authority, which was intended
to be used to enhance U.S. counter-narcotics support to nations
in the source zone, is simply used to offset Department of
State budgets. The committee believes that such drawdowns
should give highest priority to those items that will enhance a
source nation government's counter-narcotics capability, rather
than to items that provide offset savings to Department of
State budgets as is suggested in State's fiscal year 1998
drawdown proposal.
A careful examination of the total DOD resources dedicated
to this mission reveals a significant contribution on the part
of our armed forces to America's war on drugs, far more
significant than some are willing to acknowledge. The committee
directs the Secretary of Defense to include an estimate of
DOD's total contributions in future years budget submissions.
The committee is concerned that in some cases the
Department of Defense may be pressured into dedicating scarce
resources within its budget recommendation to the President for
the counter-narcotics missions that are the primary
responsibility of the Department of State or other Federal
agencies. This practice could be detrimental to other high
priority military missions, including counter-terrorism and
counter-proliferation, in today's resource constrained
environment. The committee believes that the Secretary of
Defense and the Chairman of the Joint Chiefs of Staff are in
the best position to understand all of the national security
responsibilities of DOD, and to make a balanced recommendation
to the President regarding the manner in which the resources of
the armed forces should be utilized in such a way as to most
effectively carry out those responsibilities.
The committee recommends the following budget for DOD's
counter-narcotics activities.

Drug Interdiction & Counter-drug Activities, Operations and Maintenance

(In thousands of dollars; may not add due to rounding) Amount
Fiscal year 1997 drug and counter-drug request................ $882,831
Goal 1 (dependent demand reduction)....................... $12,830
Goal 2 (Support to DLEAs)................................. $97,384
Goal 3 (DOD personnel demand reduction)................... $72,936
Goal 4 (drug interdiction--TZ/SWB)........................ $406,554
Goal 5 (Supply reduction)................................. $293,127
Increases:
Caribbean/eastern Pacific surface interdiction............ $10,000
Gulf states initiative/regional counter-drug training..... $7,000
Decreases:
JIATF south............................................... $17,000

Enhanced Caribbean/Eastern Pacific Interdiction Initiative

The Committee continues to be concerned with the impact
that our military withdrawal from Panama will have on our drug
interdiction capabilities. The Panamanian facilities provide a
unique location from which to deploy our counter-narcotics
assets. The loss of these facilities will have a significant
impact upon our ability to maintain the current level of drug
interdiction efforts. Since the United States and the
Government of Panama have been unable to reach an agreement
regarding the continued deployment of U.S. military personnel
to Panama after the remaining facilities are turned over at the
end of 1999, the Committee believes it is imprudent to
significantly expand and facilitize Joint Interagency Task
Force (JIATF) South as recommended in the President's budget
request. Until such an agreement is signed, the committee
believes that JIATF South should operate with the same
resources that it received for fiscal year 1998. Therefore, the
committee recommends a $17.0 million reduction in the budget
request for this program.
The committee believes that DOD should explore new
initiatives to enhance current interdiction capabilities so
that if Panamanian facilities are lost, a viable interdiction
program remains. To assist DOD in this effort, the committee
has included a provision that would provide $18.5 million
($10.0 million more than requested for the Carribean) within
the counter-narcotics central transfer account for the
increased deployment of DOD's Patrol Coastal Craft (PCs) to the
Caribbean and Eastern Pacific, and any maintenance or
modifications of these craft necessary to enhance
theirinterdiction capabilities. This deployment will provide the
Commander-in-Chief of the United States Southern Command (CINCSOUTH)
with a more substantial Naval presence in his theater of operations
with which to increase the surface interdiction efforts of suspected
narco-traffickers. The Department should explore the opportunity of
using Reserve personnel, to the maximum extent practicable, in the
operation of these vessels in order to maintain satisfactory PERSTEMPO
rates of the PC crews.
The committee understands that DOD has performed an initial
assessment of the viability of utilizing PCs in a mothership
concept to enhance its maritime interdiction capabilities. This
will be of particular help in the interdiction of go-fast boats
that are used by the narco-traffickers to move the bulk of
their drugs through the Caribbean and Eastern Pacific. Under
this concept, Patrol Coastal Craft and small Coast Guard
vessels that are particularly effective platforms for
intercepting maritime targets, including go-fast boats, would
be supported by a large ship such as an amphibious vessel, CD
modified T-AGOS, or Coast Guard Bouy Tenders. This would allow
a large number of the smaller vessels to remain on station for
longer periods of time performing interdiction missions. Such a
presence would seriously disrupt the narco-traffickers''
maritime smuggling capabilities. According to a DOD report
``the combination of a mothership with maritime interceptor
craft, coupled with airborne detection and monitoring, is a
potential solution to the Western Caribbean [WCARIB] go fast
threat . . . A mothership operation provides both a very long-
duration, at-sea presence covering a large threat area, and the
requisite fast maritime craft necessary to intercept the target
go-fasts.'' . . . ``Coast Guard Patrol Boats (WPBs) and Navy
Cyclone Class Patrol Craft (PCs) are very effective platforms
for intercepting maritime targets, placing boarding teams on
suspect vessels, and relieving larger ships of end-game
units.''
The committee encourages the Department of Defense to
pursue this mothership concept utilizing the PCs and any other
available Navy and Coast Guard vessels as maritime interceptor
craft. The Department of Defense, the U.S. Coast Guard, and the
U.S. Customs Service should develop a plan to ensure that the
necessary mothership platforms and surveillance vessels
(including DOD and Customs tracker aircraft) are available for
the requisite time period to effectively test this concept.
The committee directs the Secretary of Defense to provide
the Committee on Armed Services of the Senate and the Committee
on National Security of the House of Representatives, with a
report outlining the extent to which the PCs, operating either
with or without a mothership, were effective during fiscal year
1999 in the interdiction and deterrence of maritime drug
trafficking. This report should also outline CINCSOUTH's and
Commander-in-Chief Special Operation Command's (CINCSOCOM's)
recommendation regarding any future deployment of these craft
to Southern Command's (SOUTHCOM's) area of responsibility
(AOR), and the Secretary of Defense's recommendation as to the
appropriate funding mechanism for these future deployments.

Gulf States Counter-drug Initiative

The committee understands the Gulf States Counter-drug
Initiative has grown beyond its original counter-drug mission
and now performs important work for other high priority
missions of the Department of Defense, including counter-
terrorism.
Therefore, the committee supports the transfer of this
activity from the Department's Counter-drug account to the C3I
Joint Military Intelligence Program in accordance with its
increased mission and provides an additional $7.0 million for
its counter-narcotics activities. The committee expects that
the Department will fund GSCI's operations through the JMIP
budget in the future.

Patrol Coastal Craft for Drug Interdiction by Southern Command (sec.
331)

The committee is concerned with the quantity of narcotics
that are being transported by ship and fast boat through the
Caribbean and the Eastern Pacific. The committee believes that
the Department should explore new ways to increase our Naval
presence in theater in order to impede the ability of narco-
traffickers to use this method of transportation.
Therefore, to assist the Department in this effort, the
committee recommends a provision that would provide $18.5
million within the counter-narcotics central transfer account
for the increased deployment of the Department's Patrol Coastal
Craft to the Caribbean and Eastern Pacific.

Program Authority for Department of Defense Support for Counter-Drug
Activities (sec. 332)

The committee recommends a provision that would extend
section 1004 of the National Defense Authorization Act for
Fiscal Year 1991 through fiscal year 2004. The provision would
also allow the Department of Defense to use counterdrug funds
for any major renovation or modification of a Defense facility
being used for counter-narcotics purposes. Prior to using this
authority for any such projects that will exceed $500,000, the
Department must notify the congressional defense committees.

Southwest Border Fence (sec. 333)

The committee is concerned with the continued
transportation of narcotics across the southwest border and
into the United States. Over the past few years, the Department
of Defense has explored several initiatives to reducing this
flow of illegal drugs. One such initiative was the construction
of a border fence along portions of the border. Unfortunately,
it appears that this fence, in its current form, has not
contributed significantly to reducing drug smuggling. Although
the committee supports such initiatives, the committee believes
that a thorough analysis should be performed to determine how
the fence might be made more effective before the Department
proceeds with any planned expansion. Therefore, the committee
recommends a provision that would require the Secretary of
Defense to perform such an analysis before further expansion of
the southwest border fence.

SUBTITLE E--OTHER MATTERS

Sec. 341. Liquidity of working-capital funds.

The committee recommends provisions that would ensure the
liquidity of the working-capital funds (WCFs) and provide a
mechanism to allow the Department of Defense to recover
operating losses during the year of execution. The committee is
concerned about the Department's inability to maintain
sufficient cash balances in the WCFs. The lack of liquidity in
the WCFs and lack of a procedure to recover operating losses in
the year of execution has resulted in inefficient business
practices. With the implementation of the recommended
provision, advanced billing procedures will no longer be
necessary and depot maintenances activites will be able to
maintain sufficent cash balances within WCFs.

Sec. 342. Termination of authority to manage working-capital funds and
certain activities through the Defense Business Operations
Fund.

In light of the Department of Defense decision to terminate
the Defense Business Operations Fund (DBOF), the committee
recommends a provision that would transfer the relevant
statutory authorities and reporting requirements to the
Department's working-capital fund operations (section 2208 of
title 10, United States Code) and would repeal the statutory
authority for the DBOF.
Section 363 of the National Defense Authorization Act for
Fiscal Year 1997 (Public Law 104-724) required the Department
of Defense to submit a management improvement plan for its
working-capital funds, including the Defense Business
Operations Fund, by September 30, 1997. Section 363 stipulated
that unless Congress approved this plan, the statutory
authority for the DBOF would be repealed.
In December 1996, prior to the conclusion of the study, the
Department of Defense terminated the DBOF and created separate
working-capital funds for each military department and for the
defense agencies. These funds have continued to operate using
many of the same procedures created under the DBOF.
It is intended that the recommended provision would ensure
that the progress brought about by the DBOF, such as recovery
of the full cost of support activities and separate accounting
of the financial operations of each business area, are not lost
now that the DBOF has been terminated.
The committee commends the Department for the quality of
the working-capital funds review and report to the Congress,
and in general supports the recommendations in the Department's
report. The committee remains concerned, however, that the
financial problems in the working capital funds, including
significant financial losses and advance billing, have not yet
been brought under control.

Sec. 343. Clarification of authority to retain recovered costs of
disposals in working capital funds.

The committee recommends a provision that would clarify the
authority of the Defense Reutilization and Marketing Service
(DRMS) to retain, from proceeds received from sales of surplus
supplies, materials, or equipment, an amount equal to the costs
incurred in the selling, reutilizing, or otherwise disposing of
such items. The provision does not result in the retention of
any additional funds by the Department of Defense.

Sec. 344. Best commercial inventory practices for management of
secondary supply items.

The committee commends the Department of Defense for its
efforts to reform its business practices including inventory
management. The committee is concerned with continuing reports
that the Department of Defense possesses several billion
dollars worth of excess inventory. Furthermore, the committee
is concerned that the Department of Defense continues to
purchase items for which the Department already possesses
excess quantities. While the committee understands that there
will always be some level of excess inventory as well as excess
on order, the committee believes that the Department should
pursue all available opportunities to streamline and improve
its operations.
Therefore, the committee recommends a provision thatwould
direct the secretary of each military department to develop and submit
to Congress a schedule for the implementation of the best inventory
management practices found in the commercial sector that are consistent
with military requirements. The provision would also require the
Comptroller General to review the extent to which the service
secretaries comply with this requirement, and the extent to which the
best commercial inventory practices are being implemented at the
Defense Logistics Agency.
The committee commends the Department of the Navy for
reducing its level of excess inventory on order to three
percent, one percent below the Department's goal. The committee
believes that the other services and the Defense Logistics
Agency should seek to achieve this same reduced level.

Sec. 345. Increased use of SMART cards.

The committee recommends a provision that would require the
Department of Defense to take action to further integrate the
Smart Card into the naval services.

Sec. 346. Public-private competition in the provision of support
services.

The committee recommends a provision that would make
several changes to existing law to encourage public-private
competition of support functions and give the Department
greater flexibility to manage support services in the most
cost-effective manner, consistent with the national defense. In
particular, the provision would: (1) express the sense of the
Senate that the Secretary of Defense should initiate A-76
competitions covering 30,000 full time equivalent's (FTE) per
year for five years as specified in the Secretary's Defense
Reform Initiative; (2) raise the threshold below which the
Department is authorized to conduct public-private competitions
and privatize support functions without going through the A-76
notification and study process from 20 employees to 50
employees; and (3) give the Department increased flexibility to
choose the public or private option that provides the best
overall value for the taxpayer by expressly authorizing the
application of ``best value'' techniques common to the
acquisition system to public-private competitions for support
services. The new authority provided by this section would be
effective on January 1, 2001.
The committee expects the Department to take appropriate
steps to ensure that the authority to conduct public-private
competitions and privatize support functions involving fewer
then 50 employees without going through the A-76 notification
and study process is not abused by breaking up larger functions
into sub-elements of 50 or fewer employees. If the Department
fails to prevent such abuses, the committee anticipates that
the threshold would again be lowered.

Sec. 347. Condition for providing financial assistance for support of
additional duties assigned to the Army National Guard.

The committee recommends a provision that would require
competition before the Secretary of the Army could expand the
amount of support that the Army National Guard performs
pursuant to section 113(b) of title 32, United States Code, if
that support is not yet performed by a public entity such as
the National Guard, or that support is not currently under
official consideration by the Secretary of the Army for award
to the National Guard.

Sec. 348. Repeal of prohibition on joint use of Gray Army Airfield,
Fort Hood, Texas.

The committee recommends a provision that would repeal
section 319 of the National Defense Authorization Act for
Fiscal Year 1987 that prohibits the Secretary of the Army from
entering into an agreement to allow civil aviation use of Gray
Army Airfield, Fort Hood, Texas. The provision would enhance
the use of Gray Army Air Field and ease the travel of military
personnel stationed at Fort Hood and the surrounding
communities.

ADDITIONAL MATTERS OF INTEREST

Navy

Ship depot maintenance

The committee is concerned with the continuing backlog in
ship depot maintenance. The committee is aware that the Navy
has an unfunded requirement of $90.0 million for this important
maintenance function. The committee is concerned with the
turmoil this may cause within current maintenance schedules,
and that the cost of this maintenance could increase if current
problems go uncorrected for another year. Therefore, the
committee recommends an increase of $30.0 million for ship
depot maintenance in order to reduce the Navy's unfunded
requirement in this area.

Tomahawk recertification

The committee is aware that the Navy has an unfunded
requirement to recertify 175 Tomahawk missiles. Given
thereports from the field regarding the shortage of such missiles and
the need to ensure that those in the inventory are ready and reliable,
the committee recommends an additional $27.0 million to eliminate this
backlog. However, as a result of the recent reprogramming that was
approved by the congressional defense committees, there is a $5.0
million savings in the weapons support/cruise missile account for
fiscal year 1999. Therefore, the committee recommends a net increase of
$22.0 million.

Dredging operations for the maintenance of ships in the inactive
reserve

The committee is aware of the facility capacity constraints
at Norfolk Naval Shipyard where the Navy currently maintains
some of its inactive reserve vessels. These constraints require
the relocation of the U.S.S. Wisconsin to a different location
in order to make space available for active vessels in need of
repair and maintenance. Because of the requirement for the Navy
to berth this deep draft vessel within the Norfolk vicinity so
that it can be returned to the shipyard for reactivation, if
necessary, the Navy is exploring alternative berthing sites,
including some within the Elizabeth River. The committee is
aware that the redeployment of this vessel to a suitable
location in the Norfolk area may require some additional
dredging. Therefore, the committee recommends an increase of
$6.0 million for the dredging and other costs associated with
the redeployment of the U.S.S. Wisconsin within the Norfolk
region.

Naval oceanographic program

The committee recommends an additional $7.0 million to the
Naval Meteorology and Oceanography Command for equipment
purchases, air operations, and contract support in order to
support survey operations and other data collection
requirements of the Navy.

Adjustments to civilian personnel education and training funds

The committee recommends a reduction of $29.0 million in
the Operation and Maintenance, Navy account. Specifically,
civilian education and training, line 520, would be reduced by
$9.0 million and the civilian manpower and personnel
management, line 580, would be reduced by $20.0 million. These
funds would be used, in part, to fund increases in the National
Guard Youth Challenge program, STARBASE and impact aid.

Marine Corps

United States Marine Corps initial issue

The committee recommends an increase of $35.0 million in
the operation and maintenance accounts for the Marine Corps
($25.0 million) and Marine Corps Reserves ($10.0 million) to
purchase items of individual combat clothing and equipment.
This will help provide Marines in the field with the clothing
and equipment they need to survive and sustain themselves
during cold weather combat operations.

Depot maintenance and corrosion control

The committee is concerned with reports that some Marine
Corps units do not have sufficient funds to maintain equipment.
Currently, the Marine Corps has an unfunded backlog of $53.3
million worth of depot maintenance. Furthermore, the Corps
requires an additional $3.2 million in its Corrosion Control
and Coating Program to avoid the deterioration of major end
items of equipment and to extend the life cycle. The committee
recognizes the importance of maintaining and preserving
military equipment in order to ensure that it is available for
essential training and possible deployment. Therefore, the
committee recommends an increase of $20.0 million to reduce the
depot maintenance backlog of Marine Corps equipment, and an
additional $5.0 million for the depot maintenance and corrosion
control program of the Marine Corps Reserve.

United States Marine Corps Reserve personal equipment

The committee recommends an increase of $5.0 million in the
Marine Corps Reserve Operations and Maintenance account to pay
for 782 personal gear.

Air Force

Air launched cruise missiles and advanced cruise missile engineering
analysis

The committee is aware of the shortfall in funding for the
recurring sustaining engineering activities associated with the
flight analysis of the air launched cruise missile and advanced
cruise missile. Sustaining the readiness of these two systems
requires the Air Force to analyze three shots of each per year.
The President's budget request did not provide sufficient
funding for this analysis. Therefore, the committee recommends
an increase of $9.0 million to fund the required analysis.

Air Force combat training range

The committee is aware of the $5.1 million unfunded
requirement for the operation and maintenance of the Air
Force's primary training ranges, electronic scoring sites, and
air combat maneuvering instrumentation systems. Failure to
fully fund these operations will lead to a reduction in
required services and aircrews that are not combat ready.
Therefore, the committee recommends an increase of $5.1 million
to fund this requirement.

War reserve materials

The committee is aware of the funding shortfall for the
rehabilitation and replacement of critical wartime bare base
equipment that is degraded and worn out due to extensive use in
contingency operations. These systems, Harvest Falcon and
Harvest Eagle, are designed to provide theater Commanders-in-
Chief with billeting, hygiene, feeding, and airfield/backshop
capability for over 68,000 troops and 822 aircraft. These are
important assets for U.S. military capability to successfully
execute a major theater war. Therefore, the committee
recommends an increase of $12.0 million for the rehabilitation
and replacement of these systems.

Adjustments to personnel program funds

The committee recommends a reduction of $15.0 million in
the Operation and Maintenance, Air Force account. Specifically,
personnel programs, line 440, would be reduced. These funds
would be used, in part, to fund increases in the National Guard
Youth Challenge program, STARBASE and impact aid.

Guard and Reserve Components

Defense-Wide

National Guard Youth Challenge

The budget request for the National Guard Youth Challenge
program included $28.5 million. The committee recommends an
increase of $22.0 million in the National Guard Youth Challenge
program, an increase from the fiscal year 1998 level. The
committee recognizes the value of this important program and
believes that it should be expanded to include states that have
not been able to initiate programs with the reduced funding
levels.

STARBASE

STARBASE was not funded in the budget request. The
committee recommends an increase of $5.0 million in the
STARBASE program. The committee understands that this program
was intended to transition to self-sustaining status, however,
there has been no progress made to locate non-defense or
private sector funding. The committee recognizes the value of
this important program and believes that it should be expanded
to include school districts that have not been able to initiate
programs with the reduced funding levels. The Secretary of
Defense is directed to assist participating school districts in
identifying non-defense, local, or private sector funding as an
alternative to continued funding within the defense budget.

Defense reform initiative

The committee is encouraged by the recent report released
by the Department of Defense outlining the reform initiatives
it plans to undertake in order to streamline and improve its
operations. The committee understands that the Department
believes that it will achieve great savings through such
initiatives as prime vendor contracting and other inventory
reduction programs, consolidating logistics and transportation,
travel and household goods transportation reengineering, and
competition for commercial activities using Office of
Mangagement and Budget (OMB) Circular A-76. It projected that
these initiatives will generate monetary savings and enable the
Department to reduce personnel.
The Department has already started to implement portions of
this initiative, particularly in the Office of the Secretary of
Defense and other Defense-wide activities. However, rather than
reducing the budget request for the Defense-wide account, the
Department has increased this account by over $300.0 million.
Therefore, the committee recommends a reduction of $150.0
million in the budget request for the Defense-wide Operation
and Management (O&M) account to reflect the savings that are
assumed to be generated as a result of the Defense Reform
Initiative.

Adjustments to human resource activity funds

The committee recommends a reduction of $18.0 million in
the Operation and Maintenance, Defensewide account.
Specifically, defense human resources activity, line 85, would
be reduced. These funds would be used, in part, to fund
increases in the National Guard Youth Challenge program,
STARBASE and impact aid.

Overseas humanitarian demining and Commander-in-Chief initiative
activities

The committee strongly supports the humanitarian demining
and Commander-in-Chief initiative activities of the Department
of Defense. These activities have enabled military
personnelwithin the Department to forge valuable relationships with the
armed forces and civilian population of other nations. Therefore, the
committee recommends $50.0 million to fund these important programs.

Cooperative Threat Reduction (CTR) Program

The budget request included $442.4 million for the
Cooperative Threat Reduction (CTR) program, a $60.9 million
increase to the budget request for fiscal year 1998. The
committee recommends a reduction of $2.0 million to the budget
request.

Defense Threat Reduction Agency (DTRA)

The committee recommends that the mission and function of
the Cooperative Threat Reduction (CTR) program be transferred
to the Defense Threat Reduction Agency (DTRA).

Operational units readiness resources

The committee is concerned about the continuing reports
from operational commanders that readiness is being jeopardized
for numerous reasons, including a lack of training funds. This
has been particularly true with the non-deployed units.
Furthermore, although the Army's budget request has
traditionally included full funding for training requirements,
these funds have been transferred during the year of execution
in order to pay for necessary base operations that have been
underfunded.
Given the current pace of operations, an uncertain national
security environment, and the potential for short notice
deployment of troops, the committee believes that the armed
forces need to be fully trained to carry out their assigned
missions. Therefore, the committee recommends an increase of
$450.0 million for base operations and training as outlined
below:

Item
In millions
Army Base Ops................................................. 185.0
Navy Base Ops................................................. 35.0
Navy Flying Hours............................................. 45.0
USMC Base Ops................................................. 15.0
USMC OPTEMPO.................................................. 20.0
Air Force Base Ops............................................ 35.0
Air Force Flying Hours........................................ 30.0
National Guard OPTEMPO........................................ 40.0
Army Reserve OPTEMPO.......................................... 15.0
Navy Reserve Steaming Days.................................... 15.0
Air Force Reserve Flying Hours................................ 15.0
--------------------------------------------------------------
____________________________________________________

Total..................................................... 450.0

Real property maintenance

The committee is concerned with the continued growth in the
backlog of real property maintenance (RPM) throughout the
Department of Defense. If this necessary maintenance continues
to go unfunded, the Department will be faced with even larger
costs to repair damages caused by inclement weather and other
environmental conditions. Although the condition of facilities
at all military installations continues to suffer from
inadequate funding, this problem is particularly serious within
the Army and the Marine Corps. Necessary repairs on barracks,
roads, airstrips, rifle ranges, and other facilities at these
and other locations are continually deferred because of
insufficient funding. In many cases, this deferral of property
maintenance will lead to higher costs in the near-term, a
problem that will be compounded by the ``bow wave'' in
procurement and modernization. Therefore, the committee
recommends an increase of $284.0 million to the operations and
maintenance accounts of the military services for the
maintenance of real property; as outlined below:

Department:
In millions
Army.......................................................... 130.0
Navy.......................................................... 48.0
USMC.......................................................... 36.0
Air Force..................................................... 50.0
Air National Guard............................................ 20.0
--------------------------------------------------------------
____________________________________________________

Total..................................................... 284.0

Civilian personnel levels

The committee notes that the Department of Defense civilian
personnel drawdown continues at a more rapid pace than
expected. During the past several years, civilian personnel
levels in the Department of Defense have been reduced faster
than anticipated in each succeeding fiscal year budget process.
The Congressional Budget Office estimates that this drawdown
means lower-than-budgeted civilian personnel levels, resulting
in savings of approximately $658.8 million during fiscal year
1999. The committee has made the appropriate adjustments in the
fiscal year 1999 budget to reflect these savings.

Foreign currency fluctuation

The committee notes the recent strength of the American
dollar in relation to foreign currencies. This makes
thepurchase of services and goods overseas less expensive than was
originally projected by the Department of Defense when it submitted its
fiscal year 1999 budget request. The committee has made appropriate
changes to the budget request to reflect the $119.2 million savings
that would be realized in fiscal year 1999.

Fuel price reduction

The committee notes the recent reduction in the price of
oil and the impact that this will have on the fuel funding
requirements of the Department of Defense (DOD). The price of
oil has declined from $19.00 a barrel when the President's
budget request was prepared, to an estimated $17.00 a barrel in
fiscal year 1999. This makes the purchase of gasoline and other
fuels less expensive than was originally believed when the DOD
put together its budget submission. The committee has made
appropriate changes to the budget request to reflect the $304.0
million savings which will be realized in fiscal year 1999.

Restoration of work years to accomplish essential finance and
accounting services

The committee is aware that there is a mismatch of workload
and work years in the budget request for the Defense Finance
and Accounting Service. The committee provided increased
funding to restore 1500 work years to ensure better management
of expected requirements and maintenance of vital finance and
accounting services within the Department of Defense. The
committee fully expects that future requirements will be fully
funded and that any reductions will be based on a comprehensive
plan that considers expected workload and capacity to
accomplish that workload.

Restoration of 1500 work years

(In millions)

Army.......................................................... $8.8
Navy.......................................................... 10.0
Marines....................................................... 1.3
Air Force..................................................... 13.3
DLA........................................................... 2.3
Other Defense agencies........................................ 2.1
--------------------------------------------------------------
____________________________________________________

Total..................................................... $37.8

Assistance to local educational agencies that have benefit dependents
of members of the Armed Forces and Department of Defense
civilian employees

The committee recommends an increase of $35.0 million in
the Operation and Maintenance, Defensewide account to provide
assistance to local educational agencies. The committee intends
that this supplemental impact aid be made available to severly
impacted local educational agencies where the standard for the
minimum level of education within the state can not be
maintained because of large numbers of military connected
students or the effects of base realignment and closures.

Revolving Funds

Reserve Mobilization Income Insurance Program

The budget request included $37.0 million for the Reserve
Mobilization Income Insurance Fund. The Congress included
funding for the Reserve Mobilization Insurance Fund in the
supplemental appropriation bill. Since the Army National Guard
schools and special training account was underfunded in the
budget request, the committee recommends transferring the $37.0
million requested for the Reserve Mobilization Income Insurance
program in the operation and maintenance appropriation to the
military personnel appropriation.

OTHER ITEMS OF INTEREST

Defense Threat Reduction Agency (DTRA)

In February, the Congress was briefed on the Defense Reform
Initiative (DRI), a plan by the Department of Defense to
achieve savings by reorganizing and applying successful
corporate business practices. The savings generated by these
efforts would be used to develop and procure new generation
information-based weapons systems. One element of the DRI was
consolidation of activities related to weapons of mass
destruction.
The Secretary of Defense has identified countering the
threat of proliferation of weapons of mass destruction (WMD) as
a high priority. The Secretary believes that preventing the
proliferation of, reducing the number of, and defending against
WMD will present a complex challenge to national security over
the next 10-20 years.
The budget request described the establishment of the
Defense Threat Reduction Agency (DTRA) and set an establishment
target date of October 1, 1998. The mission of the agency would
be to carry out programs to counter the proliferation of, and
reduce threats posed by, weapons of mass destruction, and to
provide nuclear weapons stockpile and related support. The new
agency will be formed by consolidating existing agencies, as
well as certain functions from the Office of the Secretary of
Defense and Washington Headquarters Services.
The committee supports efforts by the Department to reduce
redundancies and conserve scarce resources by establishing a
single agency to provide services and support related to WMD to
the warfighters and the Department. The committee understands
that the DTRA would provide the cross-integration of DOD
efforts in the WMD area, which is not adequately addressed by
other agencies.
The committee understands that the new agency would
primarily be an acquisition organization, with strong
operational commitments and support, to include planning,
programming, execution, and warfighter support
responsibilities. Within this broad mission, the DTRA would
provide technical expertise in nuclear weapons and their
effects to ensure the operational effectiveness of U.S. nuclear
forces and their survivability; provide independent assessment
to the Secretary of Defense and the Chairman of the Joint
Chiefs of Staff on nuclear weapons safety, security,
reliability and control, and support the Commanders in Chief
(CINCs) and services in these areas; maintain and manage the
nuclear weapons stockpile as previously assigned to the Defense
Special Weapons Agency (DSWA); and participate in and support
DOD input to the Department of Energy Stockpile Stewardship and
Management program.
In the area of reducing or countering WMD threats, the DTRA
would provide support to operational forces in developing and
fielding systems. Operational support would include monitoring
and implementing arms control treaties and the Cooperative
Threat Reduction (CTR) program; conducting force protection
assessments for the Chairman of the Joint Chiefs of Staff and
the CINCs; supporting the development of nuclear, chemical and
biological defense doctrine, training readiness and modeling
and simulation; and preventing the proliferation of WMD
technology through technology security, export control and
international cooperative initiatives; and coordinating these
activities with the concerned U.S. departments and agencies, as
well as foreign and international agencies.
Areas of development, or fielding of equipment for which
DTRA would be responsible, would include nuclear, chemical and
biological defense capabilities for domestic emergency response
protection, technologies to monitor and verify treaties, as
well as to counter the proliferation of WMD, or defeat hardened
and deeply buried, and mobile targets. DTRA would also support
the Office of the Assistant Secretary of Defense for Special
Operations/Low Intensity Conflict in implementing its guidance
with regard to developing technologies to combat terrorism.
Combat support is an important element of the mission of
the agency; the committee understands that DTRA will be
designated as a combat support agency in recognition of the
considerable support it will provide to the warfighting CINCs.
Based on the criteria used to determine the transfer of
functions, missions, and resources to the DTRA, the committee
directs that additional activities be transferred to DTRA.
Those activities are the chemical and biological defense
program, the counterproliferation support program, and the
unitary and nonstockpile chemical and munitions destruction
programs. These programs are important examples of cross-DOD
integration that can be performed by the new agency. The
committee understands that the base of technology and expertise
for the chemical and biological defense program and the
chemical agents and munitions destruction program is largely in
the Department of the Army, and believes that the Department of
the Army should continue to manage and execute both programs
with guidance and oversight from the DTRA.
In addition, the committee recommends that programs that
focus on providing technology to assist military forces in
protecting themselves against acts of terrorism, to include the
use of WMD, such as the physical security program (PE 63228D8Z)
and the counterterror technical support program (PE 63122D8Z),
be transferred to DTRA. The committee expects the Office of
Special Operations/Low Intensity Conflict and the Technical
Support Working Group (TSWG) will continue to provide policy
oversight and develop responsive solutions for combating
terrorism.

Defense Special Weapons Agency (DSWA)

The Field Command of the Defense Special Weapons Agency
(DSWA) executes functions critical to the Department of Defense
role in supporting the nuclear weapons stockpile, performs
nuclear weapons surety inspections, and conducts unique WMD
testing and simulation. The committee is concerned to learn
that the Department may consider fragmenting and transferring
critical nuclear and WMD-related functions currently performed
by the Field Command, DSWA and transferring them to other
organizations. The committee believes these functions are
fundamental and integral to the success of the mission of the
DTRA, and should remain a responsibility of the new agency. In
addition, the committee believes Field Command should remain at
Kirtland Air Force Base.

On-Site Inspection Agency (OSIA) and Arms Control Implementation

The budget request for defense arms control compliance
activities included $9.5 million for implementing the Chemical
Weapons Convention (CWC). These funds would be used to
reimburse the CWC international monitoring agency, the
Organization for the Prohibition of Chemical Weapons (OPCW),
for equipment used during inspections as well as salaries,
subsistence allowances and international travel costs for the
inspection teams. In addition, these funds would be used
toprovide reimbursement for arms control implementation inspection
costs borne by the inspected party to a treaty or agreement.
The CWC requires that States Parties pay the administrative
costs of the Organization for the Prohibition of Chemical
Weapons (OPCW) according to the United Nations assessment
scale. Additionally, CWC States Parties are responsible for the
costs of destroying their chemical weapons and chemical weapons
production facilities, as well as the costs of the OPCW to
verify compliance with the Treaty. The budget request included
funds for the direct costs of implementing the inspection of
DOD assets and to provide for procurement, operation and
maintenance (O&M), training, and research, development, testing
and evaluation (RDT&E) funding for the military services, the
OSIA, and the DSWA. The budget request also included funds for
the destruction of the chemical stockpile.
The committee does not support the use of defense funds to
pay for those costs that are not appropriately the
responsibility of the Department of Defense, and more
appropriately included in the foreign affairs budget. The
committee understands that the Department of State is
responsible for all other U.S. costs associated with the
Treaty. The committee further understands the Department of
State agreed in the first Conference of State Parties in May
1997 to fund not only the ``usual'' in-country inspection costs
(meals, lodging, and transportation of inspectors within the
United States), but also inspector salaries and transportation
from The Hague to the Point of Entry. The committee does not
agree that these additional costs should be paid for from the
defense budget, and therefore recommends a reduction of $9.5
million to the budget request for OSIA.
Lastly, the budget request included funds for estimated
U.S. reimbursement of payments for arms control implementation
inspection costs borne by the inspected party to a treaty or
agreement. Other than the two policy agreements under the
Intermediate-Range Nuclear Forces (INF) Treaty and Strategic
Arms Reduction Treaty (START) concluded in May 1994 and
February 1995, respectively, the committee is not aware of
additional policy agreements concluded by the Department. The
committee understood in previous correspondence from the
Department that these two agreements would not be precedents
for other agreements, and the committee is not aware of any
other policy agreements for other arms control agreements. The
committee recommends that no funds be authorized specifically
for the reimbursement of arms control implementation inspection
costs to a foreign country.

Nuclear Weapons Council and Maintaining the Nuclear Deterrent

The committee believes that maintaining a credible nuclear
deterrent is a fundamental and integral part of efforts to
counter and respond to the full spectrum of the challenge posed
by WMD. The programs to sustain the nuclear deterrent are
currently performed by multiple organizations, including the
Office of the Secretary of Defense, the DSWA and the military
services. In this environment, guidance and direction from the
Secretary of Defense is essential.
Although they are not as high a priority as during the Cold
War, the committee believes that the nuclear program should not
be handled in an ad hoc manner without consideration for long
range coherent planning. As a result, adequate funding and
senior policy and implementation attention will continue to be
necessary to sustain a coherent DOD program.
The committee is encouraged by the Department's efforts to
undertake initiatives to provide improved management and
coordination of all activities related to countering or
reducing the threat of WMD through the creation of DTRA. It is
imperative, however, that there be no lessening of the
Secretary's core responsibilities to oversee and sustain the
Nation's nuclear deterrent. The committee is concerned that in
implementing the reforms recommended in the Defense Reform
Initiative (DRI), the Secretary's role in maintaining a strong
nuclear deterrent may be diminished. The committee believes
that any new management approaches should preserve and
reinforce existing statutory oversight responsibilities, as
well as congressional involvement.

