27-368

2006
109TH CONGRESS 2ND SESSION
HOUSE OF REPRESENTATIVES
REPORT

[Including cost estimate of the Congressional Budget Office]

congress.#13

MAY 5, 2006- Committed to the Committee of the Whole House on the State of the Union and ordered to be printed

NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 2007

27-368

2006
109TH CONGRESS 2ND SESSION
HOUSE OF REPRESENTATIVES
REPORT

[Including cost estimate of the Congressional Budget Office]

congress.#13

MAY 5, 2006- Committed to the Committee of the Whole House on the State of the Union and ordered to be printed

	HOUSE COMMITTEE ON ARMED SERVICES
	One Hundred Ninth Congress
DUNCAN HUNTER, California, Chairman
CURT WELDON, Pennsylvania JOEL HEFLEY, Colorado JIM SAXTON, New Jersey JOHN M. MCHUGH, New York TERRY EVERETT, Alabama ROSCOE G. BARTLETT, Maryland HOWARD P. `BUCK' MCKEON, California MAC THORNBERRY, Texas JOHN N. HOSTETTLER, Indiana WALTER B. JONES, North Carolina JIM RYUN, Kansas JIM GIBBONS, Nevada ROBIN HAYES, North Carolina KEN CALVERT, California ROB SIMMONS, Connecticut JO ANN DAVIS, Virginia W. TODD AKIN, Missouri J. RANDY FORBES, Virginia JEFF MILLER, Florida JOE WILSON, South Carolina FRANK A. LOBIONDO, New Jersey JEB BRADLEY, New Hampshire MICHAEL TURNER, Ohio JOHN KLINE, Minnesota CANDICE S. MILLER, Michigan MIKE ROGERS, Alabama TRENT FRANKS, Arizona BILL SHUSTER, Pennsylvania THELMA DRAKE, Virginia JOE SCHWARZ, Michigan CATHY MCMORRIS, Washington MICHAEL CONAWAY, Texas GEOFF DAVIS, Kentucky	IKE SKELTON, Missouri JOHN SPRATT, South Carolina SOLOMON P. ORTIZ, Texas LANE EVANS, Illinois GENE TAYLOR, Mississippi NEIL ABERCROMBIE, Hawaii MARTY MEEHAN, Massachusetts SILVESTRE REYES, Texas VIC SNYDER, Arkansas ADAM SMITH, Washington LORETTA SANCHEZ, California MIKE MCINTYRE, North Carolina ELLEN O. TAUSCHER, California ROBERT A. BRADY, Pennsylvania ROBERT ANDREWS, New Jersey SUSAN A. DAVIS, California JAMES R. LANGEVIN, Rhode Island STEVE ISRAEL, New York RICK LARSEN, Washington JIM COOPER, Tennessee JIM MARSHALL, Georgia KENDRICK B. MEEK, Florida MADELEINE Z. BORDALLO, Guam TIM RYAN, Ohio MARK UDALL, Colorado G.K. BUTTERFIELD, North Carolina CYNTHIA MCKINNEY, Georgia DAN BOREN, Oklahoma
ROBERT L. SIMMONS, STAFF DIRECTOR