Management and Oversight of the Defense Threat Reduction Agency

The committee believes that the Office of the Secretary of
Defense must retain the oversight responsibilities of the
Office of the Assistant to the Secretary of Defense (Nuclear,
Chemical and Biological). The committee believes that a senior
Department of Defense official nominated by the President and
confirmed by the Senate should be designated responsibility for
the DTRA. This individual should report directly to the Under
Secretary of Defense for Acquisition and Technology.

Further Efficiencies and Economies

The committee is advised that in consolidating the various
organizations and programs to form DTRA, the Department was
able to achieve a five percent savings, which is reflected in
the budget request. However, the committee believes that
further savings can be realized by the consolidation and
recommends an undistributed reduction of $20.0 million to DTRA
operations and maintenance.

Department of Defense demolition program and historic properties

Each of the military services is currently pursuing an
ambitious demolition program for unneeded base infrastructure.
The Committee is concerned that without adequate planning, such
demolition efforts could pose a significant threat to historic
properties under the stewardship of the Department of
Defense(DOD). Hundreds of military properties are listed on the
National Register of Historic Places and thousands more may be
eligible. A 1994 survey by the DOD Cultural Resources Council
estimated that there are 120 historic districts on
installations, and that the Department currently owns more than
25,000 pre-1940 buildings, and as many as 80,000 World War II
era buildings.
In the Department of the Army, general construction and
maintenance funds cannot be used for a building if
rehabilitation costs would exceed 70 percent of new
construction estimates. Policies for new construction require
demolition of an equal amount of existing square footage,
leaving historic buildings as vulnerable to a formula
regardless of quality. The committee is concerned about the
possibility that these requirements may inhibit rehabilitation
of some historic structures.
The committee directs each military department to examine
how that department's construction, maintenance, and demolition
policies impact historic properties. The Secretary of Defense
shall compile the results of each department's review and
submit a report to the congressional defense committees within
one year from the date of enactment of this Act. The report
shall discuss how each department uses or could use analysis of
relative historical significance, and the potential for
adaptive use in planning departmental demolition programs.
The report shall also discuss alternatives to demolition of
properties that may have historical significance, including the
mothballing of buildings and leasing of buildings pursuant to
section 111 of the National Historic Preservation Act. In this
regard, the reports should address the leasing policies of each
military department and identify any impediments to leasing
historic properties or retaining lease proceeds under section
111. In addition, the report should address the feasibility of
allowing installations to use demolition funds for
rehabilitation. In developing the report, the military
departments are encouraged to consult with the Advisory Council
on Historic Preservation, the National Conference of State
Historic Preservation Officers, and the National Trust for
Historic Preservation, and other relevant organizations with
preservation expertise.

Department of Defense shipscrapping practices

Recently, questions have been raised about the worker
safety and environmental standards related to Department of
Defense shipscrapping contracts. The committee has observed
closely the Department's efforts to address concerns in this
area.
The Navy's inactive fleet has increased by 82 percent since
1990 and the rate of inactivations has exceeded the number of
ship removals. The pressures related to the size of the
inactive fleet continue to grow as additional ships near the
end of a 30-50 year life cycle, the Quadrennial Defense Review
(QDR) recommends continued active force reductions, base
closures reduce ship berthing capacity, and multiple ship
disposition options extend disposal timelines. The current
inventory of 196 inactive ships already exceeds the Navy's
berthing capacity and 115 of those inactive ships have been
designated for scrap.
The Office of the Chief of Naval Operations determines the
disposition of decommissioned Navy ships that have become a
part of the inactive fleet, as follows: retain for
mobilization; foreign military sale or lease; donation;
transfer to MARAD; or scrap. During inactivation, the Navy
removes bulk and containerized hazardous materials, seals any
friable asbestos containing materials, inventories and labels
equipment containing liquid polychlorinated biphenyls (PCBs),
pumps fuels and lube oil tanks, drains all hydraulic oil
systems, and takes various other steps to limit and identify
risks. In addition, prior to transferring ships for scrapping,
the ship is demilitarized. The transfer agent for the Navy's
non-nuclear vessels is the Defense Logistics Agency (DLA).
Radiological decontamination and disposal of nuclear vessels is
conducted exclusively by the Navy and the Department of Energy
manages the storage of any radioactive or mixed waste.
Once the Navy notifies the DLA that a ship is ready for
sale, that agency has the responsibility to advertise,
evaluate, award, and administer any scrapping contracts.
Consistent with its responsibility to administer scrapping
contracts, the DLA manages on-site environmental and safety
assessments, meetings with regulatory agencies, and on-site
contractor progress reviews.
In January 1996, DLA suspended shipscrapping sales
following an unannounced multi-media regulatory inspection that
identified environmental violations at a Wilmington, N.C.
scrapping site. In response to Navy and DLA concerns regarding
contract award and oversight practices, the DLA developed a
two-step sealed bid and competitive evaluation procedure to
improve source selection of scrapping contractors. The first
step involves the issuance of a Request for Technical Proposal
(RFTP) to determine the technical qualifications of potential
bidders. A team of environmental, safety, legal, and program
personnel review and evaluate the RFTP, to include: an
environmental plan; asafety plan; an operational plan; and a
business and financial plan. The second step involves an Invitation for
Bid (IFB) from only those firms whose proposals are found to be
technically acceptable.
In addition, the Navy tightened its program management
capability and now works jointly with DLA to review draft
solicitations, technical proposals received, and contractor
performance. The DLA has established a dedicated Naval ship
sales program office, increased the number of sales contracting
officers, and contracted for technical support related to on-
site environmental assessments, health and safety assessments,
and progress assessments. Consistent with the efforts initiated
in January 1996, the Navy and DLA have indicated that there are
ongoing efforts to maintain effective management and oversight
of shipbreaking safety and environmental practices.
In response to recent concerns reflected in a series of
Baltimore Sun articles, the Undersecretary of Defense
(Acquisition and Technology) established a senior panel to
review Department of Defense shipscrapping practices and
policies. In addition, the Secretary of the Navy suspended any
further action to explore overseas shipscrapping options,
pending receipt and review of the panel report. Further, an
interagency ship disposal working group has also been
established to foster an exchange of ideas among the Navy, the
Maritime Administration (MARAD), the U.S. Coast Guard, the
National Oceanic and Atmospheric Agency (NOAA), and the Army.
On April 20, 1998, the Department provided the Congress
with the recommendations of the senior panel established by the
Undersecretary of Defense (Acquisition and Technology). The
panel noted that the ``[s]crapping of vessels presents many
challenges due to the complexity of the ships themselves, the
environmental and safety issues, uncertainties about the
domestic industrial base and our limited economic leverage in
international markets.'' The panel acknowledged and endorsed
the recent efforts of the Department of the Navy, DLA, and the
U.S. Maritime Administration to resolve some of the problems
associated with past ship scrapping practices. The panel also
made some recommendations on how to improve the process both
domestically and internationally.
The Undersecretary of Defense (Acquisition and Technology)
is currently reviewing the panel recommendations to determine
appropriate future actions. The agencies that participated in
the panel are also reviewing the recommendations for
implementation. The committee is satisfied with the
Department's progress in this area. In light of the complex
nature of this issue, the committee is convinced that the
Department must be allowed to continue to resolve this matter
internally. The committee looks forward to the recommendations
of the Undersecretary.

Environmentally-preferable products

The committee understands that the Department of Defense
plans to advise its procurement officials of energy-efficient
products and products that contain recovered or recycled
content through defense-wide electronic cataloging system known
as the Federal Logistics Information System (FLIS). That system
is currently under development by the Joint Logistics
Commanders.
The committee is concerned that the Department has not yet
developed any consistent methodology for assessing vendor
claims and determining the environmental preferability of
products procured through FLIS. Accordingly, the committee
directs the Department to: (1) identify specific criteria for
identifying environmentally preferable and energy-efficient
products, and the source of such criteria; (2) identify product
categories for which the Department has not yet been able to
identify such standards; (3) develop procedures to provide
reasonable assurance that particular products meet these
criteria; and (4) develop procedures for tracking purchases of
such products and estimating the extent to which the Department
is meeting environmental objectives established in 48 C.F.R.
23.704. To the extent necessary, the Department should support
research and recommend modifications to specifications for
military unique items to further these objectives. The
committee directs the Secretary of Defense to report to the
congressional defense committees, not later than March 1, 1999,
on the status of this effort.

Federal facilities

The Armed Services Committee has jurisdiction over the
defense related environmental restoration efforts of the
Departments of Defense and Energy. As a result, the committee
has observed closely the progress of S.8, the Superfund
Reauthorization bill, specifically as it pertains to federal
facilities.
During the Environment and Public Works Committee markup of
S.8, an amendment was approved to waive federal sovereign
immunity under the Comprehensive Environmental Response,
Compensation and Liability Act (CERCLA), 42 U.S.C. 9601 et seq.
The amendment would require federal facilities to comply with
state and local substantive and procedural requirements, rather
than the uniform, national process described in the National
Contingency Plan.
Under current law, federal facilities are already subject
to state laws concerning removal and remedial action, including
laws regarding enforcement (42 U.S.C. 9620(a)(4)), but state
challenges must be brought after remedial action is complete.
(42 U.S.C. 9613 (g)). Federal facilities must comply with state
substantive cleanup standards, which may bemore stringent than
federal standards and must be legally applicable or relevant and
appropriate. (42 U.S.C. 9621).
Both the Department of Defense and the Department of Energy
have expressed concerns about the impact the proposed amendment
could have on cleanup activities at their respective sites. In
particular, the two agencies have expressed concern that
because the amendment would render federal facilities
susceptible to state and local procedural requirements (such as
fees and permits), state and local authorities could compel
federal agencies to stop Superfund cleanup actions pending
completion of procedural requirements. The amendment could
invalidate interagency agreements regarding cleanup schedules
and milestones by superimposing state and local substantive and
procedural requirements that previously did not apply. As a
result, the amendment could substantially increase federal
facilities cleanup costs and enable States to reorder funding
priorities at Superfund sites, shifting resources away from
sites with higher relative risks.
There are thousands of Department of Defense sites and
Department of Energy sites that have been identified as
requiring environmental cleanup, and there is the potential
that additional such sites may be identified. The cost to the
taxpayers of completing the environmental cleanup of these
facilities is likely to be in the hundreds of billions of
dollars. Funding for site assessments and cleanup is provided
through agency budgets and congressional appropriations. The
Department of Defense prioritizes funding for cleanup sites
through relative risk site evaluations and cleanup milestones
committed to in Federal Facility agreements. Based on those
cleanup priorities the Department has maintained a steady
fiscal year funding level of about $2.0 billion during the past
five years. The Department of Energy has also committed to
cleanup schedules under federal facility compliance agreements
and provided for a steady environmental restoration funding
profile of about $1.5 billion.
Congress must ensure that federal agencies maintain
coherent national cleanup programs with resources and funds
directed to federal sites where the needs and prospective
benefits are the greatest. Because Congress strictly controls
the funding available to the Departments of Defense and Energy
through the annual authorization and appropriations process,
the agencies do not have the same degree of funding flexibility
as the private sector. For this reason, the Departments have
expressed concern that new or accelerated requirements could
divert funds from higher priority cleanup activities and other
important national security missions, reducing the overall
level of protection for public health and safety.
The committee believes that the full scope of concerns
expressed by the Department of Defense and the Department of
Energy about the proposed amendment should be made a part of
the public record so that they may be addressed in the course
of debate on the bill. Accordingly, the committee directs the
Secretary of Defense and the Secretary of Energy to submit a
report, not later than September 30, 1998, to the congressional
defense committees on the impact of the proposed amendment to
S.8. The report, which should be prepared in consultation with
the Environmental Protection Agency, should specifically
address: (1) any additional costs that might be incurred by the
taxpayers as a result of the proposed amendment; and (2) any
impact that the amendment may have on the cleanup of Department
of Defense and the Department of Energy sites pursuant to
agreements that the two agencies have entered into with the
Environmental Protection Agency and with State and local
governments.

Retread tires and re-refined oils

The committee notes that the Department of Defense has made
tremendous progress in the use of recycled products. In order
to ensure continued progress in this area, the Department
should implement the Environmental Protection Agency's
procurement guidelines for re-refined lubricating oil and
retread tires, finalize revisions to the specifications for
such procurement items, and use appropriate specifications for
tire retreading. The Department should procure these items in
accordance with the Resource Conservation and Recovery Act of
1976 (42 U.S.C. 6962), to ensure consistency with the
provisions of Executive Order 12873, dated October 20, 1993, as
it relates to the procurement of retread tires and re-refined
lubricating oil. The Department's efforts in this area,
however, should not be inconsistent with military readiness
needs and requirements.
TITLE IV--MILITARY PERSONNEL AUTHORIZATIONS

The Congress, exercising its military manpower oversight
responsibilities, authorizes the end strengths of the active
and reserve forces annually. This year, in addition to the
Subcommittee on Personnel hearings to examine the force
structure plans of the Department of Defense and the military
services, the committee held a series of hearings to receive
testimony from the Secretary of Defense, the Chairman of the
Joint Chiefs of Staff, and the Service Chiefs in which OPTEMPO,
PERSTEMPO, recruiting, retention, and quality of life were
discussed in detail. Based on those hearings, the
administration's budget request, and other information, the
committee recommended end strength ceilings for the active and
reserve forces, including active component support for the
reserves. Additionally, the committee recommended repeal of the
end strength floors in order to permit the secretaries and
chiefs of the military services to implement the reductions in
force structure recommended by the Quadrennial Defense Review.

SUBTITLE A--ACTIVE FORCES

Sec. 401. End strengths for active forces.
The committee recommends a provision that would authorize
active duty end strengths for fiscal year 1999 as shown below:

----------------------------------------------------------------------------------------------------------------
Fiscal year
-----------------------------------------------
1998 1999
authorization 1999 request recommendation
----------------------------------------------------------------------------------------------------------------
Army: Total..................................................... 495,000 480,000 480,000
Navy: Total..................................................... 390,802 372,696 372,696
Marine Corps: Total............................................. 174,000 172,200 172,200
Air Force: Total................................................ 371,577 370,882 370,882
----------------------------------------------------------------------------------------------------------------

Sec. 402. Limited exclusions of joint duty officers from limitations on
number of general and flag officers.
The committee recommends a provision that would increase
the number of general and flag officer positions exempt from
counting against the authorized limit from six to seven. The
recommended increase would permit the Director, J-8 to serve as
a lieutenant general or a vice admiral in the case of the Navy.
The recommended provision would extend until October 1,
2002 the temporary authority to exclude up to 12 joint duty
officers from the limitation on authorized general and flag
officer strength.
Sec. 403. Limitation on daily average of personnel on active duty in
grades E-8 and E-9.
The committee recommends a provision that would change the
method for computing the time limitation on active duty
enlisted personnel serving in the grades of E-8 and E-9 to a
fiscal year vice a calendar year. The recommended provision
would also correct a technical error in the existing statute.
Sec. 404. Repeal of permanent end strength requirement for support of
two major regional contingencies.
The committee recommends a provision that would repeal
section 691 of title 10, United States Code, which established
end strength floors for the military services.

SUBTITLE B--RESERVE FORCES

Sec. 411. End strengths for Selected Reserve.

The committee recommends a provision that would authorize
Selected Reserve end strengths for fiscal year 1999 as shown
below:

----------------------------------------------------------------------------------------------------------------
Fiscal year
-----------------------------------------------
1998 1999
authorization 1999 request recommendation
----------------------------------------------------------------------------------------------------------------
The Army National Guard of the United States.................... 361,516 357,000 357,000
The Army Reserve................................................ 208,000 208,000 208,000
The Naval Reserve............................................... 94,294 90,843 90,843
The Marine Corps Reserve........................................ 42,000 40,018 40,018
The Air National Guard of the United States..................... 108,002 106,991 106,991
The Air Force Reserve........................................... 73,447 72,242 72,242
The Coast Guard Reserve......................................... 8,000 8,000 8,000
----------------------------------------------------------------------------------------------------------------

Sec. 412. End strengths for Reserves on active duty in support of the
reserves.

The committee recommends a provision that would authorize
full-time support end strengths for fiscal year 1999 as shown
below:

----------------------------------------------------------------------------------------------------------------
Fiscal year
-----------------------------------------------
1998 1999
authorization 1999 request recommendation
----------------------------------------------------------------------------------------------------------------
The Army National Guard of the United States.................... 22,310 21,763 21,763
The Army Reserve................................................ 11,500 11,804 11,804
The Naval Reserve............................................... 16,136 15,590 15,590
The Marine Corps Reserve........................................ 2,559 2,362 2,362
The Air National Guard of the United States..................... 10,671 10,930 10,930
The Air Force Reserve........................................... 867 991 991
----------------------------------------------------------------------------------------------------------------

Sec. 413. End strengths for military technicians (dual status).

The committee recommends a provision that would authorize
military technician end strengths for fiscal year 1999, as
shown below:

----------------------------------------------------------------------------------------------------------------
Fiscal year
-----------------------------------------------
1998 1999
authorization 1999 request recommendation
----------------------------------------------------------------------------------------------------------------
The Army National Guard of the United States.................... 23,125 22,179 22,179
The Army Reserve................................................ 5,503 5,205 5,205
The Air National Guard of the United States..................... 22,853 22,408 22,408
The Air Force Reserve........................................... 9,802 9,761 9,761
----------------------------------------------------------------------------------------------------------------

Sec. 414. Exclusion of additional reserve component general and flag
officers from limitation on number of general and flag officers
who may serve on active duty.

The committee recommends a provision that would permit not
more than three percent of the reserve component general and
flag officers to be ordered to active duty for more than 179
days and exclude these officers from the limitation on the
number of general and flag officers on active duty. For several
years, the committee has been reducing impediments that may
preclude more effective use of the reserve components. The
Commanders-in-Chief and the Director of the Joint Staff have
identified areas in which the expertise and skills of reserve
component general or flag officers would contribute to specific
programs or initiatives. Under current law, a reserve component
general or flag officer ordered to active duty for more than
179 days will count against the limit on active duty general
and flag officers. The recommended provision would permit up to
three percent of the number of reserve component general and
flag officers to serve on active duty for a period longer than
179 days without offsetting an active duty general or flag
officer authorization. The committee expects the Chairman of
the Joint Chiefs of Staff and the service chiefs to use this
authority to permit reserve component generals in joint duty
positions where their expertise and experience will benefit the
Nation and provide the reservists valuable experience in the
joint arena.

Sec. 415. Increase in numbers of members in certain grades authorized
to be on active duty in support of the reserves.

The committee recommends a provision that would increase
the number of officers and senior enlisted personnel on active
duty in the reserve components of the Army and the Air Force in
support of the reserves. The recommended provision
wouldincrease the authorized number of Army reserve component colonels
from 412 to 438 and enlisted members in the grade of E9 from 603 to
623. The recommended provision would increase the authorized number of
Air Force reserve component majors from 643 to 791; lieutenant colonels
from 672 to 713; colonels from 274 to 297; enlisted members in the
grade of E8 from 890 to 997; and enlisted members in the grade of E9
from 366 to 395.
The committee recommends these increases, in part, to
permit the Air Force Reserve and the Air National Guard to
supplement undergraduate pilot training. As one part of the
efforts to address increased aviator attrition, the committee
supports the Air Force plan to increase throughput in pilot
training.

Sec. 416. Consolidation of strength authorizations for active status
Naval Reserve flag officers of the Navy Medical Department
staff corps.

The committee recommends a provision that would consolidate
flag officer authorizations for the Navy Reserve Medical
Department Staff Corps, identify the components of the medical
Department Staff Corps, and allocate one rear admiral (lower
half) authorization to each component of the Medical Department
Staff Corps.

SUBTITLE C--AUTHORIZATION OF APPROPRIATIONS

Sec. 421. Authorization of appropriations for military personnel.

The committee recommends a provision that would authorize
$74,434.0 million to be appropriated to the Department of
Defense for military personnel.

OTHER ITEMS OF INTEREST

Army National Guard schools and special training

The committee recommends an increase of $37.0 million in
the amount authorized to be appropriated for National Guard
Personnel, Army. The budget request included $37.0 million for
the Reserve Mobilization Income Insurance Fund. The Congress
included funding for the Reserve Mobilization Insurance Fund in
the supplemental appropriation bill. Since the Army National
Guard schools and special training account was underfunded in
the budget request, the committee recommends transferring the
$37.0 million requested for the Reserve Mobilization Income
Insurance program in the operation and maintenance
appropriation to the military personnel appropriation.

TITLE V--MILITARY PERSONNEL POLICY

The committee addressed a number of military personnel
policy issues as a result of information received during
hearings conducted by the full committee and the Subcommittee
on Personnel. The committee recommended a number of military
personnel policy changes that would improve management of
reserve component personnel. In light of the continued
drawdown, the committee recommended extension of the personnel
management authorities to facilitate the drawdown and
transition of military personnel out of the services. The
committee also recommended a provision that would extend the
date by which the Commission on Military Training and Gender-
Related Issues must complete its work.

SUBTITLE A--OFFICER PERSONNEL POLICY

Sec. 501. Streamlined selective retention process for regular officers.

The committee recommends a provision that would eliminate
the requirement to convene boards of review for officers who
have been recommended for administrative separation by a board
of inquiry. The committee believes that it is redundant to
convene a second board to review the recommendation of a board
of inquiry before the secretary of the military department
considers a recommendation to administratively separate a
regular officer. The recommended provision saves money and
reduces the time required to process such recommendations.

Sec. 502. Permanent applicability of limitations on years of active
naval service of Navy limited duty officers in grades of
commander and captain.

The committee recommends a provision that would make
permanent the temporary mandatory retirement points for Navy
Limited Duty Officers. The recommended change would not affect
Marine Corps Limited Duty Officers of the same grades.

Sec. 503. Involuntary separation pay denied for officer discharged for
failure of selection for promotion requested by the officer.

The committee recommends a provision that would modify the
conditions under which separation pay is paid. Under the
recommended provision, officers who submit a request to a
promotion board not to be selected for promotion and are
subsequently not selected for promotion would not be eligible
for separation pay if the reason for their separation is
failure to be promoted to the next higher grade. The
recommended provision would require the report of a selection
board that received communications from an officer who
requested not to be selected to include that officer's name.
The committee expects the secretaries of the military
departments to promulgate regulations to record the names of
officers who request not to be selected and to ensure
compliance with this provision.

Sec. 504. Term of office of the Chief of the Air Force Nurse Corps.

The committee recommends a provision that would extend the
term of office for the chief of the Air Force Nurse Corps from
three years to four years.

SUBTITLE B--RESERVE COMPONENT MATTERS

Sec. 511. Service required for retirement of National Guard officer in
higher grade.

The committee recommends a provision that would extend the
period for which a National Guard officer could receive credit
towards the time-in-grade required for retirement. Currently,
the time-in-grade computation for National Guard officers may
not begin until the officer has received official federal
recognition. The recommended provision would authorize the
secretary concerned to compute the time-in-grade for retirement
purposes from the date the nomination is confirmed by the
Senate.

Sec. 512. Reduced time-in-grade requirement for reserve general and
flag officers involuntarily transferred from active status.

The committee recommends a provision that would authorize
service secretaries to retire a reserve component general or
flag officer who is involuntarily transferred from active
reserve status at the grade held on active reserve status.
Since the number of reserve component general and flag officers
is controlled in statute, it is not always possible for a
reserve general or flag officer to be selected, nominated, and
confirmed for promotion and still serve sufficient time to meet
the minimum time-in-grade requirements to retire in grade. The
recommended provision would permit service secretaries to
retire selected officers in grade rather than retaining them on
active status solely to meet a time-in-grade requirement.

Sec. 513. Eligibility of Army and Air Force Reserve brigadier generals
to be considered for promotion while on inactive status list.

The committee recommends a provision that would authorize
the Secretary of the Army or the Secretary of the Air Force to
waive the eligibility requirements to permit a reserve
component brigadier general of the Army or Air Force who is on
the reserve inactive status list to be considered for promotion
to major general. To be eligible for the waiver, the reserve
brigadier general must have served at least one year on the
reserve active status list or active duty list immediately
preceding transfer to the inactive status list, and the
transfer to the inactive status list occurred within the
twelve-month period preceding the date the promotion board
convenes.

Sec. 514. Composition of selective early retirement boards for rear
admirals of the Naval Reserve and major generals of the Marine
Corps Reserve.

The committee recommends a provision that would change the
minimum grade requirement for officers participating as members
of a board convened to consider rear admirals in the Naval
Reserve or major generals in the Marine Corps Reserve for early
retirement. Currently, the statute requires members of the
board to be one grade higher than the officers being considered
for early retirement. Since the Naval Reserve and the Marine
Corps Reserve do not have officers in grades above rear admiral
or major general, this requirement caused an undue burden. The
recommended provision would require any active duty officer
participating in a selective early retirement board considering
Naval Reserve rear admirals or Marine Corps Reserve major
generals be one grade higher than the officers being considered
and that at least one member of the board be a reserve officer
in the same grade as the officers being considered.

Sec. 515. Use of Reserves for emergencies involving weapons of mass
destruction.

The committee recommends a provision that would authorize
the President to call-up reserve forces in response to domestic
emergencies involving a use, or threatened use, of a weapon of
mass destruction. In addition, the recommendedprovision would
permit reserve full time support personnel to perform duties in support
of emergency preparedness programs to prepare for or to respond to an
emergency involving the use of a weapon of mass destruction.
The committee notes the efforts underway within the
Department of Defense to develop the means to respond to acts
of terrorism involving weapons of mass destruction. In this
regard, the committee directs the Secretary of Defense to
ensure the assessment of needs and capabilities includes an
analysis of the capabilities that exist within the Commissioned
Officer Corps of the U.S. Public Health Service, who, as
members of the uniformed services, might be easily integrated
into Department of Defense plans to respond to emergencies
involving weapons of mass destruction.

SUBTITLE C--OTHER MATTERS

Sec. 521. Annual manpower requirements report.

The committee recommends a provision that would change the
date the Secretary of Defense must submit the annual manpower
requirements report from February 15 of each year to a date not
later than 45 days after the President submits the budget to
the Congress.

Sec. 522. Four-year extension of certain force reduction transition
period management and benefits authorities.

The committee recommends a provision that would extend
until September 30, 2003 the force reduction transition period
management and benefits authorities established during the
drawdown of the military services. The committee recognizes
that the successful drawdown of military personnel could not
have been accomplished without using incentives and transition
benefits to encourage voluntary separations in lieu of
involuntary actions. As a result of the Quadrennial Defense
Review, active and reserve forces are continuing to reduce
strength levels. The committee expects the military services to
continue to use the incentive and benefit programs to achieve
the reductions mandated by the Quadrennial Defense Review.

Sec. 523. Continuation of eligibility for voluntary separation
incentive after involuntary loss of membership in Ready or
Standby Reserve.

The committee recommends a provision that would permit
members who separated under the Voluntary Separation Incentive
(VSI) program and lose their membership in a reserve component
as a result of certain conditions to continue to receive the
benefit payments. In the VSI program, recipients must serve in
a reserve component to remain eligible for the benefit
payments. The recommended provision would permit those VSI
participants who were separated from a reserve component due to
age, years of service, failure to select for promotion, or
medical disqualification to continue to receive VSI benefit
payments.

Sec. 524. Repeal of limitations on authority to set rates and waive
requirement for reimbursement of expenses incurred for
instruction at service academies of persons from foreign
countries.

The committee recommends a provision that would repeal the
limitations on the military departments to waive the
requirement for reimbursement of expenses for foreign students
at the service academies.

Sec. 525. Repeal of restriction on civilian employment of enlisted
members.

The committee recommends a provision that would repeal
section 974 of title 10, United States Code. Section 974
restricts enlisted personnel from engaging in a civilian
pursuit or business if the pursuit or business interferes with
the employment of local civilians in their art, trade, or
profession. The restrictions were enacted in 1968 to limit
military musicians from competing with local musicians.
Civilian employment of military musicians is prohibited by
sections 3634, 6223 and 8634 of title 10, United States Code.
The military services have regulations governing civilian
employment of military personnel that are sufficient to control
off-duty employment.

Sec. 526. Extension of reporting dates for Commission on Military
Training and Gender-Related Issues.

The committee recommends a provision that would extend the
dates on which the reports are required of the Commission on
Military Training and Gender-Related Issues. The recommended
provision extends the date for the interim report from April
15, 1998 to October 15, 1998 and the date for the final report
from September 16, 1998 to March 15, 1999.

Sec. 527. Moratorium on changes of gender-related policies and
practices pending completion of the work of the Commission on
Military Training and Gender-Related Issues.

The committee recommends a provision that would prohibitthe
Secretary of Defense from implementing any policy changes with regard
to separation or integration of members of the armed forces on the
basis of gender, which are within the responsibility of the Commission
on Military Training and Gender-Related Issues, until the commission
has completed its work and issued its report. The final report is due
on March 15, 1999.
The committee believes that the Commission on Military
Training and Gender-Related Issues is an important body and
should be permitted to complete the assigned work without
prejudicial legislation. The statute that created the
commission requires it to review the policies and practices of
the military services with regard to gender-integration of
initial entry training and personal relationships between
members of the armed forces, and to review the recommendations
of the panels the Secretary of Defense appointed to review
gender-integrated training, fraternization, and adultery. The
committee does not intend that the recommended provision be
perceived as a judgement on the merit of the findings and
recommendations of the Kassebaum-Baker panel. Additionally, the
committee does not intend to limit the flexibility of the
Secretary of Defense or the secretaries of the military
departments to make policy changes in areas other than those
that the commission is required to review.

Sec. 528. Transitional compensation for abused dependent children not
residing with the spouse or former spouse of a member convicted
of dependent abuse.

The committee recommends a provision that would authorize
transitional compensation to eligible dependent children who do
not reside with a spouse or former spouse who is also eligible
for transitional compensation payments. The recommended
provision would ensure that dependent children who are victims
of abuse are not denied this compensation because of family
circumstances that may cause the dependent children not to
reside with the spouse or former spouse. The recommended
provision is in no way intended to create an economic incentive
for children to live away for the spouse or former spouse but
rather to ensure that, in cases where it is inappropriate or
impossible for an abused dependent to reside with the spouse or
former spouse, they are not denied the benefits of transitional
compensation.

Sec. 529. Pilot program for treating GED recipients as high school
graduates for determinations of eligibility for enlisting in
the Armed Forces.

The committee recommends a provision that would establish a
five-year pilot program to permit participants in a National
Guard Youth Challenge Program who receive a general education
development (GED) certificate to enlist in the Armed Forces as
if they had received a high school diploma. The recommended
provision would limit the pilot program to not more than 5,000
persons per year (1,250 per service). The recommended provision
would require the Secretary of Defense to conduct a
comprehensive evaluation of the performance of the participants
in the pilot program and report the results to the Congress not
later than February 1, 2004.
The committee has supported the National Guard Youth
Challenge Program since its inception. The committee notes that
the military services do not accept GED recipients with the
same priority as high school graduates. The committee expects
each service to participate in the pilot program by actively
recruiting, training, and employing National Guard Youth
Challenge Program GED recipients.

Sec. 530. Waiver of time limitations for award of Distinguished Flying
Cross in certain cases.

The committee recommends a provision that would waive the
statutory time limitations for the award of military
decorations to provide for the Distinguished Flying Cross to
certain individuals who have been recommended by the service
secretaries for these awards.

OTHER ITEMS OF INTEREST

Personal finance training

The statement of managers accompanying the conference
report on H.R. 1119 (H. Rept. 105-340) includes an Item of
Special Interest urging the secretaries of the military
departments to review the adequacy of personal finance training
programs. The committee continues to believe that providing
personal finance training, including checkbook management,
credit card management, and debt management, is important. With
the availability of new Individual Retirement Account options,
the committee believes that the personal finance training and
command information programs should make military personnel
aware of the advantages of the ``Roth IRA''. The ``Roth IRA''
may offer significant advantages to military personnel since
that IRA option is more favorable to those in lower tax
brackets and can be used for a variety of purposes. In fact,
for many service members the ``Roth IRA'' may be more
beneficial than a 401(k) plan.

Operation Walking Shield Program

Operation Walking Shield is a cooperative program
throughwhich reserve components of the armed forces train and enhance
individual and unit readiness while providing humanitarian services to
Native American communities. Initially focused on transporting surplus
federal property, including medical equipment and housing units, to
Native American communities in need, this program has evolved into a
multi-faceted program that provides beneficial training opportunities
to our Nation's reserve forces while proving to be of immense value to
our Native Americans. Military pilots and crews gain valuable logistics
support training while multi-service medical teams and civil engineer
and construction crews have been able to participate in real-life
practical training in communities that are truly in need. The committee
encourages the Secretary of Defense to continue to support this
worthwhile program with funds available for reserve component
individual readiness training.

Processing of reports of promotion boards

The committee remains concerned about the length of time
some services require to process the report of a promotion
board. The committee believes that the report of a promotion
board can be processed, in accordance with service and
Department of Defense regulations and directives, within 90
days following the recess of the board. The committee directs
the secretaries of the military departments to advise the
Committee on Armed Services of the Senate and the National
Security Committee of the House of Representatives when
processing of a report of a promotion board from the date the
board report is signed by the board members until the report of
the selection board is approved by the President or by the
official to whom that authority has been delegated exceeds 100
days. This report shall include an explanation for the delay,
an assessment of when the board report will be approved, and an
accounting for the processing time in each office through which
the board report has passed to that point. A follow-up report,
including the same information, shall be provided every 30 days
after the 100th day.

Recruiting effectiveness and efficiency

The committee continues to be concerned about the ability
of the military services to recruit quality personnel in the
numbers needed to sustain personnel readiness.
Effective recruiting is the ``life blood'' of the military.
With declining propensities among American youth to join the
military, the task of recruiting becomes even more difficult.
At the same time, the committee is aware of a high rate of
recruiter dissatisfaction, as indicated in a recent recruiter
survey conducted by the Department of Defense. The committee
believes that a great deal of this dissatisfaction is a result
of the involuntary assignment of individuals to recruiting
duty.
The committee believes it is appropriate for the military
services to consider more effective and efficient ways to
recruit. In this regard, the committee believes there is merit
in exploring the potential for outsourcing military recruiting
to entities whose business it is to recruit, and whose
recruiters are volunteers.
Consequently, the committee urges the Secretary of Defense,
in coordination with the military services, to conduct a test
to determine the feasibility of outsourcing military
recruiting. The test would be designed by the Secretary of
Defense to involve representative recruiting areas and be large
enough to ensure an unbiased test. The objective of the test
would be to determine the comparative effectiveness and cost of
the outsourcing alternative against current recruiting method.
The test would be conducted for a period of two years. The
results would be reported to the Committee on Armed Services of
the Senate and the National Security Committee of the House of
Representatives no later than 180 days after the completion of
the test.

Management of reserves on active duty in support of the reserve
components

The committee is concerned about the evolution of the
programs in which reservists serve on active duty in support of
the reserve components, referred to in this report as full-time
support (FTS) personnel. The committee recognizes and supports
the good work and the tremendous contributions to reserve unit
readiness provided by FTS personnel. Without these dedicated
professionals, the reserve components would not be capable of
serving side-by-side with the active forces and effectively
accomplishing the same missions as the active forces.
However, over time, both active and reserve component
commanders have assigned FTS personnel to duties and positions
which are not in direct support of organizing, administering,
recruiting, instructing, or training the reserve components.
The Department of Defense has implemented several policies that
have institutionalized FTS personnel into the everyday
functions of the active forces, Headquarter elements, and the
Office of the Secretary of Defense. Further, Department of
Defense policy has directed each military service to administer
their respective FTS personnel to ensure that they are provided
career opportunities, progression, retention, professional
military education, and professional development, consistent
with strength limitations and policies that may lead to a
military retirement.
In the committee's view, these policies represent subtle,
yet significant, changes in the assignment, utilization,
andmanagement of FTS personnel that were not intended when the
statutory authorities for such programs were enacted. FTS personnel
were intended to be involved directly in improving the readiness of the
reserve components by organizing, administering, recruiting,
instructing, or training the reserve components. The intent was that
reservists would be ordered to an active duty status, serve in a
capacity that would improve unit readiness and capability, and return
to reserve status upon completion of a specified tour or period of
time. Through the years, serving on active duty in support of the
reserve components has become a career field in which people are
carefully managed through positions to ensure they are promoted,
schooled, and remain in an active duty status until they retire with
retirement benefits very similar to the active component personnel.
Commanders and chiefs of staff have created positions for FTS personnel
to augment or substitute for active component personnel. Many FTS
personnel are actually performing tasks that require extremely liberal
interpretation of the legal definition pertaining to the use of
reservists serving on active duty in support of the reserve components.
The committee has observed that the services have implemented policies
and created opportunities that give FTS personnel considerable
advantage over the active duty personnel in the attendance of senior
level schools. Positions have been created for FTS personnel in major
commands, service level staffs, and departmental secretariats.
The committee believes that FTS personnel should be
concentrated in reserve component units commanded by officers
in the grade of O6 or lower. Additionally, the committee
believes that it is necessary to review the existing policies
that direct that certain FTS personnel are provided career
opportunities, progression, retention, professional military
education, and professional development consistent with
strength limitations and policies that may lead to a military
retirement.
Therefore, the committee directs the Secretary of Defense,
in conjunction with the military services and the reserve
components, to conduct a comprehensive review of the statutes,
policies, directives, and practices pertaining to FTS personnel
and to submit the results of the study to the Committee on
Armed Services of the Senate and the National Security
Committee of the House of Representatives not later than March
15, 1999. In addition to the report, the Secretary shall submit
any suggested legislative changes determined to be necessary to
re-engineer programs related to the management of reservists
serving on active duty in support of the reserve components.

Personnel and finance support of the reserve components

The committee is aware that there are separate, distinct
personnel and finance systems for the reserve components. The
committee is concerned that there do not appear to be efforts
to standardize the reserve component personnel and finance
systems with those used to manage the active forces. Separate,
and many times incompatible, personnel and finance systems
prohibit consolidation of active and reserve component records
management, and require potentially unnecessary overhead and
infrastructure. Therefore, the committee directs the Secretary
of Defense, in conjunction with the military services and the
reserve components, to conduct a comprehensive study of the
personnel management and finance systems supporting the reserve
components to determine the advisability and feasibility of
standardizing the systems used by the reserve components with
those used to manage and support the active forces. The
committee directs the Secretary of Defense to report the
results of this study, including any recommendations as to how
to standardize and re- engineer reserve component personnel and
finance systems, to the Committee on Armed Services of the
Senate and the National Security Committee of the House of
Representatives not later than March 31, 1999.

Investigations of military deaths

The committee has been interested in improving the
procedures and practices used by the criminal investigation
agencies of the military departments when investigating the
deaths of service members. In September 1996, on behalf of the
committee, the Personnel Subcommittee held a hearing that
examined the procedures and practices used by the criminal
investigation agencies of the military departments during their
investigations of military deaths that may have resulted from
self-inflicted causes. Following the hearing, the subcommittee
chairman sent letters to the service secretaries identifying
the shortcomings and lessons learned during the hearing and
requesting a report on each department's implementation of the
recommended improvements. The subcommittee chairman has
continued to meet with families of military personnel, whose
death may have resulted from self- inflicted causes, to review
the status of implementation of the suggested improvements.
Additionally, the subcommittee chairman has written to the
local law enforcement official in each case in which the family
of a service member, whose death may have resulted from self-
inflicted causes, requested review of their case. In each case,
the subcommittee chairman has followed up to ensure that the
local sheriff or chief of police reviewed the original
investigation and provided an assessment of the facts of the
case.
As a result of these activities, the committee believes the
military departments and the criminal investigativeservices
have improved the procedures and practices used to investigate military
deaths and those governing support to the families. Still, there is
work that should be done. The committee remains concerned about the use
of psychological autopsies. The military departments must ensure that
those who conduct a psychological autopsy are qualified to conduct such
activities. The committee believes that the next of kin of the deceased
should be permitted to review the report. The committee recommends that
the secretaries of the military departments review the qualifications
of the military criminal investigators to ensure that those assigned to
these critical positions are sufficiently trained and have the maturity
to conduct a detailed, fact-based investigation.
The committee directs the Secretary of Defense to review
the policies, regulations, directives, and practices used by
the military departments to describe the cause of death on the
military equivalent of the death certificate. In cases in which
the cause of death cannot be absolutely determined, the cause
of death may be more appropriately listed as undetermined.
Recently, the committee was surprised and disappointed that a
military department determined the cause of death of a pilot to
be suicide solely because they could not find another cause.
Suicide, like homicide, should be determined as a result of
evidence, not conjecture or as a matter of default when other
causes cannot be determined.
The committee acknowledges the professional work of the
Department of Defense Inspector General in conducting reviews
of cases requested by families of military deaths that may have
resulted from self-inflicted causes. While many families remain
skeptical of the fidelity and professionalism of the reviews,
as well as the original investigation, the Inspector General
has recommended important changes to policies and investigative
procedures to the military departments. The committee continues
to urge the secretaries of the military departments to
implement the recommendations of the Department of Defense
Inspector General.

Management of officers assigned to interagency and international
billets

The committee notes that the report of the Quadrennial
Defense Review and the report of the National Defense Panel
stress the importance of extending the concept of jointness
beyond the Department of Defense to other parts of the national
security establishment and to our friends and allies abroad.
The report of the National Defense Panel suggests creating an
interagency cadre of professionals, similar in spirit to the
joint experience envisioned by the Goldwater- Nichols Defense
Reorganization Act, with staff in key positions within the
national security structures. While the committee is not
recommending extending joint duty credit for assignments to
interagency and international billets, there may be a need to
identify, train, and manage officers with experience in
interagency and international assignments. The committee
directs the Secretary of Defense to conduct a study of the
advisability and feasibility of establishing a cadre of
officers whose assignments and schooling would be managed so as
to ensure a viable career track in which these officers would
serve in interagency and international assignments. The
committee directs the Secretary of Defense to report on the
results of the study to the Committee on Armed Services of the
Senate and the National Security Committee of the House of
Representatives not later than March 31, 1999.
TITLE VI--COMPENSATION AND OTHER PERSONNEL BENEFITS

The committee addressed a number of pay, allowances, and
other compensation issues. One of the committee's priorities
this year was to continue to improve the quality of life for
military personnel, their families, and retired service members
and their families. The committee recommended a number of
provisions that would significantly improve the quality of life
and living conditions, and provide equitable compensation for
military personnel to protect against inflation. The committee
recommended an increase in basic military pay of 3.1 percent
and an increase in the pay of service academy cadets and
midshipmen. In general, the committee's recommendations reflect
a commitment to enhancing quality of life and a concern for the
welfare of military personnel and their families.

SUBTITLE A--PAY AND ALLOWANCES

Sec. 601. Increase in basic pay for fiscal year 1999.
The committee recommends a provision that would waive
section 1009 of title 37, United States Code, and increase the
rates of basic pay for members of the uniformed services by 3.1
percent. This increase would be effective January 1, 1999.
Sec. 602. Rate of pay for cadets and midshipmen at the service
academies.
The committee recommends a provision that would increase
the rate of pay for cadets and midshipmen at the service
academies from $558.04 per month to $600.00 per month effective
January 1, 1999.
Sec. 603. Payments for movements of household goods arranged by
members.
The committee recommends a provision that would authorize
the Departments of Defense, Health, and Transportation to
provide members of the uniformed services with a reimbursement
or monetary allowance in advance for the cost of transportation
related to that member's baggage and household goods. The
monetary allowance may be paid only if it results in an overall
cost savings to the Government.
Sec. 604. Leave without pay for suspended academy cadets and
midshipmen.
The committee recommends a provision that would authorize
the superintendents of the military academies and the Coast
Guard Academy to order a cadet or midshipman on involuntary
leave without pay if the cadet or midshipman is pending
separation from the academy for misconduct, conduct deficiency,
or honor violation while the separation is pending final
approval. The recommended provision would permit a cadet or
midshipman to be ordered on leave without pay as a disciplinary
measure or if the cadet or midshipman is at home waiting to
repeat a semester or academic year.

SUBTITLE B--BONUSES AND SPECIAL INCENTIVE PAYS

Sec. 611. Three-month extension of certain bonuses and special pay
authorities for reserve forces.
The committee recommends a provision that would extend the
authority to pay the special pay for critically short wartime
health specialists in the Selected Reserve, the Selected
Reserve reenlistment bonuses, the Selected Reserve enlistment
bonuses, the special pay for enlisted members assigned to
certain high priority units in the Selected Reserve, the
Selected Reserve affiliation bonus, the Ready Reserve
enlistment and reenlistment bonus, the repayment of loans for
certain health professionals who serve in the Selected Reserve,
and the prior service enlistment bonus until December 31, 1999.
Sec. 612. Three-month extension of certain bonuses and special pay
authorities for nurse officer candidates, registered nurses,
and nurse anesthetists.
The committee recommends a provision that would extendthe
authority to pay certain bonuses and special pay for nurse officer
candidates, registered nurses, and nurse anesthetists until December
31, 1999.

Sec. 613. Three-month extension of authorities relating to payment of
other bonuses and special pays.

The committee recommends a provision that would extend the
authority to pay the aviation officer retention bonus, the
reenlistment bonus for active members, the enlistment bonuses
for critical skills, the special pay for nuclear qualified
officers who extend the period of active service, the nuclear
career accession bonus, and the nuclear career annual incentive
bonus until December 31, 1999.

Sec. 614. Eligibility of Reserves for selective reenlistment bonus when
reenlisting or extending to perform active guard and reserve
duty.

The committee recommends a provision that would authorize
the secretary concerned to offer a reenlistment bonus to
reserve component members who are on extended active duty in
support of the reserves. The recommended provision would
require these reserve component members on active duty in
support of the reserves to meet the same criteria as regular
component enlisted personnel to be eligible for a reenlistment
bonus.

Sec. 615. Repeal of ten-percent limitation on payments of selective
reenlistment bonuses in excess of $20,000.

The committee recommends a provision that would repeal the
restriction limiting the number of selective reenlistment
bonuses which exceed $20,000 paid during any fiscal year.
Without the ten-percent limit, the services may target existing
bonus authorities at skills and in amounts dictated by their
manning needs.

Sec. 616. Increase of maximum amount authorized for army enlistment
bonus.

The committee recommends a provision that would increase
the maximum amount authorized to be offered to a qualifying
high school graduate who enlists in the Army for at least three
years in designated skills from $4,000 to $6,000. The committee
believes the recommended increase will permit the Army to
target those military specialities where critical shortages
exist.

Sec. 617. Education loan repayment program for health professions
officers serving in Selected Reserve.

The committee recommends a provision that would modify the
current education loan repayment program for health professions
officers recruited to serve in the Selected Reserves by
permitting the services to offer the program to a health
professions student and would increase the loan repayment limit
from $3,000 per year and a total of $20,000 to $20,000 per year
and a total of $50,000.

Sec. 618. Increase in amount of basic educational assistance under all-
volunteer force program for personnel with critically short
skills or specialties.

The committee recommends a provision that would increase
the amount authorized to be offered as part of the services'
college fund programs. The recommended provision would permit
the services to offer college fund programs not to exceed
$50,000, an increase of $10,000.

Sec. 619. Relationship of entitlements to enlistment bonuses and
benefits under the All-Volunteer Force Educational Assistance
Program.

The committee recommends a provision that would authorize
the services to offer both an enlistment bonus and a college
fund program to prospective recruits in selected critically
short specialities. Currently, recruits may be offered either
the college fund or an enlistment bonus. As some critically
short specialities are not being filled, the services requested
authority to offer a combination of an enlistment bonus and a
college fund program to attract qualified volunteers. The
committee expects the services to be extremely selective when
deciding which specialities would be open to this combination
of enlistment incentives.

SUBTITLE C--TRAVEL AND TRANSPORTATION ALLOWANCES

Sec. 621. Travel and transportation for rest and recuperation in
connection with contingency operations and other duty.

The committee recommends a provision that would authorize
the secretary concerned to pay for commercial transportation,
not to exceed the cost of government provided transportation,
for leave travel of members assigned to overseas locations in
contingency operations or at overseas locations where unusual
conditions exist. Members could receive one round-trip
duringany period of service of at least six months, but less than 24
months.

Sec. 622. Payment for temporary storage of baggage of dependent student
not taken on annual trip to overseas duty station of sponsor.

The committee recommends a provision that would authorize
storage of a dependent student's unaccompanied baggage in lieu
of shipping the baggage to the overseas duty station of the
sponsor. When a student attending school in the United States
returns to spend the summer with their family in an overseas
location, they must ship their goods to the overseas location.
The recommended provision would permit the baggage to be stored
locally, which is less expensive than a round-trip overseas
shipment.

Sec. 623. Commercial travel of Reserves at federal supply schedule
rates for attendance at inactive duty training assemblies.

The committee recommends a provision that would authorize
reservists traveling to and from their reserve unit drill site
via commercial conveyance to purchase tickets at the official
government rate. The committee notes that many reservists
travel long distances to train with their reserve units. Travel
to and from the reserve unit home station is the responsibility
of the individual reservist. The recommended provision would
enable these reservists to purchase commercial tickets at the
government rate rather than full fare.

SUBTITLE D--RETIRED PAY, SURVIVOR BENEFITS, AND RELATED MATTERS

Sec. 631. Paid-up coverage under Survivor Benefit Plan.

The committee recommends a provision that would terminate
Survivor Benefit Plan payments following 30 years of payments
and attaining the age of 70. The committee believes that, once
a retiree has paid Survivor Benefit Plan premiums for a minimum
of thirty years and has reached 70 years of age, he or she has
met the actuarial obligation to support any benefit which may
accrue to his or her beneficiary. The recommended provision
returns the Survivor Benefit Plan subsidy to an appropriate
level without detracting from current efforts to balance the
federal budget by fiscal year 2002.

Sec. 632. Court-required Survivor Benefit Plan coverage effectuated
through elections and deemed elections.

The committee recommends a provision that would make
spousal coverage under the Survivor Benefit Plan (SBP),
directed as a result of court order or spousal agreement,
consistent with an election deemed to have been made by the
retired service member and the coverage effective on the first
day of the first month after the date of the court order or
spousal agreement. Under current law, the retired service
member may wait up to one year to request SBP coverage directed
as the result of a court order or spousal agreement, thus
avoiding contributing for one year. The recommended provision
would make the effective date of the coverage the next month
after the spousal agreement or court order.

Sec. 633. Recovery, care, and disposition of remains of medically
retired member who dies during hospitalization that begins
while on active duty.

The committee recommends a provision that would provide for
the recovery, care, and disposition of remains of members who
die in a hospital after having been medically retired from
active duty by reason of an injury, illness, or disease
incurred while on active duty. When a service member is
severely injured or is near death as a result of an illness or
disease, the services medically retire the individual in order
to provide the surviving family members the maximum benefits.
The recommended provision would permit the services to recover,
prepare, and transport the remains of the deceased service
member as if the member had died on active duty.

SUBTITLE E--OTHER MATTERS

Sec. 641. Definition of possessions of the United States for pay and
allowances purposes.

The committee recommends a provision that would remove the
Canal Zone from the list of possessions in title 37, United
States Code, for purposes of statutes related to military pay
and allowances.

Sec. 642. Federal employees' compensation coverage for students
participating in certain officer candidate programs.

The committee recommends a provision that would provide
medical coverage to college students participating in a Senior
Reserve Officers' Training program or the Marine Corps Platoon
Leaders Course who are injured or become ill while attending
training on orders. Medical coverage would be provided
forinjury or illness even if incurred during non-duty hours, provided
the injury or illness is determined to be in the line of duty, as
prescribed by service regulations.

Sec. 643. Authority to provide financial assistance for education of
certain defense dependents overseas.

The committee recommends a provision that would authorize
the Secretary of Defense to provide financial assistance to
sponsors of dependents in overseas areas in which the
Department of Defense does not operate schools. Currently, when
Department of Defense personnel are assigned to duties in
overseas areas in which the Department of Defense does not
operate a school, the Department of Defense has contracted with
a local school that meets standards similar to those of the
Department of Defense schools. The recommended provision would
permit the Secretary of Defense to pay the sponsor an allowance
equal to the amount that would have been expended through the
contract. The sponsor would then be able to send their
dependents to the school of their choice.

OTHER ITEMS OF INTEREST

Accrual funding of military retirement

The committee notes that a recent Rand study suggests that
the military retirement accounts be funded based on weighted
retirement propensity estimates in lieu of the current flat
accural rate. In addition, the Rand report suggests that the
Secretary of Defense and the Secretary of the Treasury
establish procedures under which the Department of Defense
shares in any windfalls resulting from actuarial gains in the
military retirement fund potentially be used to reduce outlays
from the Department of Defense. The committee has received
testimony from a number of Department of Defense witnesses,
including the Secretary of Defense and the Chairman of the
Joint Chiefs of Staff, citing the importance of military
retirement to recruiting and retention. As the Department
reviews proposals to reshape military retirement or the
possibility of creating a plan similar to a 401(k) for military
personnel, consideration should be given to the suggestions in
the Rand study. If it is determined that the suggestions in the
Rand study have merit and could be implemented, the resultant
savings may be sufficient to off-set the costs of a re-
engineered military retirement benefit or establishment of a
plan similar to a 401(k).

Computation of retired pay for certain service members

The committee is concerned about arguments presented in a
recent general court-martial with regard to the computation of
retired pay for former Chairmen and Vice Chairmen of the Joint
Chiefs of Staff, former chiefs of a service, and former senior
enlisted advisors of a service. The committee holds that the
intent of the Congress when enacting section 1406(i) of title
10, United States Code, was to protect the retired pay of
former Chairmen and Vice Chairmen of the Joint Chiefs of Staff,
former service chiefs, and former senior enlisted advisors of a
service if they served honorably in another position on active
duty subsequent to their service in the designated position.
The Congress did not intend for this provision to be used to
compute the retired pay of an individual serving in one of the
designated positions who was subsequently reduced in grade by
sentence of a court-martial or non-judicial punishment, or who
was determined by the service secretary not to have served
satisfactorily in a given grade. The committee does not find
the several sections of title 10, United States Code,
pertaining to computation of retired pay to be ambiguous nor in
conflict. The committee finds that the intent of Congress when
enacting section 1406(i) was to protect the retired pay of
those senior enlisted personnel and officers who performed good
and faithful service in an honorable manner after having served
in one of the designated positions.
TITLE VII--HEALTH CARE

The committee addressed a number of health care issues. One
of the committee's priorities this year was to continue to
improve the quality of life for military personnel, their
families, and retired service members and their families. The
committee views health care as an important aspect of quality
of life. The committee held a hearing related to military
medical readiness and health care delivery to beneficiaries of
the Military Health Care System. The committee recommended a
series of three demonstration projects to assess the most cost-
effective method to provide health care to Medicare-eligible
beneficiaries of the Military Health Care System. The committee
remains committed to full implementation of TRICARE, and in
general, the committee's recommendations reflect a commitment
to enhancing quality of life and concern for the welfare of
military personnel and their families.
Sec. 701. Dependents' dental program.
The committee recommends a provision that would establish
an index under which the individual's monthly premium for the
dependent dental plan could increase. Currently, the member's
premium is fixed at $20.00 per month. As inflation increases
the cost of the total premium, the government portion of the
total premium would increase. The recommended provisionlimits
the percent by which the member's premium may increase not to exceed
the percentage of the annual pay raise.

Sec. 702. Extension of authority for use of personal services contracts
for provision of health care at military entrance processing
stations and elsewhere outside medical treatment facilities.

The committee recommends a provision that would extend the
coverage of contract physicians by the same malpractice
litigation rules as other Department of Defense health care
providers. In addition, the recommended provision would extend
the authority of the Secretary of Defense to provide reasonable
attorney's fees in any litigation in which government attorneys
do not provide representation. The current authorities expire
on November 18, 1998, one year from date of enactment of the
National Defense Authorization Act for Fiscal Year 1998. The
recommended provision would extend the expiration date to June
30, 1999.
The committee notes that section 736 of the National
Defense Authorization Act for Fiscal Year 1998 requires the
Secretary of Defense to submit a report on the feasible
alternative means for performing the medical screening
examinations that are routinely performed at Military Entrance
Processing Stations, not later than March 31, 1998. The
Secretary has not submitted the required report. The committee
recommends a short-term extension of the authorities to permit
the Secretary of Defense to complete the required report and
submit it to the Congress for review.

Sec. 703. TRICARE Prime automatic enrollments and retiree payment
options.

The committee recommends a provision that would authorize
the Secretary of Defense to automatically enroll dependents of
service members in the grade of E-4 and below in TRICARE Prime
and would permit automatic re-enrollment for the dependents of
any service member who is enrolled in TRICARE Prime. The
provision would also permit retired service members to have any
fees associated with enrollment in TRICARE to be paid through
an allotment from their retired pay or via electronic funds
transfer from a financial institution. The committee believes
these three initiatives will streamline and simplify enrollment
in TRICARE Prime and will reduce costs to the Department of
Defense.

Sec. 704. Limited continued CHAMPUS coverage for persons unaware of a
loss of CHAMPUS coverage resulting from eligibility for
medicare.

The committee recommends a provision that would give the
Secretary of Defense the authority to waive the requirement to
purchase Medicare Part B coverage for those beneficiaries who
were unaware of the loss of CHAMPUS eligibility. This authority
would exist for the period October 1, 1998 through July 1,
1999.

Sec. 705. Enhanced Department of Defense organ and tissue donor
program.

The committee recommends a provision that would require the
Secretary of Defense, the secretaries of the military
departments, and the Surgeons General to take a number of steps
intended to enhance the Department's ability to support organ
and tissue donor elections made by service members.
Organ and tissue transplantation is one of the most
remarkable medical success stories in the history of medicine.
The committee commends the significant efforts the Department
of Defense has made in increasing the awareness of the
importance of organ and tissue donations among members of the
armed forces. The inclusion of organ and tissue donor elections
in the Defense Enrollment Eligibility Reporting System (DEERS)
central database via the Real-time Automated Personnel
Identification System (RAPIDS) represents a major step in
ensuring that organ and tissue donor elections are a matter of
record and are accessible in a timely manner.
The committee believes that the Department can and should
ensure that training, medical logistical support, and
developing technology for personal data systems incorporate
consideration of organ and tissue donation programs and
actions.

Sec. 706. Joint Department of Defense and Department of Veterans
Affairs reviews relating to interdepartmental cooperation in
the delivery of medical care.

The committee recommends a provision that would require the
Secretary of Defense and the Secretary of Veterans Affairs to
conduct a joint survey of their respective beneficiary
populations to identify, by category of individual, the
expectations of, requirements for, and behavior patterns
regarding medical care among those beneficiary categories. This
collaborative effort would be developed jointly but be
administered by an independent entity. Additionally, this
provision would require the Secretaries of Defense and Veterans
Affairs to review all applicable statutes, regulations,
policies and beneficiary attitudes which may preclude or limit
cooperative health care programs, including the sharing of
facilities and other resources, between the Department of
Defense and the Department of Veterans Affairs (VA).
The Military Health System (MHS), the health care system of
the Department of Defense (DOD), and the Veterans Health
Administration of the Department of Veterans Affairs are well
established institutions that collectively manage over 1500
hospitals, clinics, and health care facilities world-wide to
provide services to over 11 million beneficiaries. Overseeing
these systems requires a well-planned and executed effort.
During the Cold War, the MHS was designed to support full-
scale, extremely violent war with the Soviet Union and its
allies in Europe. The collapse of the Soviet Union and the end
of the Warsaw Pact led to major reassessment of the U.S.
defense policy. The overall size of the active duty force has
been reduced by one-third since the mid-1980s. In the last
decade, the number of military medical personnel has declined
by 15 percent and the number of military hospitals has been
reduced by one-third. Nationwide changes in the practice of
medicine have also affected the MHS. The National Defense
Authorization Act for Fiscal Year 1994 directed DOD to
prescribe and implement a nationwide managed health care
benefit program modeled on health maintenance organization
plans and, in 1995, beneficiaries began enrolling in TRICARE.
Veterans Affairs is also a system in transition. In the
past two years, the VA has replaced its structure of four
regions, 33 networks, and hundreds of clinics with a new system
geared to decentralizing authority into 22 Veterans Integrated
Service Networks. The purpose of the reorganization was to
improve the access, quality and efficiency of care provided to
the nation's veterans. The hallmark of the network structure is
a decentralization of control over functions previously held in
Washington.
The Veterans Administration and Department of Defense
Health Resources Sharing and Emergency Operations Act (Public
Law 97-174) was enacted in 1982 to promote cost-effective use
of federal health care resources by minimizing duplication and
under use of health care resources while benefitting both VA
and DOD beneficiaries. VA and DOD pursue programs of
cooperation ranging from shared services to joint venture
operations of medical facilities. In 1984, there was a combined
total of 102 VA and DOD facilities with sharing agreements. By
1997, that number had grown to 420. In five years, between
fiscal year 1992 and fiscal year 1997, shared services
increased from slightly over 3,000 to more than 6,000 services,
ranging from major medical and surgical services, laundry,
blood, and laboratory services to unusual speciality care
services.
As an initiative of the DOD/VA Executive Council, there is
an on-going Joint Partnering Study regarding the cost and
feasibility of integrating all or part of the DOD and VA
medical treatment provided. This study will provide an
assessment of whether improved geographical access to
facilities would result in an expanded number of facilities
available to beneficiaries and the impact on utilization rates
at facilities and related costs or savings that may result from
economies of scale.
There are numerous ongoing efforts by the DOD/VA Executive
Council to increase the accessibility to patient information
through the use of computerized information. The Computerized
Patient Record is a collaborative effort by DOD and VA that
would provide immediate access to patient records at treatment
centers/facilities. Joint Separation Physicals and Pharmacy
Program Management are other areas in which much work has been
done to increase cooperative efforts that add value to the
benefits provided. The committee believes there is room for
continued enhancement of cooperative efforts between DOD and
VA. However, there is also a need to review statutory
requirements, regulations, and local policies that may preclude
increased cooperation and/or integration of resources.
The committee views the recommended provision as an
indication of the committee's commitment to the health of the
entire military family: veteran, active duty, reserve, retiree,
and dependent. This provision is also an important step in
furthering the idea of DOD/VA cooperative efforts.

Sec. 707. Demonstration projects to provide health care to certain
medicare-eligible beneficiaries of the military health care
system.

The committee recommends a provision that would authorize
the Secretary of Defense to conduct three health care
demonstration projects in order to assess the feasibility and
advisability of providing health care to certain Medicare-
eligible beneficiaries of the Military Health Care System. The
demonstrations would begin not later than January 1, 2000 and
end not later than December 31, 2003.
The recommended provision would authorize one demonstration
project in which Medicare-eligible beneficiaries of the
Military Health Care System would participate in the Federal
Employees Health Benefits Program with the Department of
Defense paying the usual employer portion of the premiums. A
second demonstration project would create a TRICARE Senior
Supplement program in which Medicare-eligible beneficiaries of
the Military Health Care System could enroll. The TRICARE
Senior Supplement would require a modest premium and would be
similar in function to a commercial Medicare supplement
insurance policy. The third demonstration would extend the
TRICARE mail order pharmacy benefit to Medicare-eligible
beneficiaries of the Military Health Care System.
The Secretary of Defense would be required to identify six
demonstration sites outside the catchment area of a military
treatment facility, two for each demonstration. Sites where the
Medicare subvention demonstration is being conducted may not be
selected for these three demonstrations.All participants must
be Medicare eligible and participate in Medicare Part B.
The recommended provision would require the Secretary of
Defense to provide for an evaluation of the demonstration
projects by an agency independent of the Department of Defense.
The final report of the independent evaluation would be
submitted to the Congress not later than December 31, 2003.
Following completion of the independent evaluation, the
Comptroller General shall review the evaluation and report the
results of this review to the Congress not later than February
15, 2004.
The committee recognizes the need to address the commitment
to provide health care to Medicare-eligible beneficiaries of
the Military Health Care System. While addressing this need,
the committee recognizes that fiscal resources are finite and
that costs of any such health care program must be controlled.
The committee believes that these three demonstration programs,
in conjunction with the ongoing Medicare subvention
demonstration program, can provide a valuable information on
cost, ability to satisfy the health care requirements of
Medicare-eligible beneficiaries of the Military Health Care
System, the impact, if any, on military medical readiness, and
permit the Congress and the Secretary of Defense to
collectively develop a model to provide adequate health care
services to Medicare-eligible beneficiaries of the Military
Health Care System.

OTHER ITEMS OF INTEREST

Auto-destruct syringes

The committee notes that several manufacturers are
producing auto-destruct syringes, that is, single-use syringes
which by design will not function a second time. The per-unit
price of these syringes is not measurably higher than that of
disposable syringes that may be used more than once. When
including the potential costs of treating diseases caused by
multiple use of syringes, an auto-destruct disposable syringe
may be significantly cheaper. While the greatest potential for
savings from using a single-use, auto-destruct syringe may be
in organizations serving underdeveloped areas of the world, the
committee urges the Secretary of Defense to investigate the
capabilities and costs of auto-destruct syringes as a medical
force protection initiative. The highest potential value for
auto-destruct syringes may be in the medical equipment provided
to special operations forces and field medical kits. Medical
personnel accompanying special operations forces and field
combat units may use a syringe and discard it at the scene of
the emergency. If the syringe can be used again, it may be
recovered by a service member or a local national and become a
source for disease transmission. In addition, when U.S. forces
are deployed on humanitarian relief or rescue missions, auto-
destruct syringes may provide additional protection since used
auto-destruct syringes cannot be pilfered and re-used.

Health care fraud

The committee is concerned that health care fraud burdens
the Department of Defense (DOD) with significant financial
loss, and may threaten the quality of health care delivered.
The annual loss to DOD through its health benefits programs is
estimated to be $600.0 million to $1.2 billion. DOD health care
fraud detection and investigation activities have not gained
the national attention and additional resources from which
Medicare and Medicaid anti-fraud activities have benefited.
The committee directs the Controller General of the United
States to study and provide a report to the Committee on Armed
Services of the Senate and the National Security Committee of
the House of Representatives on the extent of health care fraud
within the military health care system and the status of health
care anti-fraud initiatives within DOD. The required report
should include recommendations for initiatives and incentives
that could enhance continued anti-fraud efforts within DOD.

Hepatitis C testing

The committee understands that the incidence of service-
connected hepatitis C infection may be increasing. The
committee directs the Secretary of Defense to study the extent
of service-connected hepatitis C infection, to include the
advisability and feasibility of including an antibody or
antigen test sufficient to detect hepatitis C virus during
separation and retirement physicals. Such tests could increase
the cost of separation and retirement physicals. However, early
detection of hepatitis C may reduce costs to the Department of
Defense and the Department of Veterans Affairs by reducing the
rate of serious liver disease. Additionally, an individual
identified as infected with hepatitis C would understand that
he or she should not donate blood, thus assisting in
maintaining a safe blood supply. The committee directs the
Secretary of Defense to report the results of the study to the
Committee on Armed Services of the Senate and the National
Security Committee of the House of Representatives not later
than March 31, 1999.