C O N T E N T S

Page

	Explanation of the Committee Amendments	1
	Purpose	2
	Relationship of Authorization to Appropriations	2
	Summary of Authorization in the Bill	2
	Summary Table of Authorizations	3
	Rationale for the Committee Bill	12
	Hearings	16
	DIVISION A--DEPARTMENT OF DEFENSE AUTHORIZATION	16
	TITLE I--PROCUREMENT	16
	OVERVIEW	16
	Aircraft Procurement, Army	18
	Overview	18
	Items of Special Interest	22
	AH-64 modern signal processing unit	22
	Joint cargo aircraft	22
	HH-60 aircraft wireless intercom system upgrade	23
	UH-60A to UH-60L helicopter upgrade	23
	Missile Procurement, Army	23
	Overview	23
	Items of Special Interest	26
	Patriot modifications	26
	TOW missile inventory	26
	Weapons and Tracked Combat Vehicles, Army	26
	Overview	26
	Items of Special Interest	30
	Army current to future force modernization strategy	30
	Army modularity	30
	Heavy brigade combat teams	31
	Abrams tank modernization	32
	Bradley base sustainment program	32
	Integrated air burst weapon system	32
	Ammunition Procurement, Army	33
	Overview	33
	Items of Special Interest	37
	Desert optimized equipment	37
	Modernization of .50 caliber ammunition production line	37
	Other Procurement, Army	37
	Overview	37
	Items of Special Interest	48
	Bridge to future networks	48
	Combat medical support	48
	Immersive group simulation	49
	M915A3 production	49
	Simulated combat training capability for Army National Guard	49
	Aircraft Procurement, Navy	50
	Overview	50
	Items of Special Interest	55
	EP-3E service life extension	55
	H-53 series modifications	55
	P-3C modernization	55
	Weapons Procurement, Navy	56
	Overview	56
	Item of Special Interest	60
	Conventional trident modification	60
	Ammunition Procurement, Navy & Marine Corps	60
	Overview	60
	Shipbuilding and Conversion, Navy	63
	Overview	63
	Items of Special Interest	67
	313 ship navy force structure	67
	Aircraft carrier force structure requirements	67
	Arleigh Burke class destroyer modernization	67
	Battleship transfer	68
	Incremental funding for shipbuilding	68
	Littoral combat ship program	69
	Next-generation destroyer	69
	Shipbuilding/ship repair industrial base capacity	70
	Ship cost estimates	71
	Virginia class submarine	71
	Other Procurement, Navy	72
	Overview	72
	Items of Special Interest	82
	AEGIS land based test site modernization	82
	Amphibious ship integrated bridge system	82
	AN/SPQ-9B radar	82
	AN/SPS-48 radar obsolescence, availability and recovery	83
	Boat lifts for small boats	83
	Canned lube pumps for amphibious ships	83
	CVN propeller replacement program	83
	Laser marksmanship training systems	84
	Man overboard identification system	84
	Materials handling equipment	84
	Medical support equipment	85
	Multi-climate protective system	85
	Multi-spectral threat emitter system	85
	Serial number tracking system	86
	Submarine communications upgrades	86
	Submarine non-tactical application delivery interface system shore interface	86
	Ultrasonic maintenance tools	87
	Procurement, Marine Corps	87
	Overview	87
	Items of Special Interest	94
	Envelope protective covers for marine expeditionary unit weapon systems and platforms	94
	Intelligent surveillance systems	94
	Laser perimeter awareness system	94
	Aircraft Procurement, Air Force	95
	Overview	95
	Items of Special Interest	102
	B-1B molecular sieve oxygen generation system	102
	B-2 radar modification program	102
	B-52 force structure	103
	C-130 modifications	103
	C-5 modernization programs	104
	C-9 hush kits	104
	F-22	105
	F-35	105
	KC-135 aerial refueling aircraft recapitalization program	106
	P5 combat training systems	107
	Strategic airlift force structure	107
	T-38 ejection seat upgrade program	108
	Ammunition Procurement, Air Force	109
	Overview	109
	Item of Special Interest	112
	Insensitive munitions upgrade	112
	Missile Procurement, Air Force	112
	Overview	112
	Other Procurement, Air Force	116
	Overview	116
	Items of Special Interest	123
	Cheyenne Mountain complex	123
	Combat survivor radios	123
	Combat training ranges	123
	Enterprise data collection solution	124
	Force protection near real time surveillance	124
	High frequency ground control station antennas	124
	Mobile approach control system	125
	Self-deploying infra-red streamer	125
	Procurement, Defense-Wide	125
	Overview	125
	Items of Special Interest	131
	Advanced SEAL Delivery System	131
	Chemical and biological defense procurement	131
	Special operations forces operational enhancements	131
	Unmanned aerial systems to counter improvised explosive devices	132
	U.S. Special Operations Command aviation modernization	132
	LEGISLATIVE PROVISIONS	133
	Subtitle A--Authorization of Appropriations	133
	Sections 101-104--Authorization of Appropriations	133
	Subtitle B--Army Programs	133
	Section 111--Multiyear Procurement Authority for Family of Medium Tactical Vehicles	133
	Section 112--Multiyear Procurement Authority for MH-60R Helicopters and Mission Equipment	134
	Section 113--Funding Profile for Modular Force Initiative of the Army	134
	Section 114--Bridge to Future Networks Program	134
	Subtitle C--Navy Programs	134
	Section 121--Attack Submarine Force Structure	134
	Section 122--Adherence to Navy Cost Estimates for CVN-21 Class of Aircraft Carriers	135
	Section 123--Adherence to Navy Cost Estimates for LHA Replacement Amphibious Assault Ship Program	135
	Section 124--Adherence to Navy Cost Estimates for San Antonio (LPD-17) Class Amphibious Ship Program	135
	Section 125--Multiyear Procurement Authority for V-22 Tiltrotor Aircraft Program	136
	Section 126--Quality Control in Procurement of Ship Critical Safety Items and Related Services	136
	Section 127--DD(X) Next-Generation Destroyer Program	136
	Section 128--Sense of Congress that the Navy Make Greater Use of Nuclear-Powered Propulsion Systems in its Future Fleet of Surface Combatants	136
	Subtitle D--Air Force Programs	137
	Section 131--Requirement for B-52 Force Structure	137
	Section 132--Strategic Airlift Force Structure	137
	Section 133--Limitation on Retirement of U-2 Aircraft	137
	Section 134--Multiyear Procurement Authority for F-22A Raptor Fighter Aircraft	137
	Section 135--Limitation on Retirement of KC-135E Aircraft During Fiscal Year 2007	137
	Section 136--Limitation on Retirement of F-117A Aircraft During Fiscal Year 2007	138
	TITLE II--RESEARCH, DEVELOPMENT, TEST, & EVALUATION	138
	OVERVIEW	138
	Army Research, Development, Test, & Evaluation	141
	Overview	141
	Items of Special Interest	155
	Advanced hypersonic weapon mission planning and control	155
	Applied communications and information networking	155
	Armored systems modernization	155
	AT4 confined space weapon system enhancements	157
	Center for rotorcraft innovation	157
	Digital array radar	157
	Dominant military operations on urban terrain viewer	158
	Environmental quality technology	158
	Excalibur precision guided artillery munition	158
	Flexible display initiative	159
	Gas-engine driven air conditioning system demonstrations	159
	High assurance secure object proxy	159
	Human systems integration	159
	Integrated digital environment service model	160
	Intelligent surveillance sensor suite	160
	Joint land attack cruise missile defense and micro electro mechanical system	160
	Light utility vehicle	161
	Lightweight small arms technologies	161
	Long-term armoring strategy	161
	Medical advanced technology	162
	Medical materiel/medical biological defense equipment--SDD	162
	Miniaturized sensors for small and tactical unmanned aerial vehicles	162
	Missile recycling capability technology	163
	Mobile assessment detection and response system	163
	Next-generation advanced materials research	163
	Polymer matrix composites for rotorcraft drive systems	163
	Portable and mobile emergency broadband system	164
	Product lifecycle management plus	164
	Radiation hardening initiative	164
	Smart energetics architecture	165
	Stryker vehicle open architecture electronic enhancements	165
	Tactical wheeled vehicle product improvement program	165
	Training-based collaborative research in military consequence management	166
	Transparent armor	166
	Warfighter sustainment	166
	Navy Research, Development, Test, & Evaluation	166
	Overview	166
	Items of Special Interest	181
	Advanced composite riverine craft	181
	Advanced materials for acoustic window applications	181
	Affordable towed array construction/fiber optic towed array construction	181
	Affordable weapon system	182
	Airborne reconnaissance systems	182
	Aircraft carrier launch and recovery and support equipment modernization	182
	Ballistic trajectory extended range munition	183
	Bio-film packaging applied research	183
	Cobra Judy ship replacement	183
	Common submarine radio room	184
	Conventional Trident modification	184
	Defense research sciences	185
	Detection and recovery of unexploded ordnance	185
	Dismounted soldier training test instrumentation	186
	Distributed common ground system	186
	DockShock ship shock test system	186
	DP-2 vectored thrust aircraft	187
	E-2 advanced hawkeye identification friend or foe technology development	187
	Electro-optic passive antisubmarine warfare system	187
	F/A-18 squadrons	188
	Flexible payload module and payload interface module development	189
	High performance FM fiber-optic link	189
	Human systems integration	189
	Integrated shipboard intelligent surveillance	189
	Joint integrated systems for advanced digital networking	190
	Large aperture bow array	190
	Large displacement unmanned undersea vehicle at-sea launch and recovery system	190
	Lightweight multi-threat encapsulated ceramic body armor	191
	Lithium battery technology	191
	Marine expeditionary rifle squad	191
	Maritime identification surveillance technology phased array radar	192
	Maritime technology	192
	National shipbuilding research program	193
	Shipbuilding industrial base improvement grants	193
	Shipbuilding industrial base improvement loan guarantees	193
	Naval surface fire support	193
	Network communication system technology for extreme environments	194
	Next-generation electronic warfare simulator	195
	Next-generation Phalanx	195
	Permanent magnet motor	196
	Retroreflecting optical communications for special operations	196
	Sea fighter (X-Craft)	196
	Secure infrastructure technology laboratory	197
	Shipboard wireless maintenance assistant	197
	Small arms and crew served weapons shot counter	197
	Smart valve	197
	Tactical electric field buoy development program	198
	Validation of prognostic and health management systems	198
	VH-71	198
	Virtual-at-sea training technologies	199
	Warfare protection advanced technology	199
	Wet end installation system element	200
	Wireless maritime inspection system	200
	Air Force Research, Development, Test, & Evaluation	200
	Overview	200
	Items of Special Interest	214
	Active feedback flow control technology	214
	Advanced engine starter/generator system prototype	214
	Advanced optics and laser space technology	214
	Advanced spacecraft technology	215
	Affordable lightweight power supply development	215
	B-52 internal weapons bay upgrade	216
	B-52 stand-off jammer program	216
	Biostatic protective clothing	216
	C-130 airlift squadrons	217
	Combatant commanders' integrated command and control system	217
	Distributed mission interoperability toolkit program	218
	Engineering tool improvement program	218
	High accuracy network determination system	218
	High modulus polyacrylonitrile carbon fiber	218
	Human systems integration	219
	Interactive avionics roadmap	219
	Joint advanced global strike demonstration	219
	Joint strike fighter development	220
	KC-135 aerial refueling aircraft recapitalization program	221
	Large aircraft countermeasures system for AC-130U aircraft	221
	Laser peening fatigue life extension	222
	Low emission hybrid electric engine propulsion	222
	Major test and evaluation investment	222
	Materials	223
	Measurement and signature intelligence (MASINT) visualization tools program	223
	Metals affordability initiative	223
	Nanocrystalline diamond coatings	223
	Operationally responsive space	224
	Radio frequency identification tag rapid adoption initiative, phase2	224
	Small diameter bomb	224
	Space-based radar	224
	Space control test capabilities	225
	Space technology	225
	Tactical automated security system advanced communications module	225
	Transformational satellite communications system	226
	Winglets for in-service aircraft	226
	Defense-Wide Research, Development, Test, & Evaluation	227
	Overview	227
	Items of Special Interest	240
	Accelerated intelligence analyst education and training	240
	Advanced data encryption technololgy	240
	Advanced SEAL Delivery System	240
	Advanced surface radar technologies	241
	Advanced tactical laser program	241
	Ballistic missile defense	241
	Aegis ballistic missile defense	242
	Boost defense segment	242
	Core	243
	Midcourse defense segment	243
	Multiple kill vehicle	244
	System interceptor	244
	Technology	245
	Biological warfare defense	245
	Business transformation agency	246
	Chemical-biological collective protective shelters	246
	Chemical and biological defense program	246
	Advanced technology development	247
	Applied research	247
	Basic research	247
	Combating terrorism technology support	248
	Generic logistics research and development technology demonstrations	248
	Improved suborbital operations	249
	Joint training transformation	249
	Office of force transformation	249
	Special operations advanced technology development	250
	Special operations forces operational enhancements	250
	Special operations intelligence systems development	250
	Special operations tactical systems development	251
	Special operations technology development	251
	Operational Test and Evaluation, Defense	252
	Overview	252
	LEGISLATIVE PROVISIONS	252
	Subtitle A--Authorization of Appropriations	252
	Section 201--Authorization of Appropriations	252
	Section 202--Amount for Defense Science and Technology	252
	Subtitle B--Program Requirements, Restrictions, and Limitations	252
	Section 211--Alternate Engine for Joint Strike Fighter	252
	Section 212--Extension of Authority to Award Prizes for Advanced Technology Achievements	252
	Section 213--Extension of Defense Acquisition Challenge Program	252
	Section 214--Future Combat Systems Milestone Review	253
	Section 215--Independent Cost Analyses for Joint Strike Fighter Engine Program	253
	Section 216--Dedicated Amounts for Implementing or Evaluating DD(X) and CVN-21 Proposals Under Defense Acquisition Challenge Program	253
	Subtitle C--Ballistic Missile Defense	253
	Section 221--Fielding of Ballistic Missile Defense Capabilities	253
	Section 222--Limitation on Use of Funds for Spacebased Interceptor	253
	Subtitle D--Other Matters	254
	Section 231--Review of Test and Evaluation Policies and Practices to Address Emerging Acquisition Approaches	254
	TITLE III--OPERATION AND MAINTENANCE	255
	OVERVIEW	255
	ITEMS OF SPECIAL INTEREST	288
	Budget Request Adjustments--Readiness	288
	Army Knowledge Online Disaster Recovery	289
	Capital Security Cost Share	289
	Combat Enhancement Forces and Combat Communications	290
	Homeland Defense Operational Planning System	290
	Maritime Prepositioning Ship Lease Buyout	290
	Nationwide Dedicated Fiber Optic Network	291
	Navy Marine Corps Intranet	291
	Port of Corpus Christi	291
	Readiness and Environmental Protection Initiative	291
	Weapons of Mass Destruction Civil Support Teams	292
	Environmental Issues	292
	Fuel Tank Replacement at Point Loma, California	292
	Non-thermal Treatment of Asbestos and Asbestos Containing Material	292
	Report on Uranium Located in Gore, Oklahoma	292
	Site Assessment of Former World War II Ordnance Manufacturing Facility, Rosemount, Minnesota	293
	Information Technology Issues	293
	Information Technology Overview	293
	Business Transformation Agency and Enterprise Risk Assessment Model	294
	Readiness Issues	294
	Air Force Transformation	294
	Army Logistics Modernization	295
	Base Operating Support and Facilities Recapitalization Budget Shortfalls	295
	Beryllium Supply Industrial Base	296
	Depot Maintenance Strategy and Implementation Plans	296
	High Altitude Aviation Training	297
	National Space Studies Center Study	298
	LEGISLATIVE PROVISIONS	298
	Subtitle A--Authorization of Appropriations	298
	Section 301--Operation and Maintenance Funding	298
	Section 302--Working Capital Funds	298
	Section 303--Other Department of Defense Programs	298
	Subtitle B--Environmental Provisions	299
	Section 311--Revision of Requirement for Unexploded Ordnance Program Manager	299
	Section 312--Identification and Monitoring of Military Munitions Disposal Sites in Ocean Waters Extending from United States Coast to Outer Boundary of Outer Continental Shelf	299
	Section 313--Reimbursement of Environmental Protection Agency for Certain Costs in Connection with Moses Lake Wellfield Superfund Site, Moses Lake, Washington	299
	Section 314--Funding of Cooperative Agreements Under Environmental Restoration Program	299
	Section 315--Analysis and Report Regarding Contamination and Remediation Responsibility for Norwalk Defense Fuel Supply Point, Norwalk, California	300
	Subtitle C--Workplace and Depot Issues	300
	Section 321--Extension of Exclusion of Certain Expenditures from Percentage Limitation on Contracting for Depot-Level Maintenance	300
	Section 322--Minimum Capital Investment for Air Force Depots	300
	Section 323--Extension of Temporary Authority for Contractor Performance of Security Guard Functions	300
	Subtitle D--Reports	301
	Section 331--Report on Nuclear Attack Submarine Depot Maintenance	301
	Section 332--Report on Navy Fleet Response Plan	301
	Section 333--Report on Navy Surface Ship Rotational Crew Programs	301
	Section 334--Report on Army Live-Fire Ranges in Hawaii	302
	Section 335--Comptroller General Report on Joint Standards and Protocols for Access Control Systems at Department of Defense Installations	302
	Section 336--Report on Personnel Security Investigations for Industry and National Industrial Security Program	302
	Subtitle E--Other Matters	303
	Section 341--Department of Defense Strategic Policy on Prepositioning of Materiel and Equipment	303
	Section 342--Authority to Make Department of Defense Horses Available for Adoption at End of Useful Working Life	304
	Section 343--Sale and Use of Proceeds of Recyclable Munitions Materials	304
	Section 344--Capital Security Cost Sharing	304
	Section 345--Prioritization of Funds Within Navy Mission Operations, Ship Maintenance, Combat Support Forces, and Weapons System Support	304
	Section 346--Prioritization of Funds Within Army Reconstitution and Transformation	305
	TITLE IV--MILITARY PERSONNEL AUTHORIZATIONS	306
	OVERVIEW	306
	LEGISLATIVE PROVISIONS	306
	Subtitle A--Active Forces	306
	Section 401--End Strengths for Active Forces	306
	Section 402--Revision in Permanent Active Duty End Strength Minimum Levels	307
	Section 403--Additional Authority for Increases of Army and Marine Corps Active Duty End Strengths for Fiscal Years 2008 and 2009	307
	Subtitle B--Reserve Forces	307
	Section 411--End Strengths for Selected Reserve	307
	Section 412--End Strengths for Reserves on Active Duty in Support of the Reserve Components	308
	Section 413--End Strengths for Military Technicians (Dual Status)	308
	Section 414--Fiscal Year 2007 Limitation on Number of Non-Dual Status Technicians	309
	Section 415--Maximum Number of Reserve Personnel Authorized to be on Active Duty for Operational Support	309
	Subtitle C--Authorization of Appropriations	309
	Section 421--Military Personnel	309
	Section 422--Armed Forces Retirement Home	310
	TITLE V--MILITARY PERSONNEL POLICY	310
	OVERVIEW	310
	ITEMS OF SPECIAL INTEREST	312
	Academy Language Training	312
	Closure of Article 32 Investigations in Cases of Sexual Assault or Domestic Violence	312
	Department of the Navy Personal Responsibility and Values: Education and Training Program	313
	Educational Opportunities in Interagency Coordination at the Military War Colleges	313
	Joint Advertising, Market Research and Studies	314
	Operation of Army Air Ambulance Detachments	314
	Permanent Identification Cards for Adult Disabled Children	315
	Personnel Plan for Linguists	315
	Process for Restructuring the Army National Guard	315
	Social Security Numbers on Military Identification Cards	316
	Trafficking in Persons	316
	Victim Service Organization Privilege in Cases Arising Under Uniform Code of Military Justice	317
	Web-based Enhancement to Support Family Readiness Programs	318
	LEGISLATIVE PROVISIONS	318
	Subtitle A--Officer Personnel Policy	318
	Section 501--Authorized Strength of Navy Reserve Flag Officers	318
	Section 502--Standardization of Grade of Senior Dental Officer of the Air Force with that of Senior Dental Officer of the Army	318
	Section 503--Management of Chief Warrant Officers	319
	Section 504--Reduction in Time-in-Grade Requirement for Promotion to Captain in the Army, Air Force, and Marine Corps and Lieutenant in the Navy	319
	Section 505--Military Status of Officers Serving in Certain Intelligence Community Positions	319
	Subtitle B--Reserve Component Management	319
	Section 511--Revisions to Reserve Call-up Authority	319
	Section 512--Military Retirement Credit for Certain Service by National Guard Members Performed While in a State Duty Status Immediately After the Terrorist Attacks of September 11, 2001	320
	Section 513--Report on Private Sector Promotion and Constructive Termination of Members of the Reserve Components Called or Ordered to Active Service	320
	Subtitle C--Education and Training	320
	Section 521--Authority to Permit Members Who Participate in the Guaranteed Reserve Forces Duty Scholarship Program to Participate in the Health Professions Scholarship Program and Serve on Active Duty	320
	Section 522--Junior Reserve Officers' Training Corps Instruction Eligibility Expansion	320
	Section 523--Authority for United States Military Academy and United States Air Force Academy Permanent Military Professors to Assume Command Positions While on Periods of Sabbatical	321
	Section 524--Expansion of Service Academy Exchange Programs with Foreign Military Academies	321
	Section 525--Review of Legal Status of Junior ROTC Program	321
	Subtitle D--General Service Authorities	322
	Section 531--Test of Utility of Test Preparation Guides and Education Programs in Enhancing Recruit Candidate Performance on the Armed Services Vocational Aptitude Battery (ASVAB) and Armed Forces Qualification Test (AFQT)	322
	Section 532--Nondisclosure of Selection Board Proceedings	322
	Section 533--Report on Extent of Provision of Timely Notice of Long-Term Deployments	322
	Subtitle E--Authorities Relating to Guard and Reserve Duty	323
	Section 541--Title 10 Definition of Active Guard and Reserve Duty	323
	Section 542--Authority for Active Guard and Reserve Duties to Include Support of Operational Missions Assigned to the Reserve Components and Instruction and Training of Active-Duty Personnel	323
	Section 543--Governor's Authority to Order Members to Active Guard and Reserve Duty	323
	Section 544--National Guard Officers Authority to Command	323
	Section 545--Expansion of Operations of Civil Support Teams	324
	Subtitle F--Decorations and Awards	324
	Section 551--Authority for Presentation of Medal of Honor Flag to Living Medal of Honor Recipients and to Living Primary Next-of-Kin of Deceased Medal of Honor Recipients	324
	Section 552--Cold War Victory Medal	324
	Section 553--Posthumous Award of Purple Heart for Prisoners of War Who Die in or Due to Captivity	324
	Section 554--Advancement on the Retired List of Certain Decorated Retired Navy and Marine Corps Officers	324
	Section 555--Report on Department of Defense Process for Awarding Decorations	325
	Subtitle G--Matters Relating to Casualties	325
	Section 561--Criteria for Removal of Member from Temporary Disability Retired List	325
	Section 562--Department of Defense Computer/Electronic Accommodations Program for Severely Wounded Members	325
	Section 563--Transportation of Remains of Casualties Dying in a Theater of Combat Operations	325
	Section 564--Annual Budget Display of Funds for POW/MIA Activities of Department of Defense	326
	Subtitle H--Assistance to Local Educational Agencies for Defense Dependents Education	327
	Section 571--Continuation of Authority to Assist Local Educational Agencies that Benefit Dependents of Members of the Armed Forces and Department of Defense Civilian Employees	327
	Section 572--Enrollment in Defense Dependents' Education System of Dependents of Foreign Military Members Assigned to Supreme Headquarters Allied Powers, Europe	327
	Subtitle I--Postal Benefits	327
	Section 575--Postal Benefits Program for Members of the Armed Forces	327
	Section 576--Funding	327
	Section 577--Duration	328
	Subtitle J--Other Matters	328
	Section 581--Reduction in Department of Defense Accrual Contributions to Department of Defense Military Retirement Fund	328
	Section 582--Dental Corps of the Bureau of Medicine and Surgery	328
	Section 583--Permanent Authority for Presentation of Recognition Items for Recruitment and Retention Purposes	328
	Section 584--Report on Feasibility of Establishment of Military Entrance Processing Command Station on Guam	328
	Section 585--Persons Authorized to Administer Enlistment and Appointment Oaths	328
	Section 586--Repeal of Requirement for Periodic Department of Defense Inspector General Assessments of Voting Assistance Compliance at Military Installations	329
	Section 587--Physical Evaluation Boards	329
	Section 588--Department of Labor Transitional Assistance Program	330
	Section 589--Revision in Government Contributions to Medicare-Eligible Retiree Health Care Fund	330
	Section 590--Military Chaplains	331
	Section 591--Report on Personnel Requirements for Airborne Assets Identified as Low-Density, High-Demand Airborne Assets	331
	Section 592--Entrepreneurial Service Members Empowerment Task Force	331
	Section 593--Comptroller General Report on Military Conscientious Objectors	331
	Section 594--Commission on the National Guard and Reserves	331
	TITLE VI--COMPENSATION AND OTHER PERSONNEL BENEFITS	332
	OVERVIEW	332
	ITEMS OF SPECIAL INTEREST	332
	Elimination of the Survivor Benefit Plan Two-Tier Annuity Computation System	332
	Military Decorations and Uniform Accounterments Sold in Military Exchange Stores	333
	Recoupment of Survivor Benefit Plan Overpayments	333
	Second Destination Transportation of Exchange Store Goods	334
	Treatment of Dual Military Couples	334
	United Service Organizations	334
	LEGISLATIVE PROVISIONS	335
	Subtitle A--Pay and Allowances	335
	Section 601--Increase in Basic Pay for Fiscal Year 2007	335
	Section 602--Targeted Increase in Basic Pay Rates	335
	Section 603--Conforming Change in General and Flag Officer Pay Cap to Reflect Increase in Pay Cap for Senior Executive Service Personnel	335
	Section 604--Availability of Second Basic Allowance for Housing for Certain Reserve Component or Retired Members Serving in Support of Contingency Operations	335
	Section 605--Extension of Temporary Continuation of Housing Allowance for Dependents of Members Dying on Active Duty to Spouses Who are Also Members	336
	Section 606--Clarification of Effective Date of Prohibition on Compensation for Correspondence Courses	336
	Section 607--Payment of Full Premium for Coverage Under Servicemembers' Group Life Insurance Program During Service in Operation Enduring Freedom or Operation Iraqi Freedom	336
	Subtitle B--Bonuses and Special and Incentive Pays	336
	Section 611--Extension of Certain Bonus and Special Pay Authorities for Reserve Forces	336
	Section 612--Extension of Bonus and Special Pay Authorities for Health Care Professionals	336
	Section 613--Extension of Special Pay and Bonus Authorities for Nuclear Officers	337
	Section 614--Extension of Other Bonus, Special Pay, and Separation Pay Authorities	337
	Section 615--Expansion of Eligibility of Dental Officers for Additional Special Pay	337
	Section 616--Increase in Maximum Annual Rate of Special Pay for Selected Reserve Health Care Professionals in Critically Short Wartime Specialties	337
	Section 617--Authority to Provide Lump Sum Payment of Nuclear Officer Incentive Pay	337
	Section 618--Increase in Maximum Amount of Nuclear Career Accession Bonus	337
	Section 619--Increase in Maximum Amount of Incentive Bonus for Transfer Between Armed Forces	337
	Section 620--Clarification Regarding Members of the Army Eligible for Bonus for Referring Other Persons for Enlistment in the Army	338
	Section 621--Pilot Program for Recruitment Bonus for Critical Health Care Specialties	338
	Section 622--Enhancement of Temporary Program of Voluntary Separation Pay and Benefits	338
	Section 623--Additional Authorities and Incentives to Encourage Retired Members and Reserve Component Members to Volunteer to Serve on Active Duty in High-Demand, Low-Density Assignments	338
	Subtitle C--Travel and Transportation Allowance	338
	Section 631--Authoriy to Pay Costs Associated with Delivery of Motor Vehicle to Storage Location Selected by Member and Subsequent Removal of Vehicle	338
	Section 632--Transportation of Additional Motor Vehicle of Members on Change of Permanent Station to or from Nonforeign Areas Outside the Continental United States	339
	Section 633--Travel and Transportation Allowances for Transportation of Family Members Incident to Illness or Injury of Members	339
	Subtitle D--Retired Pay and Survivors Benefits	339
	Section 641--Military Survivor Benefit Plan Beneficiaries Under Insurable Interest Coverage	339
	Section 642--Retroactive Payment of Additional Death Gratuity for Certain Members Not Previously Covered	339
	Section 643--Equity in Computation of Disability Retired Pay for Reserve Component Members Wounded in Action	339
	Subtitle E--Commissary and Nonappropriated Fund Instrumentality Benefits	340
	Section 651--Treatment of Price Surcharges of Tobacco Products and Certain Other Merchandise Sold at Commissary Stores	340
	Section 652--Limitation on Use of Department of Defense Lease Authority to Undermine Commissaries and Exchange and Other Morale, Welfare, and Recreation Programs and Nonappropriated Fund Instrumentalities	340
	Section 653--Use of Nonappropriated Funds to Supplement or Replace Appropriated Funds for Construction of Facilities of Exchange Stores System and Other Nonappropriated Fund Instrumentalities, Military Lodging, Facilities, and Community Facilities	340
	Section 654--Report on Cost Effectiveness of Purchasing Commercial Insurance for Commissary and Exchange Facilities and Facilities of Other Morale, Welfare, and Recreation Programs and Nonappropriated Fund Instrumentalities	340
	Subtitle F--Other Matters	341
	Section 661--Repeal of Annual Reporting Requirement Regarding Effects of Recruitment and Retention Initiatives	341
	Section 662--Pilot Project Regarding Providing Golf Carts Accessible for Disabled Persons at Military Golf Courses	341
	Section 663--Enhanced Authority to Remit or Cancel Indebtedness of Members of the Armed Forces Incurred on Active Duty	341
	TITLE VII--HEALTH CARE PROVISIONS	342
	OVERVIEW	342
	ITEMS OF SPECIAL INTEREST	343
	Comprehensive Combat Casualty Care Center	343
	Comptroller General Report on a Unified Medical Command Plan	343
	Fort Drum Health Care Pilot Program	343
	Mental Health Programs for Combat Veterans and Their Families	344
	Screening for Traumatic Brain Injury	344
	TRICARE Mail Order Pharmacy Program	344
	LEGISLATIVE PROVISIONS	345
	Subtitle A--TRICARE Program Improvements	345
	Section 701--TRICARE Coverage for Forensic Examination Following Sexual Assault or Domestic Violence	345
	Section 702--Authorization of Anesthesia and Other Costs for Dental Care for Children and Certain Other Patients	345
	Section 703--Improvements to Descriptions of Cancer Screening	345
	Section 704--Prohibition on Increases in Certain Health Care Costs for Members of the Uniformed Services	345
	Section 705--Services of Mental Health Counselors	346
	Section 706--Demonstration Project on Coverage of Selected Over-the-Counter Medications Under the Pharmacy Benefit Program	346
	Section 707--Requirement to Reimburse Certain Travel Expenses of Certain Beneficiaries Covered by TRICARE for Life	346
	Section 708--Inflation Adjustment of Differential Payments to Children's Hospitals Participating in TRICARE Program	346
	Section 709--Expanded Eligibility of Selected Reserve Members Under TRICARE Program	347
	Section 710--Extension to TRICARE of Medicare Prohibition of Financial Incentives Not to Enroll in Group Health Plan	347
	Subtitle B--Studies and Reports	347
	Section 711--Department of Defense Task Force on the Future of Military Health Care	347
	Section 712--Study and Plan Relating to Chiropractic Health Care Services	347
	Section 713--Comptroller General Study and Report on Defense Health Program	348
	Section 714--Transfer of Custody of the Air Force Health Study Assets to Medical Follow-up Agency	348
	Section 715--Study on Allowing Dependents of Activated Members of the Reserve Components to Retain Civilian Health Care Coverage	348
	Subtitle C--Other Matters	349
	Section 721--Costs of Incentive Payments to Employees for TRICARE Enrollment Made Unallowable for Contractors	349
	Section 722--Requirement For Military Medical Personnel to be Trained in Preservation of Remains	349
	Subtitle D--Pharmacy Benefits Program Improvements	349
	Section 731--TRICARE Pharmacy Program Cost-Share Requirements	349
	TITLE VIII--ACQUISITION POLICY, ACQUISITION MANAGEMENT, AND RELATED MATTERS	350
	OVERVIEW	350
	ITEMS OF SPECIAL INTEREST	352
	Major Defense Acquisition Program Reform	352
	Prime Vendor Program	352
	Special Operations Command Requirements	353
	Undefinitized Contract Actions	353
	LEGISLATIVE PROVISIONS	353
	Subtitle A--Provisions Relating to Major Defense Acquisition Programs	353
	Section 801--Requirements Management Certification Training Program	353
	Section 802--Additional Requirements Relating to Technical Data Rights	354
	Section 803--Study and Report on Revisions to Selected Acquisition Report Requirements	354
	Section 804--Quarterly Updates on Implementation of Acquisition Reform in the Department of Defense	355
	Section 805--Establishment of Defense Challenge Process for Critical Cost Growth Threshold Breaches in Major Defense Acquisition Programs	356
	Section 806--Market Research Required for Major Defense Acquisition Programs Before Proceeding to Milestone B	357
	Subtitle B--Acquisition Policy and Management	358
	Section 811--Applicability of Statutory Executive Compensation Cap Made Prospective	358
	Section 812--Prohibition on Procurement from Beneficiaries of Foreign Subsidies	358
	Section 813--Time-Certain Development for Department of Defense Information Technology Business Systems	358
	Section 814--Establishment of Panel on Contracting Integrity	358
	Subtitle C--Amendments to General Contracting Authorities, Procedures, and Limitations	359
	Section 821--Extension of Special Temporary Contract Closeout Authority	359
	Section 822--Limitation on Contracts for the Acquisition of Certain Services	359
	Section 823--Use of Federal Supply Schedules by State and Local Governments for Goods and Services for Recovery from Natural Disasters, Terrorism, or Nuclear, Biological, Chemical, or Radiological Attack	359
	Section 824--Waivers to Extend Task Order Contracts for Advisory and Assistance Services	359
	Section 825--Enhanced Access for Small Business	360
	Section 826--Procurement Goal for Hispanic-Serving Institutions	360
	Section 827--Prohibition on Defense Contractors Requiring Licenses or Fees for Use of Military Likenesses and Designations	360
	Subtitle D--United States Defense Industrial Base Provisions	361
	Section 831--Protection of Strategic Materials Critical to National Security	361
	Section 832--Strategic Materials Protection Board	361
	TITLE IX--DEPARTMENT OF DEFENSE ORGANIZATION AND MANAGEMENT	362
	ITEMS OF SPECIAL INTEREST	362
	Importance of Placing Foreign Area Officers in Combat Units	362
	Increased Budgetary Confidence Level Implementation in Space Acquisition	362
	National Security Space Management	362
	Report on Developing Expertise in Emerging National Security Challenges	363
	Report on Coordination and Oversight of Military Cultural and Linguistic Policies and Training	363
	LEGISLATIVE PROVISIONS	364
	Subtitle A--Department of Defense Management	364
	Section 901--Standardization of Statutory References to `National Security System' within Laws Applicable to Department of Defense	364
	Section 902--Correction of Reference to Predecessor of Defense Information Systems Agency	364
	Section 903--Addition to Membership of Specified Council	364
	Section 904--Consolidation and Standardization of Authorities Relating to Department of Defense Regional Centers for Security Studies	364
	Section 905--Redesignation of the Department of the Navy as the Department of the Navy and Marine Corps	365
	Subtitle B--Space Activities	365
	Section 911--Designation of Successor Organizations for the Disestablished Interagency Global Positioning Executive Board	365
	Section 912--Extension of Authority for Pilot Program for Provision of Space Surveillance Network Services to Non-United States Government Entities	365
	Section 913--Operationally Responsive Space	365
	Subtitle C--Chemical Demilitarization Program	365
	Section 921--Transfer to Secretary of the Army of Responsibility for Assembled Chemical Weapons Alternatives Program	365
	Section 922--Comptroller General Review of Cost-Benefit Analysis of Off-Site Versus On-Site Treatment and Disposal of Hydrolysate Derived from Neutralization of VX Nerve Gas at Newport Chemical Depot, Indiana	366
	Section 923--Sense of Congress Regarding the Safe and Expeditious Disposal of Chemical Weapons	366
	Subtitle D--Intelligence-Related Matters	366
	Section 931--Repeal of Termination of Authority of Secretary of Defense to Engage in Commercial Activities as Security for Intelligence Collection Activities Abroad	366
	TITLE X--GENERAL PROVISIONS	366
	ITEMS OF SPECIAL INTEREST	366
	Counter-Drug Activities	366
	Overview	366
	Items of Special Interest	367
	Budget requests	367
	Counternarcotics Policy for Afghanistan	367
	Intelligence and technology	368
	Maritime Domain Awareness	368
	Southwest Border Fence	368
	U.S. Central Command operations support	369
	U.S. Northern Command operations support	369
	U.S. Pacific Command operations support	369
	U.S. Southern Command operations support	369
	Other Activities	369
	Aircraft Carrier Force Structure	369
	`Commercial First' Maritime Sealift Policy	370
	Department of Defense Civil Support	370
	Department of Defense Interagency Coordination in the Global War on Terrorism	371
	Department of Defense Participation in the Committee on Foreign Investment in the United States	372
	Homeland Security/Defense Management Programs	372
	Improving International Pandemic Preparedness through Theater Security Cooperation Programs	373
	Increasing the Availability of Intelligence, Surveillance, and Reconnaissance Assets in the Event of a Catastrophic Natural or Manmade Disaster	373
	Joint Training and Certification for Nuclear, Chemical, and Biological Defense	373
	National Counter Proliferation Center	374
	Overhaul, Repair, and Maintenance of Vessels Carrying Department of Defense Cargo	375
	Report on Strategic Language Skills	375
	Special Operations Command as the Supported Command in the Global War on Terrorism	376
	Status and Implementation of Military Support for Stability, Security, Transition, and Reconstruction Operations	376
	Terrorist Use of the Internet	377
	LEGISLATIVE PROVISIONS	377
	Subtitle A--Financial Matters	377
	Section 1001--General Transfer Authority	377
	Section 1002--Authorizations of Supplemental Appropriations for Fiscal Year 2006	377
	Section 1003--Increase in Fiscal Year 2006 General Transfer Authority	377
	Section 1004--United States Contribution to NATO Common-Funded Budgets in Fiscal Year 2007	378
	Section 1005--Report on Budgeting for Fluctuations in Fuel Cost Rates	378
	Section 1006--Reduction in Authorizations Due to Savings Resulting from Lower than Expected Inflation	378
	Subtitle B--Policy Relating to Naval Vessels and Shipyards	378
	Section 1011--Transfer of Naval Vessels to Foreign Nations Based upon Vessel Class	378
	Section 1012--Overhaul, Repair, and Maintenance of Vessels in Foreign Shipyards	379
	Section 1013--Report on Options for Future Lease Arrangements for Guam Shipyard	379
	Section 1014--Shipbuilding Industrial Base Improvement Program	380
	Section 1015--Transfer of Operational Control of Certain Patrol Coastal Ships to Coast Guard	380
	Section 1016--Limitation on Leasing of Foreign-Built Vessels	380
	Section 1017--Overhaul, Repair, and Maintenance of Vessels Carrying Department of Defense Cargo	381
	Section 1018--Riding Gang Member Documentation Requirement	381
	Subtitle C--Counter-Drug Activities	381
	Section 1021--Restatement in Title 10, United States Code, and Revision of Department of Defense Authority to Provide Support for Counter-Drug Activities of Federal, State, Local, and Foreign Law Enforcement Agencies	381
	Section 1022--Restatement in Title 10, United States Code, and Revision of Department of Defense Authority to Provide Support for Counter-Drug Activities of Certain Foreign Governments	382
	Section 1023--Extension of Authority to Support Unified Counter-Drug and Counterterrorism Campaign in Colombia	382
	Section 1024--Continuation of Reporting Requirement Regarding Department of Defense Expenditures to Support Foreign Counter-Drug Activities	383
	Section 1025--Report on Interagency Counternarcotics Plan for Afghanistan and South and Central Asian Regions	383
	Subtitle D--Other Matters	383
	Section 1031--Revision to Authorities Relating to Commission on the Implementation of the New Strategic Posture of the United States	383
	Section 1032--Enhancement to Authority to Pay Rewards for Assistance in Combating Terrorism	384
	Section 1033--Report on Assessment Process of Chairman of the Joint Chiefs of Staff Relating to Global War on Terrorism	384
	Section 1034--Presidential Report on Improving Interagency Support for United States 21st Century National Security Missions	384
	Section 1035--Quarterly Reports on 2006 Quadrennial Defense Review Report Implementation	385
	Section 1036--Increased Hunting and Fishing Opportunities for Members of the Armed Forces, Retired Members, and Disabled Veterans	386
	Section 1037--Technical and Clerical Amendments	386
	Section 1038--Database of Emergency Response Capabilities	386
	Section 1039--Information on Certain Criminal Investigations and Prosecutions	387
	Section 1040--Date for Final Report of EMP Commission	387
	TITLE XI--CIVILIAN PERSONNEL MATTERS	387
	ITEM OF SPECIAL INTEREST	387
	Performance Periods Established in Connection with Public-private Competitions	387
	LEGISLATIVE PROVISIONS	388
	Section 1101--Increase in Authorized Number of Defense Intelligence Senior Executive Service Employees	388
	Section 1102--Authority for Department of Defense to Pay Full Replacement Value for Personal Property Claims of Civilians	388
	Section 1103--Accrual of Annual Leave for Members of the Uniformed Services Performing Dual Employment	388
	Section 1104--Death Gratuity Authorized for Federal Employees	388
	TITLE XII--MATTERS RELATING TO FOREIGN NATIONS	389
	ITEMS OF SPECIAL INTEREST	389
	Addressing the Threat Posed by the Islamic Republic of Iran	389
	International Military Education and Training Programs	390
	Report on Certain Cooperative Activities Involving the United States and India	390
	Report on Department of Defense Activities in Support of Multinational Peacekeeping Operations in Sudan	391
	LEGISLATIVE PROVISIONS	391
	Subtitle A--Assistance and Training	391
	Section 1201--Logistic Support for Allied Forces Participating in Combined Operations	391
	Section 1202--Temporary Authority to Use Acquisition and Cross-Servicing Agreements to Lend Certain Military Equipment to Foreign Forces in Iraq and Afghanistan for Personnel Protection and Survivability	392
	Section 1203--Recodification and Revision to Law Relating to Department of Defense Humanitarian Demining Assistance	392
	Section 1204--Enhancements to Regional Defense Combating Terrorism Fellowship Program	392
	Section 1205--CAPSTONE Overseas Field Studies Trips to People's Republic of China and Republic of China on Taiwan	393
	Section 1206--Military Educational Exchanges Between Senior Officers and Officials of the United States and Taiwan	393
	Subtitle B--Nonproliferation Matters and Countries of Concern	393
	Section 1211--Procurement Restrictions Against Foreign Persons That Transfer Certain Defense Articles and Services to the People's Republic of China	393
	Subtitle C--Other Matters	394
	Section 1221--Execution of the President's Policy to Make Available to Taiwan Diesel Electric Submarines	394
	TITLE XIII--COOPERATIVE THREAT REDUCTION WITH STATES OF THE FORMER SOVIET UNION	394
	OVERVIEW	394
	Section 1301--Specification of Cooperative Threat Reduction Programs and Funds	394
	Section 1302--Funding Allocations	394
	Section 1303--Temporary Authority to Waive Limitation on Funding for Chemical Weapons Destruction Facility in Russia	395
	Section 1304--National Academy of Sciences Study	395
	TITLE XIV--HOMELAND DEFENSE TECHNOLOGY TRANSFER	395
	LEGISLATIVE PROVISIONS	395
	Sections 1401-1403--Homeland Defense Technology Transfer	395
	TITLE XV--AUTHORIZATION FOR INCREASED COSTS DUE TO OPERATION IRAQI FREEDOM AND OPERATION ENDURING FREEDOM	396
	OVERVIEW	396
	SUMMARY TABLE OF AUTHORIZATIONS	396
	ITEMS OF SPECIAL INTEREST	404
	Budget Realignment	404
	Procurement	404
	Improvised electronic devices countermeasures	404
	Joint surveillance target attack radar system utilization	405
	Manned tactical persistent surveillance aircraft	406
	Operation and Maintenance	407
	Military Personnel	407
	Research, Development, Test, & Evaluation	407
	U-2 aircraft sensor development	407
	LEGISLATIVE PROVISIONS	407
	Section 1501--Purpose	407
	Subtitle A--Authorization of Appropriations	408
	Section 1502--Army Procurement	408
	Section 1503--Navy and Marine Corps Procurement	408
	Section 1504--Air Force Procurement	408
	Section 1505--Defense-Wide Activities Procurement	408
	Section 1506--Research, Development, Test, & Evaluation	408
	Section 1507--Operation and Maintenance	408
	Section 1508--Defense Health Program	408
	Section 1509--Classified Programs	408
	Section 1510--Military Personnel	408
	Section 1511--Treatment as Additional Authorizations	408
	Section 1512--Transfer Authority	408
	Section 1513--Availability of Funds	409
	DIVISION B--MILITARY CONSTRUCTION AUTHORIZATIONS	409
	PURPOSE	409
	MILITARY CONSTRUCTION AND FAMILY HOUSING OVERVIEW	409
	Section 2001--Short Title	429
	TITLE XXI--ARMY	429
	SUMMARY	429
	ITEMS OF SPECIAL INTEREST	429
	Explanation of Funding Adjustments	429
	Future Year Programming	430
	Planning and Design	430
	Safety-Critical Projects	430
	Unspecified Minor Construction	430
	LEGISLATIVE PROVISIONS	430
	Section 2101--Authorized Army Construction and Land Acquisition Projects	430
	Section 2102--Family Housing	431
	Section 2103--Improvements to Military Family Housing Units	431
	Section 2104--Authorization of Appropriations, Army	431
	TITLE XXII--NAVY	431
	SUMMARY	431
	ITEMS OF SPECIAL INTEREST	431
	Explanation of Funding Adjustments	431
	Planning and Design	432
	LEGISLATIVE PROVISIONS	432
	Section 2201--Authorized Navy Construction and Land Acquisition Projects	432
	Section 2202--Family Housing	432
	Section 2203--Improvements to Military Family Housing Units	432
	Section 2204--Authorization of Appropriations, Navy	432
	Section 2205--Modification of Authority to Carry Out Certain Fiscal Year 2004 and 2005 Projects	432
	TITLE XXIII--AIR FORCE	432
	SUMMARY	432
	ITEM OF SPECIAL INTEREST	433
	Planning and Design	433
	LEGISLATIVE PROVISIONS	433
	Section 2301--Authorized Air Force Construction and Land Acquisition Projects	433
	Section 2302--Family Housing	433
	Section 2303--Improvements to Military Family Housing Units	433
	Section 2304--Authorization of Appropriations, Air Force	433
	TITLE XXIV--DEFENSE AGENCIES	433
	SUMMARY	433
	ITEMS OF SPECIAL INTEREST	434
	Explanation of Funding Adjustments	434
	Fuel Storage at Naval Base Point Loma, California	434
	Missile Defense Agency Construction Activities	434
	LEGISLATIVE PROVISIONS	435
	Section 2401--Authorized Defense Agencies Construction and Land Acquisition Projects	435
	Section 2402--Family Housing	435
	Section 2403--Energy Conservation Projects	435
	Section 2404--Authorized Base Closure and Realignment Activities Funded Through Department of Defense Base Closure Account 2005	435
	Section 2405--Authorization of Appropriations, Defense Agencies	435
	Section 2406--Modification of Authority to Carry Out Certain Fiscal Year 2006 Projects	435
	TITLE XXV--NORTH ATLANTIC TREATY ORGANIZATION SECURITY INVESTMENT PROGRAM	435
	SUMMARY	435
	LEGISLATIVE PROVISIONS	436
	Section 2501--Authorized NATO Construction and Land Acquisition Projects	436
	Section 2502--Authorization of Appropriations, NATO	436
	TITLE XXVI--GUARD AND RESERVE FORCES FACILITIES	436
	SUMMARY	436
	ITEMS OF SPECIAL INTEREST	436
	Planning and Design, Air National Guard	436
	Planning and Design, Army National Guard	436
	Planning and Design, Air Reserve	437
	Planning and Design, Army Reserve	437
	LEGISLATIVE PROVISION	437
	Section 2601--Authorized Guard and Reserve Construction and Land Acquisition Projects	437
	TITLE XXVII--EXPIRATION AND EXTENSION OF AUTHORIZATIONS	437
	LEGISLATIVE PROVISIONS	437
	Section 2701--Expiration of Authorizations and Amounts Required to be Specified by Law	437
	Section 2702--Effective Date	437
	TITLE XXVIII--MILITARY CONSTRUCTION GENERAL PROVISIONS	438
	ITEMS OF SPECIAL INTEREST	438
	Energy Savings and Renewable Energy Opportunities at Joint Bases	438
	Remediation of Property at the Former Fort Ord, California	438
	LEGISLATIVE PROVISIONS	438
	Subtitle A--Military Construction Program and Military Family Housing Changes	438
	Section 2801--Increase in Maximum Annual Amount Authorized to be Obligated for Emergency Military Construction	438
	Section 2802--Applicability of Local Comparability of Room Pattern and Floor Area Requirements to Construction, Acquisition, and Improvement to Military Unaccompanied Housing	438
	Section 2803--Authority to Use Proceeds from Sale of Military Family Housing to Support Military Housing Privatization Initiative	439
	Section 2804--Repeal of Special Requirement for Military Construction Contracts on Guam	439
	Section 2805--Congressional Notification of Cancellation Ceiling for Department of Defense Energy Savings Peformance Contracts	439
	Section 2806--Expansion of Authority to Convey Property at Military Installations to Support Military Construction	439
	Section 2807--Pilot Projects for Acquisition or Construction of Military Unaccompanied Housing	439
	Section 2808--Consideration of Alternative and More Efficient Uses for General Officer and Flag Officer Quarters in Excess of 6,000 Square Feet	439
	Section 2809--Repeal of Temporary Minor Military Construction Program	440
	Section 2810--One-Year Extension of Temporary, Limited Authority to Use Operation and Maintenance Funds for Construction Projects Outside the United States	440
	Subtitle B--Real Property and Facilities Administration	440
	Section 2821--Consolidation of Department of Defense Authorities Regarding Granting of Easements for Rights-of-Way	440
	Section 2822--Authority to Grant Restrictive Easements in Connection with Land Conveyances	440
	Section 2823--Maximum Term of Leases for Structures and Real Property Relating to Structures in Foreign Countries Needed for Purposes Other than Family Housing	440
	Section 2824--Consolidation of Laws Relating to Transfer of Department of Defense Real Property Within the Department and to Other Federal Agencies	440
	Section 2825--Congressional Notice Requirements in Advance of Acquisition of Land by Condemnation for Military Purposes	441
	Subtitle C--Base Closure and Realignment	441
	Section 2831--Treatment of Lease Proceeds from Military Installations Approved for Closure or Realignment After January 1, 2005	441
	Subtitle D--Land Conveyances	441
	Section 2841--Land Conveyance, Naval Air Station, Barbers Point, Hawaii	441
	Section 2842--Modification of Land Acquisition Authority, Perquimans County, North Carolina	441
	Section 2843--Land Conveyance, Radford Army Ammunition Plant, Pulaski County, Virginia	441
	Subtitle E--Other Matters	442
	Section 2851--Availability of Community Planning Assistance Relating to Encroachment of Civilian Communities on Military Facilities Used for Training by the Armed Forces	442
	Section 2852--Prohibitions Against Making Certain Military Airfields or Facilities Available for Use by Civil Aircraft	442
	Section 2853--Naming Housing Facility at Fort Carson, Colorado, in Honor of Joel Hefley, a Member of the House of Representatives	442
	Section 2854--Naming Navy and Marine Corps Reserve Center at Rock Island, Illinois, in Honor of Lane Evans, a Member of the House of Representatives	442
	Section 2855--Naming of Research Laboratory at Air Force Rome Research Site, Rome, New York, in Honor of Sherwood L. Boehlert, a Member of the House of Representatives	442
	DIVISION C--DEPARTMENT OF ENERGY NATIONAL SECURITY AUTHORIZATIONS AND OTHER AUTHORIZATIONS	442
	TITLE XXXI--DEPARTMENT OF ENERGY NATIONAL SECURITY PROGRAMS	442
	OVERVIEW	442
	ITEM OF SPECIAL INTEREST	459
	National Nuclear Security Administration	459
	Overview	459
	Weapons Activities	459
	Directed Stockpile Work	459
	Reliable Replacement Warhead	459
	Responsive Infrastructure	459
	Study of Quantification of Margins and Uncertainty Methodology	460
	Transformation Plan for the Nuclear Weapons Complex	461
	Inertial Confinement Fusion Ignition and High Yield Campaign	462
	Readiness in Technical Base and Facilities	462
	Safeguards and Security	463
	Test Readiness	464
	Defense Nuclear Nonproliferation	464
	Global Threat Reduction Initiative	464
	International Materials Protection and Cooperation	464
	Megaports Program	465
	Radiation Detection Technology	465
	Mixed Oxide Fuel Facility	465
	Transfer Authority to Fund New or Emerging Activities Outside the United States Under the Global Threat Reduction Initiative	468
	Environmental and Other Defense Activities	468
	Overview	468
	Disposition of Plutonium Unsuitable for Conversion to Mixed Oxide Fuel	469
	Hanford Defense Site Waste Treatment and Immobilization Plant	469
	Savannah River Site Defense Environmental Cleanup	470
	Tank Waste Cleanup Research and Development Program	471
	Yucca Mountain	471
	LEGISLATIVE PROVISIONS	471
	Subtitle A--National Security Programs Authorizations	471
	Section 3101--National Nuclear Security Administration	471
	Section 3102--Defense Environmental Cleanup	471
	Section 3103--Other Defense Activities	472
	Section 3104--Defense Nuclear Waste Disposal	472
	Subtitle B--Program Authorizations, Restrictions, and Limitations	472
	Section 3111--Plan for Transformation of National Nuclear Security Administration Nuclear Weapons Complex	472
	Section 3112--Extension of Facilities and Infrastructure Recapitalization Program	472
	Section 3113--Utilization of Contributions to Global Threat Reduction Initiative	472
	Section 3114--Utilization of Contributions to Second Line of Defense Program	472
	Section 3115--Two-Year Extension of Authority for Appointment of Certain Scientific, Engineering, and Technical Personnel	472
	Section 3116--National Academy of Sciences Study of Quantification of Margins and Uncertainty Methodology for Assessing and Certifying the Safety and Reliability of the Nuclear Stockpile	472
	Section 3117--Consolidation of Counterintelligence Programs of Department of Energy and National Nuclear Security Administration	473
	TITLE XXXII--DEFENSE NUCLEAR FACILITIES SAFETY BOARD	473
	OVERVIEW	473
	ITEM OF SPECIAL INTEREST
	Role of the Defense Nuclear Facilities Safety Board	473
	LEGISLATIVE PROVISIONS	473
	Section 3201--Authorization	473
	TITLE XXXIII--NATIONAL DEFENSE STOCKPILE	474
	ITEM OF SPECIAL INTEREST	474
	Sale of Strategic and Critical Materials	474
	LEGISLATIVE PROVISIONS	474
	Section 3301--Authorized Uses of National Defense Stockpile Funds	474
	Section 3302--Revision of Limitations to Required Receipt Objectives for Previously Authorized Disposals from National Defense Stockpile	474
	TITLE XXXIV--NAVAL PETROLEUM RESERVES	475
	LEGISLATIVE PROVISIONS	475
	Section 3401--Authorization of Appropriations	475
	TITLE XXXV--MARITIME ADMINISTRATION	475
	ITEM OF SPECIAL INTEREST	485
	Fuel Assistance Payments to State and Regional Maritime Academies	475
	LEGISLATIVE PROVISIONS	475
	Section 3501--Authorization of Appropriations for Fiscal Year 2007	00
	Section 3502--Limitation on Transfer of Maritime Security Fleet Operating Agreements	476
	Section 3503--Applicability of Certain Maritime Administration Vessels of Limitations on Overhaul, Repair, and Maintenance of Vessels in Foreign Shipyards	476
	Section 3504--Vessel Transfer Authority	476
	Section 3505--United States Merchant Marine Academy Graduates: Alternate Service Requirements	477
	Section 3506--United States Merchant Marine Academy Graduates: Service Obligation Performance Reporting Requirement	477
	Section 3507--Temporary Authority to Transfer Obsolete Combatant Vessels to Navy for Disposal	477
	Section 3508--Temporary Requirement to Maintain Ready Reserve Force	477
	Departmental Data	477
	Department of Defense Authorization Request	477
	Committee Position	479
	Communications From Other Committees	479
	Fiscal Data	487
	Congressional Budget Office Estimate	487
	Committee Cost Estimate	490
	Oversight Findings	490
	General Performance Goals and Objectives	490
	Constitutional Authority Statement	491
	Statement of Federal Mandates	491
	Roll Call Votes	491
	Changes in Existing Law Made by the Bill, as Reported	498
	Additional and Dissenting Views	499
	Additional views of Ike Skelton, Steve Israel, Solomon P. Ortiz, Ellen O. Tauscher, Adam Smith, G.K. Butterfield, Loretta Sanchez, Silvestre Reyes, John Spratt, Madeleine Z. Bordallo, Robert E. Andrews, Mark Udall, Neil Abercrombie, Marty Meehan, Jim Langevin, Susan Davis, Vic Snyder, Tim Ryan, Rick Larsen, Jim Marshall	499
	Additional views of Jeff Miller	502
	Additional views of Jim Marshall	503
	Additional views of Cathy McMorris	508
	Dissenting views of Cynthia McKinney	510