The Psychopharmacology Demonstration Project

The Psychopharmacology Demonstration Project (PDP) was
funded by Congress in 1991 to train military psychologists in
the prescription of psychotropic medications, pursuant to
section 8097 of the Department of Defense Appropriations Act
for Fiscal Year 1992. The committee understands that ten
military psychologists successfully completed this training
prior to termination of the program. The committee directs the
Comptroller General to conduct a study to determine the extent
to which these health providers have been integrated into the
Military Health System, to include the quality of care provided
to military personnel and their beneficiaries, contributions of
these providers to cost effectiveness, and their impact on
medical readiness.
TITLE VIII--ACQUISITION POLICY, ACQUISITION MANAGEMENT, AND RELATED
MATTERS

The committee recommends several provisions to improve the
acquisition process in the Department of Defense. These
provisions represent the strong interest of the committee in
continuing acquisition management reform while ensuring the
preservation of essential safeguards in the acquisition
process.
Sec. 801. Para-aramid fibers and yarns.
The committee recommends a provision that would authorize
the Secretary of Defense to procure articles containing para-
aramid fibers and yarns manufactured in a foreign country that
is a party to defense memorandum of understanding, if such
country allows U.S. manufacturers of that product to compete
for sales to that foreign country. The committee intends this
legislation to restore the ability of a foreign manufacturer to
be a qualified Department of Defense (DOD) supplier of para-
aramid fibers and yarns, a basic component of certain military
equipment, such as combat helmets, body armor, and aircrew
survival equipment. This authority will improve warfighting
capability by ensuring competition on price and delivery and
DOD access to technological innovation applicable to these
products.
Sec. 802. Procurement of travel services for official and unofficial
travel under one contract.
The committee recommends a provision that would allow the
procurement of travel services under one contract for both
official and unofficial travel. By procuring all travel
services under a single process, the Department of Defense will
be able to garner savings and gain efficiencies. The provision
would also clarify the ability of the Department of Defense to
deposit fees generated by unofficial travel sales into
nonappropriated fund accounts. The Secretary of Defense is
expected to implement sufficient regulations to ensure the
proper accounting between appropriated and nonappropriated
funds.
Sec. 803. Limitation on use of price preference upon attainment of
contract goal for small and disadvantaged businesses.
Section 2323 of title 10, United States Code, requires that
the Secretary of Defense attempt to obligate five percent of
the total amount of funding for research and development,
procurement, operations and maintenance, and military
construction for contracts and subcontracts with small and
disadvantaged businesses, historically Black colleges and
universities, and minority institutions. Through its aggressive
efforts the Department of Defense (DOD) has exceeded this goal
for each year since fiscal year 1992. Figures for fiscal year
1997 indicate that the combined percentages for prime and
subcontract awards were over nine percent of total prime and
subcontract expenditures for the Department.
One of the tools available to the DOD within this program
is the authority to pay up to 10 percent above fair market cost
per contract for contractors or subcontractors who meet the
preference criteria. DOD expenditures for the cost of
preference payments average approximately $7.5 million per
year. The committee believes that such an expenditure in fiscal
year 1999 would be unnecessary since the Department appears to
be awarding contracts for values far in excess of the statutory
objective. Therefore, the committee again recommends a
provision that would condition the use of section 2323 price
preference criteria on the failure of DOD to achieve the goal
in the prior fiscal year.
Sec. 804. Distribution of assistance under the Procurement Technical
Assistance Cooperative Agreement Program.
The committee recommends a technical amendment to sections
2413 and 2415 of title 10, United States Code, to recognize the
change in the Department of Defense contract administration
structure.
Sec. 805. Defense Commercial Pricing Management Improvement Act.
On March 18, 1998, the Subcommittee on Acquisition and
Technology conducted a hearing to review the status
ofacquisition reform efforts in the Department of Defense. The
subcommittee received testimony from the Inspector General (IG), the
General Accounting Office, the Under Secretary of Defense for
Acquisition and Technology, and representatives from the military
departments and the Defense Logistics Agency. Some of the issues
reviewed at the hearing were related to the problems in commercial
spare parts procurement presented in two IG reports and in the
preliminary results of recent work by the General Accounting Office
(GAO).
The IG presented a number of examples in which the Defense
Logistics Agency paid increases over previous prices on
commercial parts, by as much as 1,430 to 13,163 percent. The
price increases appear to have reflected no additional value to
the government. The higher prices represented undiscounted or
marginally discounted catalog prices for items that the
Department of Defense had earlier purchased using cost-based
pricing or through the use of competitive procedures. The IG
audits indicated that the contractors involved did not violate
any laws or regulations, but that: ``DOD procurement approaches
were poorly conceived, badly coordinated and did not result in
the government getting good value for the prices paid for both
commercial and non-commercial items.'' The IG also asserted
that the Defense Logistics Agency recognized the importance of
the audit findings and moved quickly to take corrective action.
The Department of Defense has officially characterized the
cases uncovered in the IG audits as ``rare and isolated'' and
not reflective of the broader results of recent acquisition
reform. The committee agrees that acquisition reform efforts by
Congress and the Department of Defense have resulted in savings
of hundreds of millions of dollars and, just as importantly,
have provided DOD with more rapid access to leading edge
commercial technology. Although testimony by the GAO indicates
that of the non-competitive spare parts purchases that involve
commercial pricing problems is relatively small ($2.7 billion
of a total of over $100 billion of DOD contracting dollars in
fiscal year 1997), the instances of pricing abuses raised in
the two IG audits are widespread enough to raise concerns.
There are several root causes of the current pricing
difficulties. The acquisition workforce has been reduced by
over 40 percent since the early 1990's. In the process of the
downsizing, the personnel in many buying activities have
experienced consolidation and physical relocation. At the same
time, acquisition personnel are being required to transition
from using cost-based, rigid procurement procedures to a more
flexible commercial pricing environment where a variety of
methods must be used to determine price reasonableness without
recourse to certified cost or pricing data.
The committee does not believe that recent revelations
concerning spare parts prices justify a retreat from the
acquisition reform principles established in the Federal
Acquisition Streamlining Act of 1994 and the Federal
Acquisition Reform Act of 1996. Attempts to amend these laws as
a means of eliminating any potential abuses could prevent the
government from having access to increasingly important
commercial technologies and from benefiting from commercial
technology development cycles.
The committee is persuaded that the Department of Defense
has sufficient regulatory and administrative authority to allow
defense acquisition personnel to respond effectively to the new
commercial procurement environment. The committee believes,
however, that the evidence suggests that the Department of
Defense should address commercial pricing procedures in a
systematic manner and not in an isolated fashion. Accordingly,
the committee recommends a provision, the Defense Commercial
Pricing Management Improvement Act, that would require the
Secretary of Defense to take administrative and regulatory
actions to address a number of commercial pricing issues.
The provision would require the secretary to promulgate
regulations to provide guidelines that would ensure price
reasonableness in sole-source commercial item purchases. The
secretary would also be required to clarify issues, such as the
use of uncertified cost and pricing data and information on
prices previously paid for similar items. The committee
recognizes that there is a broad range of methods and sources
for determining price reasonableness, only some of which may be
appropriate to a given item. The committee is concerned that
current regulations and guidance do not provide adequate
direction for the government buyer.
The provision would also require the secretary to establish
procedures to ensure that, to the maximum extent practicable,
sole-source spare parts purchases are negotiated through
corporate contracts by single contracting officers or item
managers to ensure that the government receives maximum
leverage for the size of its purchases and to ensure that
catalog discount issues and price reasonableness determinations
are not treated in an isolated or piecemeal fashion. Finally,
the provision would require the Secretary of Defense to
establish a system for tracking price trends in spare parts in
order to isolate categories of items that require further
management attention. The provision would provide the Secretary
of Defense with the discretion to set up such a system in a
manner that would ensure minimal burden on the acquisition
system and proper management.
The committee is aware that the IG intends to issue another
audit report related to these issues, and the committee has
asked the GAO to expand its work to review commercial practices
with respect to pricing. The committee views the results of the
recent audits as serious and intends to continue intensive
oversight in this area.

Sec. 806. Department of Defense purchases through other agencies.

The committee recommends a provision that would require the
Secretary of Defense to revise regulations issued pursuant to
Section 844 of the National Defense Authorization Act for
Fiscal Year 1994 (Public Law 103-160) to cover all purchases of
goods and services by the Department of Defense under so-called
``multiple award task order and delivery order contracts''
entered into or administered by any other agency. Congress
authorized multiple award task order and delivery order
contracts in the Federal Acquisition Streamlining Act to
address the lack of competition in traditional, single-award
task order and delivery order contracts. However, the General
Accounting Office (GAO) testified before the Acquisition and
Technology Subcommittee that some officials may be using
multiple award task order and delivery order contracts to avoid
competition.
The committee is concerned by the preliminary findings of
GAO's review. According to GAO:

One agency issued a high proportion--64 percent--of
orders on a sole-source basis. This multiple award
contract has a potential value of over a billion
dollars. In another multiple award contract having the
potential to exceed several billion dollars, agency
announcements of planned orders identify
``recommended'' firms specifically invited to submit
proposals. This practice has resulted in just one
proposal being received on most orders.

GAO also reported that at least one agency has charged that
there appear to be discriminatory fees for orders placed by
outside agencies, including the Department of Defense. The
committee directs the Department of Defense Inspector General
to determine whether discriminatory fees were charged as
indicated by the Comptroller General, and if so, whether any
refund may be due the Department.
The committee expects that the regulations required by the
recommended provision would help avoid misuse by permitting
Department of Defense officials to place orders under multiple
award task order and delivery order contracts with other
agencies only when there is a legitimate reason to do so. That
approach would be consistent with regulations already in place
to address inter-agency purchases under the Economy Act.
A number of industry representatives have also expressed
concerns about the implementation of multiple award task order
and delivery order contracts. The committee intends to review
carefully the issues involved with the use of this authority
over the next year.

Sec. 807. Supervision of Defense Acquisition University structure by
Under Secretary of Defense for Acquisition and Technology.

The committee is aware of recent efforts within the
Department of Defense to reorganize the management of higher
education within the Department under a chancellor for
education and professional development, with a goal of full
accreditation for all such higher education programs by January
1, 2000. The committee supports this management initiative as
it relates to the defense acquisition workforce, but believes
that the Under Secretary of Defense for Acquisition and
Technology should retain certain policy responsibilities for
the defense acquisition university component of the Department
of Defense higher education system. The committee, therefore,
recommends a provision that would specify that the
responsibility for the establishment of policy and requirements
for educational programs of the defense acquisition university
be vested in the Under Secretary of Defense for Acquisition and
Technology.

Sec. 808. Repeal of requirement for Director of Acquisition Education,
Training, and Career Development to be within the Office of the
Under Secretary of Defense for Acquisition and Technology.

The committee recognizes the recent Department of Defense
efforts to restructure the management of higher education
programs for the defense acquisition workforce. The committee
recommends a provision that would remove the requirement that
the director of acquisition education, training, and career
development be appointed within the office of the Under
Secretary of Defense for Acquisition and Technology.

Sec. 809. Eligibility of involuntarily downgraded employee for
membership in an acquisition corps.

The organizations that manage and administer the
acquisition of goods and services for the Department of Defense
and the armed services are undergoing significant restructuring
in an attempt to streamline the acquisition process. As a
result of base closure actions or reductions in force,
individuals in the defense acquisition workforce have been
downgraded. In recognition of these circumstances, the
committee recommends a provision that would preserve membership
in the defense acquisition corps for an employee who previously
served within grade GS-13 or above and was downgraded to grade
GS-12 or below through a reduction in force action, a base
closure, or similar reason other than for cause. The committee
directs the Secretary of Defense to report to the congressional
defense committees, no later thanMarch 1, 2000, on the number
of employees within each grade below GS-13 by grade for whom this
authority was used to preserve membership in the defense acquisition
corps.

Sec. 810. Pilot programs for testing program manager performance of
product support oversight responsibilities for life cycle of
acquisition programs.

In the report submitted in response to section 912 of the
National Defense Authorization Act for Fiscal Year 1998 (Public
Law 105-85), the Secretary of Defense indicated his intention
to require the secretaries of the military departments to
designate at least 10 programs with significant associated
large operations and support costs. The program managers of
these programs would be required to ensure that the product
support functions are properly carried out over the entire
program life cycle.
The committee believes that this is an important initiative
which will begin to address a long-standing management problem.
According to the report provided to the committee by the
Secretary:

In today's environment, most Program Executive
Officers (PEOs) and Program Managers (PMs) have direct
responsibility and control of funding for development
and fielding weapon systems and equipment. Once the
system or equipment is fielded, the PM retains overall
responsibility for the system or equipment, but loses
control of significant portions of the funding required
for support. This practice results in much higher life-
cycle costs than should be the case, because the PEO
and PM have no incentive to take action, during
development or modification of the systems, to design
into equipment features that will improve the
reliability and maintainability of the fielded system,
and it divides responsibility for system support among
many agencies.

The committee agrees with this assessment and recommends a
provision that would require the Secretary of Defense to
designate 10 programs for which the program manager will be
made responsible for the life cycle cost issues through the
life of the program. The Secretary would be required to report,
no later than February 1, 1999, to the congressional defense
committees on the 10 programs and to include any policy,
regulatory, organizational, or legislative changes that would
be required to fully implement this new approach to life cycle
cost management.

Sec. 811. Scope of protection of certain information from disclosure.

The committee recommends a provision that would amend
section 2371 of title 10, United States Code, to clarify that
certain information submitted by outside parties in cooperative
agreements for basic, applied, and advanced research are
protected from disclosure under section 552 of title 5, United
States Code.

OTHER ITEMS OF INTEREST

Defense capability preservation agreement

The committee is aware that the Army has received a
proposal for the establishment of a defense capability
agreement for the operations at an ammunition plant similar to
that authorized for the shipbuilding industry in section 808 of
the National Defense Authorization Act for Fiscal Year 1996, as
amended. This proposal has been offered as a means to encourage
commercial use of the facility through the use of dual overhead
rates. The committee directs the Secretary of the Army to
review this proposal carefully and to provide a report to the
congressional defense committees, no later than October 31,
1998, on the feasibility and desirability of entering into such
an agreement. If it is determined that the agreement is
desirable, the Secretary should recommend legislation to
authorize the Army to enter into such an agreement.

Item-by-item waivers to domestic preference requirements

Section 811 of the National Defense Authorization Act for
Fiscal Year 1998 authorized the Secretary of Defense to waive
the so-called domestic preference requirements in Section 2534
of Title 10 on an item-by-item, country-by-country basis.
The committee supports the waiver of these domestic
preference requirements in appropriate circumstances and urges
the Department to make full use of the new authority. Domestic
preference restrictions impair competition for Department of
Defense contracts and may result in higher prices to the
taxpayer. In some cases, these preferences may also impede our
ability to compete for contracts in other countries.
The appropriate implementation of Section 811 waivers
should enable the Department of Defense to procure the best
defense equipment for the men and women in uniform at the best
price for the taxpayer and enhance our warfighting ability. It
should also help improve our relations with longstanding trade
partners, helping U.S. businesses in the long-term.
The committee is concerned by the apparent failure of the
Department of Defense to implement this provision in an
effective manner. It is the committee's understanding that, to
date, no waivers have been issued pursuant to Section 811.
Moreover, the initial implementing regulations issued by the
Department of Defense appear to narrow the applicability of the
waivers to subcontracts.
It was the committee's intent that waivers extend to all
subcontracts and options entered into after the effective date
of a waiver, regardless when the prime contract may have been
entered. The committee urges the Department to implement this
provision in the manner in which it was intended.
TITLE IX--DEPARTMENT OF DEFENSE ORGANIZATION AND MANAGEMENT

Sec. 901. Reduction in number of Assistant Secretary of Defense
positions.
The committee recommends a provision that would codify the
reductions in the number of assistant secretaries of defense
announced by the Secretary of Defense as part of the Defense
Reform Initiative. Specifically, the recommended provision
would reduce the number of assistant secretaries of defense
from 10 to nine.
Sec. 902. Renaming of position of Assistant Secretary of Defense for
Command, Control, Communications, and Intelligence.
The committee recommends a provision that would amend
section 138(b)(3) of title 10, United States Code, to change
the name of the Assistant Secretary of Defense for Command,
Control, Communications, and Intelligence (ASD-C3I).
The Secretary of Defense has recently announced a number of
significant organizational changes to the Office of the
Secretary of Defense pursuant to the Defense Reform Initiative.
Among these changes is a significant modification of the office
of the ASD-C3I. As a result, the current title no longer
describes the full range of responsibilities of this office,
nor adequately identifies its functional priorities. The
committee endorses the new title--``Assistant Secretary of
Defense for Space and Information Superiority''.
The committee had been concerned that the term ``space''
would not appear in the revised title of the ASD-C3I. As the
``single focal point for space'' in the Department of Defense,
this would have been a serious omission that would have sent a
negative and misleading message. The committee notes that,
although there are significant areas of overlap between
``information superiority'' and ``space'', the two areas also
have many unique aspects that deserve significant focused
attention. Therefore, the committee strongly endorses the
Secretary's decision to include the term ``space'' in the
revised title of this important position.
The committee notes that the Assistant Secretary for Space
and Information Superiority will be responsible for some of the
most critical issues facing the Department of Defense,
including space policy, information assurance, information
operations, intelligence policy, command, control,
communications, surveillance, reconnaissance, the ``year 2000''
problem, and electromagnetic spectrum issues. The committee
believes that one of the most significant challenges facing the
Assistant Secretary will be the integration and mutual
leveraging of the various elements that he will supervise. The
committee looks forward to maintaining a close and constructive
relationship with the Assistant Secretary of Defense for Space
and Information Superiority.
Sec. 903. Authority to expand the National Defense University.
The committee recommends a provision that would permit the
Secretary of Defense to designate, as he considers appropriate,
educational institutions of the Department of Defense as
institutions of the National Defense University.
Sec. 904. Reduction in Department of Defense headquarters staff.
The committee recommends a provision that would codify the
reductions in the Department of Defense headquarters staff
announced by the Secretary of Defense as part of the Defense
Reform Initiative. Specifically, the recommended provision
would require the Office of the Secretary of Defense to reduce
by 33 percent, defense agencies to reduce by 21 percent,
Department of Defense field activities to reduce by 36 percent,
the Joint Staff to reduce by 29 percent, the headquarters of
the combatant commands and associated activities to reduce by
seven percent, and other headquarters elements, including the
headquarters of the military departments and their major
commands and associated activities to reduce by 29 percent. The
recommended provision would require the Secretary of Defense to
submit, not later than March 1, 1999, a plan to implement the
directed personnel reductions.
Sec. 905. Permanent requirement for quadrennial defense review.
The committee recommends a provision that make permanent
the requirement contained in the National Defense Authorization
Act for Fiscal Year 1997, for the Secretary of Defense to
conduct a Quadrennial Defense Review (QDR) at the beginning of
each new administration with a view toward determining and
expressing the defense strategy of the United States and
establishing a revised defense plan for the ensuing10 and 20
years.
The provision would also require the Secretary of Defense
of the preceding administration to appoint a National Defense
Panel (NDP) that would conduct a comprehensive assessment of
the defense strategy, force structure, force modernization
plans, infrastructure, budget plan, and other elements of the
defense program and policies, with a view toward recommending a
defense strategy and a revised defense plan for the ensuing 10
and 20 years. The panel would submit a report to the Secretary
of Defense, the Committee on Armed Services of the Senate and
the National Security Committee of the House of
Representatives, that would outline the results of its
assessment approximately one month prior to the inauguration of
the new administration. This would allow the new administration
to consider the recommendations of the NDP prior to the QDR.

Sec. 906. Management reform for research, development, test, and
evaluation.

The committee recommends a provision that would require the
Secretary of Defense to submit to the congressional defense
committees a comprehensive cross-service analysis of the
Department of Defense laboratories and test and evaluation
centers and an action plan for restructuring and revitalization
of these laboratories and centers. This action plan should be
designed to reduce duplication through consolidation of areas
and functions into lead or Executive services, and should
reengineer management processes of the laboratories and test
and evaluation centers in order to increase operational
efficiency.
The provision recommended by the committee would require
the Department to address a number of related issues. These
include: (1) expanded use of the federated lab concept that
allows for partnership arrangements with leading edge
laboratories in industry, academia, and other Federal agencies;
(2) the benefits of bringing test ranges and test facilities
together under a single management structure; (3) the
feasibility of an investment strategy that focuses
modernization and productivity resources in a rational manner
to reduce redundancy and duplication; (4) steps that can be
taken, through personnel demonstrations and pilot projects or
otherwise, to enhance the Department's ability to compete with
the private sector for talented younger scientists and
engineers for junior (GS-12 and below) positions in the
laboratories and centers; and (5) the creation of an
appropriate vehicle for the dissemination of information about
successful management initiatives among the laboratories and
centers. The action plan should include a specific schedule for
implementing proposed reforms and an estimate of the cost
savings that are likely to result.
The committee is also concerned that the differing
accounting processes of the three military services make it
difficult to provide an across-the-board comparison of the
laboratories and centers, and reach cost-effective solutions to
cross-agency problems. To address this problem, the provision
would require the Secretary to provide the congressional
defense committees a plan and schedule for establishing a cost-
based management information system to allow the accurate
comparison of costs of operating defense laboratories and test
and evaluation centers across the services. The secretary's
report should specifically address the feasibility of
establishing a revolving fund for the laboratories and centers.

Sec. 907. Restructuring of administration of Fisher Houses.

The committee recommends a provision that would repeal
section 2221 of title 10, United States Code, and direct the
secretaries of the military departments to establish a
nonappropriated fund as the single source of funding to
operate, maintain, and improve the Fisher Houses and Fisher
Suites, and to close each Fisher House Trust Fund and transfer
the amounts in the Treasury fund to the nonappropriated fund.
All future fees, monetary donations, proceeds from the sale of
property, gifts and grants would be deposited in the newly
established nonappropriated fund. The recommended provision
would require the secretaries of the military departments to
submit an annual report to the Committee on Armed Services of
the Senate and the National Security Committee of the House of
Representatives not later than January 15th of each year. The
required report would include the amount in the fund as of
October 1 of the previous year, all deposits and disbursements
from the fund during the previous fiscal year and a budget for
the operation of the Fisher Houses and Fisher Suites for the
current fiscal year.
The Secretary of the Navy and the Secretary of the Air
Force have not complied with the law requiring them to
establish a corpus in a Fisher House Trust Fund in the United
States Treasury. The recommended provision would require the
Secretary of the Navy and the Secretary of the Air Force to
establish a corpus sufficient for operating Fisher Houses and
Fisher Suites within these departments and transfer the corpus
into the newly established nonappropriated fund.
TITLE X--GENERAL PROVISIONS

SUBTITLE A--FINANCIAL MATTERS

Sec. 1002. Authorization of emergency appropriations for fiscal year
1999.
The committee recommended a provision that would provide
emergency authorization of $1.9 billion for operations in
Bosnia for fiscal year 1999.
Sec. 1003. Authorization of prior emergency supplemental appropriations
for fiscal year 1998.
The committee recommends a provision that would authorize
the emergency supplemental appropriations enacted in the 1998
Supplemental Appropriations and Rescissions Act (Public Law
105-174). The supplemental provided funding for fiscal year
1998 expenses related to military operations in Southwest Asia,
Bosnia, and natural disasters.
Sec. 1004. Partnership for Peace information system management.
The committee recommends a provision that would make
available $5.0 million from funds authorized in section 301 and
section 201 of this Act for the Partnership for Peace
Information Management System.

SUBTITLE B--NAVAL VESSELS

Sec. 1011. Iowa class battleship returned to Naval Vessel Register.
The committee recommends a provision that directs the Navy
to replace the U.S.S. New Jersey on the Naval Vessel Register
with the U.S.S. Iowa. Such placement would be consistent with
section 1011 of the National Defense Authorization Act for
Fiscal Year 1996, which stated that the committee believed
retention of two battleships in the fleet's strategic reserve
to be a prudent measure since the Department of the Navy's
Future Years Defense Program would not provide a replacement
fire-support capability comparable to the battleships until
well into the next century.
On February 12, 1998, the Navy placed the U.S.S. New Jersey
on the Naval Vessel Register. However, the committee has
recently learned that the U.S.S. Iowa is in better overall
material condition than the U.S.S. New Jersey. For this reason,
the provision would direct the Navy to replace the U.S.S. New
Jersey with the U.S.S. Iowa.
Because the Navy lacks adequate naval surface fire-support
for forces operating ashore, the committee continues to believe
it is prudent to maintain two battleships on the Naval Vessel
Register.
The Navy's post-Cold War emphasis on littoral operations,
including support for amphibious operations and land forces
operating close to shore, has increased the need for surface
combatants capable of providing shore fire-support. The Navy
has developed both a short-term and a long-term plan to provide
the shore fire-support required by the Marines. The near-term
plan includes development of the Extended Range Guided Munition
(ERGM) for the DDG-51 5-inch guns and rapid development of a
land attack missile.
Long-term Navy plans to fill the gap in naval surface fire-
support centers on development of a 155mm gun and deployment of
a land attack missile.
Neither the long-term nor the short-term solutions to
meeting the shore fire-support requirements anticipate being
able to project the weight of the 16-inch projectile fired from
a battleship's main battery. Instead, the Navy is developing
accurate long range fire-support weapons capable of responding
rapidly to a call for fire-support with precision weapons that
have the ability to carry a variety of submunitions to meet
battlefield requirements.
While the committee believes the Navy's approach is sound,
it realizes that battleships' ability to provide large caliber
massed fire-support ashore is a unique capability. Therefore,
the Navy is directed to maintain a contingency plan for
reactivating the battleships remaining on the Naval Vessel
Register. The plan shall include a reactivation time line and a
defined engineering work package.
Sec. 1012. Long-term charter of three vessels in support of submarine
rescue, escort, and towing.
The Department of the Navy currently leases three vessels
and uses them primarily to support submarine rescue, escort and
towing efforts. All three vessels were built or converted to
meet the requirements of the Navy's Deep Submergence Systems
program. The leases for these vessels will soon expire and the
Department is seeking statutory authority to exceed lease terms
as defined by section 2401 of title 10, United States Code.
The committee recommends a provision that would authorize
waiver of statutory requirements with respect to the duration
of the lease in the case of the Kellie Chouest, Dolores
Chouest, and the Carolyn Chouest. The Kellie Chouest and
Dolores Chouest could be leased until the end of fiscal year
2005, and the Carolyn Chouest could be leased until the end of
fiscal year 2012, subject to earlier termination for the
convenience of the government under certain conditions. The
committee would require the lease agreement for the Carolyn
Chouest be written to include a provision that the lease maybe
terminated at the convenience of the government, with no penalty to the
government, should the Navy decide to decommission the submarine
research vessel NR-1.
The committee is concerned that the Navy is contracting for
secondary services in these leases that can be more efficiently
executed by resources owned and operated by the Department,
such as the R/V Gosport. Secondary services include, but are
not limited to: torpedo retrieval, sonar calibration, and
submarine sea trial escort.
As such, the committee directs the Department to utilize
fully the R/V Gosport and other assets owned and operated by
the Navy for these secondary services prior to outsourcing for
these services. As a result, substantial savings should be
realized in upcoming negotiations for continuing support from
the Kellie Chouest, Dolores Chouest, and the Carolyn Chouest.

Sec. 1013. Transfers of naval vessels to foreign countries.

The committee recommends a provision that would transfer,
on a grant basis, one Newport class tank landing ship, one
Stalwart class oceanographic survey ship, and four Knox class
frigates; on a sale basis, three Oliver Hazard Perry class
guided missile frigates, one Anchorage class landing ship dock,
one medium floating drydock, one Newport class tank landing
ship, one Stalwart class oceanographic survey ship, two
auxiliary repair docks, one medium auxiliary repair drydock,
and one medium floating drydock; and on a lease/sale basis,
four Kidd class guided missile destroyers and one Cimarron
class oiler to various countries. The Chief of Naval Operations
has certified pursuant to statutory requirement that such naval
vessels are not essential to the defense of the United States.
Any expense incurred by the United States in connection with
these transfers would be charged to the recipient. The
provision would also:
(1) direct that, to the maximum extent possible, the
Secretary of the Navy shall require, as a condition of
transfer, that repair and refurbishment associated with
the transfer be accomplished in a shipyard located in
the United States; and
(2) stipulate that the authority to transfer these
vessels will expire at the end of a two-year period
that begins on the date of enactment of the National
Defense Authorization Act for Fiscal Year 1999.

SUBTITLE C--MISCELLANEOUS REPORT REQUIREMENTS AND REPEALS

Sec. 1021. Repeal of reporting requirements.

The committee recommends a provision that would repeal
certain obsolete or superseded reporting requirements presently
imposed by statute upon the Department of Defense.

Sec. 1022. Report on Department of Defense financial management
improvement plan.

The committee recommends a provision that would require the
Comptroller General to report to the congressional defense
committees on the Department of Defense financial management
improvement plan required by section 2222 of title 10, United
States Code.

Sec. 1023. Feasibility study of performance of Department of Defense
finance and accounting functions by private sector sources or
other Federal Government sources.

The committee recommends a provision that would require the
Department of Defense to study the finance and accounting
function within the Department to determine the possible
streamlining, consolidation, reengineering, and possible
competition of this function. The study requires the Department
to determine certain core functions, establish an outsourcing
policy, and develop criteria for the possible privatization of
finance and accounting functions within the Department.

Sec. 1024. Reorganization and consolidation of operating locations of
the Defense Finance and Accounting Service.

The committee recommends a provision that would require the
Department of Defense to study and define future workload
requirements for each of the finance and accounting operating
locations (OPLOCs), and define whether excess capacity exists.
Current downsizing plans for the OPLOCs are not consistent with
stated requirements in the fiscal year 1999 defense budget
request or initiatives announced in the Defense Reform package.
The committee is concerned that the civilian workforce has been
reduced to meet full time equivalent (FTEs) ceilings without
consideration of required workloads and the Department's
ability to accomplish essential finance and accounting
services. The recommended provision would require that the
study be submitted to the congressional defense committees by
December 15, 1998, and that no OPLOC be closed until six months
after the submission of this study.

Sec. 1025. Report on inventory and control of military equipment.

The committee is concerned with recent reports that the
Department of Defense is unable to account for billions of
dollars in assets such as aircraft engines and one launcher for
an AVENGER weapon system. While the committee understands that
this could simply be the result of poor record keeping on the
part of the military services, the committee is concerned that
it demonstrates a lack of oversight and control on the part of
the senior leadership. Such oversight and control is essential
to ensuring that the resources of the Department are
efficiently and effectively managed and that these systems are
not inappropriately disposed of through sale or transfer.
Therefore, the committee recommends a provision that would
require each of the military services to perform a systematic
inventory of their major-end-items. A report on the results of
each of these inventories shall be provided to Congress no
later than March 31, 1999. Each report should include the
status and location of each item for which they can account,
the number and types of items for which they cannot account,
and the steps being taken to locate these items and improve
their oversight in the future.

Sec. 1026. Report on continuity of essential operations at risk of
failure because of computer systems that are not year 2000
compliant.

The committee is concerned with the progress of the
Department of Defense (DOD) and the intelligence community in
their efforts to ensure that all of their computer and other
information and support systems will be immune to the problems
associated with the approach of the year 2000 (Y2K). While the
debate continues regarding those steps which are necessary to
prepare the national security community for the threats of the
21st Century, insufficient attention has been given to
preparing the information and other support systems of this
community for the mere transition from 1999 to 2000.
Although the problems associated with the conversion to the
new millennium have been known for years and the Department of
Defense has taken steps to make its systems compliant, the
Department has been unable to meet its projected time line to
ensure all necessary systems will be renovated. Since almost
half of its 1,891 Mission Critical Systems are still in the
renovation phase, it is unlikely that the Department will be
able to complete its testing and integration efforts in time to
avoid the fallout.
While there has been a great deal of concern raised over
the recent reports of hackers attacking the Department's
computer system, and the threat posed by the possible insertion
of a virus into this system by such individuals, few people are
aware of the extent to which the Y2K problem poses a far more
serious danger to our national security than any of the viruses
that have been identified to date. At midnight on December 31,
1999, every system that is not Y2K compliant, and every system
that is connected to another that is not compliant, will be at
risk of failure. Furthermore, some problems may occur three
months earlier with the beginning of fiscal year 2000.
It is impossible to determine the specific impact that non-
compliance for even a small portion of the mission critical
systems might have on military and intelligence operations
given the extent of the interconnection among these systems
with each other and non-mission critical systems. Further
complicating this determination is the extent to which the
national security community relies upon private sector
information and support networks that may not be Y2K compliant.
Without the ability to identify, isolate, and correct the
problems with all systems that this community relies upon
before they occur, it is important to ensure that we have
developed effective contingency plans to overcome the impacts
of the problem after they materialize.
Furthermore, as disconcerting as the problems that will
occur as a result of our own systems being non-compliant may
be, we must also understand the problems that are posed to our
national security as a result of the non-compliance on the part
of the systems of other nations. Although the leaders of these
nations are aware of the problems, it is difficult to predict
how they and their subordinates will react if their own
information and support systems are crippled by Y2K
deficiencies. In an age where weapons of mass destruction with
global reach are controlled through elaborate information
networks, the threat posed to the viability of those networks
is of critical importance and steps must be taken to ensure
that any confusion or misunderstandings are resolved before
they develop into crisis situations. The committee commends the
U.S. Strategic Command for its efforts to develop lines of
communication with other nations in order to ensure the
responsible management of any problems that may arise.
As stated previously, steps have been taken to prepare for
the Y2K problem in the United States and the committee commends
the Commandant of the Marine Corps and the Chief of Naval
Operations for their efforts to resolving this critical issue
and its identification as one of their highest priorities for
any additional funding. The committee recommends an increase of
$20.0 million in the Marine Corps procurement account, and
$12.0 million in the Navy Operations and Maintenance (O&M)
account, for the replacement and renovation of computers and
shipboard systems to ensure that they are Y2K compliant.
Therefore, the committee recommends a provision that would
require the Secretary of Defense and the Director of the
Central Intelligence Agency to provide a joint report to the
Committee on Armed Services of the Senate and the Committee on
National Security of the House of Representatives, outlining
their planned course of action to ensure a continuity
ofessential operations. This report would include the prioritization of
mission critical systems to ensure that the greatest efforts are made
to guarantee that the most important systems are Y2K compliant. The
report should also contain a discussion of the private and other public
information and support systems that the national security community
relies upon, and the efforts underway to ensure their compliance.
Furthermore, the report should outline the efforts underway to repair
the underlying operating systems and infrastructure, such as the
telecommunications and utility systems that service DOD and the
intelligence community, and the community's plan for a comprehensive
test of DOD systems to include simulated operational tests in mission
areas. Finally, the report should outline a comprehensive contingency
plan for the entire national security community, as well as individual
contingency plans for the separate elements of the community, including
the creation of crisis action teams to respond to emergencies arising
from the Y2K problem. The committee recommends an increase of $60.0
million to Defense-wide O&M, for the development of these contingency
plans. The report should be submitted no later than March 31, 1999, in
both classified and unclassified forms, as necessary.

Sec. 1027. Reports on naval surface fire-support capabilities.

The committee recommends a provision that would direct the
Secretary of the Navy to report by March 31, 1999 to the
Committee on Armed Services of the Senate and the Committee on
National Security of the House of Representatives on battleship
readiness for meeting naval surface fire-support requirements.
The report is directed to contain the following:
(1) Reasons for the Secretary's failure to comply
with the requirements of section 1011 of the National
Defense Authorization Act for Fiscal Year 1996 until
February 1998;
(2) the requirement for Air-Naval Gunfire Liaison
Companies;
(3) the plans for retaining and maintaining 16-inch
gun ammunition;
(4) the Navy plans for retaining the hammerhead crane
essential for lifting battleship turrets; and
(5) an estimate of the cost of restoring the
battleships remaining on the Naval Vessel Register for
seaworthiness and with the operational capabilities
necessary to meet requirements for naval surface fire-
support and the annual cost for maintaining the
battleships in such condition while they are listed on
the Naval Vessel Register. In addition, an estimate of
cost to reactivate the battleships once the restoration
to a seaworthy condition and the addition of naval
surface fire-support capabilities are complete.
The Secretary of the Navy is directed to work through the
Director of Expeditionary Warfare Division (N85) of the Office
of the Chief of Naval Operations in preparing the report.
The Comptroller General is directed to provide a report to
the Committee on Armed Services of the Senate and the Committee
on National Security of the House of Representatives on the
naval surface fire-support capabilities of the Navy that
contains the following:
(1) an assessment of the extent of compliance by the
Secretary of the Navy with the requirements of section
1011 of the National Defense Authorization Act for
Fiscal Year 1996 until February 1998;
(2) plans for executing the naval surface fire-
support mission;
(3) an assessment of the short-term and long-term
costs associated with the plans; and
(4) an assessment of the short-term and long-term
costs associated with alternative methods for executing
the naval surface fire-support mission of the Navy,
including the alternative of reactivating two
battleships.

Sec. 1028. Report on roles in Department of Defense aviation accident
investigations.

The committee recommends a provision that would require the
Secretary of Defense to provide an assessment of the role of
the Office of the Secretary of Defense and the Joint Staff in
the investigation of military aircraft accidents. Additionally,
the provision would require the Secretary of Defense to report
on the advisability of requiring an independent entity of the
Department of Defense to supervise military aircraft accident
investigations.

Sec. 1029. Strategic plan for expanding distance learning initiatives.

The committee recommends a provision that would require the
Secretary of Defense to develop and provide to Congress a 5-
year plan for guiding and expanding distance learning
initiatives in the Department of Defense.

Sec. 1030. Report on involvement of Armed Forces in contingency and
ongoing operations.

The committee is concerned about the reports of declining
retention rates, decreased availability of military support
equipment and combat service support personnel, and shortfalls
in training funds. In many cases, these problems have been
attributed to the extensive deployment of U.S. military
personnel and equipment to contingency and ongoing
operations.The committee notes that the Presidential Decision
Directive-25 outlines certain factors that are to be considered before
deploying U.S. military forces to U.N. peacekeeping operations. The
Directive identifies the following factors: the availability of
personnel, funds, and other resources; and the identification of clear
objectives and an endpoint for U.S. participation.
The committee is concerned about the reports that
peacekeeping and other contingency operations may be
contributing to the readiness problems of the military
services. Therefore, the committee recommends a provision that
would require the Secretary of Defense to submit a report to
the congressional defense committees that would outline the
following:
(1) the effects of U.S. involvement in contingency
operations on the retention and reenlistment of
personnel in the Armed Forces;
(2) the extent to which involvement in these
operations has resulted in shortfalls in personnel and
equipment;
(3) the cost of these operations and the accounts
from which the funds to pay those costs were drawn;
(4) the objectives of the operation, and the set of
conditions that defines the end of each operation.
(5) an identification of the U.S. vital interests
involved in each operation and, if none, an
identification and characterization of the level of
U.S. national interests involved.
The report should be submitted no later than January 31,
1999.