27-368

2d Session

109-452

--NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 2007

[To accompany H.R. 5122]

[Including cost estimate of the Congressional Budget Office]

The Committee on Armed Services, to whom was referred the bill (H.R. 5122) to authorize appropriations for fiscal year 2007 for military activities of the Department of Defense, to prescribe military personnel strengths for fiscal year 2007, and for other purposes, having considered the same, report favorably thereon with amendments and recommend that the bill as amended do pass.

The amendments are as follows:

The amendment strikes all after the enacting clause of the bill and inserts a new text which appears in italic type in the reported bill.

The title of the bill is amended to relfect the amendment to the text of the bill.

EXPLANATION OF THE COMMITTEE AMENDMENTS

The committee adopted an amendment in the nature of a substitute during the consideration of H.R. 5122. The title of the bill is amended to reflect the amendment to the text of the bill. The remainder of the report discusses the bill, as amended.

PURPOSE

The bill would--(1) Authorize appropriations for fiscal year 2007 for procurement and for research, development, test and evaluation (RDT&E); (2) Authorize appropriations for fiscal year 2007 for operation and maintenance (O&M) and for working capital funds; (3) Authorize for fiscal year 2007: (a) the personnel strength for each active duty component of the military departments; (b) the personnel strength for the Selected Reserve for each reserve component of the armed forces; (c) the military training student loads for each of the active and reserve components of the military departments; (4) Modify various elements of compensation for military personnel and impose certain requirements and limitations on personnel actions in the defense establishment; (5) Authorize appropriations for fiscal year 2007 for military construction and family housing; (6) Authorize emergency appropriations for increased costs due to Operation Iraqi Freedom and Operation Enduring Freedom; (7) Authorize appropriations for fiscal year 2007 for the Department of Energy national security programs; (8) Modify provisions related to the National Defense Stockpile; and (9) Authorize appropriations for fiscal year 2007 for the Maritime Administration.

RELATIONSHIP OF AUTHORIZATION TO APPROPRIATIONS

The bill does not generally provide budget authority. The bill authorizes appropriations. Subsequent appropriation acts provide budget authority. The bill addresses the following categories in the Department of Defense budget: procurement; research, development, test and evaluation; operation and maintenance; working capital funds, military personnel; and military construction and family housing. The bill also addresses Department of Energy National Security Programs and the Maritime Administration.

Active duty and reserve personnel strengths authorized in this bill and legislation affecting compensation for military personnel determine the remaining appropriation requirements of the Department of Defense. However, this bill does not provide authorization of specific dollar amounts for personnel.

SUMMARY OF AUTHORIZATION IN THE BILL

The President requested budget authority of $513.3 billion for the national defense budget function for fiscal year 2007. Of this amount, the President requested $491.5 billion for the Department of Defense, including $16.7 billion for military construction and family housing and $50 billion for estimated emergency costs for the Global War on Terror. The defense budget request for fiscal year 2007 also included $17.0 billion for Department of Energy national security programs and the Defense Nuclear Facilities Safety Board.

The committee recommends an overall level of $512.9 billion in budget authority. This amount represents an increase of approximately $21.4 billion from the amount authorized for appropriation by the National Defense Authorization Act for Fiscal Year 2006 (Public Law 109-163).

SUMMARY TABLE OF AUTHORIZATIONS

The defense authorization act provides authorization for appropriations but does not generally provide budget authority. Budget authority is provided in appropriations acts. In order to relate the recommendations to the budget resolution, matters in addition to the dollar authorizations contained in this bill must be taken into account. A number of programs in the national defense function are authorized in other legislation. The following table summarizes authorizations included in the bill for fiscal year 2007 and, in addition, summarizes the implications of the committee action for the budget authority totals for national defense (budget function 050).

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RATIONALE FOR THE COMMITTEE BILL

H.R. 5122, the National Defense Authorization Act for Fiscal Year 2007, reflects the House Armed Services Committee's steadfast support of the courageous, professional and dedicated men and women of the United States armed forces and the committee's appreciation for the sacrifices they make to accomplish their required missions. Events of the last year--ranging from on-going operations in Iraq and Afghanistan to robust counter-terrorism efforts around the globe to time-sensitive disaster and humanitarian responses both at home and abroad--serve to highlight the United States military's flexibility and responsiveness in defending our nation's interests and addressing security challenges, wherever and whenever they may arise.

For example, with the support of our coalition partners and over 220,000 Iraqi Security Forces personnel, members of the United States military helped to establish secure, stable conditions under which more than 12 million Iraqis could cast their votes for new national assembly representatives last December. That month also figured prominently in Afghanistan, where United States, Afghan and allied forces maintained security and stability as 351 men and women from all provinces, tribes and ethnic groups were inaugurated into the National Assembly. At home, United States forces actively contributed to Hurricane Katrina relief efforts with approximately 20,000 Active Duty and 50,000 National Guard troops providing military support to civil authorities.

The committee considers it critical that the capabilities and capacity of the armed forces continue to improve so they can accomplish the full range of diverse 21st century missions, minimize risks associated with such challenges and effectively engage in hostilities, when necessary, as far from American shores as possible. Thus, the committee's top priority remains ensuring that our military personnel receive the best equipment, weapons systems and training possible. As such, H.R. 5122 would provide for both near- and longer-term military personnel and force structure requirements. It also highlights the need for improvements in acquisition processes and cooperation among key federal departments and agencies.

Taking Care of Our Military Personnel

Through H.R. 5122, the committee continues its support for the outstanding Soldiers, Sailors, Airmen and Marines, who selflessly make significant personal sacrifices to protect and defend our nation. To ensure that the United States armed forces remain robust enough to meet the full range of 21st Century security challenges, particularly those related to the Global War on Terrorism, the committee recommends for Fiscal Year 2007 additional active duty growth of 30,000, or 6 percent, for the Army and 5,000, or about 3 percent, for the Marine Corps above the budget request. These recommendations would bring the Army end strength to 512,400 and the Marine Corps to 180,000. In addition, the committee supports the Department of the Army's decision to request an Army National Guard (ARNG) end strength of 350,000 and recommends adding about 2,300 full-time ARNG support personnel. To support this additional manpower, H.R. 5122 would increase ARNG funding by $789 million for personnel and equipment costs.

H.R. 5122 also reflects the committee's on-going commitment to improving the efficiency and effectiveness of servicemembers' benefits. The committee recommends an across-the-board pay raise, which would decrease the 4.5 percent gap between military and private sector pay to about 4.0 percent. Moreover, this legislation completes the transition to full TRICARE health program coverage for selected reserve personnel and, in light of the Department of Defense's proposed TRICARE cost-sharing arrangement, requires further study to ensure that a comprehensive policy and fiscal basis for sustaining future military health care benefits are in place. H.R. 5122 also improves programs for our nation's wounded military personnel and the surviving family members of those who have died or have been seriously injured in service.

Balancing Near- and Longer-Term Military Capabilities

The committee believes strongly that the Department of Defense must not focus on long-term military capabilities at the expense of resetting and recapitalizing the warfighting force that is serving the United States so well in current operations. In particular, this legislation sends a clear signal that force protection remains this committee's top priority. Through oversight hearings, briefings and numerous trips to Iraq and Afghanistan, committee members continue to follow the significant threat to our soldiers and marines from improvised explosive devices (IEDs), or makeshift road-side bombs. H.R. 5122 reflects the committee's initiative to `take back the roads' and provide the best available IED jamming devices and persistent surveillance capability this includes $109.7 million for jamming devices that will prevent the radio-initiation of road-side bombs, which currently cause the majority of U.S. casualties in Iraq and Afghanistan, and $100 million for at least 10 manned persistent surveillance aircraft to patrol road segments and other areas where IED activity is greatest.

H.R. 5122 also provides insight into how the committee believes the Department of Defense should strike the right balance between accepting technical risk and providing increased capabilities to these warfighters. It reflects the committee's continuing concerns about the long lead times required for major systems and the possibility that programs do not focus adequately on the near-term requirements of the United States armed forces.

For example, the committee questions how the Department of the Army plans to fund the Future Combat System (FCS), the Modular Force Initiative and reset programs--three costly efforts that would require funding in excess of the funds programmed for the next five years. H.R. 5122 reflects the committee's decision to balance the health and capability of the current force with the future needs of the Army by reducing the FCS program by $326 million and requiring a Defense Acquisition Board review of the FCS program.

In addition to reflecting concerns about the growing cost of the FCS program, this legislation puts into place spending limits on programs for other major programs for which cost estimates are rapidly increasing. These legislative initiatives would contain shipbuilding costs by holding the Department of the Navy accountable to their cost estimates on the CVN-21 aircraft carrier, the Landing Helicopter Assault (LHA-R) amphibious assault ship, and the LPD-17 Landing Platform Dock amphibious ship and would increase competition for elements of the Joint Strike Fighter (F-35) and next generation destroyer (DD(X)) programs.

The committee notes that the Fiscal Year 2007 budget request included $2 billion for the Department of the Air Force's F-22 aircraft program. However, despite the Fiscal Year 2006 projection for procurement of 29 F-22's in Fiscal Year 2007, the funds requested for Fiscal Year 2007 were for subassemblies and not aircraft. Rather than authorize incremental funding for major aircraft programs, which Congress has not done in decades, the committee recommends an additional $1.4 billion for the full funding for procurement of 20 F-22 aircraft.

Over the last five years, the Global War on Terrorism has demonstrated time and again that U.S. intelligence, surveillance and reconnaissance (ISR) capabilities are critical to military effectiveness. The Department of Defense's most recent Quadrennial Defense Review, released in February 2006, highlighted gaps in ISR capabilities, and as a result of several hearings and briefings over the last year, the committee agrees that the United States currently has insufficient capacity and capability to meet all national and combatant commander requirements or provide tactical control over needed ISR assets at the small-unit level. One key area for improvement is persistent surveillance platforms, which the DOD could usefully deploy for operations ranging from combat and counterterrorism scenarios to stability and humanitarian operations and domestic crises. For example, unmanned aerial vehicles could provide a reliable battlefield picture on a 24-hours-a-day/7-days-a-week basis. However, the committee notes with concern that despite highlighting existing ISR gaps, DOD officials decided to retire U-2 aircraft to achieve savings without identifying a similar capability that will be available in the near-term. H.R. 5122 would prohibit this retirement until the Department certifies to Congress that the U-2 program is not required to mitigate gaps in ISR capabilities.

Finally, H.R. 5122 underscores the need for operationally responsive space capabilities. Adversaries recognize that the backbone of the United States military's command, control, communication, computers, intelligence, surveillance and reconnaissance (C4ISR) system is space-based, making it vulnerable to asymmetric attack and not easily reconstituted. The committee believes that the United States must develop a responsive space infrastructure, including flexible space launch and rapidly deployable C4ISR platforms, to address this vulnerability and reduce the temptation for adversaries to attack our space assets. This legislation would establish an Office of Operationally Responsive Space in the DOD to contribute to the development of low-cost rapid reaction payloads to fulfill joint military operational requirements.

Fielding the Right Equipment at the Right Time

The rising cost and lengthening production schedules of major defense acquisition programs has led to more expensive platforms fielded in fewer numbers. The committee believes that internal DOD pressure to develop follow-on weapons systems that include all necessary and anticipated military capabilities may create an over-reliance on individual `mega' systems that are potentially more expensive and time-consuming to develop than less sophisticated but capable systems. These increases in cost and development time generally result in smaller numbers of platforms purchased, creating a `high demand, low density' situation in which the needed platforms have higher operational tempos, wear out faster, increase stress on military personnel, undermine the ability to conduct traditional presence missions intended to shape the strategic choices of potential adversaries and limit the strategic depth of United States forces responding to multiple contingencies. Moreover, the shrinking pool of skills and experience maintained by the acquisition workforce and the inadequate prioritization of combatant commands' requirements in deference to the military services' priorities are strong concerns of the committee. At the end of the day, the Department needs to recognize that its acquisition process must result in cost-effectively `putting metal on targets'--which in some cases will not require costly, leading-edge technologies. H.R. 5122 would address these issues by requiring training programs, improving management oversight and internal controls and closely monitoring implementation of acquisition reform in the Department of Defense.

Developing Partnerships

The committee notes that international coalition partners have proven essential to military successes in Afghanistan, Iraq and elsewhere and appreciates the diplomatic, financial and military contributions made by foreign governments to the Global War on Terrorism. However, the committee believes that several key federal departments and agencies may lack the same operational commitment to success in the on-the-ground war effort.

Achieving United States security objectives requires the integration of all national power--political, military and economic. In many cases, non-military departments and agencies lack planning, surge and overseas deployment capabilities, and the interagency process--which coordinates national-level policy development--has not been effective in executing national security policy. As a result, our servicemembers routinely fill gaps in civil capabilities, such as reconstruction efforts, coordination of humanitarian relief and training and equipping police forces. These missions are in addition to the full range of military operational requirements and may, in some cases, place an unfair burden on our armed forces.

H.R. 5122 would require that the President assess the non-DOD elements required to achieve the full spectrum of U.S. national security interests, including organizational structures, planning and assessment capabilities, information-sharing policies, command and control systems, personnel policies and acquisition authorities. The President would also provide specific legislative proposals to improve interagency capacity and enhance civilian capabilities for national security purposes.

Supplemental Funding

The committee recommends authorization of $50 billion in funds to support the defense activities principally associated with Operation Iraqi Freedom (OIF) and Operation Enduring Freedom (OEF). These funds are designated for emergency contingency operations to support force protection equipment, operational needs and military personnel requirements of the units deployed and engaged in the Global War on Terrorism.

Included in the force protection recommendation is funding for up-armored Humvees, tactical wheeled vehicle recapitalization and modernization programs for the most heavily used vehicles in OIF and OEF, night vision devices and improvised explosive device jammers. In addition, the committee recognizes the need to replenish critical small-arms and ammunition procurement programs, including funding for the M16 rifle, M240 medium machine gun and M4 carbine modifications, and .50 caliber cartridges, 120mm tank ammunition canisters and 155mm high explosive projectiles. Incorporated in the day-to-day operation recommendation is funding to pay for food, fuel, spare parts, maintenance, transportation, base expenses, as well as costs incurred by stateside installations for increased mobilizations and demobilizations due to OIF and OEF.

Over the past four years, the committee has recommended increases in the active component manpower to sustain the full range of capabilities required of the mission assigned to the armed forces. The committee recommends funding a cumulative active component increase of 30,000 for the Army and 5,000 for the Marine Corps over the budget request.

HEARINGS

Committee consideration of the National Defense Authorization Act for Fiscal Year 2007 results from hearings that began on February 1, 2006, and that were completed on April 7, 2006. The full committee conducted fifteen sessions. In addition, a total of thirty-two sessions were conducted by 6 different subcommittees on various titles of the bill.

DIVISION A--DEPARTMENT OF DEFENSE AUTHORIZATION

TITLE I--PROCUREMENT

OVERVIEW

The budget request for fiscal year 2007 contained $84.2 billion for procurement. This represents a $6.2 billion increase from the amount authorized for fiscal year 2006.

The committee recommends authorization of $85.9 billion, an increase of $1.7 billion from the fiscal year 2007 request.

The committee recommendations for the fiscal year 2007 procurement program are identified in the table below. Major issues are discussed following the table.

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AIRCRAFT PROCUREMENT, ARMY

OVERVIEW

The budget request for fiscal year 2007 contained $3.6 billion for Aircraft Procurement, Army. The committee recommends authorization of $3.7 billion, an increase of $148.3 million, for fiscal year 2007.

The committee recommendations for the fiscal year 2007 Aircraft Procurement, Army program are identified in the table below. Major changes to the Army request are discussed following the table.

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ITEMS OF SPECIAL INTEREST

AH-64 modern signal processing unit

The budget request contained $775.6 million for AH-64 modifications, but no funds were requested for the modern signal processing unit (MSPU) initial integration and production for the AH-64.

The MSPU is an embedded digital vibration diagnostic technology already developed by the Army for the AH-64A Apache and the AH-64D Longbow to monitor the tail rotor gearbox, the intermediate gearbox, and the auxiliary power unit clutch for incipient failures. The MSPU is a direct replacement for the 30-year-old analog signal processing unit which is known to experience high failure rates and shown to be unreliable in detecting incipient gearbox failures. The improved diagnostics of the MSPU will improve flight safety and reduce maintenance test costs.

The committee recommends an increase of $6.0 million to integrate the modern signal processing unit into the AH-64A and AH-64D production line and to procure the MSPU for fielding as spares for both the active Army and Army National Guard Apache and Longbow aircraft.

Joint cargo aircraft

The committee supports the decision to establish a joint program office and to utilize a single capability development document as the basis for requirements for the Joint Cargo Aircraft (JCA). The committee believes that cost control is the most critical factor in determining the likelihood for success of the JCA program, and that the imperative for cost containment will necessitate a strict control of requirements and the use of maximum jointness and commonality in training, sustainment and maintenance. The committee recommends that the joint program office work to develop an acquisition and sustainment strategy for JCA that is joint in all phases of the program. The acquisition and sustainment strategy should address the purchase of sufficient rights in technical data required to provide competition in maintaining and sustaining the aircraft throughout its complete lifecycle. The committee notes that it has included a provision (section 802) that would require acquisition programs to acquire sufficient technical data required for lifecycle sustainment. The committee also notes that the core logistics capability for cargo aircraft currently in the Department of Defense (DOD) inventory resides largely in the Air Force Air Logistics Centers and the committee believes the JCA should be identified as a core logistics capability under subsection (a)(2) of section 2464 of title 10, United States Code, with no waiver under subsection (b), if the JCA is acquired in sufficient numbers to warrant such a designation. At a minimum, the Department should acquire the technical data necessary to enable the government to utilize its core logistics capability to maintain the JCA, if required.

The committee directs the Secretary of Defense to submit to the congressional defense committees a report on the plan to acquire and sustain the JCA. The committee directs that the report be delivered no later than 60 days after the acquisition and sustainment strategy is approved by the appropriate milestone decision authority. The committee further directs that the report shall include DOD's recommendations regarding whether or not the JCA will be identified as a core logistics capability under subsection (a)(2) of section 2464 of title 10, United States Code, and if so identified, whether the Department intends to waive the limitation on contracting under subsection (b) of such section for the JCA.

HH-60 aircraft wireless intercom system upgrade

The budget request contained $30.9 million for H-60 modifications, but included no funds for procurement of non-encrypted aircraft wireless intercom system (AWIS) upgrades for active and reserve HH-60 medical evacuation (MEDEVAC) helicopters.

The committee notes there is no integrated or qualified wireless communication system onboard HH-60 rotorcraft for use by crewmembers. Consequently, this does not allow onboard medical personnel, while in flight or during ground operations, freedom to use both hands to perform emergency medical procedures while communicating with the flight crew. Early fielding of non-encrypted AWIS would eliminate the operational hazards and restrictions inherent in the existing tethered system for MEDEVAC crews.

The committee recommends an increase of $4.0 million to modify HH-60 rotorcraft with wireless intercom systems.

UH-60A to UH-60L helicopter upgrade

The budget request included $554.6 million in aircraft procurement for 38 UH-60M aircraft, but included no funds for the non-recurring costs of replacement of UH-60A engine transmission and engine upgrades as part of the UH-60A upgrade program.

The committee notes the significant reduction in flying hour costs, of over $700 per hour, offered by replacement of the original UH-60A engines.

The committee recommends an additional $15.0 million for the non-recurring development and engineering costs of upgrading the UH-60A engine transmission and engine to the UH-60L configuration.

MISSILE PROCUREMENT, ARMY

OVERVIEW

The budget request for fiscal year 2007 contained $1.4 billion for Missile Procurement, Army. The committee recommends authorization of $1.5 billion, an increase of $140.0 million, for fiscal year 2007.

The committee recommendations for the fiscal year 2007 Missile Procurement, Army program are identified in the table below. Major changes to the Army request are discussed following the table.

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ITEMS OF SPECIAL INTEREST

Patriot modifications

The budget request contained $69.9 million for the procurement of Patriot modifications.

The committee understands that the Army has an unfunded requirement to transition or pure fleet existing Patriot Advanced Capability-2 (PAC-2) missile battalions to an upgraded PAC-3 missile battalion configuration capable of deploying the PAC-3 missile by the end of fiscal year 2009.

The committee supports this initiative and recommends $209.9 million, an increase of $140.0 million for the purpose of restarting the PAC-3 production line, and for upgrading tactical Patriot fire units to the PAC-3 configuration capability.

TOW missile inventory

The budget request contained $31.6 million to procure 949 TOW missiles.

The committee recognizes the Army and Marine Corps face a significant challenge in maintaining an adequate inventory of TOW missiles. The TOW requirement is perceived to be at a minimum 20,000 missiles but the Army's current program of record supports an inventory of only 6,500 missiles. The committee is aware the Army and Marine Corps have fired more than 6,000 TOW missiles in Operation Iraqi Freedom (OIF), yet by 2009, based on missile shelf life, the Army will have fewer TOW missiles in its inventory than it had at the start of the OIF.

While the committee notes the Army's intent to increase TOW procurement and encourages the Army to proceed with this course of action, the committee also notes the Army staff has not defined a minimum warfighting inventory requirement for TOW missiles.

Therefore, the committee directs the Secretary of the Army to submit a report to the congressional defense committees by March 15, 2007, that details the acquisition strategy for TOW procurement across the Future Years Defense Program and specifies the current, minimum warfighting requirement for the TOW missile.

WEAPONS AND TRACKED COMBAT VEHICLES, ARMY

OVERVIEW

The budget request for fiscal year 2007 contained $2.3 billion for Weapons and Tracked Combat Vehicles, Army. The committee recommends authorization of $2.3 billion, an increase of $33.1 million, for fiscal year 2007.

The committee recommendations for the fiscal year 2007 Weapons and Tracked Combat Vehicles, Army program are identified in the table below. Major changes to the Army request are discussed following the table.

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ITEMS OF SPECIAL INTEREST

Army current to future force modernization strategy

The Army is implementing its current to future force modernization strategy at a time when U.S. ground forces continue to operate at high operational tempos in Iraq and Afghanistan, as well as fill a critical role in the global war on terrorism. The committee notes that while the Future Combat Systems (FCS) is the Army's long-term transformation strategy, modularity and equipment reset constitutes the near-term strategy. Given fiscal realities, the Army's challenge of simultaneously funding reset and modularity, and the high technical risks associated with the development of FCS, the committee is concerned the Army may sacrifice the warfighting capability of the current force in order to resource FCS.

While conceptually supporting modularity, the committee continues to have concerns about the details, not the least of which is its escalating costs, uncertainty in adequate resources for active Army and Army National Guard equipping strategies, and whether the new modular designs for brigade combat teams (BCTs) will provide sufficient capability for sustained, high-intensity combat operations. Specifically, the committee is concerned about the Army's decision to field modular heavy BCTs with only two maneuver battalions, instead of three. The committee understands that Stryker BCTs have three maneuver battalions and FCS BCTs will also have three maneuver battalions. Accordingly, the committee is concerned that the Army's decision to field modular heavy BCTs with two instead of three maneuver battalions is resource vice strategy driven.

The committee notes that the Government Accountability Office (GAO), the Congressional Budget Office, and the Institute for Defense Analysis have also expressed similar concerns in reference to modularity. The committee further notes soldiers returning from Iraq have indicated that while technology can be a critical combat enabler, technology alone cannot serve as a replacement for force structure, `boots on the ground.' The committee commends the Army for adding a reconnaissance battalion to the modular brigade design. The committee believes that although the reconnaissance battalion is a critical force multiplier, it alone should not be required to perform missions that would normally be performed by a third maneuver battalion.

The Army has stated that the procurement funding for modularity is within the Future Years Defense Program (FYDP) and the procurement funding for FCS is beyond the FYDP. However, the committee notes this position is not supported by the information provided by the Army to the committee. The committee agrees with GAO's assessment that given the degree of uncertainty in modularity cost estimates and the likely cost growth from FCS; the Army's modularity and FCS programs are at risk of becoming unaffordable.

Army modularity

The committee continues to support the Army's restructuring from a division based force to a more readily deployable brigade centric force, a process known as modularity, and the committee understands that modularity remains a top priority of the Chief of Staff of the Army. However, the committee remains concerned that the Army has not provided sufficient information for Congress to assess the capabilities, costs, affordability, and risks of the Army's modularity implementation plans. The committee notes that the Army's cost estimate for completing modularity by 2011 has grown from an initial estimate of $28.0 billion in 2004 to a current estimate of $52.5 billion. Further, in the `2005 Modularity' report submitted to Congress, the Army states a requirement for 77 brigade combat teams (BCTs). Of the 77 BCTs, 35 were to be heavy BCTs consisting of Abrams tanks and Bradley fighting vehicles. In the `2006 Modularity' report and the 2007 budget request the requirement is for 70 BCTs, of which 33 would be heavy BCTs. The committee is concerned about the Army's rationale to reduce the total BCT requirement and furthermore, it remains unclear to the committee what impact the current modularity strategy will have on meeting the needs of the combatant commanders.

Accordingly, the committee directs the Secretary of Defense to obtain from each combatant commander, an assessment of the Army's modularity initiative to include issues or concerns regarding modularity designs, equipment, personnel and/or rotation strategy. Further, the committee directs the Secretary to submit a report, including the assessments from the combatant commanders, to the Senate Committee on Armed Services and the House Committee on Armed Services with the submission of the President's budget for fiscal year 2008.

Heavy brigade combat teams

The budget request included $171.1 million for the M1A2 Abrams System Enhancement Program (SEP) tank and $285.0 million for the Bradley base sustainment program.

The committee remains concerned about the Abrams tank and Bradley fighting vehicle modernization programs and the associated funding. Current operations continue to demonstrate that there are few conflicts where main battle tanks and Bradley fighting vehicles do not play a significant role in ensuring the survivability and offensive firepower of the armed forces. The committee remains resolute in its assessment that the Army should pure fleet, at a minimum, 18 of its active component heavy brigade combat teams (BCTs) with the M1A2 Abrams SEP tank and the Bradley A3 fighting vehicle.

The committee notes that in the Army's March 2006 report to Congress, `The Army Modular Initiative,' it clearly states that one of the key criteria for modularity funding was `modernization of older equipment.' The report further states that modularity equipment modernization includes major systems upgrades such as Apache and Chinook helicopters, but does not include the M1A2 Abrams SEP tank or the Bradley A3 as part of modernization. The committee believes that the M1A2 Abrams SEP tank and the Bradley A3 are critical components of modular heavy BCTs.

The committee is concerned that the Army's current procurement strategy will not adequately fund the M1A2 Abrams SEP tank program and the Bradley A3 program, to at least the minimum economic quantity of approximately 60 and 144 per year, respectively. The committee is also concerned that the Army's current plan results in paying more to get fewer M1A2 Abrams SEP tanks and Bradley A3s, which will result in a significant delay in meeting the total requirement of 18 M1A2 Abrams SEP tanks and Bradley A3 heavy BCTs. The committee notes that even if the Army develops a plan that funds the M1A2 SEP tank and the Bradley A3 production at the minimum economic quantity it will take the Army up to 10 years to meet the total requirement for 18 M1A2 Abrams SEP tank and Bradley A3 equipped heavy BCTs.

Accordingly, the committee directs the Secretary of the Army to submit a report by February 28, 2007, to the Senate Committee on Armed Services and the House Committee on Armed Services providing the feasibility and rationale for multiyear procurement authority for the M1A2 Abrams SEP tank and the Bradley A3. At a minimum, the report shall include the

impact that a multiyear procurement would have on the unit cost and the impact this authority would have on meeting the total M1A2 Abrams SEP tank and Bradley A3 requirement, consisting of 18 heavy BCTs.

Abrams tank modernization

The budget request included $171.1 million for 23 M1A2 Abrams System Enhancement Program (SEP) retrofit tanks.

The M1A2 Abrams SEP tank is an upgraded, fully digitized, first generation M1A2 Abrams tank which enhances lethality, survivability, and mobility, as well as providing improved situational awareness for its crew.

Accordingly, the committee recommends an increase of $128.9 million for the M1A2 Abrams SEP tank program.

Bradley base sustainment program

The budget request included $285.0 million for 16 Bradley A3 fighting vehicles and 90 Operation Desert Storm (ODS) vehicles.

The Bradley base sustainment program upgrades earlier variants of the Bradley A2 ODS and the Bradley A3 standard. The Bradley A3 is more lethal and survivable; provides enhanced command and control; and allows shared situational awareness. The Bradley A3 continues to maintain combat overmatch above current and future threat forces and remains compatible with the M1A2 Abrams System Enhancement Program tank.

Accordingly, the committee recommends an increase of $147.0 million for the Bradley A3 program.

Integrated air burst weapon system

The budget request contained $32.3 million for the integrated air burst weapon system family.

The committee understands this funding line would provide procurement dollars for the low rate initial production of the Objective Individual Combat Weapon, Increment One (OICW-1) program; a family of small arms that are projected to be replacements for existing carbines, rifles, and light machine guns. The committee is aware that the official request for proposals (RFP) for the OICW-1, originally announced in May 2005 was delayed and now has been terminated. The committee is also aware that the program was redirected to the Joint Requirements Oversight Council (JROC) for further review.

The committee notes the OICW-1 program has not yet been reviewed by the JROC nor has an estimated date for a review been established. The committee understands that pending the outcome of this future JROC review, the new RFP would incorporate additional joint requirements that would require further development and refinement. The committee also notes the Army is currently restructuring the procurement program for small arms in support of the recently approved small arms acquisition strategy, and recognizes these funds would be redistributed to other small arms acquisition programs in accordance with this new strategy.

Therefore, the committee believes the budget request for the integrated air burst weapon system family is not justified and recommends a decrease of $32.3 million. The committee also recommends the redistribution of these funds to other small arms acquisition programs as reflected in this report based on urgent need and in support of the Army's recently restructured small arms acquisition strategy.

AMMUNITION PROCUREMENT, ARMY

OVERVIEW

The budget request for fiscal year 2007 contained $1.9 billion for Ammunition Procurement, Army. The committee recommends authorization of $1.7 billion, a decrease of $211.7 million, for fiscal year 2007.

The committee recommendations for the fiscal year 2007 Ammunition Procurement, Army program are identified in the table below. Major changes to the Army request are discussed following the table.

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ITEMS OF SPECIAL INTEREST

Desert optimized equipment

The budget request contained $10.3 million for ammunition peculiar equipment, but included no funds for desert optimized ammunition peculiar equipment.

The committee understands that the harsh desert conditions of Iraq and Afghanistan are causing ammunition peculiar equipment to degrade at a much greater rate than anticipated. The committee notes that there is great benefit to upgrading forward deployed ammunition peculiar equipment with desert optimized equipment.

The committee recommends an increase of $3.0 million to optimize ammunition peculiar equipment for desert environments.

Modernization of .50 caliber ammunition production line

The budget request included $116.2 million for modernization of ammunition production facilities, but included no funds to modernize the line for production of .50 caliber ammunition.

The committee notes that much of the existing facilities and equipment used in the production of .50 caliber ammunition date from the era of World War II. While this equipment has been able to support .50 caliber ammunition production in recent years, the production line is extremely difficult to maintain and the obsolete nature of this equipment limits the ability of the Army to increase production quantities on short notice.

The committee directs the Army to develop a plan to modernize the production line for .50 caliber ammunition, and submit the plan to the congressional defense committees no later than March 1, 2007. Furthermore, the plan should include a proposed schedule for modernization consistent with continued production of .50 caliber ammunition at levels similar to those occurring in 2006, and a recommended funding program associated with this schedule.

OTHER PROCUREMENT, ARMY

OVERVIEW

The budget request for fiscal year 2007 contained $7.7 billion for Other Procurement, Army. The committee recommends authorization of $7.0 billion, a decrease of $211.7 million, for fiscal year 2007.

The committee recommendations for the fiscal year 2007 Other Procurement, Army program are identified in the table below. Major changes to the Army request are discussed following the table.

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ITEMS OF SPECIAL INTEREST

Bridge to future networks

The budget request contained $340.2 million for bridge to future networks.

The Bridge to Future Networks program is comprised of two elements: area common user system (ACUS) modernization and joint network node (JNN). The committee is concerned about the Army's plan to meet its battle command network requirement for both the current and future force. The Army began the acquisition of the JNN with funds appropriated in the Emergency Supplemental Appropriations Act for Defense, the Global War on Terror, and Tsunami Relief, 2005 (Public Law 109-13) that would provide an urgent warfighting demand for a networking capability in support of the global war on terrorism. The JNN is not a program of record and the committee believes that continued procurement of JNN through emergency supplemental appropriations is not appropriate.

The committee further understands that the Department of Defense's Director of Operational Test and Evaluation and the General Counsel have determined that JNN should not proceed beyond low rate initial production before completing operational testing.

The committee also understands that the Army is developing the Warfighter Information Network-Tactical (WIN-T) program at the same time that it is procuring the JNN. According to the Army, WIN-T is the foundation for network-centric brigade operations and is applicable to not just the Future Combat Systems (FCS) force, but also to today's current force of modular brigade combat teams.

The committee is aware the Army has not developed a plan that assesses how best to transition from JNN to WIN-T. It remains unclear to the committee whether the Army will attempt to accelerate development of WIN-T or pursue a parallel course that continues to procure JNN while realigning the WIN-T program with FCS. Therefore, the committee included a provision (section 114) in this Act that would require the Secretary of the Army to submit a report to the congressional defense committees on the analysis of how the JNN and the WIN-T will be integrated and whether or not there are opportunities to leverage JNN technologies and equipment as part of the WIN-T development effort.

Combat medical support

The budget request contained $20.5 million for combat medical support, but included no funding for Golden Hour--4 units of red blood cells (GH4) and Golden Hour--30 units of red blood cells or frozen plasma (GH30) blood bags. The committee recommends more fully equipping the U.S. military with Golden Hour technology blood bags to enable safe transport of blood to the battlefield, resulting in more saved lives during military conflicts and increasing the availability of useable blood.

The committee recommends an increase of $17.0 million for Golden Hour blood bags.

Immersive group simulation

The budget request included $16.9 million for the Army's networked system of manned simulators, but included no funds for its immersive group simulation project.

The committee supports simulation efforts by the Army to replicate elements on the combined arms battlefield. This reduces overall training costs and provides training that might otherwise be foregone because of limitations on live training ranges. Immersive group simulations complement and enhance training programs by allowing groups of trainers to place groups of soldiers into synthetic training environments that replicate real world conditions to stress reactive and decision making capabilities, train on appropriate tactics and techniques, and make mistakes where the consequences are non-lethal.

Therefore, the committee recommends an increase of $6.5 million for the immersive group simulation project.

M915A3 production

The budget request contained $31.2 million for truck, tractor, and line-haul equipment, including funds to procure 160 M915A3 line-haul tractor trucks.

The M915A3 is used by Army transportation companies to transport breakbulk, containers, water and petroleum over primary and secondary roads. The committee notes that previous models of the M915 are experiencing operational readiness rates below the Army goal and are difficult to support. The committee also notes that there are significant inventory shortages across the Army, but particularly in transportation companies of the national guard and reserve forces.

The committee recommends $40.5 million for truck, tractor, and line-haul equipment, an increase of $9.3 million to accelerate fielding of the M915A3 to the Army National Guard.

Simulated combat training capability for Army National Guard

The budget request contained $38.5 million for combat training centers support and other associated costs, but included no funds for simulated combat training capability systems for the Army National Guard.

The committee understands this system would provide effective pre-mobilization and post-mobilization home-station training for Army National Guard units engaged in the global war on terrorism. The committee recognizes that although there is no substitute for the robust live-fire and simulated training capabilities provided at Combat Training Centers (CTCs) and through the Joint National Training Capability (JNTC), this particular system would supplement CTC and JNTC activities, as well as provide additional training opportunities for Army National Guard units at their home stations. Furthermore, the committee believes that this additional training capability would potentially contribute to more effective CTC and JNTC training exercises for national guard units.

The committee recommends $47.8 million, an increase of $9.3 million to provide simulated, flexible and expandable combat training capability to Army National Guard units.

AIRCRAFT PROCUREMENT, NAVY

OVERVIEW

The budget request for fiscal year 2007 contained $10.9 billion for Aircraft Procurement, Navy. The committee recommends authorization of $10.8 billion, a decrease of $108.1 million, for fiscal year 2007.

The committee recommendations for the fiscal year 2007 Aircraft Procurement, Navy program are identified in the table below. Major changes to the Navy request are discussed following the table.