SUBTITLE D--OTHER MATTERS

Sec. 1041. Cooperative counterproliferation program.

The committee recommends a provision that would provide the
Secretary of Defense authority to provide assistance to a
foreign country, or instrumentality of a foreign country, for
cooperative counterproliferation activities, to include
destroying, removing or obtaining from such country, weapons of
mass destruction and related material that could present a
significant threat to U.S. national security interests.
The Department of Defense is required to certify to the
congressional defense committees prior to conducting any
activity under this authority, that the material in question is
at risk of transfer to a restricted foreign country, that such
transfer would threaten U.S. national security interests if
completed, and that there are no other options to prevent the
transfer. The provision would also allow the Secretary to waive
the certification requirement if making such certification
would be contrary to national security interests. The committee
believes this provision should be used only as a last resort
when all other options, including assistance by the Department
of State and the Department of Energy, are not feasible.
Additionally, the provision would require an annual report of
DOD cooperative counterproliferation activities.

Sec. 1042. Extension of counterproliferation authorities for support of
United Nations Special Commission on Iraq.

The committee recommends a provision that would amend
section 1505 of the National Defense Authorization Act for
Fiscal Year 1992 to extend the authority for the Department of
Defense to continue to provide support to the United Nations
Special Commission on Iraq (UNSCOM) through fiscal year 1999.

Sec. 1043. One-year extension of limitation on retirement or
dismantlement of strategic nuclear delivery systems.

The committee continues to support the administration's
policy of remaining at Strategic Arms Reduction Treaty (START
I) levels of strategic forces until START II enters into force.
Therefore, the committee recommends a provision that would
extend by one year section 1302(e) of the National Defense
Authorization Act for Fiscal Year 1998 (Public Law 105-85). The
committee, however, is willing to consider alternative START I
force postures that may be more affordable than the current
force configuration.

Sec. 1044. Direct-line communication between United States and Russian
commanders of strategic forces.

The committee recommends a provision that would express the
sense of the Congress that the commanders of the U.S. Strategic
and Space Commands and the Russian commander of the Strategic
Rocket Forces should have a communication link to make
immediate contact for any matter of an urgent nature.
The committee believes that a direct communications link
would help to improve mutual confidence in the respective early
warning and strategic systems and prevent or reduce the
opportunity for misunderstandings or miscalculations that could
have disastrous effects on the United States and Russia.
The provision would also direct the Secretary of Defense to
study the feasibility of initiating discussions with the
Russian Minister of Defense to establish a direct
communications link among the commanders of the U.S. Strategic
and Space Commands and the Russian Strategic Rocket Forces, and
report back to the congressional defense committees the results
of his findings.

Sec. 1045. Chemical warfare defense.

The committee recommends a provision that would direct the
Secretary of Defense to review, and modify as appropriate,
Department of Defense chemical warfare defense policy and
doctrine relative to the protection of U.S. forces against
exposure to low levels of chemical warfare agents, and to
report to the congressional defense committees by May 1, 1999
on any modification of chemical warfare policy and doctrine as
a result of that review.
The committee believes that DOD and military services
chemical warfare defense policies and doctrine should provide
for adequate protection of personnel from any low-level
exposure to a chemical warfare agent that would endanger the
health of exposed personnel, whether by single exposures,
exposure to a chemical warfare agent concurrent with other
dangerous exposures, or by repeated exposures to such hazards
over time. Specific concerns and mission requirements of the
various services should be addressed. Finally, DOD and service
policy and doctrine should provide for the recording,
reporting, coordinating, and retaining of information on
possible exposures, including the monitoring of the health
effects of exposures on humans and animals by location.
To guide the Secretary of Defense in the evolution of
policy and doctrine on low-level exposures to chemical warfare
agents, the committee directs the Secretary of Defense to plan
a research program, including a five year budget plan, on the
effects of chronic and low-level exposure to chemical warfare
agents.

Sec. 1046. Accounting treatment of advance payment of personnel.

The committee recommends a provision that would clarify the
authority of the Department of Defense to disburse advance
payments to service members, in a permanent change of station
status, in amounts that may exceed what is available in the
military personnel appropriations. Authority already exists for
the military departments to pay up to three months basic pay to
members in a permanent change of station status. However, when
the payment period crosses fiscal years, section 1006 of title
37, United States Code, is silent on whether the military
departments have the authority to make these advanced payments
in excess of amounts available in the military personnel
appropriations. The recommended provision would exclude
obligations and expenditures for payments of advanced military
pay, from any determination of amounts available, except in the
fiscal year in which such amounts are ultimately earned.

Sec. 1047. Reinstatement of definition of financial institution in
authorities for reimbursing defense personnel for Government
errors in direct deposits of pay.

The committee recommends a provision that would reinstate
the definition of ``financial institutions'' that previously
existed and was deleted as a result of the 1994 redrafting of
section 3332 of title 31, United States Code. The provision
restores the definition of a financial institution, as follows:
any bank, savings and loan association or similar institution,
or a credit union chartered by the U.S. Government or a state.

Sec. 1048. Pilot program on alternative notice of receipt of legal
process for garnishment of federal pay for child support and
alimony.

The committee recommends a provision that would authorize
the Department of Defense to conduct a pilot program that would
allow the Department to refrain from providing actual court
documents to the military member, concerning child support and
alimony payments, prior to proceeding with a court ordered
garnishment. The Defense Finance and Accounting Service would
continue to include pertinent information with the notification
to the service member involved. Actual copies of the court
documents would be available upon request.

Sec. 1049. Costs payable to the Department of Defense and other federal
agencies for services provided to the Defense Commissary
Agency.

The committee recommends a provision that would prohibit
the Defense Commissary Agency from paying any costs for
services provided by a Department of Defense or other federal
agency that exceeds the price at which the service could be
procured in full and open competition. The committee is
concerned that the Defense Commissary Agency is paying overseas
transportation charges that may include the overhead and
infrastructure costs of the Transportation Command, which would
inappropriately inflate the second destination transportation
cost to the commissary agency and mask the core costs of
defense agencies. The recommended provision would apply to all
services billed to the Defense Commissary Agency within the
revolving fund accounts of the Department of Defense or other
federal agencies.

Sec. 1050. Collection of dishonored checks presented at commissary
stores.

The committee recommends a provision that would permit the
Secretary of Defense to impose a charge for the collection of
dishonored checks presented at a commissary store. The
recommended provision would require that the imposition and
amounts of the charges be consistent with the practices
ofcommercial grocery stores. Revenues generated by the dishonored check
charges would be deposited to the commissary revolving trust fund.

Sec. 1051. Defense commissary agency telecommunications.

The committee recommends a provision that would require the
Secretary of Defense to provide the Defense Commissary Agency
authority to obtain telecommunications and related services
under the Federal Telecommunications System (FTS) 2000/2001
contract and to report to the Committee on Armed Services of
the Senate and the National Security Committee of the House of
Representatives when Defense Commissary Agency
telecommunications have been initiated under the FTS 2000/2001
contract. Authority to use advanced telecommunications services
will permit the Defense Commissary Agency to use credit card
and check approval procedures similar to those used in
commercial grocery stores.

Sec. 1052. Research grants competitively awarded to service academies.

The committee recommends a provision that would permit the
service academies to compete for and receive research grants
that are awarded competitively. The recommended provision would
authorize appropriated funds to be used to pay expenses
involved in preparing proposals to obtain research grants
offered by a corporation, fund, foundation, educational
institution, or other similar entity that is organized and
operated primarily for scientific, literary, or educational
purposes. Any grants awarded to the academies would be
deposited in a special account established for administering
the proceeds of such grants.

Sec. 1053. Clarification and simplification of responsibilities of
inspectors general regarding whistleblower protections.

The committee recommends a series of amendments to section
1034 of title 10, United States Code, the Military
Whistleblower Protection Act, that would improve the
administration of this statute without diluting the protection
it affords to service members who make allegations of
violations of law, mismanagement, waste, abuse, danger to
public health or safety, or reprisal for protected
communications. These amendments should reduce the
administrative burden on the Inspector General of the
Department of Defense (DOD IG) and Inspectors General within
the services, thereby allowing them to concentrate their
resources on investigations and reduce the delays which have
marked, in particular, the reprisal investigation process.
Subsection (a) would authorize Inspectors General at all
levels of the armed forces to accept reprisal complaints under
the statute. The determination of whether the complaint falls
within the statute would rest with the DOD IG or the Inspector
General of the military department concerned. The DOD IG would
continue to exercise its oversight role in reprisal
investigations. This subsection would further authorize
investigations to be closed if an initial analysis of the
complaint determined that a full investigation was not
warranted, thus conserving scarce investigative resources.
Subsection (b) would clarify that the mismanagement which
is the subject of a complaint must be ``gross mismanagement.''
This change would make the definition in the Military
Whistleblower Protection Act consistent with that in the
civilian Whistleblower Protection Act (5 U.S.C. 2302(b)(8)).
Subsection (c)(1) would delete the requirement to provide a
copy of the full report of investigation to the Secretary of
Defense, who would simply be notified of the result. The member
making the allegation would continue to receive a copy of the
full report.
Subsection (c)(2) would modify the present requirement that
the member making the allegation be automatically provided with
copies of all supporting documents, in addition to the report
of investigation itself. The amendment would require that these
documents be provided only if the member requested them.
Subsection (c)(3) would lengthen the present statutory
period during which a reprisal investigation must be completed
(or a report explaining the delay produced) from 90 to 120
days.
Subsection (d) would repeal the present requirement that a
post-investigation interview be conducted with the member
making the allegation.
Subsection (e) would amplify the definition of ``Inspector
General'' presently in the statute.

Sec. 1054. Amounts recovered from claims against third parties for loss
or damage to personal property shipped or stored at Government
expense.

The committee recommends a provision that would allow funds
recovered from third parties in relation to household good
claims be deposited into the current appropriations for payment
of such claims. Specifically, the proposal clarifies a process
used by the military services for the last 30 years.

Sec. 1055. Eligibility for attendance at Department of Defense domestic
dependent elementary and secondary schools.

The committee recommends a provision that would
authorizethe Secretary of Defense to extend the enrollment of
dependents of civilian employees of the federal government for more
than five consecutive years if the Secretary determines that the
student is eligible to attend the Department of Defense Domestic
Dependent Elementary and Secondary School, there is space available,
and adequate arrangements are made to pay the tuition costs for the
educational services provided. The committee notes that in some areas
in which the Department of Defense operates a domestic school system,
employees of other federal agencies remain on station for more than
five years. The recommended provision would permit these students to
remain in the Department of Defense domestic school system as long as
space is available and arrangements are made to reimburse the
Department of Defense for tuition costs.

Sec. 1056. Fees for providing historical information to the public.

The committee recommends a provision that would allow the
historical institutes of the military services to provide
historical information to members of the public for a fee that
is equivalent to the cost of researching and transmitting the
information. The revenues from these fees would be credited to
the appropriations accounts that incurred the costs of
providing such information. These organizations would not be
able to charge such a fee for any information that is
considered public information pursuant to section 552 of title
5, United States Code, or that is provided to a member of the
armed forces or employee of the United States acting in their
official capacity.

Sec. 1057. Periodic inspection of the Armed Forces Retirement Home.

The committee recommends a provision that would eliminate
the requirement for the Department of Defense Inspector General
to conduct inspections of the Armed Forces Retirement Homes, as
well as review the inspections conducted by the Inspectors
General of the military departments. The recommended provision
would require inspections of the homes every three years.
Responsibility to conduct inspections would rotate among the
three services on a schedule determined by the Secretary of
Defense.

Sec. 1058. Transfer of F-4 phantom II aircraft to foundation.

The committee recommends a provision that would authorize
the Secretary of the Air Force to transfer an F-4 aircraft to
the Collings Foundation. The provision would further require
that before the aircraft can be transferred, the Air Force must
ensure that it is properly demilitarized, the foundation agrees
that it will not transfer the aircraft to a third party without
the approval of the Air Force, and the foundation would fully
indemnify the United States from any liabilities connected with
the conveyance of the aircraft.

Sec. 1059. Act constituting presidential approval of vessel war risk
insurance requested by the Secretary of Defense.

The committee recommends a provision that would amend
section 1205(b) of the Merchant Marine Act of 1936 (46 U.S.C.
Appendix 1285(b)) to ensure that vessel war risk insurance is
available on a timely basis in the event that commercial
shippers providing sealift for the Department of Defense are
unable to obtain commercial insurance on reasonable terms.
The current statute requires consultation with the
President by the Secretary of Transportation prior to each
issuance of vessel war risk insurance. This amendment would
authorize the pre-approval of vessel war risk insurance, so
that it can be immediately available in a national emergency or
contingency. A similar provision authorizing the pre-approval
of aviation insurance (49 U.S.C. 44305(b)) was enacted in the
Aviation Insurance Reauthorization Act of 1997 (Public Law 105-
137).

Sec. 1060. Commendation and memorialization of the United States Navy
Asiatic Fleet.

The Asiatic Fleet of the U.S. Navy was established in 1910
to protect American nationals, policies and possessions in the
Far East. The sailors and marines of the Asiatic Fleet ensured
the safety of U.S. citizens and foreign nationals, and provided
humanitarian assistance in the Far East during the Chinese
civil war, the Yangtze Flood of 1931, and the outbreak of Sino-
Japanese hostilities in the 1930s.
The committee recommends a provision which would express
the sense of the Congress regarding the U.S. Navy Asiatic
Fleet. This provision would commend the personnel who served in
the Asiatic Fleet and honor those who gave their lives in the
line of duty while serving in the Asiatic Fleet.
This provision also authorizes and requests the President
of the United States to proclaim March 1, 1999 as United States
Navy Asiatic Fleet Memorial Day and encourages observance of
the day throughout the United States.

Sec. 1061. Program to commemorate 50th anniversary of the Korean War.

The committee recommends a provision that would increase
the amount authorized to be expended for the Korean
Warcommemorative program from $1.0 million to $10.0 million.

Sec. 1062. Relocation of frequency spectrum.

The committee is concerned with the proposed sale of those
portions of the frequency spectrum that are currently utilized
by the Department of Defense (DOD) and intelligence community.
The trend toward a more information based military requires
that the Department of Defense have adequate access to those
portions of the frequency spectrum (primarily below 3.1 Ghz)
used by the Department's communications equipment. However,
over the past five years, the Department has either
relinquished or agreed to share over 500 MHZ of spectrum. This
reallocation has already limited the capability of some
military systems such as the Navy's Cooperative Engagement
Capability (CEC).
Last year, the committee directed the Secretary of Defense
to perform a systematic, detailed review of U.S. national
security requirements, and the impacts of further reallocation
of those portions of the spectrum currently used or dedicated
to the Department of Defense and the intelligence community.
This review was also supposed to include the costs to the
Department associated with past and potential future
reallocations of frequency spectrum. Upon completion, the
results of the review were to be provided to the Congress.
The report which was submitted by the Department
highlighted the historical importance of military access to the
frequency spectrum, as well as the value of retaining that
access in order to conduct the operations of today, and counter
the threats of the 21st Century. According to the report,
``Gulf War operations used nearly every major military [Radio
Frequency] RF system in the U.S. arsenal.'' Perhaps the best
example of the importance of communications systems utilizing
the radio frequency spectrum is provided by the circumstances
of the Iraqi military during the Gulf War, which had little
ability to use such systems and were therefore at a
disadvantage. Furthermore, although the scale of a military
operation may change, spectrum requirements essentially remain
the same. Although our current force deployed to Bosnia is on a
far smaller scale than that deployed during the Gulf War, it
makes use of almost all of the same spectrum resources.
The importance of ready access to the spectrum was also
demonstrated in the rescue operation for Captain Scott O'Grady,
an Air Force pilot who was shot down in 1995 by a Bosnian-Serb
surface-to-air missile.

The search and subsequent rescue of Air Force Captain
Scott O'Grady had its own unique set of frequency
requirements. The success of his rescue mission might
very well have been compromised without ready access to
the spectrum required for operating the communications,
radar, navigation, and electronic combat equipment on
the rescue ship and aircraft. Future rescue missions
will require similar resources.

The military services operate thousands of systems in that
part of the frequency that has been suggested for possible
sale. The Army in particular operates thousands of tactical
air-ground-air, air-to-air, land mobile, and trunking radios in
the lower portion of the spectrum. The loss of these
frequencies will have a substantial impact upon Army operations
and training. Moreover, the Army will be required to
restructure, reaccommodate, and replace current assets with new
equipment operating in other frequency bands, if possible.
According to the DOD report, ``[i]f we are to maintain the
high quality of our forces, we must continue to train as we
will fight--and that requires access to the same spectrum in
the US that we will use overseas.'' Furthermore, ``many of our
advances in technologies such as anti-stealth and portable mine
detection radars, and secure, high capacity communications will
demand greater spectrum access rather than less.''
However, some of the negative impacts on military systems
and operations can be reduced by redesigning these systems so
that they do not require access to those portions of the
spectrum that are being sold. Such redesigns are difficult and
costly.
The report failed to provide the required information
regarding the cost to the Department of Defense associated with
the redesign of systems as a result of past or potential future
reallocations of the frequency spectrum. Some estimate that
this will cost billions of dollars.
Therefore, the committee recommends a provision that would
require any entity that purchases portions of the spectrum that
have been used by the DOD or other federal agency, and that the
DOD or other agency relinquished in order to make that portion
of the spectrum available for sale or lease, reimburse the DOD
or other agency for the total cost incurred by the government
in order to make that portion of the spectrum available.

Sec. 1063. Technical and clerical amendments.

The committee recommends a provision that would make
various technical and clerical amendments to existing law.

OTHER ITEMS OF INTEREST

Arms control and other national priorities

The budget request did not include funding for integration
and launch costs, as well as procurement costs, for two
satellite based sensors that are needed to monitor
theComprehensive Test Ban Treaty, as well as other nuclear testing
treaties in force. The committee understands that they were deemed by
the Air Force to be a low priority relative to warfighting
requirements.
The committee is concerned that devolvement of programs
from the Office of the Secretary of Defense to the military
services may in some instances cause the services to have to
choose between supporting warfighting priorities or broad
national security goals in allocating resources.
The committee believes that programs that are primarily
justified in terms of their support to arms control or
verification be funded out of accounts designated for such
activities.
The committee directs the Secretary of Defense to submit a
report to the congressional defense committees by June 1, 1998
on how funding for these sensors to meet the broad national
security goals of detecting nuclear testing treaties will be
provided. In addition, the report should address the mechanism
by which the Department will ensure that broad national
security funding priorities are addressed and appropriate
funding provided.

Assured strategic command and control

Nuclear deterrence continues to be a cornerstone of our
national security. Key to the credibility of that deterrent is
assured nuclear command and control. Since the end of the Cold
War, however, the U.S. nuclear strategic command and control
(C2) system, particularly the survivable elements, has been
downsized considerably. In 1994, the Department of Defense
undertook a review of nuclear command, control, communications
and intelligence. Its final report, approved in August 1997,
established a ``thin-line'' nuclear C2 architecture to provide
minimum survivable strategic command and control of U.S.
nuclear forces by the President.
While the committee recognizes that the end of the Cold War
afforded the opportunity to streamline nuclear force structure,
it nevertheless views the imperative for a robust strategic C2
infrastructure to control the remaining forces as being
stronger than ever when viewed in the context of the current
and emerging national security environment.
The committee also views assured strategic command and
control as a critical prerequisite for further nuclear arms
reductions. Fewer weapons require more efficient and effective
command and control assurance in order to maintain a credible
nuclear deterrent. Arms control reductions absent assured
strategic command and control reduce the capability, and
therefore, credibility, of our nuclear deterrent and, as a
result, jeopardize U.S. national security. Therefore, the
committee directs the Secretary of Defense to provide adequate
support for the operations, manning, training, equipping,
maintenance, and infrastructure necessary to ensure the
survivability, flexibility and endurance of strategic C2
systems. The committee directs the Secretary of Defense to
submit a report to the congressional defense committees not
later than February 15, 1999 which addresses the following
matters:
(1) The policy guidance underlying strategic C2 as it
relates to nuclear weapons policy and as it supports
the national military strategy;
(2) Readiness requirements and associated resources
needed for survivable strategic C2 systems;
(3) Vulnerabilities or deficiencies in current
survivable strategic C2 systems and platforms;
(4) E-4B mission requirements and concepts of
operation, including modernization programs and
opportunities for more effective and efficient
employment of this platform;
(5) Mission requirements and concepts of operation
for the U.S. Strategic Command and U.S. Space Command
command centers, including plans for modernization and
opportunities for more effective and efficient
employment of platforms; and
(6) E-6B mission requirements and concepts of
operation, including modernization programs and
opportunities for more effective and efficient
employment of this platform.

Reporting miscellaneous expenses in object classes 25 series
(Contractual Services)

The committee is concerned about the fact that the
Department of Defense reports more than fifty percent of the
expenses in object class 25 (Contractual Services) as
miscellaneous expenses. Reporting expenses in this manner is of
limited value and undermines the financial reporting process.
Therefore, the committee believes the Department of Defense
should take immediate steps to limit reporting expenses as
miscellaneous to no more than fifteen percent of the total
expenses reported in object classes 25 series.

Reprogramming procedures for the National Reconnaissance Office

The committee is very concerned about the fact that the
National Reconnaissance Office (NRO) executed a reprogramming
request without the committee's approval. Prior to this
incident, the committee informed the NRO that its congressional
notification procedure for reprogramming requests was
inadequate and needed to be improved. It is difficult for the
committee to have confidence in the NRO in light of such an
egregious oversight.
To avoid future difficulties, the committee directs the NRO
to review its reprogramming procedures and to develop a more
effective system. The committee will not act on any further
reprogrammings until the NRO has assured the committee that the
new procedure will prevent future congressional notification
problems. The committee expects that future actions will
involve proper congressional notification with sufficient time
for full review.
TITLE XI--DEPARTMENT OF DEFENSE CIVILIAN PERSONNEL

Sec. 1101. Repeal of employment preference not needed for recruitment
and retention of qualified child care providers.
The committee recommends a provision that would repeal an
employment preference for military spouses who applied for
child care positions. Originally, this additional preference
was extended to military spouses to attract applicants for
child care positions. Over time, military spouses have used
this preference to obtain civil service status and then move on
to other civil service positions creating personnel turbulence
in the child care centers. Increased compensation for child
care providers have resolved the initial recruitment and
retention problems. Existing civil service military spouse
preference is sufficient to ensure military spouses receive
appropriate consideration for child care and other civil
service positions.
Sec. 1102. Maximum pay rate comparability for faculty members of the
United States Air Force Institute of Technology.
The committee recommends a provision that would permit
civilian faculty at the United States Air Force Institute of
Technology to be paid at the same level as civilian faculty at
other senior military schools and the service academies.
Sec. 1103. Four-year extension of voluntary separation incentive pay
authority.
The committee recommends a provision that would extend
until September 30, 2003 the civilian voluntary separation
incentive pay authority established during the civilian
drawdown within the Department of Defense. The committee
recognizes that the successful drawdown of civilian personnel
could not have been accomplished without using incentives and
transition benefits to encourage voluntary separations in lieu
of involuntary actions. As a result of the Quadrennial Defense
Review, the Department of Defense is continuing to reduce the
civilian workforce. The committee expects the military services
to continue to use the incentive and benefit programs to
achieve the reductions mandated by the Quadrennial Defense
Review.
Sec. 1104. Department of Defense employee voluntary early retirement
authority.
The committee recommends a provision that would modify the
conditions under which voluntary early retirement would be
authorized for civilian employees of the Department of Defense.
Sec. 1105. Defense Advanced Research Projects Agency experimental
personnel management program for technical personnel.
The committee recommends a provision that would provide the
Secretary of Defense special personnel management authorities
to carry out a five-year experimental program in which eminent
experts in science and engineering fields for research and
development projects administered by the Defense Advanced
Research Projects Agency. The recommended provision would
permit scientists and engineers from outside federal civil
service to be hired and paid without regard to existing civil
service laws. Appointments under the recommended legislation
would be limited to a maximum of four years. The recommended
provision would require the Secretary of Defense to submit an
annual report to the Congress beginning in 1999.

OTHER ITEMS OF INTEREST

Temporary assignments of personnel between Federal Government, and
state or local governments, institutions of higher education,
Indian tribal governments and other eligible organizations
Temporary assignments of personnel between Federal
Government, and state or local governments, institutions of
higher education, Indian tribal governments and other eligible
organizations, including federally funded research and
development centers, are authorized by the Intergovernmental
Personnel Act (IPA) of 1970 (5 U.S.C. 1304, 3371-3376) and are
referred to as ``IPAs.''
These assignments are intended to facilitate federal-state-
local cooperation through the temporary assignment of skilled
personnel. These assignments can be used for a variety of
purposes, including: to strengthen the management capabilities
of eligible organizations; to assist in thetransfer and use of
new technologies; and to provide program and developmental experiences
that could enhance individual job performance. Assignments arranged to
meet the personal interests of employees, to circumvent compensation
limits or personnel ceilings, or to avoid unfavorable personnel
decisions are contrary to the spirit and intent of this program.
The Secretary of Defense is directed to review the use of
IPA and to ensure that these assignments are being used in a
manner consistent with the intent of the authorizing statute.
The Secretary shall report the results of that review to the
congressional defense committees not later than March 1, 1999.

Enhanced training for Department of Defense civilian employees
regarding A-76

The committee is aware that some DOD civilian employees
receive training with regard to A-76 competitions. The
committee applauds the Department of Defense for these training
efforts and encourages the Department to expand training
opportunities to ensure that, to the maximum extent possible,
all employees who would be involved in A-76-type actions
receive the appropriate training.

Management by Full Time Equivalents

Section 1101 of the National Defense Authorization Act for
Fiscal Year 1998 (Public Law 105-85) required the service
secretaries and Department of Defense (DOD) agency directors to
certify to the Congress that Full Time Equivalent (FTE)
ceilings were not used in the management of civilian personnel.
There is, however, still evidence that FTE-ceilings are being
used. The committee, therefore, urges that the service
secretaries and DOD agency directors include in the required
certification consideration of the possible use of prohibited
manpower management constraints as a factor when making
decisions to outsource activities traditionally performed by
government employees.

High-grade restrictions

The committee is concerned about the effects of on-going
high-grade restrictions on the Federal Scientists and
Technologists (S&Ts). Although the committee understands the
rationale for controlling high-grade growth, especially in a
time of downsizing, the committee notes that the uniform
application of high-grade restrictions across agencies and
laboratories, without regard for the unique attributes of the
S&T community may result in an unintended ``brain drain'' from
which it may take years to recover.
Hiring freezes, reductions-in-force, and early separation
programs intended to facilitate the downsizing of the
Department of Defense, when coupled with high-grade
restrictions can result in a stagnant work force of middle-
graded S&Ts. These highly-educated and trained individuals at
or below GS-13 will leave government service because there are
no opportunities for advancement. The end result could be a
smaller yet significantly less capable organization.
The committee directs the Secretary of Defense to review
the application of high-grade controls, as applied to the S&T
community as a whole and in individual laboratories, to
determine if such controls are in the best long-term interests
of the Department of Defense. Additionally, the committee
encourages the Secretary of Defense to provide to those
agencies and laboratories that employ S&T personnel, the
maximum flexibility possible in the management of S&T
personnel, consistent with the uniqueness of this community and
the long-term needs of the Department. The Secretary shall
report to the Congressional defense committees on the results
of that review not later than March 1, 1999.

TITLE XII--JOINT WARFIGHTING EXPERIMENTATION

The committee believes the Department of Defense should
move quickly toward a process of joint experimentation as
recommended by the National Defense Panel. The committee
acknowledges the progress the Department has made by developing
a charter assigning the responsibility and authority for that
process to the Commander-in-Chief, U.S. Atlantic Command. The
committee directs the CINC, USACOM, or other combatant
commander subsequently responsible for joint experimentation,
to report to the congressional defense committees annually on
joint experimentation conducted in the previous year. The
Secretary of Defense and the Chairman of the Joint Chiefs of
Staff are also directed to comment on each report prior to the
submission to the Congress. The committee will carefully review
the initial and subsequent annual reports on joint warfighting
experimentation to assess the adequacy of the scope and pace of
transformation activity. Should that scope and pace be deemed
inadequate, the committee will consider legislation to
establish a unified combatant commander with the mission,
forces, budget, responsibilities and authority to conduct joint
experimentation.
DIVISION B--MILITARY CONSTRUCTION AUTHORIZATIONS

The purpose of Division B is to provide military
construction authorization and related authority to support the
military departments and defense agencies during fiscal year
1999. The administration's budget request is reflected in S.
1813, the Military Construction Authorization Act for Fiscal
Year 1999, as introduced by request. The military construction
division of this bill, as recommended by the committee, totals
$8.3 billion in authorization for appropriations for fiscal
year 1999.
This authorization provides funding for construction and
military family housing operations for the military services,
the Reserve components, the defense agencies, and the North
Atlantic Treaty Organization Security Investment Program. It
also provides authorization for the Defense Base Closure and
Realignment account that funds activities associated with the
1993 and 1995 base closure recommendations.
Committee Action
The committee recommends an overall authorization for the
Department of Defense military construction program that is
above the administration's request for fiscal year 1999. For
fiscal year 1999, the Department of Defense requested
authorization of appropriations of $4.3 billion for military
construction and $3.5 billion for family housing construction
and support. These funding levels represent a reduction of
approximately $600.0 million from the fiscal year 1998 request.
The committee recommends $4.7 billion for military construction
and $3.6 billion for family housing construction and support
for fiscal year 1999. In reviewing the services' military
construction programs, the committee found that since 1995,
funding for military construction and family housing has
declined by 19 percent. During the same period, the overall
defense budget has declined by only eight percent. At these
funding levels, the committee questions the services' ability
to mitigate the serious deficiencies in the quality of our
defense infrastructure, barracks and family housing.
Despite the ominous funding declines, there are rays of
promise for improved Quality of Life in the fiscal year 1999
military construction request. For example, there is again a
sizeable request for barracks construction, both in CONUS and
overseas. In addition, the Army and the Navy provided
additional funding to enhance both National Guard and Reserve
facilities.
The committee reaffirms its support to modernize, renovate,
and improve aging defense facilities and focuses its funding
priorities on improving quality of life and readiness-related
projects for the active and Reserve components. Of the $500.0
million added to the construction program, more than $164.0
million will fund unaccompanied personnel quarters, child
development centers, dining facilities, education centers, and
military family housing. The funding increase also provides
approximately $100.0 million for high priority projects
submitted by the military services that could not be funded in
the Department's budget request.
The committee denied the Department's shift of the Chemical
Demilitarization Program funds from the Office of the Secretary
Defense to the Army Military Construction Program. The
committee believes that due to the national implications of
this program, oversight is more appropriately placed in the
Office of the Secretary of Defense. The committee recommended a
reduction of $50.0 million, to the Department's request for the
Chemical Demilitarization Program. The program has experienced
delays in obtaining the required construction and environmental
permits and is carrying over $60.0 million in unobligated
funds.
The committee notes that the Department is again relying on
prior year savings to fund military construction projects
rather than including the full funding in the budget request.
Over the past three fiscal years the Military Departments were
directed to use in excess of $84.0 million from prior year
savings to fund their military and family housing construction
program. The use of prior year savings denies the services the
flexibility to fund necessary cost variations and complete
projects that have justifiable cost increases. The committee
denied the use of prior year funds and expects the Department
to fully fund the military construction requests in future
budget requests.
The following table identifies the committee's
recommendations for fiscal year 1999 military construction and
family housing construction projects.

Base closure and realignment accounts

The committee recommends authorization of $1.7 billion in
fiscal year 1999 for the Defense Base Closure and Realignment
Account, 1990, that supports the recommendations of the 1993,
and 1995 Defense Base Closure and Realignment Commissions.
The committee will continue to carefully monitor the
justification for the construction projects funded within these
accounts and the other cost elements of these accounts.
Although funding is not specifically limited to projects
identified in its budget justification, the Department of
Defense identified the following construction projects for
fiscal year 1999 that it plans to fund from these accounts.

TITLE XXI--ARMY

SUMMARY

The Army requested authorization of $790,876,000 for
military construction and $1,206,534,000 for family housing for
fiscal year 1999. The committee recommends authorization of
$764,478,000 for military construction and $1,228,358,000 for
family housing for fiscal year 1999. The reduction in the
military construction program reflects the transfer of the
Chemical Demilitarization program to Office of the Secretary of
Defense.

Sec. 2101. Authorized Army construction and land acquisition projects.

This section contains the list of authorized Army
construction projects for fiscal year 1999. The authorized
amounts are listed on an installation-by-installation basis.
The state list contained in this report is intended to be the
binding list of the specific projects authorized at each
location.

Sec. 2102. Family housing.

This section would authorize new construction and planning
and design of family housing units for the Army for fiscal year
1999.

Sec. 2103. Improvements to military family housing units.

This section would authorize improvements to existing units
of family housing units for fiscal year 1999.

Sec. 2104. Authorization of appropriations, Army.

This section would authorize specific appropriations for
each line item contained in the Army's budget for fiscal year
1999. This section also provides an overall limit on the amount
the Army may spend on military construction projects.

Sec. 2105. Modification of authority to carry out fiscal year 1998
project.

The committee recommends a provision that would amend
section 2101 of the Military Construction Authorization Act for
Fiscal Year 1998. The provision would authorize an increase of
funding for the whole barracks complex renewal at Fort Sill
Oklahoma, from $25.0 million to $28.3 million, due to a change
in scope.

OTHER ITEMS OF INTEREST

Improvements of military family housing, Army

The committee recommends that, within authorized amounts
for improvements to military family housing and facilities, the
Secretary of the Army execute the following projects:
$7,400,000 for Whole House Revitalization (40 units) at Fort
Richardson, Alaska and $10,000,000 for Whole House
Revitalization (95 units) at Fort Campbell, Kentucky.
TITLE XXII--NAVY

SUMMARY

The Navy requested authorization of $468,150,000 for
military construction and $1,189,760,000 for family housing for
fiscal year 1999. The committee recommends authorization of
$538,715,000 for military construction and $1,202,406,000 for
family housing for fiscal year 1999.
Sec. 2201. Authorized Navy construction and land acquisition projects.
This section contains the list of authorized Navy
construction projects for fiscal year 1999. The authorized
amounts are listed on an installation-by-installation basis.
The state list contained in this report is intended to be the
binding list of the specific projects authorized at each
location.
Sec. 2202. Family housing.
This section would authorize new construction and planning
and design of family housing units for the Navy for fiscal year
1999.
Sec. 2203. Improvements to military family housing units.
This section would authorize improvements to existing units
of family housing for fiscal year 1999.
Sec. 2204. Authorization of appropriations, Navy.
This section would authorize specific appropriations for
each line item in the Navy's budget for fiscal year 1999. This
section also provides an overall limit on the amount the Navy
may spend on military construction projects.
TITLE XXIII--AIR FORCE

SUMMARY

The Air Force requested authorization of $454,810,000 for
military construction and $1,008,446,000 for family housing for
fiscal year 1999. The committee recommends authorization of
$592,330,000 for military construction and $1,060,404,000 for
family housing for fiscal year 1999.
Sec. 2301. Authorized Air Force construction and land acquisition
projects.
This section contains the list of authorized Air Force
construction projects for fiscal year 1999. The authorized
amounts are listed on an installation-by-installation basis.
The state list contained in this report is intended to be the
binding list of the specific projects authorized at each
location.
Sec. 2302. Family housing.
This section would authorize new construction and planning
and design of family housing units for the Air Force for fiscal
year 1999.
Sec. 2303. Improvements to military family housing units.
This section would authorize improvements to existing units
of family housing for fiscal year 1999.
Sec. 2304. Authorization of appropriations, Air Force.
This section would authorize specific appropriations for
each line item in the Air Force's budget for fiscal year 1999.
This section also would provide an overall limit on the amount
the Air Force may spend on military construction projects.