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ITEMS OF SPECIAL INTEREST

EP-3E service life extension

The budget request contained $56.8 million for EP-3E aircraft modifications, but included no funds for service life extension modifications in lieu of the Aerial Common Sensor (ACS) program cancellation.

The committee is concerned about the impact the cancelled ACS program may have on the qualitative service life of the EP-3E. The committee understands that continued support of the legacy EP-3E airframes and mission systems will be tenuous until a viable joint or service-specific replacement is identified and fully operational. The EP-3E capability contributes significantly to the national collection posture of the defense intelligence community and combatant commanders.

The committee understands that the EP-3E program was not fully prepared for the cancellation of the ACS, and that significant deficiencies to aircraft mission systems are expected in fiscal year 2007.

Therefore, the committee recommends $66.8 million, an increase of $10.0 million for additional service life extension modifications needed to sustain the EP-3E.

H-53 series modifications

The budget request contained $28.3 million for H-53 series modifications, but included no funds for the advanced helicopter emergency egress lighting system (ADHEELS).

The ADHEELS provides crew escape lighting for helicopters in the event of water impact. The committee understands that the Department of the Navy has selected ADHEELS as its future helicopter escape lighting system due to its superior performance, significantly increased operational reliability, and lower life cycle costs, and has recently equipped all SH-60 helicopters with this system; and therefore, the committee recommends that the ADHEELS also be installed on the Navy's fleet of H-53 helicopters.

Consequently, the committee recommends $31.3 million for H-53 series modification, an increase of $3.0 million to begin the installation of ADHEELS in the Navy's H-53 helicopter fleet.

P-3C modernization

The budget request contained $204.6 million for P-3C aircraft modifications, but contained no funds for the P-3C high resolution digital recorder.

The committee understands the P-3C aircraft has been used extensively in the global war on terrorism as a surveillance and targeting platform to provide time-sensitive targeting information to ground forces and other airborne assets. As part of the P-3C anti-surface warfare improvement program (AIP) upgrade, a next generation high resolution combined video and radar recorder has been developed to replace the legacy recorder. The committee understands that without key technology upgrades and aircraft parts obsolescence management, the P-3C ability to meet the Navy's Fleet Response Plan will be degraded.

Therefore, the committee recommends $207.6 million, an increase of $3.0 million for procurement of ten high resolution digital recorders.

WEAPONS PROCUREMENT, NAVY

OVERVIEW

The budget request for fiscal year 2007 contained $2.6 billion for Weapons Procurement, Navy. The committee recommends authorization of $2.5 billion, a decrease of $38.0 million, for fiscal year 2007.

The committee recommendations for the fiscal year 2007 Weapons Procurement, Navy program are identified in the table below. Major changes to the Navy request are discussed following the table.

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ITEM OF SPECIAL INTEREST

Conventional Trident modification

The budget request contained $957.6 million for Trident II missile modifications, including $38.0 million for the conventional Trident modification (CTM) program. The budget request also contained $111.1 million for strategic missile systems equipment, including $12.0 million for CTM.

The committee understands that the Department of Defense is working to develop the prompt, precision, global conventional strike capability called for in the 2001 Nuclear Posture Review, and in the 2006 Quadrennial Defense Review. The committee also understands that the existing Trident II weapons system provides an opportunity to develop a long range conventional strike capability by leveraging existing technology at relatively low risk.

However, the committee is concerned that the development of this conventional ballistic missile capability for a submarine that has historically carried nuclear armed ballistic missiles could cause a missile launch misinterpretation regarding which type of a warhead a ballistic missile may be carrying. The committee is encouraged that the Department has begun to engage military and civilian leaders of the international community to discuss the United States' intent behind this conventional strike capability, and is also developing measures to preclude misinterpretation of a conventional launch.

However, until this vital policy matter can be resolved, the committee recommends $919.6 million for Trident II missile modifications, a decrease of $38.0 million, and $99.1 million for strategic missile systems equipment, a decrease of $12.0 million.

AMMUNITION PROCUREMENT, NAVY & MARINE CORPS

OVERVIEW

The budget request for fiscal year 2007 contained $789.9 million for Ammunition Procurement, Navy & Marine Corps. The committee recommends authorization of $758.8 million, a decrease of $31.2 million, for fiscal year 2007.

The committee recommendations for the fiscal year 2007 Ammunition Procurement, Navy & Marine Corps program are identified in the table below. Major changes to the Navy & Marine Corps request are discussed following the table.

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SHIPBUILDING AND CONVERSION, NAVY

OVERVIEW

The budget request for fiscal year 2007 contained $10.6 billion for Shipbuilding and Conversion, Navy. The committee recommends authorization of $11.2 billion, an increase of $604.6 million, for fiscal year 2007.

The committee recommendations for the fiscal year 2007 Shipbuilding and Conversion, Navy program are identified in the table below. Major changes to the Navy request are discussed following the table.

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ITEMS OF SPECIAL INTEREST

313 ship navy force structure

The committee applauds the Chief of Naval Operations for developing the Navy's future force structure and the accompanying long-term shipbuilding plan to build it. This long-term plan provides the shipbuilding industry a view into the future that has been lacking. However, the committee is concerned that the plan was developed using unrealistic assumptions that will not make the plan executable. Of greatest concern to the committee is the affordability of the ship construction plan. According to the Navy's estimates, execution of this plan requires a significant increase in shipbuilding funds from $8.7 billion in fiscal year 2006 to $17.2 billion in fiscal year 2011. Obtaining these additional funds in a period of anticipated federal spending reductions will be difficult. The plan also assumes that individual ship acquisition programs can avoid the cost growth that has plagued most Navy ship acquisition programs.

The committee is concerned about the affordability of the Navy's long-term shipbuilding plan, recreating much of the uncertainty about the future of naval shipbuilding that the plan was designed to eliminate.

Aircraft carrier force structure requirements

The committee is concerned by the Chief of Naval Operation's plan to retire the USS John F. Kennedy. According to the Navy's long range shipbuilding plan, if the Navy retires the Kennedy, then the aircraft carrier force will drop to 11 between now and 2012, and then drop to 10 in 2013 and 2014. With the commissioning of CVN-78 in 2015, the aircraft carrier force increases to 11 and then back to 12 in 2019 and beyond.

The committee believes it is the objective of the Chief of Naval Operations to maintain a force of 12 aircraft carriers since the long range shipbuilding plan shows a total of 12 aircraft carriers between 2019 and the far range of the plan in 2036. It is apparent to the committee that the decision to allow the force structure to fall to 10 in the near future is fiscally rather than operationally driven.

The committee believes that the Navy should continue to maintain no less than 12 operational aircraft carriers in order to meet potential global commitments. The committee believes that a reduction below 12 aircraft carriers puts the nation in a position of unacceptable risk.

Arleigh Burke class destroyer modernization

The budget request contained $2.2 million for the Arleigh Burke class destroyer (DDG-51) modernization program.

The committee understands that the DDG-51 modernization program is a comprehensive mid-life modernization effort to ensure mission relevant service life of 35 years for the Arleigh Burke class destroyers. The modernization will include hull, mechanical and electrical technology upgrades to reduce manning and total ownership costs, combat system integrated warfighting improvements, and installation of an open architecture computing environment to allow future ballistic missile defense, air defense and other upgrades. The committee also understands that this modernization effort will focus on earlier Flight I ships (DDG-51 to DDG-71) to ensure they support the Chief of Naval Operations Sea Power 21 requirements of Sea Strike, Sea Shield and ForceNet. The committee believes that because the next generation destroyer, DD(X), will not be fielded until 2013, the DDG-51 fleet must be modernized at an accelerated rate to take earlier advantage of the operating cost reductions and the improved combat system capabilities.

Therefore, the committee recommends an increase of $200.0 million to accelerate the modernization program by two years.

Battleship transfer

In the conference report (H. Rept. 109-360) accompanying the National Defense Authorization Act for fiscal year 2006, the committee included instructions regarding the transfer of the battleships USS Wisconsin and USS Iowa to the Commonwealth of Virginia and State of California, respectively, and the President's reversion authority pursuant to a national emergency. The committee seeks to clarify that the battleships USS Wisconsin and USS Iowa must be regarded as potential mobilization assets and both the recipients and the U.S. Navy are instructed to treat them as such. The committee notes that the following measures should be taken: (1) the ships must not be altered in any way that would impair their military utility; (2) the ships must be preserved in their present condition through the continued use of cathodic protection and dehumidification systems and any other preservation methods as needed; (3) spare parts and unique equipment such as 16-inch gun barrels and projectiles, be preserved in adequate numbers to support the two ships, if reactivated; and (4) the Navy must prepare plans for the rapid reactivation of the two battleships should they be returned to the Navy in the event of a national emergency.

Incremental funding for shipbuilding

The budget request recommends incremental funding for 3 of the 7 ships in the request, including for the first time construction of a surface combatant, the next-generation destroyer DD(X). Furthermore, during the consideration of the National Defense Authorization Act for Fiscal Year 2006 (Public Law 109-163), the Navy sought and was granted the authority to use incremental funding for the next aircraft carrier, which will be recorded as procured in 2008.

The committee remains concerned that the use of incremental funding is not a solution to the Navy's problem in funding shipbuilding. While incremental funding can allow the Navy to smooth out the dramatic spikes in shipbuilding funding required as a result of aircraft carrier construction every four or five years, it does not fundamentally increase the number of ships that a given amount of money will purchase. During the committee's hearings on shipbuilding, all witnesses emphasized the importance of program and funding stability as the top priority for reducing the cost of shipbuilding and sustaining the shipbuilding industrial base. The committee notes that Congress adopted the full funding policy in the 1950s in part because of a concern that incremental funding was detrimental to funding stability. Future congresses may find themselves unwilling, or unable, to fund completion of ships begun in prior years and only partially funded. The committee remains convinced that the full funding policy is the correct policy for funding shipbuilding.

The committee understands that the Department of Defense this year considered submission of a legislative proposal that would permanently authorize the use of `split funding' for aircraft carriers and large deck amphibious ships, and the Navy's fiscal year 2007

shipbuilding plan already assumes such authority for the second LHA class amphibious assault ship. The committee has approved the use of split funding for certain ships in certain cases. However, the committee does not believe that a blanket policy supporting incremental funding for any class of ship is appropriate, and has not included such a provision in the bill.

Littoral combat ship program

The committee is concerned about the uncertainty in the Navy's acquisition strategy for the Littoral Combat Ship (LCS). The Navy recently announced its intention to continue with the Flight Zero design through fiscal year 2009. The Navy plans to procure 15 LCSs through this initial design phase. How long the Navy intends to continue with two separate designs for these vessels remains unclear. The committee believes that it is also unclear when the Navy will place this program into the discipline of the normal acquisition process with definitive and mature requirements and Director, Operational Test and Evaluation, review before continuing with procurement. The Navy's long-range shipbuilding plan calls for procuring 55 LCSs, and the committee encourages the Navy to develop an acquisition strategy for the long-term that clarifies any ambiguity in the current build profile. The committee further encourages the Navy to downselect to one of the two LCS variants currently in procurement in order to achieve economy of scale, or present a compelling case to the congressional defense committees on why both variants should be procured.

Next generation destroyer

The budget request contained $2.6 billion for split procurement of two next generation destroyers (DD(X)).

The committee does not believe the DD(X) is affordable. The committee supports recent efforts by the Navy to `design cost out' of the lead ship and to focus on threshold instead of objective requirements in an effort to reduce the risk of cost growth. However, due to the unusually large number of new technologies being integrated on the next generation destroyer, the committee understands there is no prospect of being able to design and build the two lead ships for the $6.6 billion budgeted.

The committee is concerned that the Navy is attempting to insert too much capability into a single platform. As a result, the DD(X) is now expected to displace over 14,000 tons and by the Navy's estimate, cost almost $3.3 billion each. Originally, the Navy proposed building 32 next generation destroyers, reduced that to 24, then finally to 7 in order to make the program affordable. In such small numbers, the committee struggles to see how the original requirements for the next generation destroyer, for example providing naval surface fire support, can be met. In this day of netted operations, the committee advocates reducing the capabilities resident on the next generation destroyer, to instead rely on the netted sensors and weapons systems of other ships in the strike group. By reducing the requirements for the DD(X), a smaller, less expensive destroyer could be procured in greater numbers.

Because of its expense, the committee does not believe that DD(X) will be procured in sufficient numbers to meet the operational need. However, the committee does believe that the DD(X) program's engineering development models show the potential for some impressive advances in warfighting capability. The committee supports the construction of up to two DD(X)s to demonstrate technologies that could be incorporated into future, more affordable, major surface combatants. The committee recommends that these ships demonstrate as wide a range of technologies as is reasonably feasible, including both the advanced induction and permanent magnet motor propulsion concepts that were originally investigated for DD(X).

Therefore, the committee recommends $2.6 billion to fund one next generation destroyer as a technology demonstrator.

Shipbuilding/ship repair industrial base capacity

The committee believes that the ability to build naval ships and submarines is a critical national asset. Therefore, it is imperative that the United States sustain a healthy ship design, engineering and construction capability.

The first tier shipbuilding/ship repair industrial base is made up of six private and four public shipyards. Since there is very little commercial large-ship shipbuilding currently being executed in these shipyards, all 10 shipyards are almost wholly dependent on Department of Defense (DOD) work for sustainment.

The committee is concerned that the U.S. shipbuilding/ship repair industrial base has significant capacity beyond what is necessary for all anticipated DOD new construction and maintenance work, and believes that Navy ship acquisition programs are paying the price.

The Navy recently published a long-term shipbuilding plan that supports the goal of building and maintaining a 313 ship Navy by 2020. Although this plan provides the needed `stability' that the U.S. shipbuilding industry has been looking for, it does not appear to generate enough work to keep the major U.S. shipbuilders operating at their current capacity. Evidence of this is most obvious at General Dynamics Electric Boat Division where the contractor is planning to lay off hundreds of designers and engineers and thousands of production workers in the next several years. The plan to increase the procurement of Virginia class submarines from 1 to 2 per year has been delayed for over 10 years and the latest plan has the increase happening in fiscal year 2012. Similar challenges will affect the shipyards now constructing the last of the DDG-51 destroyers. Those yards are starting to ramp up to build the next generation destroyer, however, the next generation destroyer is not expected to be built in a sufficient quantity to keep the current workforce fully employed.

The committee directs the Secretary of the Navy to report to the congressional defense committees on measures that can be taken to manage the capacity of the shipbuilding/ship repair industrial base in a manner that would make Navy shipbuilding more affordable. Such report shall be submitted by the submission of the President's request for fiscal year 2008, as required by section 1105 of title 31, United States Code.

Ship cost estimates

The committee is deeply concerned about the process used for establishing the Navy's ship cost estimates. The committee notes that the original cost estimates on numerous existing ship classes have regularly been described by the Navy as inaccurate and unrealistic when those ships near completion of construction. The committee notes that in several cases it has been informed that ship cost estimates delivered to the committee in prior years either intentionally or unintentionally excluded certain known shipbuilding costs such as escalation, and that these cost estimates were known to be inaccurate on the day they were first delivered to the committee. The committee recommends that the process for deriving ship cost estimates be revised to ensure that all major known elements of ship cost are routinely included in all ship cost estimates.

The committee notes that Sections 122, 123, and 124 of the bill would impose cost limitations on three current ship classes based on the Navy's latest costs estimates. The committee further notes that the imposition of these statutory cost limitations makes the need for a high level of confidence in the cost estimates for these ship classes unusually important. Accordingly, the committee directs that the Secretary of the Navy revalidate the cost estimates for CVN-21, for the ships currently programmed in the LHA Replacement program, and for the eight ships of the San Antonio class amphibious ship that follow the lead ship. The committee further directs that the revalidated costs estimates be submitted for review and approval by the Under Secretary of Defense for Acquisition, Technology, and Logistics. Finally, the committee directs that no later than July 1, 2006, the Secretary of the Navy submit a report in writing to the congressional defense committees containing the revalidated cost estimates for these ship classes including a certification by the Secretary that all known and anticipated major elements of cost have been included in the estimate.

Virginia class submarine

The budget request contained $676.6 million for advance procurement funding for Virginia class submarines.

The committee believes that the Navy's attack submarine force structure must be maintained at no less than 48 submarines in order to meet potential global commitments. The Navy's Annual Long-Range Plan for Construction of Naval Vessels for fiscal year 2007 shows that the force will decrease below 48 attack submarines between 2020 and 2033, reaching a low of 40 attack submarines in 2028 and 2029. The committee believes that a reduction below 48 attack submarines puts the country in a position of unacceptable risk.

Therefore, the committee recommends $1.1 billion for advance procurement of Virginia class submarines, an increase of $400.0 million for the procurement of a second Virginia class submarine in fiscal year 2009.

OTHER PROCUREMENT, NAVY

OVERVIEW

The budget request for fiscal year 2007 contained $5.0 billion for Other Procurement, Navy. The committee recommends authorization of $5.0 billion, an increase of $74.9 million, for fiscal year 2007.

The committee recommendations for the fiscal year 2007 Other Procurement, Navy program are identified in the table below. Major changes to the Navy request are discussed following the table.

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ITEMS OF SPECIAL INTEREST

AEGIS land-based test site modernization

The budget request contained $75.3 million for AEGIS support equipment, but included no funds for modernizing AEGIS land-based test sites.

The committee understands that the AEGIS land-based test sites are essential to the operational effectiveness of the AEGIS weapons system, including the development of an integrated missile defense system capable of providing a layered defense against ballistic and cruise missiles. The committee is aware that in order to maintain the highest possible level of effectiveness, the land-based test sites require state-of-the-art upgrades to peripheral emulators and switching systems used to collect and analyze combat system performance data. Modernization of the emulators and switches will ensure timely testing, certification and delivery of updated AEGIS baselines to the fleet.

The committee recommends $80.3 million for AEGIS Support Equipment, an increase of $5.0 million to be used for modernizing AEGIS land-based test sites.

Amphibious ship integrated bridge system

The budget request contained $31.0 million for other navigation equipment, but included no funds for the amphibious ship integrated bridge system.

The committee is aware that the Navy has directed that all ships in the fleet will use electronic navigation/electronic charting by the end of fiscal year 2009. The committee believes that additional funding will allow for the conversion of amphibious ships to electronic navigation/electronic charting, allowing them to meet the Navy's goal. Conversion to electronic navigation/electronic charting will allow a reduction in bridge manning, saving an estimated $0.6 million per ship per year, more than paying for the conversion in less than three years.

The committee recommends $35.5 million for other navigation equipment, an increase of $4.5 million to be used for the amphibious ship integrated bridge system.

AN/SPQ-9B radar

The budget request contained $2.5 million for the AN/SPQ-9B radar, but included no funds for testing of the AN/SPQ-9B on the littoral combat ship (LCS).

The committee is aware that the two LCS variants now under construction are to be delivered with tactical/fire control radars chosen by the prime contractors. The committee believes that the AN/SPQ-9B tactical/fire control radar, already in the Navy inventory, may provide superior self-protection against anti-ship sea skimming missiles than the radars being provided. The AN/SPQ-9B radar has been thoroughly tested by the Navy and a successful radar operational assessment was completed in September 2002. The committee is aware that an identification friend or foe capability, an LCS requirement, was successfully added in 2005. The ability to provide volume surveillance, another LCS requirement, is presently under development and scheduled for completion in the spring or summer of 2006. The committee believes that additional funds will be used for the procurement of the AN/SPQ-9B radar for the LCS program.

The committee recommends $8.5 million for the AN/SPQ-9B radar, an increase of $6.0 million to be used for the testing of the AN/SPQ-9B on the LCS.

AN/SPS-48 radar obsolescence, availability and recovery

The budget request contained no funds for radar support and no funds for the AN/SPS-48 radar obsolescence, availability and recovery (ROAR) program.

The committee is aware that the AN/SPS-48 ROAR program's goal is to maintain and support the air defense capabilities on aircraft carriers, amphibious assault ships and the San Antonio class amphibious warfare ships.

The committee recommends $7.3 million for the AN/SPS-48 radar obsolescence, availability and recovery program to accelerate the ROAR program by two years.

Boat lifts for small boats

The budget request contained $41.1 million for standard boats, but included no funds for boat lifts for shore-based small boats.

The committee understands that the current inventory and generally poor material condition of boat lifts at shore activities has reduced the level of boat readiness and increased lifecycle costs. The committee is aware that modern, state-of-the-art boat lifts, due to their design and capabilities, will expand boat service life, reduce maintenance costs, and permit quick and safe docking and boarding. Therefore, the committee recommends that modern commercial-off-the-shelf boat lifts be purchased and installed at small boat shore facilities to reduce lifecycle costs and improve operational readiness of the shore-based small boat fleet.

The committee recommends $42.1 million for standard boats, an increase of $1.0 million to be used for the procurement of modern boat lifts for shore activities.

Canned lube pumps for amphibious ships

The budget request contained $172.8 million for items under $5.0 million, but included no funds for installing canned lube pumps on the Harpers Ferry and Whidbey Island class amphibious ships.

The committee believes that the currently installed lube oil pumps have a high failure rate, leak excessively, and are driving up maintenance costs. Installation of the canned lube oil pumps will provide operating efficiency and reduce maintenance costs.

The committee recommends an increase of $4.0 million for items under $5.0 million, to be used for installing canned lube pumps on the Harpers Ferry and Whidbey Island class amphibious ships.

CVN propeller replacement program

The budget request contained $172.8 million for items under $5.0 million, but included no funds for the CVN propeller replacement program.

The committee understands that the old-design propellers on the Nimitz class aircraft carriers suffer from blade erosion caused by cavitation and the high operating tempo of recent years. Propeller refurbishment on the outboard and inboard propellers is required every three and six years, respectively. The committee believes that the new-design propellers will require refurbishment every 12 years, more closely corresponding to the interval of aircraft carrier drydockings. The committee also believes that propeller replacement will lead to increased ship operational availability and reduced disruptions to planned maintenance schedules.

The committee recommends an increase of $3.5 million for items under $5.0 million, to be used for the CVN propeller replacement program.

Laser marksmanship training systems

The budget request contained $18.2 million for training support equipment, but included no funds to procure laser marksmanship training systems (LMTS) for the Navy Reserve.

The LMTS is a proven laser-based marksmanship training system that simulates live-fire training, can be used in various environmental conditions and locations, as well as allowing sailors to train with their own primary personal defense weapon to engage various types of targets.

The committee is aware this system contributes to individual sailor and unit readiness, improves skill retention, reduces unit training costs and achieves environmental cost avoidance associated with traditional live-fire training exercises. The committee understands the Navy Reserve has a program to field LMTS to all Navy Reserve Centers.

The committee recommends $26.2 million for training support equipment, an increase of $8.0 million to accelerate the fielding of LMTS to all Navy Reserve Centers.

Man overboard identification system

The budget request contained $58.6 million for command support equipment, but included no funds for the man overboard identification system.

The committee is aware that the man overboard identification system provides an active means by which a Navy ship can be immediately alerted to a man-overboard incident and further allows for precise location of the individual in the water, thus reducing the chance of serious injury or death. Each sailor or marine wears a small transmitter on his life jacket, that, when activated upon water entry, transmits a signal to the ship identifying the specific sailor, the ship from which he fell and the global positioning system coordinates of the incident. A direction finder then tracks the location of the man-overboard during the rescue effort. Under the current installation plan, the Navy would provide man-overboard transmitters only to those sailors and marines identified as at risk, approximately a third of all crew onboard. The committee believes that the Navy needs to consider providing a transmitter for every crewmember on the ship, not just those considered at risk.

The committee recommends $67.4 million for command support equipment, an increase of $8.8 million to be used for the man overboard identification system.

Materials handling equipment

The budget request contained $13.7 million for materials handling equipment (MHE), but contained no funding to procure an 11,000 pound rough terrain, self deployable, manually operated forklift system capable of operating efficiently in nuclear, biological, and chemical environments for the Navy Construction Force (NCF) Seabees.

The committee is aware the NCF Seabees are in the process of recapitalizing their fleet of construction equipment and MHE. The committee supports this initiative and notes that the high operational tempo coupled with the harsh environment of Iraq has consequently resulted in some equipment becoming uneconomical to either repair or to rebuild through service life extension programs or recapitalization programs.

The committee notes this system would address NCF Seabees lift requirements for fiscal year 2007. The committee recommends $23.7 million in materials handling equipment, an increase of $10.0 million to accelerate the procurement and delivery of 100 forklift material handling equipment systems for the NCF Seabees.

Medical support equipment

The budget request contained $5.6 million for medical support equipment, but included no funding for 3,600 lightweight and NATO-standard litters and litter load carriage tools; 2,500 lightweight, combat medics' bags; or 4,500 onboard kits for tactical vehicles, which include pelvic stabilization devices, ear nose and throat packs, airway tools, and tourniquets. The committee recommends more fully equipping naval expeditionary forces to enable field medical personnel in tactical units to stabilize and evacuate casualties more rapidly, efficiently, and safely.

The committee recommends $11.8 million for medical support equipment, an increase of $6.2 million for combat casualty care equipment upgrades.

Multi-climate protective system

The budget request contained $18.6 million for various aviation life support items, but included no funds for the multi-climate protective system (MCPS).

The MCPS is a modular protective aircrew clothing ensemble that provides flame protection, thermal protection, and sufficient insulation while reducing the heat stress and bulk commonly associated with cold weather clothing systems. Components of the system can be used in a wide range of temperatures and climate conditions. The committee understands that funding to procure 5,532 MCPSs has been obligated thus far, and that the Department of the Navy's MCPS requirement is for 25,000 systems. The committee believes that procurement of the MCPS should continue.

Accordingly, the committee recommends $22.6 million for aviation life support, an increase of $4.0 million for procurement of the MCPS. Additionally, the committee strongly encourages the Department of the Navy to include the necessary funds for the MCPS in its future budget requests to meet MCPS requirements.

Multi-spectral threat emitter system

The budget request contained $56.2 million for weapons range support equipment, but included no funds for the multi-spectral threat emitter system (MTES).

The MTES provides a mobile surface-to-air and air defense artillery electronic threat simulation for aircraft along the East Coast of the United States to provide for more realistic aircrew proficiency training. The committee notes that Congress appropriated $2.5 million for fiscal year 2005 and $2.1 million for fiscal year 2006 for the MTES, and recommends authorization of additional funds to complete the procurement of two MTES systems.

Accordingly, the committee recommends $64.2 million for weapons range support equipment, an increase of $8.0 million for procurement of two MTESs.

Serial number tracking system

The budget request contained $12.1 million for other supply support equipment, but included no funds for implementation of the serial number tracking system.

The serial number tracking system provides a web-based, cradle-to-grave total asset visibility of individual components through the supply, maintenance and transportation processes. The technology enables rapid and accurate data collection for information systems and permits logistics data to be used Navy-wide for increased readiness. The committee recommends the implementation of the serial number tracking system application in the areas of shipboard medical equipment, warehouse and ground support equipment management at Naval and Marine Corps Air Stations. The committee believes that the use of modern commercial-off-the-shelf automatic identification and data collection technologies like the serial number tracking system for critical asset management will yield significant improvements in productivity and effectiveness.

The committee recommends $15.1 million for command support equipment, an increase of $3.0 million to be used for implementation of the serial number tracking system.

Submarine communications upgrades

The budget request contained $12.3 million for satellite communications systems, but included no funds for the Miniaturized Demand Assigned Multiple Access (mini-DAMA) communications set upgrades.

The committee understands that the mini-DAMA communications set provides communications links necessary for command and control of battlegroups, as well as for control, targeting and battle damage assessment for deployed tomahawk weapons. The committee is aware that due to program delays in the Joint Tactical Radio System, it is necessary to perform mini-DAMA upgrades in the submarine fleet to avoid degradation of combat missions.

The committee recommends an increase of $2.1 million to be used for mini-DAMA communications set upgrades in the submarine fleet.

Submarine non-tactical application delivery interface system shore interface

The budget request contained $24.8 million for submarine training device mods, including $2.9 million for the submarine non-tactical application delivery interface system (SNADIS) shore interface.

The committee recommends authorizing additional funds to allow the Navy to accelerate the development and integration of the shore command system with the existing deployed ship based SNADIS. When these two systems are fully integrated and sharing information, both the ship's commanding officer and shore commander will have the information available to assess and evaluate the readiness of the submarine force.

The committee recommends $27.8 million for submarine training device mods, an increase of $3.0 million to be used for the SNADIS shore interface.

Ultrasonic maintenance tools

The budget request contained $172.8 million for items less than $5.0 million, but included no funds for ultrasonic maintenance tools.

The committee understands that ultrasonic maintenance tools have the potential to significantly reduce ship maintenance man-hours by eliminating several time consuming maintenance procedures currently used to locate and identify compartment integrity breeches, fluid system leaks, bearing and gear anomalies and clogged engine fuel injectors. The committee believes significant cost-savings may be attained with maintenance reducing technology.

The committee recommends an increase of $2.5 million for the procurement of ultrasonic maintenance tools.

PROCUREMENT, MARINE CORPS

OVERVIEW

The budget request for fiscal year 2007 contained $1.3 billion for Procurement, Marine Corps. The committee recommends authorization of $1.2 billion, a decrease of $49.7 million, for fiscal year 2007.

The committee recommendations for the fiscal year 2007 Procurement, Marine Corps program are identified in the table below. Major changes to the Marine Corps request are discussed following the table.

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ITEMS OF SPECIAL INTEREST

Envelope protective covers for marine expeditionary unit weapon systems and platforms

The budget request contained $31.8 million for fire support systems, but included no funds to procure envelope protective covers for Marine Corps Expeditionary Units' (MEUs) weapon systems and platforms.

The committee understands the Navy currently employs envelope protective covers for equipment platforms and weapon systems. The committee notes that widespread use of envelope protective covers by the Navy is generating higher equipment readiness ratings for protected naval weapon systems and platforms, as well as lower maintenance requirements, reduced manpower requirements, and higher return on equipment investments. The committee encourages the Marine Corps to field similar envelope protective covers to seven MEUs to cover such equipment platforms as the M777 lightweight 155mm howitzers and M198 155mm howitzers, as well as to capitalize on the economic and performance benefits provided by these protective covers.

The committee recommends $34.8 million in fire support systems, an increase of $3.0 million to procure envelope protective equipment covers for seven MEUs.

Intelligent surveillance systems

The budget request contained $13.8 million for training devices, but contained no funding for a modular intelligent surveillance training system.

The committee understands a modular intelligent surveillance system would provide Marine Corps trainers with improved situational awareness of military personnel conducting urban training exercises, and would provide immediate feedback to the training unit in after action review format. Further, the committee is aware this system would allow trainers to observe in real-time a training event either from a `blue' or `opposing' force perspective; a capability not currently employed by existing training systems.

The committee recommends $18.8 million for training devices, an increase of $5.0 million to procure modular intelligent surveillance training systems.

Laser perimeter awareness system

The budget request contained $5.2 million for physical security equipment, but included no funds to procure laser perimeter awareness systems (LPAS).

The LPAS is an all-weather surveillance sensor system that would detect the presence and track the motion of intruders, locating them in range, bearing, and elevation with respect to the position of the sensor.

The committee understands Marine Corps regulations governing the security of arms, ammunition, and explosives, as well as aviation assets, mandate constant surveillance and restricted access to these assets. The committee is aware that Marine Corps installations are currently equipped with base-wide electronic security systems that are outdated and require extensive modernization. The committee notes the LPAS would provide critical enhancements to existing security and force protection technology to meet current Marine Corps security requirements outlined in the Marine Corps's Flightline Security Enhancement Program (FSEP), as well as increase the effectiveness of available security manpower.

Therefore, the committee recommends $14.7 million for physical security equipment, an increase of $9.5 million to procure three LPAS and associated equipment, as well as to address a Commandant of the Marine Corps unfunded requirement.

AIRCRAFT PROCUREMENT, AIR FORCE

OVERVIEW

The budget request for fiscal year 2007 contained $11.5 billion for Aircraft Procurement, Air Force. The committee recommends authorization of $13.0 billion, an increase of $1.6 billion, for fiscal year 2007.

The committee recommendations for the fiscal year 2007 Aircraft Procurement, Air Force program are identified in the table below. Major changes to the Air Force request are discussed following the table.

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ITEMS OF SPECIAL INTEREST

B-1B molecular sieve oxygen generation system

The budget request contained $53.1 million for B-1B aircraft modifications, but included no funds for the molecular sieve oxygen generation system (MSOGS) reliability improvement program.

The committee understands the MSOGS is the B-1B oxygen generation system which consists of a concentrator, water separator, and a back-up oxygen system that provides the aircrew with an unlimited source of oxygen for breathing during flight. The committee notes that while operating in forward basing locations containing a high humidity level, the rate of repair for the MSOGS has doubled causing negative impacts to operationally available aircraft. The committee is aware that the original equipment manufacturer has identified an improved, high-efficiency water separator that would enhance the reliability of the MSOGS, increase operational availability of the aircraft, and eliminate the need for a depot level repair.

Therefore, the committee recommends $57.6 million, an increase of $4.5 million for the MSOGS reliability improvement program.

B-2 radar modification program

The budget request contained $191.3 million for B-2 modernization, including $160.7 million for the B-2 radar modification program (RMP).

The committee understands that in October 2000, the Department of Commerce notified the Department of Defense that the B-2 must vacate its current operating frequency before a classified near-term date (NTD) and relocate to a frequency band where the U.S. Government is the primary user. The committee understands that this raised a significant challenge for the Air Force due to budget cycle timing. The committee notes the Air Force started the program in fiscal year 2003 to replace the B-2 radar system by the NTD and modeled the program around a traditional acquisition structure.

The committee notes the B-2 RMP plans to make a low-rate production decision in February 2007, to procure four radar modification units in fiscal year 2007. However, the committee understands that radar flight testing will not have progressed to the point that the first of two planned radar software blocks is fully tested and certified until the beginning of fiscal year 2008. Although flight testing will be underway, only 23 percent of the flight testing is expected to be completed by the beginning of fiscal year 2007. The committee recognizes that producing RMP units before ensuring that the design is mature and functions in its intended environment can increase the likelihood of design changes that lead to cost growth, schedule delays, and performance problems.

Although the committee realizes the challenges presented to the Air Force to correct the radar frequency issue promptly, the committee strongly discourages future programs from this methodology of proceeding into low-rate production before program components have been fully tested and certified.

B-52 force structure

The budget request included a proposal to retire 18 B-52 aircraft in fiscal year 2007, and 20 B-52 aircraft in fiscal year 2008.

The committee understands that the 2006 Quadrennial Defense Review directed the Air Force to reduce the B-52 force to 56 aircraft and use the savings to fully modernize the remaining B-52s, B-1s, and B-2s to support global strike operations. However, the committee understands that the estimated $680.0 million savings garnered from the proposed B-52 retirement in the remaining Future Years Defense Program (FYDP) has not been reinvested into modernizing the current bomber force, but has instead been applied towards Air Force transformational activities. The committee also understands that the current B-52 combat coded force structure is insufficient to meet combatant commander requirements for conventional long-range strike, if the need should arise to conduct simultaneous operations in two major regional conflicts.

Additionally, the committee is concerned that the decision to retire 38 B-52 aircraft is primarily based on the nuclear warfighting requirements of the Strategic Integrated Operations Plan, and did not consider the role of the B-52 in meeting combatant commander's conventional long-range strike requirements. The committee disagrees with the decision to reduce the B-52 force structure given that the Air Force has not begun the planned analysis of alternatives to determine what conventional long-range strike capabilities and platforms will be needed to meet future requirements.

The committee is deeply concerned that retirement of any B-52 aircraft prior to a replacement long-range strike aircraft reaching initial operational capability status is premature. Further, the committee strongly opposes a strategy to reduce capability in present day conventional long-range strike capability in order to provide funding for a replacement capability that is not projected to achieve initial operational capability until well into the future.

Therefore, the committee included a provision (section 131) in this Act that would prohibit the Air Force from retiring any B-52 aircraft, except for the one B-52 aircraft no longer in use by the National Aeronautics and Space Administration for testing. Additionally, this section would require the Air Force to maintain a minimum B-52 force structure of 44 combat coded aircraft until the year 2018, or until a long-range strike replacement aircraft with equal or greater capability than the B-52H model has attained initial operational capability status.

C-130 modifications

The budget request contained $217.7 million for C-130 modifications, but included no funds for the C-130 scathe view communication systems improvement, or for procurement of the AN/APN-241 radar for the Air Force Reserve Command (AFRC).

The C-130 scathe view system provides a near-real-time imaging capability to support humanitarian relief and non-combatant evacuation operations. The committee understands that the C-130 scathe view system currently has a short-range, line-of-sight capability to transmit full motion video, but this capability could be extended to longer ranges with a tactical common data link (TCDL) upgrade. Therefore, the committee recommends an increase of $1.8 million for procurement of a TCDL upgrade to the C-130 scathe view system.

The AN/APN-241 is a weather and navigation radar that replaces the 1950's-era AN/APN-59 radar currently installed on the AFRC's C-130 aircraft fleet. The committee understands that the AN/APN-241 radar has significantly improved performance capabilities and a much lower mean-time-between-failure rate. The committee also understands that procurement and installation of the AN/APN-241 radar is the second highest C-130 unfunded priority for the AFRC. Therefore, the committee recommends an increase of $5.5 million to procure AN/APN-241 radars for the AFRC's C-130 fleet.

Therefore, the committee recommends an increase of $1.8 million for the C-130 scathe view communication systems improvement and an increase of $5.5 million for the AN/APN-241 radar for the AFRC.

C-5 modernization programs

The budget request contained $223.1 million for C-5 modernization programs, including $50.4 million for the C-5 avionics modernization program (AMP), $66.7 million for advanced procurement of three reliability and re-engining program (RERP) kits, and $28.9 million for aircraft defensive systems.

The committee understands that the average C-5 aircraft has approximately 70 percent of its forecasted structural life remaining and supports the initiatives to modernize the C-5 fleet. The committee notes that the AMP and the RERP are expected to increase the C-5 wartime operational availability from a current average of 60 percent, to at least 75 percent. Further, the committee understands that the AMP and the RERP have the potential to reduce the total ownership cost of the C-5 aircraft fleet by $24.0 billion (fiscal year 2005 dollars) over the remaining service life of the fleet, and that a return on investment of approximately $13.0 billion (fiscal year 2005 dollars) could be realized by the year 2028.

The committee understands that C-5A aircraft are prohibited from directly delivering cargo into airfields assessed as having a man-portable air defense system (MANPADS) threat. Further, the committee understands that the C-5A aircraft must land at a base outside of these MANPADS threat areas and transfer its cargo onto another aircraft installed with an operational missile warning and countermeasure system, causing an increased delay in getting supplies and equipment to the warfighter.

Therefore, the committee recommends $289.8 million, an increase of $32.0 million for procurement of 8 additional AMP kits; an increase of $12.5 million for procurement of 10, AN/AAR-47 and AN/ALE-47 missile warning and countermeasure dispensing systems; and an increase of $22.2 million for advanced procurement of 1 additional RERP kit.