OTHER ITEMS OF INTEREST

Planning and design, Air Force
The committee directs that, of the amount authorized for
appropriations for Air Force planning and design, the Secretary
of the Air Force may use $1,152,000 million for the completion
of design work associated with the construction of the
Consolidated Command and Control, Intelligence and Exploitation
Facility at the Air Force Research Laboratory's Information
Directorate, Rome, New York.
Improvements of military family housing, Air Force
The committe recommends that, within authorized amounts for
improvements of military family housing and facilities, the
Secretary of the Air Force execute the following projects:
$9,110,000 for family housing improvements (94 units) at
Charleston Air Force Base, South Carolina.
Consolidation of the Officer Training School, Maxwell Air Force Base,
Alabama
The committee is aware that the Air Force is consolidating
the Officer Training School currently split between the Air
University and Maxwell Gunter Annex at Maxwell Air Force Base.
The committee supports this action due to the economic and
quality of life benefits. The committee urges the Secretary of
the Air Force to make every effort to include the appropriate
level of funding for the Commissioned Officer Training
Dormitory in the fiscal year 2000 budget request.
TITLE XXIV--DEFENSE AGENCIES

SUMMARY

The Defense Agencies requested authorization of
$491,675,000 for military construction and $37,244,000 for
family housing for fiscal year 1999. The committee recommends
authorization of $571,975,000 for military construction and
$37,244,000 for family housing.
Sec. 2401. Authorized Defense Agencies construction and land
acquisition projects.
This section contains the list of authorized Defense
Agencies construction projects for fiscal year 1999. The
authorized amounts are listed on an installation-by-
installation basis. The state list contained in this report is
intended to be the binding list of the specific projects
authorized at each location.
Sec. 2402. Improvements to military family housing units.
This section would authorize the Secretary of Defense to
make improvements to existing units of family housing for
fiscal year 1999 in an amount not to exceed $345,000.
Sec. 2403. Energy conservation projects.
This section would authorize the Secretary of Defense to
carry out energy conservation projects.

Sec. 2404. Authorization of appropriations, Defense Agencies.

This section would authorize specific appropriations for
each line item in the Defense Agencies budget for fiscal year
1999. This section also would provide an overall limit on the
amount the Defense Agencies may spend on military construction
projects.

Sec. 2405. Modification of authority to carry out certain fiscal year
1995 projects.

The committee recommends a provision that would amend
section 2401 of the Military Construction Authorization Act for
Fiscal Year 1995, as amended, and section 2408 of the Military
Construction Authorization Act for Fiscal Year 1998. The
provision would authorize an increase of funding for the
construction of the Chemical Demilitarization Facilities at
Pine Bluff Arsenal, Arkansas, from $134.0 million to $154.4
million, and at Umatilla Army Depot, from $187.0 million to
$193.4 million, due to cost increases resulting from a delay in
receiving the appropriate permits.

Sec. 2406. Modification of authority to carry out fiscal year 1990
project.

The committee recommends a provision that would amend
section 2401 of the Military Construction Authorization Act for
Fiscal Year 1990, as amended. The provision would authorize an
increase of funding for the construction of the Portsmouth
Naval Hospital, Virginia, from $330.0 million to $351.4
million, due to cost increases resulting from inflation and
change in scope.
TITLE XXV--NORTH ATLANTIC TREATY ORGANIZATION SECURITY INVESTMENT
PROGRAM

SUMMARY

The Department of Defense requested authorization of
$185,000,000 for the North Atlantic Treaty Organization
Security Investment Program for fiscal year 1999. The committee
recommends $159,000,000.
Sec. 2501. Authorized NATO construction and land acquisition projects.
This section would authorize the Secretary of Defense to
make contributions to the North Atlantic Treaty Organization
(NATO) security investment program in an amount equal to the
sum of the amount specifically authorized in section 2502 of
this bill and the amount of recoupment due to the United States
for construction previously financed by the United States.
Sec. 2502. Authorization of appropriations, NATO.
This section would authorize the Secretary of Defense to
make contributions to the North Atlantic Treaty Organization
(NATO) security investment program in an amount equal to the
sum of the amount specifically authorized in section 2502 of
this bill and the amount of recoupment due to the United States
for construction previously financed by the United States.
TITLE XXVI--GUARD AND RESERVE FORCES FACILITIES

SUMMARY

The Department of Defense requested a military construction
authorization of $179,535,000 for fiscal year 1999 for National
Guard and Reserve facilities. The committee recommends
authorization for fiscal year 1999 of $400,201,000 to be
distributed as follows:

Army National Guard..................................... $93,395,000
Air National Guard...................................... 161,932,000
Army Reserve............................................ 107,378,000
Air Force Reserve....................................... 20,225,000
Naval and Marine Corps Reserve.......................... 15,271,000
--------------------------------------------------------
____________________________________________________
Total............................................... 400,201,000

Sec. 2601. Authorized Guard and Reserve construction and land
acquisition projects.

This section would authorize appropriations for military
construction for the National Guard and Reserve by service
component for fiscal year 1999. The state list contained in
this report is intended to be the binding list of the specific
projects authorized at each location.

Sec. 2602. Reduction in fiscal year 1998 authorization of
appropriations for Army National Guard military construction.

The committee recommends a provision to amend the Military
Construction Authorization Act for Fiscal Year 1998 to rescind
the authority for the construction of a United States Army
Reserve Center and Organizational Maintenance Shop at Fort
Douglas, Utah. The provision would reduce funding for reserve
component construction for fiscal year 1998 from $66,267,000 to
$53,553,000. The project is redundant to a project submitted in
the fiscal year 1999 military construction request.

OTHER ITEMS OF INTEREST

Planning and design, Guard and Reserve Forces facilities

The committee directs that of the amount authorized for
appropriations for Army National Guard, Army Reserve, Naval
Reserve, Marine Corps Reserve, Army National Guard, and Air
Force Reserve construction and land acquisition projects, the
amount indicated for each respective project be directed toward
the design of:

Army National Guard:
NH: Concord, Army Aviation Support Facility............. $968,000
OK: Sand Springs, Readiness Center...................... 972,000
TITLE XXVII--EXPIRATION AND EXTENSION OF AUTHORIZATIONS

Sec. 2701. Expiration of authorizations and amounts required to be
specified by law.
This section would provide that authorizations for military
construction projects, repair of real property, land
acquisition, family housing projects and facilities,
contributions to the North Atlantic Treaty Organization
infrastructure program, and National Guard and Reserve projects
will expire on October 1, 2001 or the date of enactment of an
Act authorizing funds for military construction for fiscal year
2002, whichever is later. This expiration would not apply to
authorizations for which appropriated funds have been obligated
before October 1, 2000 or the date of enactment of an Act
authorizing funds for these projects, whichever is later.
Sec. 2702. Extension of authorizations of certain fiscal year 1996
projects.
This section would provide for selected extension of
certain fiscal year 1996 military construction authorizations
until October 1, 1999, or the date of the enactment of an Act
authorizing funds for military construction for fiscal year
2000, whichever is later.
Sec. 2703. Extension of authorization of fiscal year 1995 project.
This section would provide for selected extension of
certain fiscal year 1995 military construction authorizations
until October 1, 1999, or the date of the enactment of an Act
authorizing funds for military construction for fiscal year
2000, whichever is later.
Sec. 2704. Effective date.
This section would provide that titles XXI, XXII, XXIII,
XXIV, and XXVI of this bill shall take effect on October 1,
1998, or the date of the enactment of this Act, whichever is
later.
TITLE XXVIII--GENERAL PROVISIONS

SUBTITLE A--MILITARY CONSTRUCTION PROGRAM AND MILITARY FAMILY HOUSING
CHANGES

Sec. 2801. Modification of authority relating to architectural and
engineering services and construction design.
The committee recommends a provision that would authorize
the Secretary of the Air Force to convey, without
consideration, the McNeese State University in Lake Charles,
Louisiana approximately 4.38 acres of real property and
improvements that constitute the Lake Charles Air Force
Station. The conveyance would be contingent upon the University
accepting the property, subject to such easements or rights of
way as the Secretary considers appropriate. The provision would
include a reversion clause in the event that the Secretary
determines that the conveyed property is not used as a research
facility.
Sec. 2802. Expansion of Army overseas family housing lease authority.
The committee recommends a provision that would amend
section 2828(e) of title 10, United States Code, to authorize
the Secretary of the Army to increase, by no more than 500
family housing units in Italy and no more than 800 family
housing units in Korea, the number of leases for which the
maximum amount is $25,000 per unit per year. Inflation in Italy
has risen 57 percent since 1989 and Korea is experiencing an
annual inflation rate of five to seven percent. This authority
would enable the Army to retain family housing leases in Italy
and Korea as the cost of the leases begins to exceed the
current statutory cap.

SUBTITLE B--REAL PROPERTY AND FACILITIES ADMINISTRATION

Sec. 2811. Increase in thresholds for reporting requirements relating
to real property transactions.
The committee recommends a provision that would amend
section 2662 of title 10, United States Code, to increase the
threshold for congressional notification for real property
transactions from $200,000 to $500,000. The transactions
requiring notification include the purchase, lease, transfer,
and disposal of real property.
Sec. 2812. Exceptions to real property transaction reporting
requirements for war and certain emergency and other
operations.
The committee recommends a provision that would amend
section 2662 of title 10, United States Code, to waive the
reporting requirements for certain real estate transactions.
The provision would modify the reporting requirements in the
event of a declaration of war, a national emergency, a natural
disaster, a contingency operation, or a civil disturbance. In
the event the secretary of a military department enters into a
real property agreement under these conditions, the secretary
would be required to submit a report on the agreement to the
Committee on Armed Services of the Senate and the Committee on
National Security of the House of Representatives not later
than 30 days after entering into the agreement.
Sec. 2813. Waiver of applicability of property disposal laws to leases
at installations to be closed or realigned under the base
closure laws.
The committee recommends a provision that would amend
section 2667(f)(1) of title 10, United States Code, to clarify
that the Federal Property and Administrative Services Act
(FPASA) of 1949 does not apply to the lease of excess property
at closing or realigned installations if the secretary of the
military department determines that such lease would facilitate
state or local economic adjustment effort. The provision would
resolve a legal issue where the courts have ruled that the
FPASA is paramount over section 2667 of title 10, United States
Code.
Sec. 2814. Restoration of Department of Defense lands used by another
Federal agency.
The committee recommends a provision that would amend
section 2691 of title 10, United States Code, to authorize the
Secretary of the Military Department concerned to require users
of Department of Defense lands to restore lands upon expiration
of their use or to reimburse the military department for
performing the restoration. The current authorization only
allows the military department to restore the lands of other
federal agencies. There is no reciprocal authority for use of
Department of Defense lands by other federal agencies. This
provision would eliminate this inequity.

SUBTITLE C--LAND CONVEYANCES

Sec. 2821. Land conveyance, Indiana Army Ammunition Plant, Charlestown,
Indiana.
The committee recommends a provision that would authorize
the Secretary of the Army to convey to the Indiana Army
Ammunition Plant Reuse Authority all right, title, and interest
to and in a parcel of real property, including improvements,
consisting of approximately 4660 acres located at the Indiana
Army Ammunition Plant, Charlestown, Indiana. The purpose of the
conveyance would be for the development of an industrial park
to replace all or part of the economic activity lost due to the
inactivation of the plant. The provision would require the
Plant Reuse Authority to compensate the secretary at the fair
market value for the conveyed property, but defer payment for a
10-year period. The secretary would be required to deposit any
proceeds in a special account established in accordance with
section 204 of the Federal Property and Administrative Services
Act of 1949.
In the event the Reuse Authority conveys or leases the
property during the 10-year period, the Reuse Authority would
pay the United States an amount equal to the fair market value
of the reconveyed property as of the time of reconveyance,
excluding any improvements made on the property by the Reuse
Authority. The provision would also authorize the Secretary of
the Army to accept compensation for administrative expenses.

Sec. 2822. Land conveyance, Army Reserve Center, Bridgton, Maine.

The committee recommends a provision that would authorize
the Secretary of the Army to convey, without consideration, to
the Town of Bridgton, Maine, a parcel of excess real property,
including improvements thereon, consisting of approximately
3.65 acres on which is located the Army Reserve Center,
Bridgton, Maine. The purpose of the conveyance would be for
public benefit and it would facilitate the expansion of the
municipal office complex, Bridgton, Maine. The provision would
include a reversion clause in the event that the secretary
determines that the conveyed property is not used for public
benefit.

Sec. 2823. Land conveyance, Volunteer Army Ammunition Plant,
Chattanooga, Tennessee.

The committee recommends a provision that would authorize
the Secretary of the Army to convey to Hamilton County,
Tennesssee all right, title, and interest to and in a parcel of
excess real property, including improvements, consisting of
approximately 1033 acres located at the Volunteer Army
Ammunition Plant, Chattanooga, Tennessee. The purpose of the
conveyance would be for the development of an industrial park
to replace all or part of the economic activity lost due to the
inactivation of the plant. The provision would require Howard
County to compensate the secretary at the fair market value for
the conveyed property, but defer payment for a 10-year period.
The secretary would be required to deposit any proceeds in a
special account established in accordance with section 204 of
the Federal Property and Administrative Services Act of 1949.
In the event the Reuse Authority conveys or leases the
property during the 10-year period, the Reuse Authority would
pay the United States an amount equal to the fair market value
of the reconveyed property as of the time of reconveyance,
excluding any improvements made on the property by the Reuse
Authority. The provision would also authorize the Secretary of
the Army to accept compensation for administrative expenses.

Sec. 2824. Release of interests in real property, former Kennebec
Arsenal, Augusta, Maine.

The committee recommends a provision that would authorize
the Secretary of the Army to release, without consideration,
all right, title, and interest of the United States in and to a
parcel of real property consisting of approximately 40 acres
located in Augusta Maine, and formerly know as the Kennebec
Arsenal. The property was transferred to the State of Maine in
1905 subject to the condition that the property be used as a
hospital for the insane. The condition for transfer was amended
by section 771 of the Department of Defense Appropriations Act
for Fiscal Year 1981 (Public Law 96-527; 94 Stat. 3093) to
include the phrase ``or for other public purposes.'' The
provision would remove these conditions to clear the title to
allow the State of Maine and the City of Augusta to form a
nonprofit corporation to redevelop the property in support of a
museum and for commercial activities.

Sec. 2825. Land exchange, Naval Reserve Readiness Center, Portland,
Maine.

The committee recommends a provision that would authorize
the Secretary of the Navy to convey to the Gulf of Maine
Aquarium Development Corporation, Portland, Maine, a parcel of
real property, including improvements thereon, consisting of
approximately 3.72 acres in Portland, Maine, for the purpose of
establishing an aquarium and research facility. The site is
currently the Naval Reserve Readiness Center, Portland, Maine.
In exchange for the conveyance, the provision would require the
corporation to provide replacement facilities, as the Secretary
determines appropriate for the Naval Reserve. These facilities
would be designed and built by the corporation on a parcel of
real property to be conveyed to the United States or designed
and constructed on real property under the jurisdiction of the
secretary. The secretary would have the option of choosing the
form of compensation.

Sec. 2826. Land conveyance, Air Force Station, Lake Charles, Louisiana.

The committee recommends a provision that would authorize
the Secretary of the Air Force to convey, without
consideration, the McNeese State University in Lake Charles,
Louisiana approximately 4.38 acres of real property and
improvements that constitute the Lake Charles Air Force
Station. The conveyance would be contingent upon the University
accepting the property, subject to such easements or rights of
way as the Secretary considers appropriate. The provision would
include a reversion clause in the event that the Secretary
determines that the conveyed property is not used as a research
facility.

SUBTITLE D--OTHER MATTERS

Sec. 2831. Purchase of build-to-lease family housing at Eielson Air
Force Base, Alaska.

The committee recommends a provision that would authorize
the Secretary of the Air Force, if he determines that it is in
the best economic interest of the Air Force, to purchase the
366-unit military family housing project at Eielson Air Force
Base, Alaska, that was constructed and is being leased by the
Secretary under section 801 of the Military Construction
Authorization Act for Fiscal Year 1984 (Public Law 98-115). The
purchase price of the housing units would be an amount equal to
the amount of the outstanding indebtedness of the developer for
the project that would remain at the time of the purchase if
the developer had paid down the indebtedness to the lender
according to the original payment schedule for the project.

Sec. 2832. Beach replenishment, San Diego, California.

The committee recommends a provision that would authorize
the Secretary of the Navy to use funds remaining from the Naval
Air Station North Island, California dredging project
authorized in section 2204(a)(1) of the Military Construction
Authorization Act for Fiscal Year 1997 to carry out beach
replenishment in and around San Diego, California. The
provision would authorize the secretary to merge any funds
contributed to the cost of that project by the State of
California and by local governments under the agreement under
section 2205 of the Military Construction Authorization Act for
Fiscal Year 1997. The provision would prohibit any obligation
of funds to carry out the beach replenishment project until 30
days after the date on which the Secretary submits to the
congressional defense committees a report providing the
following information:
(1) an explanation why the sand originally proposed
to be used for beach replenishment under the project
related to the Naval Air Station North Island dredging
could not be used for that purpose.
(2) a comprehensive explanation of why the beach
replenishment plan at Naval Air Station North Island
was abandoned;
(3) a description of any administrative action taken
by or against any agency or individual as a result of
abandonment of the plan;
(4) a statement of the total Navy funds available for
the beach replenishment;
(5) a statement of the amount of the contributions of
the State of California and local government for the
beach replenishment;
(6) an estimate of the total cost of the beach
replenishment;
(7) the amount of financial aid the State of
California has received from the Federal Government for
beach restoration and replenishment during the 10-year
period ending on the date of enactment of this Act;
(8) the amount of financial aid the State of
California has requested from the Federal Government
for beach restoration or replenishment because of the
1997-1998 El Nino event; and
(9) a current analysis that compares the costs and
benefits of homeporting the U.S.S. John C. Stennis
(CVN-74) at Naval Station North Island with the costs
and benefits of homeporting that vessel at Naval
Station Pearl Harbor, Hawaii, and the costs and
benefits of homeporting that vessel at Naval Station
Bremerton, Washington.
The committee is disappointed that the Navy and the State
of California could not reach the appropriate accommodations to
carry out the beach replenishment project, as authorized by the
Military Construction Act for Fiscal Year 1997. The committee
included this provision so that the Secretary of the Navy may
comply with an agreement reached with the City of San Diego in
dredging operations necessary to home port the U.S.S. Stennis
at the Naval Station North Island. The committee would not be
receptive to any request for additional funding for the beach
replenishment project and would be prepared to support the
relocation of the U.S.S. Stennis, if a satisfactory agreement
is not reached, to complete the dredging and beach
replenishment.

OTHER ITEMS OF INTEREST

Report on Air Force Plant #3, Tulsa, Oklahoma

The committee commends the Department of the Air Force for
the expeditious obligation of environmental cleanup funds for
the ground contamination at Air Force Plant #3, Tulsa,
Oklahoma. The committee, however, remains concerned about other
environmental contamination, particularly in above-ground
structures. The committee directs the Secretary of the Air
Force to investigate these hazards and report to the
congressional defense committees by March 1, 1999 on these
risks. The report should also include a detailed obligation
schedule that fully addresses these concerns before the actual
title transfer to the City of Tulsa.

Report on Fort Hunter Liggett, California

The committee is aware that the Army is currently
developing plans for the reuse of Fort Hunter Liggett,
California, which the 1995 Defense Base Closure and Realignment
Commission realigned. The Commission's findings state in part:
``The realignment of this installation ends the Active
Component presence while preserving the U.S. Army Reserve
Command garrison. The Army will license the training facility
and training area to the California National Guard as part of
the realignment.''
The committee has learned that the Secretary of the Army's
plan for the realignment of Fort Hunter Liggett does not
include a requirement to grant a real estate license to the
California National Guard. Although the committee does not
intend to intervene in the base closure process, the committee
directs the secretary to submit a report to the Committee on
Armed Services of the Senate detailing the Army's intent
regarding the granting of a real estate license to the
California National Guard.
TITLE XXIX--JUNIPER BUTTE RANGE LANDS WITHDRAWAL

The committee recommends a provision that would provide for
the withdrawal and reservation of approximately 12,000 acres of
public lands, known as the Juniper Butte Range, Idaho, to
support enhanced military training. In addition to the land
withdrawal, the provision would require the Administrator of
the Federal Aviation Administration to modify current airspace
restrictions associated with the existing Saylor Creek Range.
The committee anticipates that the changes in airspace
associated with Enhanced Training in Idaho (ETI) would result
in a net decrease of existing restricted airspace by nearly 50
percent. Flights would be more evenly distributed throughout
the Military Operational Area (MOA) to avoid concentration of
flights north of the Duck Valley Reservation and over the
Owyhee Canyonlands.
The committee notes that land use and environmental
considerations would involve monitoring and cooperation among
the Department of the Air Force, the Department of Interior,
and the State of Idaho. Specifically, integrated natural
resource management plans would be developed by the Air Force,
in cooperation with the Department of Interior and the State of
Idaho, consistent with the Sikes Act (16 U.S.C. 670a). The
committee understands that military land-based components would
avoid special use land management areas, such as wilderness
study areas and areas of critical environmental concern.
Moreover, it is expected that there would be continued emphasis
on meaningful input by the Shoshone-Paiute tribes on cultural
resources issues, with a focus on consultation, government-to-
government relations, and effective monitoring procedures.
The committee recognizes that the Department of the Air
Force and the Department of Interior are engaged in discussions
related to the terms and conditions of the withrawal. The
committee hopes that these discussions will result in a
resolution that will balance the interests related to enhanced
training and protection of the environment.
Consistent with the National Environmental Policy Act (42
U.S.C. 4321 et seq.), the Department of the Air Force prepared
an environmental impact statement (EIS) to examine the existing
conditions and potential environmental consequences of
selecting the ETI action alternative for the 366th Wing based
at Mountain Home Air Force Base, Idaho. The alternative action
search for range development began with interagency and
intergovernmental discussions among the Air Force, the
Department of Interior, the State of Idaho, the Shoshone-Paiute
Tribes, and the Idaho congressional delegation. There were four
alternative actions evaluated: no action; Clover Butte;
Grasmere; and Juniper Butte. The EIS identified Juniper Butte
as the preferred alternative because it addressed the
operational goals to enhance training in Idaho with less
potential for environmental impacts. The selection of the
Juniper Butte Range was based on operational, environmental,
ranching, and Native American considerations. The committee has
been assured that these considerations were taken into account
under the recommended land withdrawal provision.
DIVISION C--DEPARTMENT OF ENERGY NATIONAL SECURITY AUTHORIZATIONS AND
OTHER AUTHORIZATIONS

TITLE XXXI--DEPARTMENT OF ENERGY NATIONAL SECURITY PROGRAMS

Title XXXI authorizes appropriations for the Atomic Energy
Defense Activities of the Department of Energy, including: the
purchase, construction, and acquisition of plant and capital
equipment; research and development; nuclear weapons; naval
nuclear propulsion; environmental restoration and waste
management; operating expenses; and other expenses necessary to
carry out the purposes of the Department of Energy Organization
Act (Public Law 95-91). The title would authorize
appropriations in five categories: weapons activities; defense
environmental restoration and waste management; other defense
activities; defense environmental management privatization; and
defense nuclear waste disposal.
The fiscal year 1999 budget request for the atomic energy
defense activities totaled $12.3 billion, a 5.4 percent
increase over fiscal year 1998. Of the total amount requested,
$4.5 billion was for weapons activities, $4.3 billion was for
defense environmental restoration and waste management
activities, $1.0 billion was for defense facility closure
projects, $516.0 million was for defense environmental
management privatization, $1.7 billion was for other defense
activities, $190.0 million was for defense nuclear waste
disposal, and $140.0 million was for the formerly utilized
sites remedial action program.
The committee recommends $11.9 billion for atomic energy
defense activities, a reduction of $379.3 million to the budget
request. The committee recommends $4.5 billion for weapons
activities, $5.3 billion for defense environmental restoration
and waste management, $241.9 million for defense environmental
management privatization, $1.7 billion for other defense
activities, $190.0 million for defense nuclear waste disposal,
and $140.0 million for the formerly utilized sites remedial
action program.
The following table summarizes the budget request and the
committee recommendations:

SUBTITLE A--NATIONAL SECURITY PROGRAMS AUTHORIZATIONS

Sec. 3101. Weapons activities.

The committee recommends a provision that would authorize
$4.5 billion for atomic energy defense weapons activities of
the Department of Energy, an increase of $19.7 million from the
requested amount of $4.5 billion. The amount authorized is for
the following activities: $2.1 billion for stockpile
stewardship, a reduction of $65.0 million; $2.1 billion for
stockpile management activities, an increase of $89.7 million;
and $255.5 million for program direction, a reduction of $5.0
million. The committee recommends an undistributed reduction of
$145.0 million to be offset by the availability of uncosted,
unobligated prior year funds.

Stockpile stewardship programs

The committee recommends $451.0 million for the Advanced
Strategic Computing Initiative (ASCI) and Stockpile Computing
program, a reduction of $65.0 million. The committee notes that
even at this reduced level of funding, the program will
experience a growth rate of 12 percent over fiscal year 1998
funding levels.
The committee believes that the Department has not fully
justified the rapid growth requested in this program or the
pace of acquisition of added computational capacities.
Thecommittee notes that the Office of Defense Programs does not fully
utilize the computing capacity that it has already acquired. The
average utilization rate for existing Defense Programs-operated
supercomputers is only 46 percent, leaving more than half of all
computing capability unused. Further, the committee notes that much of
the experimental data that the ASCI computers are intended to utilize
have not been collected. The data in question will be collected at new
experimental facilities that have not been constructed. Given these
findings, the committee believes that the proposed reduction will have
no significant impact on the Department's stockpile stewardship and
management program. The committee encourages the Department to adjust
the rate of growth of this program in future years to track more
closely the utilization requirements of the Office of Defense Programs.
The committee recommends no funding for utilization of
capabilities at the Pittsburgh Supercomputing Center. Given
existing low utilization rates of DOE-owned supercomputers, the
committee believes that this leasing arrangement is not
advantageous for the taxpayer. The committee directs the
Secretary of Energy to report to the congressional defense
committees on the justification for such leases, and whether
any such leased capabilities can meet the Department's
computing needs in lieu of computer acquisitions proposed under
the ASCI program.
The committee compliments the Department on the successful
subcritical experiments conducted in fiscal year 1998. The
committee believes these experiments are fully compliant with
existing arms control agreements and are vital to maintaining
the safety and surety of the U.S. nuclear deterrent. The
committee notes, however, that the Department will conduct only
three of the four experiments scheduled to be conducted this
fiscal year, rather than the four experiments that were
proposed. The committee notes that $20.0 million in fiscal year
1998 funds designated for subcritical experiments will be
unused by the end of the fiscal year due to the delay of one of
the planned experiments. The committee supports a vigorous
program to carry out subcritical experiments and recommends the
Department establish attainable schedules for such activities.

Stockpile management programs

The committee continues to believe that the United States
must maintain viable weapons manufacturing capabilities and
capacities to rebuild aging weapons and to retain the ability
to reconstitute its nuclear forces. The committee directs the
Department to maintain the existing manufacturing capabilities
found at the four nuclear weapons production plants and to
ensure that weapons activities continue to be carried out
jointly by DOE laboratories and plants.
Of the funds available for stockpile management, the
committee recommends an increase of $45.0 million for weapons
production plants, to be allocated as follows: $20.0 million
for the Pantex Plant to support scheduled workload requirements
associated with weapons dismantlement activities and for skills
retention; $15.0 million for the Kansas City Plant to support
advanced manufacturing efforts such as Advanced Development
Program and for skills retention; $5.0 million for the Y-12
Plant to support maintenance of core stockpile management
capabilities; and $5.0 million for the Savannah River Site to
support infrastructure and maintenance activities associated
with the replacement tritium facility.
The Assistant Secretary for Defense Programs is encouraged
to create a stockpile stewardship and management council to
advise the Assistant Secretary on programmatic and budget
issues related to the Department's weapons missions. The
council membership should include the three weapons laboratory
directors, the four weapons production plant managers, the
manager of Nevada Test Site, and a representative of the U.S.
Strategic Command. The council should attempt to meet
quarterly, but no less than semiannually.
The committee commends the Department for successfully
producing a replacement plutonium pit at the Los Alamos
National Laboratory. The committee is concerned, however, that
the Department has not completed a long range plan for full
scale pit production. The committee notes that production
quantities envisioned by the Office of Defense Programs may not
be in alignment with Department of Defense needs because the
Department of Defense has not established a pit production
requirement for warheads expected to remain in the enduring
stockpile.
The committee directs the Secretary of Energy and Secretary
of Defense to prepare a long range plan identifying pit
production requirements, including: quantities by warhead type,
schedules, costs, and siting options. The report should also
identify the military requirements and assumptions underlying
each option and include options which reflect various potential
stockpile levels. The report should be submitted to the
Committee on Armed Services of the Senate and the Committee on
National Security of the House of Representatives in both
unclassified and classified form not later than March 1, 1999.

Technology transfer and education

The committee recommends $69.0 million for technology
transfer and education activities. Of this amount, the
committee recommends $11.0 million for the American Textiles
Partnership project.

Program direction

The committee recommends a $5.0 million reduction to the
budget request for program direction. The committee believes
that the reduction can be achieved through continued efficiency
savings to be gained from realignment efforts described in the
Institute for Defense Analysis report on the Department's
management structure for weapons activities.

Construction projects

The committee recommends a reduction of $11.0 million to
the chemistry and metallurgy research facility renovation
project (95-D-102) to reflect continued delays and suspended
operations at that facility. The committee recommends a
reduction of $4.3 million to the nuclear material storage
facility renovation project (97-D-122) to reflect delays in
final design and deferral of planned construction activities.

Tritium production

The committee does not believe the Department's fiscal year
1999 budget request of $157.0 million for tritium production to
be credible. The committee notes that the requirement to
deliver new tritium by the year 2005 for the light water
reactor and the year 2007 for the accelerator, as identified in
the Nuclear Weapons Stockpile Memorandum, has not changed. The
committee believes that the Department's unwillingness to
include funding for the acquisition of a new tritium source in
its proposed out year funding plan is unacceptable. Further,
the committee notes that the fiscal year 1999 budget request
does not appear to be sufficient to complete the Department's
own dual track tritium strategy. The committee is very
concerned that the Department did not request sufficient funds
to continue evaluation of both technologies being considered
under the dual track approach. The committee recommends an
increase of $60.0 million for research associated with the
accelerator production of tritium option in order to fully fund
the dual track approach.
The committee continues to be concerned that the Department
has not completed a senior level policy review required by the
National Defense Authorization Act for Fiscal Year 1998. The
committee expects this review to include participation by
senior cabinet-level officials, such as the Secretaries of
Defense, State, and Energy, as well as the National Security
Advisor and the Director of the Arms Control and Disarmament
Agency. The committee notes that the Secretary of Energy is
prohibited from selecting a preferred technology option until
30 days after the results of this review are submitted to
Congress. The committee further notes that a provision in the
National Defense Authorization Act for Fiscal Year 1998 urged
the Secretary to identify a preferred light water reactor sub-
option not later than March 1, 1998. As of May 14, 1998, the
committee has not received notification that any such sub-
option was selected.
The committee remains concerned that the selection of a
commercial light water reactor option could have unacceptable
nuclear proliferation ramifications. The committee notes that
the United States has a long-standing policy requiring civilian
and military uses of nuclear energy to remain separate. The
committee endorses this policy and does not propose to alter
this policy in the absence of a full and open debate on the
potential ramifications of such a decision.

Laboratory Directed Research and Development

The committee continues to be concerned that funds provided
for Laboratory Directed Research and Development (LDRD) may not
be managed appropriately. The committee supports a viable,
laboratory directed research program. The committee notes that
LDRD funds are authorized and appropriated by Congress, but do
not fall under the same budgetary control as similar funds made
available to the Department. The committee directs the
Secretary of Energy to identify alternative methods of meeting
the goals of the LDRD program that provide greater managerial
and programmatic control over funds utilized within this
program. The report should be provided to the congressional
defense committees not later than February 1, 1999, and should
identify a range of alternatives, including, but not limited
to, the creation of a line item funding account for all funds
provided to the Department pursuant to Title XXXI at each DOE
laboratory that currently has an LDRD program.
The committee notes that prohibitions enacted in the
National Defense Authorization Act for Fiscal Year 1998
regarding uses of LDRD funds remain in effect.

Sec. 3102. Environmental restoration and waste management.

The committee recommends a provision that would authorize
$5.3 billion for defense environmental restoration and waste
management activities (the Environmental Management program) of
the Department of Energy, an increase of $1.0 billion to the
requested amount of $4.3 billion. The amount authorized is for
the following activities: $1.0 billion for closure projects,
the amount of the request; $1.0 billion for site and project
completion, the amount of the request; $2.7 billion for post
2006 completion, a $10.0 million increase; $250.0 million for
technology development, a $57.0 million increase; $336.2
million for program direction, a $10.0 million reduction. The
committee recommends an undistributed reduction of $21.0
million to be offset by the availability ofuncosted,
unobligated prior year funds.

Post 2006 completion

Of the amounts authorized for post 2006 completion, the
committee recommends an increase of $5.0 million to the
National Spent Fuel Program to address regulatory and
repository issues associated with Department of Energy owned
spent nuclear fuel and an increase of $10.0 million to
accelerate research and treatment of high level nuclear wastes
at the Idaho National Engineering and Environmental Laboratory.
Of the amounts authorized for post 2006 completion, the
committee recommends an increase of $30.0 million for the in-
tank precipitation (ITP) process at the Savannah River Site.
The committee notes that the Department has invested over
$270.0 million on late wash and saltstone precipitation
technologies. The unexpected shutdown of the ITP process
jeopardizes the operational efficiency of the defense waste
processing facility and, if left unaddressed, could pose
significant risks to worker safety and health. The committee
directs the Department to set aside these additional funds
until a full review has been conducted on the technology
options available to correct the problems discovered with the
current ITP system. The committee directs the Department to
evaluate all technology options on an equal basis. Options
should include modifications to the current system and
selection of alternative technologies, such as ion exchange.
The committee recommends an increase of $10.0 million to
support infrastructure upgrades at the defense waste processing
facility (DWPF) and consolidated incineration facility (ICF).
The committee notes that shortfalls in infrastructure
investments have resulted in periodic operational shutdowns of
these two facilities. The committee supports appropriate
investments to ensure continuity of operations at the DWPF and
ICF. The committee recommendation includes full funding for the
F- and H-canyon materials processing facilities.

Technology development

The committee is concerned by the Department's request for
the Office of Science and Technology. Recent Departmental
testimony and the ``Accelerating Cleanup--Pathways to Closure''
report have identified that the Department cannot meet its
accelerated closure goals without aggressive application of new
technologies. The committee agrees with the Department's
assessment of the need for increased use of innovative
technology at DOE facilities. The committee encourages the
Department to revise its performance measures for facility
managers to include the application of new technology in site
cleanup activities. The committee is pleased with the recent
management changes in the Office of Science and Technology and
believes that this office can now fully meet the technology
needs of the environmental management program. The committee
urges the Secretary to report on the proposed uses of the $57.0
million increase in this account.

Accelerating cleanup

The committee commends the Department's environmental
management program for its progress in focusing its management
attention and resources on completing clean up and closure of
DOE facilities. The committee compliments the Office of
Environmental Management on its ``2006 Plan'' and the
subsequent ``Accelerating Cleanup--Pathways to Closure''
report. These documents, however, identify several deficiencies
in the Department's long range cleanup plans. The committee is
concerned that there are no known methods to treat and dispose
of much of the waste that is currently stored or that will be
generated; cost data for closure activities have not been
developed; and the basis for the assumptions that new
technologies will be available and program efficiency savings
will be achieved are not explained. The committee intends to
work cooperatively with the environmental management program to
address these deficiencies and to establish tangible program
metrics based on the ``Accelerating Cleanup'' report.

UF6 stabilization and reuse

The committee notes that the Department has issued a Draft
Programmatic Environmental Impact Statement for Alternative
Strategies for the Long-Term Management and Use of Depleted
Uranium Hexafluoride. The committee also notes that the
Department's preferred alternative is to convert and use all of
the depleted uranium as soon as possible. The Department is
encouraged to pursue programs that will expedite conversion and
appropriate beneficial reuse of this material.

Environmental validation, verification and engineering analysis

The Department's environmental programs are increasingly
challenged by the complexity of regulatory, scientific,
engineering, and analytical factors affecting requirements and
resource decisions across the DOE complex. The committee
recognizes the need to retain and expand core capabilities and
specialized skills to enhance competency and integration across
environmental management programs. The Environmental
Validation, Verification and Engineering Analysis (EVVEA)
program is designed to meet this need in the same way the Core
Capabilities Program assures specialized expertise for
theDepartment's Defense Programs laboratories. The committee supports
this initiative for fiscal year 1999 and directs the Department to
provide sufficient funding in future budget requests to maintain a
robust program to enhance environmental engineering and analysis core
capabilities.

Off-site disposal of low level waste

The committee is concerned that the Department has only one
commercial low-level waste disposal option available. Although
this facility has a satisfactory operating record and has
proven to be a cost effective option for waste disposal, it
remains the Department's sole large-scale commercial disposal
option. The committee encourages the Department to move forward
with a national procurement, as announced by the Secretary of
Energy, to initiate open competition for the Department's waste
disposal contracts.

Overdue reports

The committee notes that the Secretary of Energy has not
provided the report required by section 3132(f) of the National
Defense Authorization Act for Fiscal Year 1998, regarding the
Department's authority to enter into privatization contracts
and any potential for such contracts to violate Federal anti-
deficiency requirements. The report was required to be
submitted not later than 90 days after enactment of the
provision, but has not yet been received by the committee. The
committee further notes that the Secretary of Energy has not
provided the report required by section 3102 of the National
Defense Authorization Act for Fiscal Year 1997, regarding use
of travel funds under DOE grants, cooperative agreements, and
subcontracts. The committee directs that both of these reports
be provided not later than 30 days after enactment of this
provision and that 25 percent of all Departmental travel funds
authorized by this title be withheld until the reports are
provided to the committee.

Sec. 3103. Other defense activities.

The budget request included $1.7 billion for other defense
activities in the Department of Energy (DOE). This amount
includes $696.3 million for nonproliferation and national
security; $168.9 million for fissile materials control and
disposition; $35.0 million for nuclear energy; $45.0 million
for worker community transition; $74.0 million for environment,
safety and health; $2.4 million for hearings and appeals; and
$665.5 million for naval reactors.
The committee recommends authorization of $236.9 million
for arms control activities, a reduction of $20.0 million to
the budget request. The committee also recommends an increase
of $3.0 million to the budget request for intelligence
activities to conduct analysis of foreign nuclear weapons
capabilities; and recommends a $4.0 million reduction to the
budget request for nonproliferation and national security
program direction.

Nonproliferation and verification research and development

For several years, the committee has endorsed efforts of
the national laboratories in the area of forensic analysis.
While the committee does not recommend an increase to the
fiscal year 1999 budget request for this activity, the
committee continues to support the broader participation of
Department of Energy laboratories in this program. The
committee also supports the broad participation of DOE national
laboratories, including Pacific Northwest Laboratory, Idaho
National Laboratory, the Savannah River Site, and industry in
the research and development of technologies to detect and
respond to chemical and biological warfare and terrorism.

Russian Reactor Core Conversion Program

The Congress provided the Department of Energy authority in
the National Defense Authorization Act for Fiscal Year 1997 to
expand its international reactor safety assistance program to
include a program to develop, in conjunction with the
Department of Defense (DOD), a cooperative program with Russia
to modify or replace the nuclear reactor cores at three
plutonium production facilities. Funds were included in the DOD
Cooperative Threat Reduction (CTR) program in fiscal years 1997
and 1998 for this activity.
The committee directs DOD and DOE to keep the committee
informed on the status of the Reactor Shutdown Agreement with
the Russian Federation Ministry of Atomic Energy and to submit
a joint report to the committee on the agreement not later than
60 days after agreement is reached. The report should include a
status report on the project, as well as detailed information
on the estimated cost to complete the program, the design of
the core, and the program plan to complete the conversion. The
information on Russia's specific contribution to the reactor
core conversion program should also be included in the report
submitted to the committee.
Lastly, the committee understands that a program decision
document will serve as the basis upon which a decision will be
made by the United States on whether to complete the remaining
core conversion activities. The committee wants to be kept
informed on a regular basis on this program and directs the
Secretaries of Defense and Energy not to take any action that
would result in an expenditure of funds for activities that
might be affected by a decision not to complete the
coreconversion activities, until the committee has been notified.

Nuclear smuggling and counterterrorism

The Congress directed the Department to make $3.0 million
available to plan and conduct realistic exercises to prepare
Federal, state, and local entities to respond to domestic
terrorist use of nuclear devices or materials. The committee
supports the use of existing national assets such as the Nevada
Test Site (NTS) and the Hammer facility at the Pacific National
Laboratory to train Federal, state and local first responders
as part of the domestic emergency response program. The
committee continues to believe that training exercises should
use the most realistic scenarios possible. The DOE should
coordinate the activities of these exercises with the executive
agent and program manager for the Department of Defense
domestic emergency preparedness program in order to integrate
scenarios related to chemical and biological incidents in the
exercises and take advantage of cost savings. The committee was
advised during recent testimony by the Director of the
Nonproliferation and National Security program that no funds
had been made available. The committee directs the Department
to report to the Congress by July 1, 1998 on the status of
implementing the direction of providing funding for a
coordinated DOD/DOE domestic emergency training exercise.
The committee remains concerned about previous press
reports that supercomputers were sold by a U.S. firm to nuclear
weapons institutes in Russia and China. The committee directs
the Department of Energy to provide a report to the
congressional defense committees not later than November 1,
1998 on the status of the investigations involving these
incidents.

Worker and community transition

The committee recommends a reduction of $5.0 million to
worker and community transition to be taken from reduced
severance payments at Department of Energy defense nuclear
facilities.

Fissile materials

The committee recommends the budget request of $168.9
million for fissile materials. The committee is pleased with
the approach being pursued by DOE in the fissile materials
disposition program. The committee supports the request for
title I design funds for new materials disposition facilities.
Of the amount requested for fissile materials, $24.9
million is requested for fissile material activities with the
Russian government, a $14.9 million increase over the fiscal
year 1998 budget. The committee believes that the requested
amount for cooperative efforts with the Russian materials
disposition program is more than sufficient. The committee
remains concerned that there has been insufficient progress
achieved in negotiating a bilateral agreement with the Russian
government on disposition of plutonium. The committee
understands that the bilateral agreement with the Russian
government has been reached on a narrowly focused joint testing
program.
The committee directs the Department to report to the
congressional defense committees on the status of efforts to
achieve agreement with the Russian government on this program.
The report should also include information on the estimated
cost and how the program is expected to be financed.
The committee encourages the Department to continue these
cooperative efforts and does not support construction of a U.S.
mixed oxide fuel fabrication facility without significant
progress being made in Russian materials disposition programs.

Environment, safety and health-defense

The committee recommends a reduction of $5.0 million to
defense environment, safety and health. The committee notes
that this account was increased dramatically in past years. The
decrease is expected to be taken from efficiency savings
similar to those implemented by the Environmental Management
program.

Naval reactors

The committee recommends an increase of $16.0 million to
naval reactors to expedite decommissioning and decontamination
activities at surplus prototype plant facilities. This increase
is intended to continue ongoing prototype facility deactivation
efforts. The committee notes that trained, experienced workers
are proceeding from project to project in an orderly and
efficient manner. The committee further notes that the budget
request would eliminate over 20 percent of the prototype
inactivation work planned for fiscal year 1999. The committee
directs that the increased funding be utilized to support
continued progress in the prototype facility deactivation
program, consistent with the committee's desire to complete
rapidly cleanup and closure of surplus facilities.
The committee recommends full funding for existing
operating naval nuclear reactors and to support work on the New
Attack Submarine and carrier reactor plants. The committee
believes these programs are essential to maintain the viability
of U.S. nuclear powered vessels into the future.

Sec. 3104. Defense nuclear waste disposal.

The committee recommends authorization of the budget
request of $190.0 million for the Department of Energy fiscal
year 1998 defense contribution to the defense nuclear waste
fund.

Sec. 3105. Defense environmental management privatization.

The committee recommends $273.9 million for defense
environmental management privatization projects to be allocated
as follows: $113.5 million for the tank waste remediation
system project, phase I (Richland); $20.0 million for spent
nuclear fuel dry storage (Idaho); $87.3 million for advanced
mixed waste treatment (Idaho); $19.6 million for remote handled
transuranic waste transportation (Carlsbad); and $33.5 million
for environmental management/waste management disposal (Oak
Ridge).
The committee authorizes the use of $25.0 million in fiscal
year 1997 unobligated, uncosted balances within the defense
environmental management privatization account to reflect the
cancellation of projects, as follows: $15.0 million for the
broad spectrum low activity mixed waste treatment privatization
project (Oak Ridge), and $10.0 million for the waste water
treatment plant privatization project (Rocky Flats). The
committee further authorizes the use of $7.0 million in fiscal
year 1998 unobligated, uncosted balances within the defense
environmental management privatization account to reflect
unobligated, uncosted, and undistributed funds.
The committee believes that management of the Hanford Tank
Waste Remediation System (TWRS) privatization project requires
greater scrutiny by DOE senior management than other projects
at the Hanford Site. The use of both government and private
investments in this project makes integration with other
Hanford Site requirements and priorities difficult.
Accordingly, the committee endorses the transfer of
responsibility for the TWRS project to the Assistant Secretary
of Energy for Environmental Management. The committee takes
this action without prejudice to the Hanford Site management.

SUBTITLE B--RECURRING GENERAL PROVISIONS

Sec. 3121. Reprogramming.

This provision would prohibit the reprogramming of funds in
excess of 110 percent of the amount authorized for the program,
or in excess of $1.0 million above the amount authorized for
the program, until the Secretary of Energy has notified the
congressional defense committees and a period of 30 days has
elapsed after the date on which the report is received.

Sec. 3122. Limits on general plant projects.

This provision would authorize the Secretary of Energy to
carry out any construction project authorized under general
plant projects if the total estimated cost does not exceed $5.0
million. The provision would require the Secretary to submit a
report to Congress if the cost of the project is revised to
exceed $5.0 million.

Sec. 3123. Limits on construction projects.

This provision would permit any construction project to be
initiated and continued only if the estimated cost for the
project does not exceed 125 percent of the higher of: (1) the
amount authorized for the project; or (2) the most recent total
estimated cost presented to the Congress as justification for
such project. The Secretary of Energy may not exceed such
limits until 30 legislative days after the Secretary submits to
the congressional defense committees a detailed report setting
forth the reasons for the increase. This provision would also
specify that the 125 percent limitation would not apply to
projects estimated to cost under $5.0 million.

Sec. 3124. Fund transfer authority.

This provision would permit funds authorized by this Act to
be transferred to other agencies of the government for
performance of work for which the funds were authorized. The
provision would permit the merger of such transferred funds
with the authorizations of the agency to which they are
transferred. The provision would also limit, to not more than
five percent, the amount of such funds that may be transferred
between authorization accounts in the Department of Energy that
were authorized pursuant to this Act.

Sec. 3125. Authority for conceptual and construction design.

This provision would limit the Secretary of Energy's
authority to request construction funding until the Secretary
has completed a conceptual design. This limitation would apply
to construction projects with a total estimated cost greater
than $5.0 million. If the estimated cost to prepare the
conceptual design exceeds $600,000, the provision would require
the Secretary to request funds for the conceptual design before
requesting funds for construction. The provision would require
the Secretary to submit to Congress a report on each conceptual
design completed under this provision. The provision would
provide an exception to these requirements in the case of an
emergency.

Sec. 3126. Authority for emergency planning, design, and construction
activities.

This provision would permit, in addition to any authorized
advance planning and construction design, the Secretary of
Energy to perform planning and design with funds available for
any Department of Energy national security program construction
project whenever the Secretary determines that the design must
proceed expeditiously to protect the public health and safety,
to meet the needs of national defense, or to protect property.

Sec. 3127. Funds available for all national security programs of the
Department of Energy.

This provision would authorize amounts appropriated for
management and support activities and for general plant
projects to be made available for use, when necessary, in
connection with all national security programs of the
Department of Energy.

Sec. 3128. Availability of funds.

This provision would authorize amounts appropriated for
operating expenses or for plant and capital equipment to remain
available until expended. Program Direction funds would remain
available until the end of fiscal year 2001.

Sec. 3129. Transfers of defense environmental management funds.

This provision would provide the manager of each field
office of the Department of Energy with limited authority to
transfer up to $5.0 million in fiscal year 1999 defense
environmental management funds from one program or project
under the jurisdiction of the office to another such program or
project, once in a fiscal year. This provision extends the
authority granted by section 3139 of the National Defense
Authorization Act for Fiscal Year 1997.

SUBTITLE C--PROGRAM AUTHORIZATIONS, RESTRICTIONS, AND LIMITATIONS

Sec. 3131. International cooperative stockpile stewardship.

The committee recommends a provision that would prohibit
use of fiscal year 1999 or prior year funds to conduct
international cooperative stockpile stewardship activities. The
provision excludes activities conducted with the United Kingdom
and France and activities carried out under Title III of this
Act (relating to cooperative threat reduction with states of
the Former Soviet Union). The prohibition would apply to all
Department of Energy activities, including, but not limited to,
laboratory directed research and development funded studies and
analyses of possible nuclear futures. This provision is
consistent with prohibitions established by the National
Defense Authorization Acts for Fiscal Year 1997 and 1998.
The committee remains concerned that conducting
international cooperative stockpile stewardship activities may
have unintended detrimental impacts on U.S. national security
interests. Accordingly, the committee strongly opposes any
programs intended to assist existing and threshold nuclear
weapons nations in areas relating to nuclear weapons safety,
reliability and effectiveness.

Sec. 3132. Prohibition on use of funds for ballistic missile defense
and theater missile defense.

The committee recommends a provision that would prohibit
the use of any funds authorized by Title XXXI to support
ballistic missile defense research, development, demonstration,
testing, and evaluation. The prohibition includes studies and
assessments. The provision would also prohibit use of
Laboratory Directed Research and Development and laboratory
overhead funds for such purposes.
The committee supports cooperation among Department of
Energy laboratories and the Ballistic Missile Defense
Organization (BMDO) in those areas where there is mutual
programmatic benefit. The committee believes that the
Departments of Defense and Energy should pursue such activities
through work for others agreements and that use of funds
authorized and appropriated for stockpile stewardship and
management should not be used to carry out BMDO missions. The
committee notes that the cooperative agreement required by
section 3131 of the National Defense Authorization Act for
Fiscal Year 1998 is not executed.

Sec. 3133. Licensing of certain mixed oxide fuel fabrication and
irradiation facilities.

The committee recommends a provision that would require any
person constructing or operating new or existing facilities
utilized to fabricate mixed oxide (MOX) fuel for use in
commercial nuclear reactors be subject to licensing by the
Nuclear Regulatory Commission (NRC). The provision would also
require the occupational safety and health of employees working
at such facilities be subject to regulation by theDepartment of
Labor. The licensing and regulatory requirements in this provision
would not apply to demonstration, testing, or research activities
related to MOX fuel carried out by, or under contract with, the
Department of Energy.
The committee believes that, in order to be successful, the
Department of Energy's fissile materials disposition program
must provide for seamless regulatory oversight of all mixed
oxide fuel fabrication and irradiation activities. Because MOX
fuel is intended to be burned in commercial nuclear facilities
that are regulated by the NRC, the committee believes it is
advantageous for any MOX fuel fabrication facilities to meet
applicable NRC standards.
The committee does not endorse the wholesale external
regulation of Department of Energy defense nuclear facilities
and remains skeptical of the potential benefits associated with
implementing new regulatory regimes at new or existing DOE
defense nuclear facilities.

Sec. 3134. Continuation of processing, treatment, and disposition of
legacy nuclear materials.

The committee recommends a provision that would require the
Secretary of Energy to maintain a high state of readiness at
the F-canyon and H-canyon facilities, as recommended by the
Defense Nuclear Facilities Safety Board and consistent with
direction provided in previous year's authorizations.

Sec. 3135. Authority for Department of Energy federally funded research
and development centers to participate in merit-based
technology research and development programs.

The committee recommends a provision that would amend the
National Defense Authorization Act for Fiscal Year 1995 to
grant Department of Energy (DOE) sponsored federally funded
research and development centers (FFRDCs) the same ability to
compete for contracts as Department of Defense sponsored
FFRDCs. The provision would authorize DOE facilities that
function primarily as research laboratories to respond to
competitive solicitations, research announcements, broad agency
announcements, and grant announcements for programs that
promote research, development, demonstration, transfer of
technology based on their core competencies, areas of
specialized or derived expertise, or utilization of unique
facilities.

Sec. 3136. Support for public education in the vicinity of Los Alamos
National Laboratory, New Mexico.

The committee recommends a provision that would authorize
the Department of Energy (DOE) to make a $5.0 million payment
to a not-for-profit education foundation in the area around the
Los Alamos National Laboratory to enrich educational activities
of the local school system. DOE contributions to this
foundation would be used to contribute to a fund, the corpus of
which would remain in trust and the annual revenue used to
support the local school system. This provision extends the
authority granted to the Secretary of Energy in section 3167 of
the National Defense Authorization Act for Fiscal Year 1998.
The conferees expect that the Secretary of Energy will make
no more than five total annual payments to this fund for a
total contribution not to exceed $25.0 million. The conferees
note that the Secretary was authorized to make the first of
such payments in fiscal year 1998. The conferees expect that
upon making the fifth payment or meeting the $25.0 million cap,
DOE assistance to the local school system will end.

SUBTITLE D--OTHER MATTERS

Sec. 3141. Repeal of fiscal year 1998 statement of policy on stockpile
stewardship program.

The committee recommends a provision that would repeal
section 3156 of the National Defense Authorization Act for
Fiscal Year 1998. The committee believes the fiscal year 1998
provision is no longer needed and may be misinterpreted to
establish a U.S. policy to unilaterally draw down the U.S.
nuclear stockpile in advance of arms control negotiations.

Sec. 3142. Increase in maximum rate of pay for scientific, engineering,
and technical personnel responsible for safety at defense
nuclear facilities.

The committee recommends a provision that would raise the
pay level for the excepted service authority provided in the
National Defense Authorization Act for Fiscal Year 1995 from
Level IV to III of the Executive Schedule. This increase is
intended to help the Department of Energy attract and retain
senior scientific, engineering, and technical personnel who
possess the skills to perform critical nuclear health and
safety activities at the Department's defense nuclear
facilities.
The committee notes that, in recent years, the Level IV pay
cap has limited the Department's ability to attract and retain
the highest qualified scientific and technical talent.

Sec. 3143. Sense of Senate regarding treatment of Formerly Utilized
Sites Remedial Action Program under a nondefense discretionary
budget function.

The committee recommends a sense of the Senate resolution
that urges the Office of Management and Budget to transfer
funding for the Formerly Utilized Sites Remedial Action Program
into a non-defense discretionary portion of the Federal budget
in future years.

OTHER ITEMS OF INTEREST

Asset disposition

The committee continues to support the Department of
Energy's efforts to identify surplus assets or real property
excess to the needs of the Federal Government. Section 3138 of
the National Defense Authorization Act for Fiscal Year 1998
created a pilot program to dispose of excess Department assets
and assess how the proceeds from such sales might be used to
reduce the Federal deficit and conduct decontamination,
decommissioning, and closure activities at Department of Energy
owned clean-up sites. The provision authorized six transactions
under the pilot program and directed the Secretary of Energy to
report on the amounts retained by the Department as a result of
the transactions.
The committee continues to support this initiative, but
believes more information is needed before the pilot program
can be expanded. The committee anticipates that the Department
will submit the report by the statutory due date of January 31,
1999. The committee will assess the benefits of expanding this
program based on the results of the pilot transactions and the
information and recommendations contained in the report.

Improving collaboration between the Department of Defense and
Department of Energy laboratories

The committee commends the Under Secretary of Defense for
Acquisition and Technology and the Assistant Secretary of
Energy for Defense Programs for beginning to develop ways to
use the Nation's investment in science and technology at the
Department of Energy National Laboratories for national defense
goals in the post-Cold War era. The committee notes that in
response to the recommendations contained in the National
Defense Authorization Act for Fiscal Year 1998, the Departments
of Defense and Energy have agreed to collaborate in three areas
that are key to addressing the challenge of defeating the hard
and deeply buried targets that shelter the war-making
capabilities, including weapons of mass destruction, of rogue
states.
The committee believes that the Under Secretary of Defense
for Acquisition and Technology and the Assistant Secretary of
Energy for Defense Programs should create a mechanism to fund
and manage the pilot project to defeat hard and deeply buried
targets and other related collaborative programs. The committee
directs a report be submitted to the congressional defense
committees no later than February 15, 1999, that provides a
detailed description of the pilot program and a plan for its
execution, including an explanation of joint funding and
management arrangements.

Los Alamos Non-proliferation Center

The Department of Energy National Laboratories play a
significant role in the nonproliferation activities of the
Department of Energy. The Department of Energy has indicated
that it is planning to request funds for construction of a new
modern building to consolidate the nonproliferation activities
at Los Alamos National Laboratory (LANL). The committee urges
the Department to submit the construction project as part of
its fiscal year 2000 budget request.
The committee notes that the Department of Energy has
established two nonproliferation centers. The construction of
the facility at Los Alamos National Laboratory will bring the
number of DOE nonproliferation centers to three. The committee
wants to ensure that research and development efforts at the
three centers not result in the unnecessary duplication of
effort. The committee directs DOE to report to the
congressional defense committees by March 1, 1999 on the unique
roles that each of these centers will play in the
nonproliferation effort.

Robotics and intelligent machines

Last year, the committee noted the crucial support provided
by the Department of Energy to the development of robotics and
intelligent machines, and directed the Secretary of Energy to
develop a comprehensive Robotics and Intelligent Machines
Initiative to integrate existing Departmental programs. The
committee understands that the Department has made substantial
progress in responding to this directive.
The committee notes that the Under Secretary of Energy has
been assigned responsibility for improving coordination on
robotics within the Department. Under his direction, a robotics
roadmap is being developed to identify research needs and
opportunities related to the full spectrum of the Department's
missions. This technology roadmap should be completed this
summer.
The committee looks forward to receiving the roadmap and
encourages the Department to continue its planning efforts. The
committee directs the Department to use its robotics roadmap to
plan the Robotics and Intelligent Machines Initiative called
for in the National Defense Authorization Act for Fiscal Year
1998. The committee also encourages the Department to build on
the development of its robotics roadmap and increase
interagency awareness and cooperation on research and
development related to robotics and intelligent machines.
TITLE XXXII--DEFENSE NUCLEAR FACILITIES SAFETY BOARD

The committee recommends a provision that would authorize
$17.5 million for the Defense Nuclear Facilities Safety Board
(DNFSB) for fiscal year 1999. The committee notes that DNFSB
continues to provide exceptional and effective external
oversight with a budget that equals about one-tenth of one
percent of total Atomic Energy Defense funding.
Section 3202 of the National Defense Authorization Act for
Fiscal Year 1998 (P.L. 105-85) directed the DNFSB to prepare a
report and make recommendations regarding: which Department of
Energy (DOE) facilities should remain under the jurisdiction of
the DNFSB; the potential regulatory and jurisdictional issues
surrounding defense environmental management privatization
projects and the proposed commercial light water reactor option
for tritium production; the potential costs of moving DOE
facilities to an alternative external regulation regime; and
the impact of repealing section 210 of the Department of Energy
National Security and Military Applications of Nuclear Energy
Authorization Act of 1981 (42 U.S.C. 7272). The report is to be
submitted to Congress this year and will include any comments
by the Secretary of Energy and the Chairman of the Nuclear
Regulatory Commission.
The committee is not convinced that external regulation of
new or existing DOE defense nuclear facilities will increase
safety, decrease cost, or improve operational efficiency at
such facilities. The committee notes that transfer of the
Paducah gaseous diffusion plant from DOE to NRC regulation cost
over $200.0 million and took three years to complete.
The committee is concerned that the implementation of an
additional external regulation approach could draw scarce
resources away from high priority, compliance driven cleanup
actions and critical national security activities, with little
added benefit. The committee believes no decisions should be
made or actions taken until the findings of the DNFSB and the
comments of the Secretary of Energy and Chairman of the Nuclear
Regulatory Commission have been provided and the ongoing
external regulation pilot program is completed. The committee
will be extensively involved in any movement toward an
alternative external regulation approach.
TITLE XXXIII--NATIONAL DEFENSE STOCKPILE

The committee recommends a provision that would authorize
the Stockpile Manager to obligate $83.0 million from the
National Defense Stockpile Transfer Fund during fiscal year
1998 for the authorized uses of funds under section 9(b)(2) of
the Strategic and Critical Materials Stock Piling Act (50
U.S.C. 98c).
The committee also recommends a provision that would
authorize the disposal of excess materials from the National
Defense Stockpile. Under current law, the Stockpile Manager
cannot dispose of excess materials unless the proposed disposal
has been reviewed by the Market Impact Committee and included
in the Annual Materials Plan or a revision of the plan.
TITLE XXXIV--NAVAL PETROLEUM RESERVES

The President's budget request included $117.0 million for
operation of the Naval Petroleum and Oil Shale Reserves in
fiscal year 1998. The committee recommends a provision that
would authorize the full $117.0 million for the operation of
the Naval Petroleum and Oil Shale Reserves in fiscal year 1999.
TITLE XXXV--PANAMA CANAL COMMISSION

Sec. 3501. Short title; references to Panama Canal Act of 1979.
The committee recommends a provision that would establish
title XXXV of the National Defense Authorization Bill for
Fiscal Year 1999 as the ``Panama Canal Commission Authorization
Act for Fiscal Year 1999''.
Sec. 3502. Authorization of expenditures.
The committee recommends a provision that would grant the
Panama Canal Commission authority to make expenditures from the
Panama Canal Commission Revolving Fund within existing
statutory limits. The provision would also establish ceilings
for the reception and representation expenditures of the
supervisory board, administrator and secretary of the
Commission.
Sec. 3503. Purchase of vehicles.
The committee recommends a provision that would authorize
the Panama Canal Commission to purchase vehicles for official
use.
Sec. 3504. Expenditures only in accordance with treaties.
The committee recommends a provision that would confirm the
obligation of the Panama Canal Commission to make expenditures
only in accordance with the Panama Canal Treaty of 1977 and
related agreements.
Sec. 3505. Donations to the Commission.
The committee recommends a provision that would provide the
Panama Canal Commission with the authority to accept donations
of funds, property and services from both private and public
entities for the purpose of carrying out its promotional
activities. The committee believes this authority will help the
Commission to establish and operate a museum and expanded
tourist facilities at the Miraflores Locks. The museum and
tourist facilities will facilitate the Canal's efforts to
promote its core ship transit business while enhancing its
ability to earn additional revenues as a tourist destination.
It is envisioned, for example, that private corporations will
sponsor state-of-the-art, multimedia presentations regarding
different aspects of the Canal's history, operations and
future. Absent the authority to accept donations, funding for
such expansion and diversification would come largely from
tolls charged to the international shipping community, and
thereby divert funds from capital improvements.
Various agencies currently have similar authority to accept
gifts. Specific statutory authority to accept donations is
required in order to avoid violations of the Anti-Deficiency
Act (31 U.S.C. 1341 et seq.), which, among other things,
prohibits augmentation of appropriations without congressional
approval.
Sec. 3506. Agreements for United States to provide post-transfer
administrative services for certain employee benefits.
The committee recommends a provision that would provide for
the assumption of responsibility for administering post-1999
Panama Canal-related benefits in Panama by the U.S. ambassador
to Panama. The Panama Canal Commission currently administers
programs that provide financial and medical benefits to
approximately 700 former Canal employees and dependents who
were never covered by any Canal retirement ormedical plan. The
employment of these former employees was terminated prior to October 5,
1958. The Commission also provides liaison services for approximately
260 individuals receiving disability payments under the provisions of
the Federal Employees' Compensation Act (5 U.S.C. 8101 et seq.).
The Commission expects to contract with some private
financial or insurance entity to manage these programs and
oversee the distribution of benefits after 1999. In conjunction
with such a contract, the U.S. Embassy in Panama would have a
three-fold responsibility: (1) facilitate resolution of
complaints of the aforementioned former employees; (2) perform
periodic audits of contract performance; and (3) take
appropriate measures, including legal action, to ensure
contract compliance. The provision of such services is deemed
appropriate in light of the general infirmity of these former
employees and to protect the fiscal integrity of these
programs.
The committee expects that the contractor or contractors
would be subject to the jurisdiction of U.S. courts.

Sec. 3507. Sunset of United States overseas benefits just before
transfer.

The committee recommends a provision that would sunset
certain benefits to certain U.S. citizen employees of the
Panama Canal Commission and thereby clarify the conditions of
employment intended to be continued by Panama after the
transfer of the Canal. U.S. citizen employees working for the
Panama Canal have traditionally been eligible, either by
statute or agency regulation, for a number of benefits, which
include an overseas recruitment and retention (tropical/Panama
Area) differential, housing, vacation leave and travel,
repatriation, an equity package, educational tuition
sponsorship, educational travel and medical sponsorship.
Originally, these benefits were provided to all U.S. citizens.
However, over the years, eligibility requirements for many of
these benefits have been narrowed such that they are now
extended to new employees only at the discretion of the
Commission based on actual recruitment needs. Accordingly,
eligibility for some of these benefits depends, in addition to
citizenship, on the date of hire, place of recruitment and
position for which recruited. Only repatriation remains an
entitlement for all U.S. citizen permanent employees, while
educational travel for dependents remains available by law only
to those employed on September 30, 1979 and those recruited
outside Panama after that date. In addition, many of these
benefits are guaranteed for employees who were hired before the
effective date of the Panama Canal Treaty of 1977 throughout
the life of the Treaty by section 1231(a), which requires that
the terms and conditions of employment be generally no less
favorable than those enjoyed on September 30, 1979. The covered
conditions of employment include such broad areas as basic pay,
tropical differential, leave and travel, transportation and
repatriation rights, and group health and life insurance.
The purpose of affording these benefits, as is common
throughout the U.S. Government, has been to provide recruitment
and retention incentives to U.S. citizen employees who have
been willing to work for a U.S. Government agency outside of
the United States. The Panama Canal Commission, a U.S.
Government corporation, will cease to operate the Panama Canal
on December 31, 1999, at which time its employees will largely
become employees of the Panama Canal Authority (PCA), the
Government of Panama entity that will succeed the Panama Canal
Commission. The Panamanian Constitution and the organic law
establishing the PCA guarantee continuance of conditions of
employment existing on December 31, 1999. Panama's executive
branch has indicated that these guarantees will not extend to
any citizenship-based benefits and has stated that, after
December 31, 1999, it will compensate PCA employees uniformly,
i.e., without regard to citizenship or place of recruitment.
Performing this technical adjustment of accelerating the
expiration of these benefits by twelve hours (from 12:00 noon
on December 31, 1999 to 11:59 p.m. on December 30, 1999) will
help make the transition to a system with no citizenship-based
benefits clearer and less prone to confusion and claims.
Panama's interpretation of its own Constitution and laws
should prevail in any litigation which might be brought by
former Commission employees who continue with the PCA and who
claim entitlement to such benefits. Nevertheless, it is prudent
to sunset these benefits on December 30, 1999 so it is clear to
all concerned that the aforementioned continuity provisions of
Panamanian law will not cover the benefits in question.
Accordingly, it is in the best interest of the transition to
terminate these benefits before December 31, 1999 in order to
ensure the PCA has the flexibility to determine if and what
kind of retention benefits are necessary for operational
continuity and efficiency. Termination of these benefits on
December 30, 1999, rather than at noon December 31, 1999,
requires specific amendments to Public Law 96-70. The provision
would provide for the early--December 30, 1999--repeal of
specific provisions related to benefits, e.g., 1206 (cost of
living allowance/equity adjustment), 1207 (educational travel),
1217(a) (recruitment and retention (tropical) differential),
1224(11) (housing and educational allowances); 1231 (general
preservation of terms and conditions of employment existing on
September 30, 1979) and 1321 (educational and medical
sponsorship).
While the provision would terminate these rights and
nullify existing agency regulations on December 30, it would
also provide that compensation calculations, like most of those
listed in section 1218, are to be computed and paid asif the
provisions had not been repealed. For example, the 1217(a) tropical
differential will continue to be treated as basic pay for these U.S.
citizen employees with respect to such things as retirement benefits,
severance pay and payment of accumulated leave. On the other hand,
actual compensation for that one day would be marginally affected. For
example, any pay calculations for hours of work performed on December
31, 1999 will not continue to include a 15 percent tropical or Panama
Area differential component.

Sec. 3508. Central Examining Office.

The committee recommends a provision that would repeal a
section relating to the Central Examining Office. The unit
known as ``Central Examining Office'' no longer exists and an
office performing similar functions does not require a
statutory mandate.
The Central Examining Office was the successor office to
the Canal Zone Central Examining Office that served all U.S.
Government agencies operating in the former Canal Zone. As
initially established in 1979, this office was responsible for
carrying out the President's responsibilities for coordination
of policies and activities of agencies participating in the
Panama Canal Employment System (PCES). Since September 1996,
the Panama Canal Commission has had sole administration of the
PCES, and the Central Examining Office, with its reduced
mission, was reformed as the Recruitment and Examination
Division within the Commission's Department of Human Resources.
The Commission does not need statutory authority to create or
continue such an office.

Sec. 3509. Liability for vessel accidents.

The committee recommends a provision that would bring the
Panama Canal Commission's liability for vessel accidents in
line with industry standards and thereby lower costs for Panama
Canal operations. The situation concerning liability for
injuries to vessels and their cargo, crew and passengers while
transiting the Canal has changed several times since the
waterway first opened to the shipping world in 1914. For the
first 26 years, the agency operating the waterway was a virtual
insurer for injuries sustained while a vessel was passing
through a lock, but paid nothing for injuries sustained
anywhere else in the waterway. In 1940, the law was changed to
allow the Canal to pay up to $60,000 on claims for vessel
damage sustained outside the locks; however, it could not be
sued on claims for non-locks damage.
In 1951, the newly formed Panama Canal Company, a wholly
owned government corporation, was made liable without limit on
all vessel accident claims, regardless of whether the accident
occurred in or out of the locks, and was subject to suit on all
such claims. The Company remained a virtual insurer with
respect to damage sustained in the locks, but the shipowner was
required to establish negligence on the part of one or more
Canal employees before the agency was liable in non-locks
cases. When the Panama Canal Treaty entered into force in
October 1979, the Panama Canal Commission (which replaced the
Company as the U.S. agency operating the Canal) remained an
insurer for vessel damage sustained in the locks (and could be
sued on such claims), but was authorized to consider non-locks
vessel damage claims only up to $120,000. Claims in excess of
that amount were required to be submitted to the Congress with
a special report and recommendation. Although a number of such
claims were submitted to the Congress during this time, and
were the subject of hearings before the Merchant Marine and
Fisheries Committee of the House of Representatives, none was
ever disposed of by legislative action.
The current law, enacted in 1985, gave the Commission the
authority to settle vessel claims regardless of either the
situs of the accident or amount of the claim. The agency is
subject to suit on all such claims but is no longer an insurer
for damage sustained by a vessel while passing through the
locks. For both in-lock and out-of-lock damages, the claimant
is required to establish negligence on the part of the Canal's
employees before being entitled to recover.
The provision would limit the Commission's exposure to
liability for vessel damage (as well as for injuries to cargo
crew, and passengers aboard vessels passing through the Canal)
to those cases in which the claimant is covered by insurance
against Canal mishaps in the amount of at least $1 million.
Under these amendments, the Canal would pay only those damages
that are in excess of amounts recovered or recoverable by the
claimant from its insurer. The provision would also foreclose
consideration of any claim in the nature of subrogation against
the Commission by an insurer. It would also bring investigation
and litigation costs down for less significant accidents, as
has been the case in other contexts in which a ``no-fault''
system has been introduced. Savings from these efficiencies
could be used for tangible Canal capital improvements and
maintenance, instead of being used for attorneys' fees and
related administrative costs.

Sec. 3510. Placement of United States citizens in positions with the
United States Government.

The committee recommends a provision that would provide
U.S. citizen employees of the Panama Canal Commission, who were
hired after the Panama Canal Treaty of 1977 and who are
involuntarily separated during the 18 months immediately
preceding transfer of the Canal to Panama, the same placement
opportunities generally provided to other U.S. federal
employees who are involuntarily separated.
In 1979, the Congress provided, in section 1232 of the
Panama Canal Act of 1979 (22 U.S.C. 3672), that the Office of
Personnel Management (OPM) afford placement assistance in other
U.S. Government positions for U.S. citizens who were employees
of the Panama Canal Company or Canal Zone Government on March
31, 1979, but were separated as a result of the 1977 Panama
Canal Treaties.
OPM established a Government-wide placement program for
eligible employees who requested placement assistance (5 CFR
315.601 (1997)). As a result, pre-Treaty employees who were
separated from employment as a result of the Treaty were
provided maximum placement assistance that included priority
consideration for vacancies in the U.S. Government.
Less than two years remain before the Canal is transferred
to Panama. At this time, approximately 60 U.S. citizen
employees remain with the Panama Canal Commission, in Panama
and in its Washington and New Orleans offices, who will be
ineligible to retire by the Canal transfer date. That number is
expected to decrease before the transfer, but some inevitably
will wish to continue their federal careers. Commission
employees working in Panama cannot utilize existing placement
programs, which require employees to occupy positions within
the local commuting area of advertised vacancies. Accordingly,
this provision requires OPM to provide assistance to current--
as of July 1, 1998--U.S. citizen employees of the Panama Canal
Commission who are separated from employment as a result of the
1977 Panama Canal Treaty and related agreements.
Specifically, OPM currently operates the Interagency Career
Transition Assistance Plan (ICTAP) for Displaced Employees (5
CFR 330.701 et seq.). Generally, ICTAP does not apply to
excepted service employees, which includes all Commission
employees, because ``such employees do not have the same kind
of eligibility to be appointed on an ``interchangeable'' basis
as employees in the competitive civil service.'' 62 Federal
Register 31317. This rationale does not apply to Commission
employees, however, because the Congress specifically provided
for the interchange of Canal employees and the competitive
service. 22 U.S.C. 3652(a)(4).
By granting Commission employees noncompetitive appointment
eligibility and selection priority, the provision would render
these former Canal employees ``displaced employees'' within the
meaning of the ICTAP. 5 CFR 330.703(b)(7). Additionally,
because ICTAP functions within a ``local commuting area,'' the
amendment allows, in the case of an employee employed in the
Republic of Panama at the time of separation, the local
commuting area to be the Standard Federal Region or local
commuting area of the employee's choice.
In practical terms, such priority placement will give the
displaced Canal employee priority over an individual who is not
a federal employee, a federal employee from outside the local
commuting area or a federal employee from within the local
commuting area but from outside the agency. The Canal employee
will be on equal footing with employees involuntarily separated
due to a reduction in force from outside the agency within the
local commuting area. Canal employees will have a lower
priority than employees within the agency with the vacancy.

Sec. 3511. Panama Canal Board of Contract Appeals.

The committee recommends a provision that would provide
greater flexibility in the timeline for establishing the Panama
Canal Board of Contract Appeals and in determining the salaries
of members serving on the Board.
The purpose of section 3102 of the Panama Canal Act of 1979
(22 U.S.C. 3862), enacted last year in Public Law 105-85, is to
facilitate the transfer of the Panama Canal Commission's
contract dispute resolution system to Panamanian administration
after 1999. The Board of Contract Appeals is the forum intended
for that purpose. Section 3102 was drafted before the current
Panama Canal Authority (PCA) Board of Directors was in place.
This provision would revise section 3102 to allow flexibility
in the timing and implementation of current law relating to the
Board of Contract Appeals, in light of the workload ahead of
the PCA and the fact that whatever actions the United States
takes are designed to be continued by the PCA. Therefore, given
the foreseeable workload of the transition, a more flexible
timeline is indicated.
The current statute calls for the Board to be established
and functioning no later than January 1, 1999. This revision
would simply eliminate any mandatory date for establishment and
functioning of the Board of Contract Appeals, so that the
United States and Panama could take more time to ensure that
the result will truly meet the long term needs of the
transition.
Another section of the provision would allow the Commission
to bring salaries for members serving on the Board of Contract
Appeals in line with local salary conditions and the
professional expertise envisioned for service on that body. In
light of the purpose of establishing the Board for long-term,
continuous service under Panamanian administration of the
Canal, and because local compensation may differ from that
prevailing in the United States, section 3102(a) is amended to
authorize the Commission's Supervisory Board to determine the
compensation for the Chairman, Vice Chairman and other members
of the Board of Contract Appeals.
The Commission's Supervisory Board would not be able to
reduce, during any Board member's appointed term, the level of
that member's compensation from the level established at
thetime of that member's appointment. This provision is included to
preserve the independence of the Board and its decisionmaking
functions. Without this amendment, the Contract Disputes Act (28 U.S.C.
2510 et seq.) would require that compensation be fixed according to the
levels prescribed by section 5372a of title 5, United States Code.
Consistent with the Panama Canal Treaty of 1977, U.S.
jurisdiction and funding of the Panama Canal Board of Contract
Appeals will end on December 31, 1999. At that time the
functions of the Board will be continued by the Panama Canal
Authority under Panamanian laws, regulations, and funding.

LEGISLATIVE REQUIREMENTS

Departmental Recommendations

By letter dated March 17, 1998, the General Counsel of the
Department of Defense forwarded to the President of the Senate
proposed legislation ``To authorize appropriations for fiscal
year 1999 for military activities of the Department of Defense,
to prescribe military personnel strengths for fiscal year 1999,
and for other purposes.'' The transmittal letter and proposed
legislation were officially referred as Executive Communication
4382 to the Committee on Armed Services on March 17, 1998.
Executive Communication 4382 is available for review at the
committee. Senators Thurmond and Levin introduced this
legislative proposal as S. 1812, by request, on March 23, 1998.
By letter dated February 17, 1998, the General Counsel of
the Department of Defense forwarded to the President of the
Senate proposed legislation ``To authorize military
construction and related activities of the Department of
Defense for fiscal year 1999.'' The transmittal letter and
proposed legislation were officially referred as Executive
Communication 4381 to the Committee on Armed Services on
February 17, 1998. Executive Communication 4381 is available
for review at the committee. Senators Thurmond and Levin
introduced this legislative proposal as S. 1813, by request, on
March 23, 1998.

Committee Action

In accordance with the Legislative Reorganization Act of
1946, as amended by the Legislative Reorganization Act of 1970,
there is set forth below the committee vote to report the
National Defense Authorization Act for Fiscal Year 1999.
Vote: Adopted by voice vote.
The roll call votes on amendments to the bill which were
considered during the course of the mark-up have been made
public and are available at the committee.

Congressional Budget Office Cost Estimate

It was not possible to include the Congressional Budget
Office cost estimate on this legislation because it was not
available at the time the report was filed. It will be included
in material presented during floor debate on the legislation.

Regulatory Impact

Paragraph 11(b) of rule XXVI of the Standing Rules of the
Senate requires that a report on the regulatory impact of the
bill be included in the report on the bill. The committee finds
that there is no regulatory impact in the case of the National
Defense Authorization Bill for Fiscal Year 1999.

Changes in Existing Law

Pursuant to the provisions of paragraph 12 of rule XXVI of
the Standing Rules of the Senate, the changes in existing law
made by certain portions of the bill have not been shown in
this section of the report because, in the opinion of the
committee, it is necessary to dispense with showing such
changes in order to expedite the business of the Senate and
reduce the expenditure of funds.

ADDITIONAL VIEWS OF SENATOR JOHN McCAIN

The chairmen of the Senate Armed Services Subcommittees are
to be commended for the fine job they did presenting their
recommendations to the full committee, especially given the
extremely difficult circumstances under which they were
operating. The Balanced Budget Agreement of 1997 established
funding levels for the 050 National Defense function beyond
which the committee could not mark without being in violation
of the agreement. This fiscal discipline, the long overdue
response to decades of prolifigate spending on programs of
questionable merit or low priority, helped to constrain the
normal tendency of members to add programs for strictly
parochial reasons.
Sadly, the rest of the Senate acted in the usual
irresponsible fashion by requesting funding for programs not
requested by the Department of Defense and, in some instances,
of little or no relevance to the mission of providing for the
common defense. During previous years, when Congress added
funds to the Administration's budget request out of concern for
issues of readiness, modernization, and quality of life, the
impact on high-priority programs of member-adds was minimized,
although still highly damaging to research and development
programs that get little attention yet represent the future of
our armed forces. Applying standard operating procedures in the
most constrained fiscal environment in which the department has
had to operate in many years, however, magnifies the problem of
wasteful and unnecessary spending many-fold. It is in this
light that one must assess the bill currently before us.
The problem of continued procurement of C-130 aircraft
despite an enormous surplus of such platforms in the Air Force
inventory solely to provide federal tax dollars for specific
congressional districts is worse than ever. During the very
time when it is incumbent upon Congress to deal responsibly
with the budget for national defense, the addition of four C-
130J aircraft (2 C-130Js, 1 EC-130J, 1 WC-130J) is
irresponsible. To add these aircraft in the same bill the
accompanying report for which is highly critical of the C-130J
program for cost overruns and development delays is a disgrace.
These aircraft represent real money, over $200 million, at a
time when the majority party is supposed to be concerned about
inadequate force structure, readiness, missile defense,
counterproliferation, and the federal deficit, this addition
completely defies logic and portrays Congress in the worst
light.
Congress' proclivity to fund National Guard programs
irrespective of other higher priorities on account of the
Guard's representation in every state and most congressional
districts has been another continuing problem for many years.
That the aforementioned C-130Js are designated for the Air
National Guard is a case in point. That an unrequested $1.5
billion amphibious assault ship was provided $50 million in
advance procurement funding in the bill, further strains
credibility within a political party that rose to primacy in
Congress under the mantle of fiscal responsibility. Compared to
the cost of a $1.5 billion ship and the C-130Js for the Guard,
the $7.5 million added to the budget for the purchase of
additional Norwegian-made Penguin missiles as part of a
possible quid pro quo arrangement involving Norwegian purchase
of U.S.-built patrol craft doesn't seem like such a big deal.
Everything is relative, though, and $7.5 million wasted is a
significant sum to most Americans.
The Science and Technology accounts continue to be
cavalierly abused by Congress. The chairman of the Acquisition
and Technology Subcommittee did a fine job of minimizing that
damage, but important long-term 6.1 and 6.2 science and
technology programs are still being impaired by member adds,
some of which clearly constitute wasteful spending under any
credible objective assessment. For example, the $1.5 million in
the Acquisition and Technology portion of the bill to study the
effects on missile components of high frequency vibrations
would be commendable were it not for the fact that we already
have 40 years of research into that area, involving every
single missile and rocket designed and tested since the dawn of
the missile age. This addition, while fortunately relatively
small, nevertheless is a prime example of members conducting
themselves with a ``business as usual'' mentality.
Similarly, adding $3 million for research in stainless
steel double hull technologies is an unambiguous waste of
precious financial resources. Naval shipbuilders possess
considerable knowledge of and experience in the use of various
grades of steel, especially for use in constructing submarine
hulls. Furthermore, environmental statutes requiring the use of
double hull tankers for transporting oil have already provided
commercial and naval shipbuilders all the incentive they need
to pursue this technology with their own resources, to say
nothing of the added benefit to such shipbuilders of Title XI
loan guarantees such as were used to secure double hull tanker
contracts for one particular U.S. shipbuilder.
The committee added $3 million to initiate a highly
questionable program in the area of remote visualization,
collaborative exploitation of high performance computing
modernization capabilities, and distance learning computing.
Clearly, this funding is intended as an earmark for one
particular college, competitive language notwithstanding.
These criticisms of the Acquisition and Technology account
aside, the chairman of the subcommittee did an admirable job of
minimizing disruption to science and technology programs by
mandating competitive contract processes as well as by holding
monetary amounts to a minimum. The continuation to the tune of
$11 million of the High Frequency Active Auroral Research
Program (HAARP), however, is a reminder that the committee, and
Congress as a whole, still have a ways to go.
The practice of adding military construction projects for
which the Defense Department has not requested funding in a
given fiscal year continues unabated, this year to the tune of
close to $600 million. The 88 projects added to the
Administration request may very well fall within most of the
established criteria for being added to the budget (for
example, they are in the Future Years Defense Plan), but the
funds for these projects had to be taken away from requested
programs. Once again, the damage done to higher priority
projects by this ``business as usual'' approach is magnified in
a zero-growth budget environment.
While it is gratifying that no money was added for the
National Automotive Center, it is disheartening that the
absence of such an add is a direct result of the funding for
the center being included in the Administration's request--a
triumph of politics over military necessity. Also troubling is
the designation of the NAC as the beneficiary of all future
defense dollars for development of commercial-military
automotive technology. The use of the word ``should'' in the
committee report in this context is obviated by the committee's
direction that the Secretary of Defense develop a plan for
implementing the goal of designating the NAC as the focal point
for this activity.
As of this writing, the issue of whether to allocate as
much as $550 million to the National Foreign Intelligence
Program resulting from a dispute between the Armed Services and
Intelligence Committees is yet to be resolved. The amount of
money at issue is significant given the requirement to mark to
the budget agreement level. Should the Armed Services Committee
have to implement cuts to accommodate Intelligence Committee
concerns, to fail to impose those cuts on member-adds would do
serious damage to the highest priority programs and activities.
Such a situation would be intolerable.
The Armed Services Committee wisely included provisions to
fund the requested pay raise for our men and women in uniform,
to take effect January 1, 1999, and to increase the monthly pay
for cadets and midshipmen at the service academies.
Of all the critical programs that are included in the $270
billion Defense Authorization bill, the single most important
issue that was addressed was Senator Kempthorne's and Senator
Cleland's health care reform package that provides for a
demonstration project in which the Department of Defense would
provide health care to retired military personnel and their
families who are over age 65 and Medicare-eligible. The
Secretary of Defense would be required to identify six
demonstration sites outside the catchment area of a military
treatment facility, two for each demonstration. The
demonstration projects would allow Medicare-eligible
beneficiaries to participate in the Federal Health Benefits
Program (FEHBP), create a TRICARE Senior Supplement program
that would be similar in function to a commercial Medicare
supplement insurance policy, and extend the TRICARE mail order
pharmacy benefit to all Medicare-eligible beneficiaries of the
Military Health Care System. The Committees action is an
important step in the protracted effort at reconciling the
promise of life-time medical care with the extreme discomfort
retirees feel at losing access to CHAMPUS when they turn 65
years of age.
The Committee also included a useful provision to encourage
the Services to expedite the release of promotion board
results. Specifically, it requires Service Secretaries to
advise the Senate Armed Services and House National Security
Committees when 100 days have elapsed since the board report
was signed by the board members without an approval by the
President. Officers stationed around the globe are concerned
with the increasing amount of time it seems to be taking the
Navy to release promotion board results. According to the
Bureau of Naval Personnel, the promotion board routing process
currently takes the Navy six to seven months from selection
board call out until it reaches the Senate. The other services
route promotion board results in half the time and yet they all
operate under the same Secretary of Defense instruction. A
smooth running promotion system enhances retention, and the
converse is true, a poor running promotion system hurts
retention.
The Armed Services Committee wisely funded the requested
pay raise for active duty personnel, to take effect January 1,
1999, and approved an increase in monthly pay for cadets and
midshipmen at the service academies. It was particularly
gratifying to see the committee include in its bill legislation
establishing health care demonstration projects for Medicare-
eligible military retirees as part of the protracted effort at
reconciling the promise of life-time medical care with the
extreme discomfort retirees feel at losing access to CHAMPUS
when they turn 65.
The looming problem of systemic computer malfunctions
expected to occur with the turn of the century, the so-called
Y2K problem, received the attention it deserved by the
committee. Concerned about the impact on military operations
and the Department of Defense's ability to continue to function
when its computer-dependent administrative and logistical
organizations suffer the effects of computers unable to
properly identify the year as 2000, the committee wisely
requires the department to focus the necessary attention and
resources on preparing for that eventuality. Additionally, the
committee authorized additional funds toward that purpose.
Given the scale of the problem and limited time with which to
confront it, the Readiness Subcommittee's emphasis on this
issue is fully warranted.
Finally, it was extremely disappointing to witness yet
another failed attempt by myself and others to pass legislation
mandating another round of base closures. The Secretary of
Defense and Chairman of the Joint Chiefs of Staff have
repeatedly emphasized the importance of divesting themselves of
unneeded infrastructure if vital modernization and readiness
initiatives are to be implemented. For the Armed Services
Committee, which knows better than any other collection of
Members in the Senate the importance of closing military
installations and facilities excess to requirements, to once
again reject proposals to close such installations and
facilities flies in the face of reality. Concerns about the
politicization of the process as was done during the 1995 round
are valid, but the Committee's refusal to consider additional
base closings even after the current Administration leaves
office is a strong indication that parochial considerations are
playing a much greater role than many are willing to admit.
These criticisms should not detract from the good work of
the chairman of the Armed Services Committee, who is stepping
down at the end of the current session of Congress. Strom
Thurmond deserves all the accolades he is receiving for his
years as committee chairman. His experience and strong desire
to act in the best interest of the United States and its Armed
Forces should stand as an example to all who follow. He has
succeeded in getting a $270 billion authorization bill to the
floor of the Senate in an expedient and efficient manner.
Congress, and the country, owe Chairman Thurmond a debt of
gratitude for his years of devoted service to the national
defense of the United States.

John McCain.

ADDITIONAL VIEWS OF SENATOR CARL LEVIN

I support the National Defense Authorization Act for Fiscal
Year 1999 reported by the Armed Services Committee. It is
consistent with the bipartisan budget agreement and with the
FY1999 Budget Resolution. In several important aspects the bill
continues the implementation of the recommendations of the
Quadrennial Defense Review (QDR) to help keep our military
forces the finest in the world.
There are some areas, however, where I believe this bill
needs to be improved, and I will be working to make these
improvements during the floor debate in the Senate and in
conference.

base closures

I am disappointed that the committee turned down the
request of the Secretary of Defense and the Chairman of the
Joint Chiefs of Staff to authorize another round of base
closures in the Department of Defense. The case for closing
more military bases is clear and compelling.
Recently Secretary Cohen released a detailed report
mandated by Congress last year on the extent of our excess
military infrastructure and the savings from past base
closures. This report contains almost 1,800 pages of backup
material, and is responsive to those who have said that we need
a thorough analysis before we can reach a decision on the need
for more base closures.
Secretary Cohen's report reaffirms that DOD still has more
bases than it needs. From 1989 to 1997, DOD reduced total
active duty military end strength by 32 percent, a figure that
will grow to 36 percent by 2003. Even after 4 base closure
rounds, DOD's base structure in the United States has been
reduced by only 21 percent.
DOD's analysis concluded that the military services still
have about 23 percent excess capacity in their current base
structure. For example, by 2003:
The Army will have reduced the personnel at its
classroom training commands by 43 percent, while
classroom space will have been reduced by only 7
percent.
The Air Force will have reduced the number of
fighters and other small aircraft by 53 percent since
1989, while the base structure for those aircraft will
be only 35 percent smaller.
The Navy will have 33 percent more hangars for its
aircraft than it requires.
Secretary Cohen's Report also documents the substantial
savings that have been achieved from past base closure rounds.
Between 1990 and 2001, DOD estimates that base closure actions
will produce a total of $13.5 billion in net savings. After
2001, when all of the prior base closure actions must be
completed, steady state savings will be $5.6 billion per year.
CBO and GAO are both conducting their review of the DOD
Report on Base Closures. In the past, though, both CBO and GAO
have agreed that base closures produce substantial savings.
According to the DOD Inspector General's recent work, these
savings in some cases are larger--and the costs somewhat
smaller--than we thought.
Based on the savings from the first four base closure
rounds, every year we delay another base closure round, we deny
the Defense Department, and the taxpayers, about $1.5 billion
in annual savings that we can never recoup by continuing to
study the question of exactly how much savings we have achieved
from previous rounds.
I know that closing bases is a painful process. All three
Air Force bases in my state have been closed, and we are still
working to overcome the economic blow to those communities. But
experience shows that there is life after base closure.
According to Secretary Cohen's recent report, at bases closed
more than two years, nearly 75 percent of the lost civilian
jobs have been replaced. Communities affected by base closures
obviously have to cope with near-term disruption, but the long-
term economic impact can be positive in most cases.
It is just as important to focus on the long-term military
impact of base closures.
Secretary Cohen said last month that: ``More than any other
initiative we can take today, BRAC will shape the quality and
strength of the forces protecting America in the 21st
century.''
General Shelton, the Chairman of the Joint Chiefs of Staff,
stated: ``I strongly support additional base closures. Without
them we will not leave our successors the warfighting dominance
of today's force.''
A decade ago, under the bipartisan leadership of the Senate
and the House, Congress had the vision and courage to start the
base closure process. That process has been remarkably
successful. DOD would be facing tremendous financial and budget
problems today if they were not able to count on the savings
from the previous base closure rounds.
The senior civilian and military leaders of DOD are telling
us again that they need to close more bases. I hope that
Congress will have the same vision and courage that we showed
ten years ago when we started the base closure process.
Admiral Jay Johnson, the Chief of Naval Operations, summed
it up well last month when he said:

This is more than about budgeting. It's about
protecting American interests, American citizens,
American soldiers, sailors, airmen and Marines. We owe
them the best force we can achieve. Reducing excess
infrastructure will help take us there and is clearly a
military necessity.

Closing bases is a military necessity, and we cannot afford
to delay any longer. Congress should authorize another round of
base closures.

chemical demilitarization programs

Through DOD's Chemical Demilitarization program, the U.S.
is destroying our chemical weapons in accordance with the
Chemical Weapons Convention (CWC), which the Senate ratified
almost exactly one year ago. It is very important to make sure
this program is sufficiently funded in order to meet our treaty
obligation of destroying our declared chemical weapons
stockpile by April 29, 2007.
I am very disappointed that the Committee bill includes a
reduction of $125 million to the budget request of $980 million
for the Chemical Demilitarization program. I believe this
significant cut could harm the program and interfere with the
ability of the U.S. to meet its CWC treaty obligations.
Given the historical difficulty of obtaining the necessary
permits to build and operate the chemical destruction
facilities, DOD program managers have taken a number of
initiatives recently to accelerate key schedules and reduce
program costs. These initiatives, which are designed to ensure
that the U.S. meets its treaty obligations, depend upon the
funding level contained in the FY1999 budget request.
I believe the Senate should not ratify a treaty and then
take an action, even if inadvertent, that could have the effect
of precluding the U.S. from being able to comply with the
treaty. I hope the Senate will restore the funding required to
assure we meet the CWC deadlines for destroying our chemical
weapons stockpile.

Department of Energy Stockpile Stewardship and Nonproliferation
Programs

The Department of Energy (DOE) has the responsibility to
ensure that the U.S. stockpile of nuclear weapons is safe and
reliable. DOE also has important programs underway to prevent
the spread of nuclear materials and technology to rogue nations
and terrorists. Unfortunately, the Committee bill reduces the
budget request for both of these essential programs.
The Energy and Water Development Appropriations Act for
Fiscal Year 1993 included a nuclear testing moratorium that
brought the U.S. nuclear weapons testing program to an end. DOE
is responsible for keeping the U.S. nuclear warheads safe and
reliable without nuclear weapons testing. Maintaining this
stockpile is now done through the Stockpile Stewardship
Program, which uses new computational and experimental
capabilities to maintain the safety and reliability of the
nuclear weapons stockpile.
The Committee bill reduces the FY1999 budget request for
the Stockpile Stewardship Program by $145 million. In a letter
to the Committee, Secretary of Energy Federico Pena indicated
that such reductions could imperil fundamental areas of the
Stockpile Stewardship Program, and could have ``a real and
dramatic impact on our ability to continue to certify the
stockpile and maintain our strategic deterrent.''
DOE also plays a key role in our nonproliferation efforts
to ensure that nuclear materials and technology do not fall
into the wrong hands. The DOE arms control programs help
account for, control, and protect weapons materials through
cooperative programs in Russia and the Newly Independent
States, and around the world. The Committee reduction of $20
million to the budget request of $237 million is, in my view,
short-sighted.
I hope that the funds for these two important programs can
be restored to the levels requested in the FY1999 budget during
the Senate's floor debate or in conference.

Carl Levin.

ADDITIONAL VIEWS OF SENATOR JEFF BINGAMAN

This year's defense bill continues to place greater
emphasis on addressing potential threats which are not
validated and for which military requirements have not been
established and authorized. This year the Committee increased
spending for National Missile Defense, including the Space
Based Laser program, for example, by almost $100 million above
the President's request of about $1.0 billion. Information
provided to the Committee indicated that the ballistic missile
threat for which such spending is directed is limited.
Intelligence reports indicate that the threat for ballistic
missile attack from any rogue nation is not likely to occur for
many years in the future. While it is important to continue to
fund technology research for ballistic missile defense, funding
priority for those programs could be lower than for programs
designed to meet more immediate threats.
The announcement of nuclear tests in India on May 11, 1998
serves as a wake-up call that proliferation of nuclear weapons
and other weapons of mass destruction is a near-term threat
deserving of immediate attention and priority funding. India
has repeatedly stated its concern that existing nuclear powers
have not taken serious measures toward reducing nuclear weapons
and cannot expect other countries to foreswear them in the
absence of meaningful movement toward disarmament. For example,
progress toward reaching final agreement on the START II Treaty
remains stalled, and, should Russia ratify that agreement,
under its provisions full implementation would not be complete
for more than another decade. In addition, the Senate has taken
no steps toward ratification of the Comprehensive Test Ban
Treaty submitted by the President last September. While the
timing of India's tests may have come as a surprise, it should
not be a shock in view of India's perspective on these matters.
While the Committee increased funding for defense against
intercontinental ballistic missiles, it reduced funding for
programs designed to prevent the proliferation of nuclear
weapons and materials and other weapons of mass destruction.
The President requested $697 million dollars--compared to $1
billion for National Missile Defense--for threat reduction
programs to combat proliferation. The Committee cut the
Department of Defense's Cooperative Threat Reduction programs,
also known as Nunn Lugar programs, by $2 million after debating
much deeper cuts. Those programs provide essential means to
ensure and improve the security of Russian nuclear weapons from
theft or misuse and to dismantle them in Russia and nations of
the former Soviet Union. The Committee also reduced funding by
$20 million for programs in the Department of Energy (DOE)
related to cooperative threat reduction. As a result of the
Committee's action, DOE's Materials Protection Control and
Accounting program, which provides added security measures to
prevent nuclear weapons materials from being smuggled to
terrorists or rogue nations will be delayed.
The proliferation clock ticks on as the Senate demurs
ratification of the Comprehensive Test Ban Treaty (CTB).
India's actions will assuredly provoke a response from
Pakistan. Other non-nuclear nations may reconsider their
positions concerning whether to develop a nuclear weapons
capability. China, a signatory to the CTB, may choose
ultimately not to ratify it. Meanwhile, the Committee reduced
funding for programs needed to provide essential information to
U.S. nuclear weapons scientists that would support the CTB. By
cutting funding for the Stockpile Stewardship Program by about
$130 million, the Committee threatens the likelihood of Senate
ratification of the CTB. Failure to ratify the CTB will
reinforce the action taken by the Indian government and
encourage other nations to follow suit.
The Committee's priorities are misplaced not only with
respect to investing our resources to meet our most immediate
military threats, but for those needed to ensure our long-term
security. The Committee continues to cut funding for basic
research and development efforts needed to support the
technologies for weapons a generation away. The Committee
approved a cut in funding for initial research programs by $100
million below last year's appropriated level. Efforts to
establish long-term spending goals for basic research in order
to avoid further erosion gained vocal support, but not the
Committee's endorsement. Funding to support the nation's test
and evaluation facilities, especially at White Sands, remains
insufficient to repair existing facilities and update
instrumentation needed to evaluate high technologies being
developed for next generation weapon systems.
I am deeply concerned that the Committee remains stuck on
an inertial path that cannot move quickly enough either to meet
the nation's most immediate defense threats, or to make the
necessary investments in meeting long-term defense needs. The
Senate's recent extensive debate on NATO enlargement represents
our inability to move beyond Cold War concerns. The Committee's
actions suggest a similar myopia. I intend to raise these
issues fully when the Senate considers the bill.

Jeff Bingaman.

ADDITIONAL VIEWS OF SENATOR JOHN GLENN

As a Member of both the Senate Armed Services Committee
(SASC) and the Senate Select Committee on Intelligence (SSCI),
I wish to register my deep concern with the significant
reductions taken by the SASC to the fiscal year 1999
intelligence budget. The SSCI's recommendation for the fiscal
year 1999 Intelligence Authorization Bill resulted in a modest
reduction to the overall budget request--the outcome of an in-
depth SSCI review of the Intelligence Community's budget
request. The SSCI's budget review resulted in significant
increases in funding for high priority projects designed to
position the Intelligence Community for the technological
challenges of the future.
The SASC's reduction to the intelligence budget far
exceeded the SSCI's recommended reduction level and represents
a ``meat axe'' approach to the intelligence budget. (Note:
Since the intelligence budget is classified, most of the
intelligence budget is concealed within the defense budget.
Accordingly, the SASC has annually taken the intelligence bill
on sequential referral after the SSCI has marked it up.)
These severe cuts to the intelligence budget are
unacceptable, and it is particularly ironic that some who have
supported this deep cut also bemoan the increased threat to
U.S. national security from a diminishing defense budget. The
U.S. needs a strong and reliable intelligence capability during
this period of enormous change and uncertainty in the
international environment. Indeed, we rely heavily on
intelligence to detect and monitor these changes in the
international system so we can reallocate increasingly scarce
resources in a more efficient manner.
To the extent that we need to de-emphasize resources
devoted to the former Soviet target, we must focus more of our
intelligence capabilities and resources on other security
threats such as the proliferation of weapons of mass
destruction--as underscored by the recent nuclear tests in
India, drug smuggling, terrorism, environmental change, low-
intensity conflict in the Third World, information warfare and
the illicit export of high-technology items. We also need to
continue to support a robust capability to monitor arms control
agreements.
It is also important to remember that accurate and timely
intelligence is our greatest force-multiplier--particularly at
a time when we are reducing the size of our military forces.
Intelligence serves as our nation's ``early warning system'',
and it needs to be protected at a time when the U.S. defense
establishment is being reduced. It should also be noted that
defense systems and programs often have a great utility in
their non-use, serving as deterrents to our enemies.
Intelligence systems and programs, on the other hand, are
constantly in use--with the primary objective of keeping U.S.
policymakers informed about changes to our national security
and thereby avoiding the need to deploy military forces to
protect U.S. lives and property.
In addition, with the end of the Cold War and the strong
likelihood that our defense spending will remain in decline, we
must be mindful of the lessons of history. Defense spending has
always experienced cycles of expansion and contraction. Periods
of lower tension result in reduced defense budgets. Such times
invariably give way to period of greater tension which, in
turn, lead toward greater defense spending. When the day comes
that the United States must rebuild our national defense to
confront a threat that is now difficult to foresee, we must do
it from the strongest and most reliable intelligence base
possible. I am convinced that significant reductions to our
intelligence capabilities--such as those recommended in the
fiscal year 1999 National Defense Authorization Act, especially
during this period of international instability, are extremely
unwise and are likely to be damaging to U.S. national security.
This cut by the SASC has also led me to the reluctant
conclusion that the SASC should no longer play a role in
authorizing intelligence programs, particularly when it
increasingly appears that it has little appreciation for the
vital role of intelligence in our nation's security. As a
Member of the SASC since 1985 and a Member of the SSCI since
1989, I have long been concerned with the SASC's practice of
cannibalizing the intelligence budget to fund unrelated and
less important defense systems and programs. This latest action
by the SASC is simply one more example of this long- standing
practice. I believe that the time has come to formally end the
practice of burying the intelligence budget in the Pentagon's
budget and have a separate, stand-alone intelligence budget
line in the federal budget.
On October 15, 1997, Director of Central Intelligence (DCI)
George Tenet publicly announced the aggregate amount
appropriated for intelligence and intelligence-related
activities for fiscal 1997. In March of this year, Director
Tenet publicly announced the same information for fiscal year
1998. I believe that disclosing the aggregate U.S. intelligence
budget poses no threat to our nation's security and I believe
that the Administration should publicly disclose the aggregate
intelligence budget every year, thereby ending the need to have
the intelligence budget buried in the Pentagon's budget. I do
not believe that public disclosure puts us on a ``slippery
slope'' for more detailed disclosures of Intelligence Community
programs and activities. Just as past Administrations have
refused to disclose the aggregate intelligence budget for the
last 50 years, so too should we hold the line against
disclosing more than the aggregate figure in the future.
I believe that there should be a separate line in the
federal budget--separate and distinct from the defense budget--
that contains the aggregate figure for intelligence and
intelligence-related activities. These funds should be
authorized exclusively by the Senate and House intelligence
oversight committees, and the appropriations committees of the
Senate and House should consider the creation of intelligence
subcommittees to deal with intelligence budget appropriations.
I think this will go a long way toward making Congressional
oversight of the Intelligence Community more effective and
responsible.
The Director of Central Intelligence is ostensibly the
manager of the Intelligence Community, but in reality, he only
has meaningful control of the CIA's budget. Serious
consideration should be given to providing the DCI with sole
management authority of the entire Intelligence Community
budget. I think this would significantly enhance the
management, efficiency and effectiveness of the Intelligence
Community.
John Glenn.