C-9 hush kits

The committee understands that funds appropriated in fiscal year 2005 for Department of the Air Force C-9 hush kits remain unobligated due to the near-term retirement of these aircraft from the inventory. Hush kits are required to allow the ground maintenance of C-9 engines to meet various locality noise standards for engine ground-run maintenance. The committee also understands that the Department of the Navy plans to maintain its C-9 aircraft for at least the next 10 years, and therefore encourages the Department of Defense to transfer the funding provided for Department of the Air Force C-9 hush kits to the Department of the Navy, ensuring that these funds will be executed to best support the needs of the Department of Defense.

F-22

The budget request contained $1.5 billion for the F-22 aircraft procurement program, but included insufficient funds to procure 20 F-22 aircraft in fiscal year 2007. The F-22 is a multi-mission fighter aircraft that combines a low-observable radar signature with an ability to cruise at

supersonic speeds without the use of thrust augmentation, and performs air dominance, homeland and cruise missile defense, and air-to-ground attack missions. The F-22 achieved its initial operational capability in the first quarter of fiscal year 2006.

The budget request included an F-22 multiyear acquisition strategy to procure 3 lots, numbered as lots 7 through 9, each consisting of 20 aircraft, between fiscal years 2008 and 2010. As part of this strategy, the budget request included a plan to incrementally fund each of these three lots over a three year period through budgeting for advance procurement two years prior to full funding, subassembly activities to be budgeted one year prior to full funding, and final assembly to be budgeted in the third year. The committee understands that the Department of Defense's F-22 multiyear acquisition strategy is inconsistent with the full-funding policy which would allow for advance procurement of long-lead items to protect a delivery schedule, and require a budget for procurement of complete and useable end items in a fiscal year.

The committee considers the F-22 incremental funding acquisition strategy to be wholly unacceptable. The committee believes that the full-funding policy should apply to the F-22 aircraft procurement program, and any other Department of Defense aircraft procurement program contemplated in the foreseeable future. The committee further believes that incremental funding of aircraft procurement programs presents an unacceptable budgeting risk that, due to unforeseen circumstances, future funding increments may not be authorized and appropriated to provide the required funding increments which would result in partially completed end items that are of no military value to the Department of Defense or to warfighting commands.

Therefore, the committee recommends $2.9 billion to fully fund and procure 20 F-22 aircraft in fiscal year 2007, an increase of $1.4 billion. The committee very strongly urges the Department of Defense and the Department of the Air Force to restructure its future F-22 procurement budget plans to comply with the full-funding policy.

F-35

The budget request contained $245.0 million in Aircraft Procurement, Navy for F-35 advance procurement to procure the long-lead items necessary to build eight short take-off and vertical land (STOVL) Navy and Marine Corps variants, which would be fully funded in fiscal year 2008. The budget request also contained $118.3 million in Aircraft Procurement, Air Force for F-35 advance procurement to procure the long-lead items necessary to build eight conventional take-off and landing (CTOL) Air Force variants, which would also be fully funded in fiscal year 2008. Additionally, the budget request contained $869.7 million for the first five CTOL Air Force F-35 variants.

The F-35 program, also known as the joint strike fighter (JSF) program, is developing a family of three strike fighter aircraft for the Air Force, Navy and Marine Corps. About 70 percent of the parts for all three fighter variants will be common. The Air Force CTOL variant will replace the F-16 and A-10 fleets; the Navy variant, or aircraft carrier version (CV), will complement the F/A-18E/F; and the Marine Corps variant, or short take-off, vertical landing (STOVL) version, will replace the AV-8B and the F/A-18C/D fleets.

In the committee report (H. Rept. 109-89) accompanying the National Defense Authorization Act for Fiscal Year 2006, the committee recommended that the F-35 program not begin its low-rate initial procurement program in fiscal year 2007 because testing to determine whether or not the redesigned, lower-weight F-35 production configuration would meet mission requirements would not be known until after the first flights of the lower-weight STOVL and CTOL test aircraft. The committee notes that the first flight of the higher-weight CTOL aircraft has been delayed by three months, resulting in corresponding delays in the first flights of the lower-weight STOVL and CTOL test aircraft, now planned for the second and fourth quarters of fiscal year 2008, respectively.

The Subcommittee on Tactical Air and Land Forces held a hearing on March 16, 2006, at which the Government Accountability Office (GAO) witness testified, that, `the JSF program remains committed to a business case that invests heavily in production before testing has demonstrated an acceptable level of performance of the aircraft,' and that the `program expects to begin low-rate initial procurement in 2007 with less than one percent of the flight test program completed and no production representative prototypes built for the three JSF variants.' As a result, the committee remains very concerned that concurrent development and production of the F-35 is likely to result in further cost increases and schedule delays. The committee notes that the GAO reports that only three percent of the flight test program will be complete in fiscal year 2008, and believes that JSF procurement for fiscal year 2008 should also remain at the fiscal year 2007 procurement quantity of five aircraft.

Accordingly, the committee recommends $92.0 million in Aircraft Procurement, Navy for the advance procurement of long-lead components for three STOVL F-35 aircraft in fiscal year 2008, a decrease of $153.0 million. The committee also recommends $30.3 million in Aircraft Procurement, Air Force, for the advance procurement of long-lead components for two CTOL F-35 aircraft in fiscal year 2008, a decrease of $88.0 million.

KC-135 aerial refueling aircraft recapitalization program

The budget request contained $36.1 million for advanced procurement for the KC-135 aerial refueling aircraft recapitalization program (KC-X). The budget request included a proposal to retire 78 KC-135E aircraft.

The committee fully supports recapitalization of the KC-135 aerial refueling fleet. The committee notes that a system development and design contract would likely not be awarded until the end of fiscal year 2007, in accordance with the estimated acquisition schedule of the Air Force. The committee believes it is premature to authorize advanced procurement funding at such an early stage of the KC-X program.

The committee notes that the Air Force has been restricted since fiscal year 2004 from retiring KC-135E aircraft. However, the committee believes that it is premature to retire 78 KC-135E aircraft in fiscal year 2007 based on the tanker recapitalization program still being in its early stages of execution. The committee recognizes that 29 of the requested 78 KC-135E aircraft selected for retirement have been grounded from flight since fiscal year 2004.

Therefore, the committee included a provision (section 135) in this Act that would permit the Secretary of the Air Force to retire the 29 KC-135E grounded aircraft, and require the Secretary of the Air Force to maintain all retired KC-135Es, beginning in fiscal year 2007, in a condition that would allow recall to future service in the Air Force reserve, guard, or active forces aerial refueling force structure. The committee will consider additional KC-135E retirements based on the future progress of the KC-X program. Lastly, the committee recommends a decrease of $36.1 million for advanced procurement for the KC-X program.

P5 combat training systems

The budget request contained $474.9 million for other production charges, including $4.9 million for the P5 combat training system (P5CTS).

The P5CTS is an airborne instrumentation subsystem pod used by fighter and attack aircraft which provides the capability to conduct air-to-air, air-to-surface, and electronic warfare combat training while providing real-time aircraft monitoring and recording events for post- mission debrief and analysis. The committee notes that the P5CTS budget for fiscal year 2006 was $13.9 million and had been planned for $14.1 million in fiscal year 2007, but understands that this amount was decreased to $4.9 million because the Department of the Air Force reprogrammed $9.2 million for other purposes. As a result, the committee further understands that this decrease will delay P5CTS fielding at various Air Force Bases (AFB), including Shaw AFB where the current P5CTS fielding plan will meet only half of its requirement for 48 P5CTSs.

To address this shortfall, the committee recommends $478.1 million for other production charges, an increase of $3.2 million to procure 24 additional P5CTSs.

Strategic airlift force structure

The budget request contained $2.6 billion for procurement of 12 C-17s, including $389.6 million for shutdown costs of the production line.

The Commander, U.S. Transportation Command and the Commander, Air Mobility Command, both testified before the House Committee on Armed Services March 2, 2006, that no more than 20 C-17s, in addition to the 180 C-17s currently in the Department of Defense's program of record, are needed to meet both the inter-theater and intra-theater airlift requirements, and provide a recapitalization solution for older C-17s being used at a higher than planned utilization rate. Further, the Commanders testified that the range of 292 to 383 strategic airlift aircraft set forth in the Mobility Capability Study (MCS), should not be considered a strict composition of a specific type of aircraft, but should instead be considered a capacity requirement based on an acceptable level of risk. Lastly, the Chief of Staff of the Air Force identified seven additional C-17s as the number one request on the Air Force's unfunded priority list.

The committee is concerned that the decision by the Department to maintain a strategic airlift force structure of 292 aircraft is not based on meeting future airlift requirements, but based on fiscal constraints. Further, the committee is concerned about the acceptable level of risk provided with a strategic airlift force structure of 292 aircraft with critical uncertainties such as defining future Army modularity and intra-theater airlift requirements, the outcome of the C-5 modernization program, the C-130 wing-box repair strategy, and the viability of the Civil Reserve Airlift Fleet to augment future airlift requirements. The committee is concerned that the MCS scenarios used for the modeled year were not intended to fully stress the defense transportation system and is deeply concerned by the shortsightedness of the MCS to project capabilities required past the year 2012. The committee supports the initiative to modernize the C-5 fleet and supports the evaluation of a C-5A aircraft in the Reliability Enhancement and Re- enginging Program (RERP) configuration. Lastly, the committee urges the Secretary of the Air Force when determining the composition of the future strategic airlift fleet, to thoroughly examine the benefits of including both the C-5 and C-17 platforms.

Therefore, the committee included a provision (section 132) in this Act that would require the Secretary of the Air Force to maintain a minimum strategic airlift aircraft force structure of 299 aircraft beginning in fiscal year 2009. Additionally, the provision would repeal section 132 of the National Defense Authorization Act for Fiscal Year 2004 (Public Law 108-136), to allow the Air Force flexibility in managing its strategic airlift fleet composition. Lastly, the committee recommends $2.9 billion, an increase of $299.8 million for procurement of 3 additional C-17s. The committee strongly encourages the Secretary of the Air Force to apply the $389.6 million of shutdown costs towards the procurement of these 3 additional C-17s.

T-38 ejection seat upgrade program

The T-38 ejection seat upgrade program (ESUP) upgrades the T-38 ejection seat system with an inter-seat sequencing system that would accommodate a larger population of pilot heights and weights.

The committee notes that the Air Force maintains an inventory of 509 T-38 aircraft, but only 243 aircraft are planned for the ESUP. The committee strongly encourages the Air Force to budget for the ESUP for the entire T-38 fleet.

AMMUNITION PROCUREMENT, AIR FORCE

OVERVIEW

The budget request for fiscal year 2007 contained $1.1 billion for Ammunition Procurement, Air Force. The committee recommends authorization of $1.1 billion, an increase of $4.0 million, for fiscal year 2007.

The committee recommendations for the fiscal year 2007 Ammunition Procurement, Air Force program are identified in the table below. Major changes to the Air Force request are discussed following the table.

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ITEM OF SPECIAL INTEREST

Insensitive munitions upgrade

The budget request contained $235.5 million for general purpose bombs of various types and weights. The committee notes that the Department of the Air Force indicates that 40 percent of the MK-84 2,000-pound general purpose (GP) bombs requested for fiscal year 2007 would be loaded, assembled and packed with a new, more expensive explosive fill, known as MNX-795, instead of trinitroluene (TNT), which are classified as insensitive munitions (IMs).

IMs are those providing a higher degree of safety in the handling, manufacturing, storage, and use because they are more insensitive to unplanned stimuli. The committee understands that IMs will provide substantial improvements in decreasing unplanned high-order detonations due to heat induced by fire, bullet impact, fragment impact, and adjacent detonations; and the committee believes that the percentage of IMs procured for fiscal year 2007 should be expanded.

Accordingly, the committee recommends $239.5 million for general purpose bombs, an increase of $4.0 million to procure additional IMs.

MISSILE PROCUREMENT, AIR FORCE

OVERVIEW

The budget request for fiscal year 2007 contained $4.2 billion for Missile Procurement, Air Force. The committee recommends authorization of $4.2 billion, a decrease of $32.7 million, for fiscal year 2007.

The committee recommendations for the fiscal year 2007 Missile Procurement, Air Force program are identified in the table below. Major changes to the Air Force request are discussed following the table.

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OTHER PROCUREMENT, AIR FORCE

OVERVIEW

The budget request for fiscal year 2007 contained $15.4 billion for Other Procurement, Air Force. The committee recommends authorization of $15.4 billion, an increase of $20.6 million, for fiscal year 2007.

The committee recommendations for the fiscal year 2007 Other Procurement, Air Force program are identified in the table below. Major changes to the Air Force request are discussed following the table.

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ITEMS OF SPECIAL INTEREST

Cheyenne Mountain complex

The budget request contained $19.3 million for procurement of the Cheyenne Mountain Complex, including $14.9 million for tactical warning/attack assessment systems.

The committee believes that the modernization and integration of the command and control systems at Cheyenne Mountain, Colorado is critical to adequately support the North American Aerospace Defense Command, U.S. Northern Command and U.S. Strategic Command. However, the committee is aware of management deficiencies in the Commander's integrated command and control system (CCIC2S) program, which are resulting in a significant cost overrun and an undefined delivery schedule. Therefore, the committee directs the Secretary of Defense to maintain essential operation and maintenance activities, and limit future investment to only the developmental activities deemed essential to national security needs.

The committee recommends $4.4 million for procurement of the Cheyenne Mountain Complex, a decrease of $14.9 million.

Combat survivor radios

The budget request contained a total of $69.2 million for combat survivor evader locator (CSEL) radios for the Departments of the Army, Navy and Air Force.

The CSEL radio provides combat forces with secure, encrypted, low probability of exploitation, two-way, over the horizon, near real-time data-burst communications with precise location and non-secure, unencrypted line-of-site voice and beacon capability to support survival evasion, and personnel recovery operations. In the committee report (H. Rept. 109-89) accompanying the National Defense Authorization Act for Fiscal Year 2006, the committee expressed its belief that procurement funds should be made available for either the CSEL, or an alternate survival radio, to meet immediate user requirements since the CSEL radio program was late in delivering radios to meet warfighter needs. The committee understands that the Department of Defense requires over 40,000 survival radios, that the CSEL radio program has been able to meet less than a third of those requirements thus far, and that combatant commanders still have an urgent need for survival radios.

Therefore, the committee directs that procurement funds requested for CSEL radios be made available to procure either CSEL radios or alternate survival radio systems that can address the urgent survival radio need.

Combat training ranges

The budget request contained $35.4 million for combat training ranges, but included no funds for the unmanned threat emitter (UMTE) modernization program.

The UMTE modernization program provides updated electronic threat simulations for combat aircrew training. The committee understands that the UMTEs located at the Eielson Air Combat Training Range have been modernized to more accurately replicate current electronic threat systems and that this upgrade has also reduced manpower, operations and support costs. The committee further understands that five UMTEs located at the Nellis Test and Training Range require the UMTE modernization, and believes that these systems should be upgraded.

Consequently, the committee recommends $47.4 million for combat training ranges, an increase of $12.0 million for the UMTE modernization program.

Enterprise data collection solution

The budget request contained $14.6 million for mechanized material handing equipment, but included no funding for the Enterprise Data Collection Solution (EDCS). The committee understands that the EDCS assembles data from various Air Force logistics systems across the enterprise, thus eliminating the need to manually enter data for each transaction. This system will not only save time and money, but it will reduce errors and speed the flow of logistics.

The committee recommends $18.6 million for mechanized material handling equipment, an increase of $4.0 million for the procurement of common EDCS equipment for four key Air Force installations.

Force protection near real time surveillance

The budget request contained $41.4 million for various types of Air Force physical security systems, but included no funds for the force protection surveillance system (FPSS).

The FPSS consists of a tactical communications intercept system, a near real-time video surveillance system, and a tactical internet communications system for dissemination of surveillance information. The committee notes that Congress appropriated an increase of $1.0 million for fiscal year 2006, and believes that additional FPSSs should be acquired.

Accordingly, the committee recommends $44.4 million for Air Force physical security systems, an increase of $3.0 million for the acquisition, deployment and integration of the FPSS into mission planning systems and surveillance platforms.

High frequency ground control station antennas

The budget request contained $7.7 million for radio equipment, including $1.3 million for high frequency ground control station (HFGCS) antennas.

The HFGCS is a strategic and tactical command and control network that provides beyond line-of-sight interoperable voice and data for aircrews. The HFGCS serves as the primary command and control resource for the Air Mobility Command's (AMC) cargo and tanker aircraft. The committee understands that most of AMC's HFGCS antenna inventory is nearing or past its design life and that numerous high frequency antenna are inoperative. The committee notes that the Air Force Chief of Staff included 20 additional HFGCS antennas among his unfunded priorities for fiscal year 2007.

Consequently, the committee recommends $12.7 million for radio equipment, an increase of $5.0 million for the procurement of 20 HFGCS antennas.

Mobile approach control system

The budget request contained $6.2 million for air traffic control and landing systems, but included no funds to procure a mobile approach control system (MACS).

The MACS provides military forces with next-generation mobile air traffic control services, day and night, in all weather conditions, to military and civilian aircraft, and will replace the aging TPN-19 and MPN-14K landing control centers employed by the Department of the Air Force combat communications squadrons and Air National Guard (ANG) air traffic

control squadrons. The committee understands that of 10 ANG air traffic control squadrons, only 4 have the MACS, and believes that its procurement for the ANG should continue.

Consequently, the committee recommends $23.5 million for air traffic control and landing systems, an increase of $17.3 million for one MACS for the ANG.

Self-deploying infra-red streamer

The budget request contained no funds for personal safety and rescue equipment items less than $2.0 million, or for the self-deploying infra-red streamer (SDIRS) system.

The SDIRS system is an 11-inch by 40 foot orange rescue streamer distress signal which includes a water-activated light system. The SDIRS is used in ejection seat-equipped aircraft and is automatically deployed in the event of a water landing. The committee believes that this system assists in more rapidly locating and rescuing downed crew members and that it should be installed on all Department of the Air Force ejection seat-equipped aircraft.

Consequently, the committee recommends $4.0 million for personal safety and rescue equipment items less than $2.0 million, an increase of $4.0 million for procurement and installation of 5500 SDIRS systems.

PROCUREMENT, DEFENSE-WIDE

OVERVIEW

The budget request for fiscal year 2007 contained $2.9 billion for Procurement, Defense-Wide. The committee recommends authorization of $2.9 billion, a decrease of $5.0 million, for fiscal year 2007.

The committee recommendations for the fiscal year 2007 Procurement, Defense-Wide program are identified in the table below. Major changes to the Air Force request are discussed following the table.

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ITEMS OF SPECIAL INTEREST

Advanced SEAL Delivery System

The committee acknowledges the Department of Defense's recent decision to cancel the Advanced SEAL Delivery System (ASDS) program due to its performance and reliability to date. The committee has expressed its continued concern regarding technical issues, contractor performance, and cost growths throughout the life of the program and will continue to closely monitor the development and fielding of this capability. Additionally, due to the troubled history surrounding the development of ASDS, the committee wants to ensure that the ASDS improvement program (AIP) and accompanying ASDS concept study consider the most current technologies for incorporation into future ASDS capabilities and designs.

Therefore, the committee directs the Secretary of Defense to conduct an ASDS design competition during fiscal year 2007 and authorizes an additional $10.0 million in research and development funding specifically for this competition. Design competition in fiscal year 2007 will ensure that ASDS program decisions made upon completion of the critical systems review portion of the AIP and of phase three of the ASDS concept study take into account current technologies and designs available through related industry research and development as well as the lessons learned from the critical systems review and ASDS concept study. Finally, the committee directs the Secretary of Defense to report to the Senate Committee on Armed Services and the House Committee on Armed Services by June 1, 2007, on the results of the AIP's critical systems review and on the status of an overall ASDS program decision.

Chemical and biological defense procurement

Section 1703 of the National Defense Authorization Act for Fiscal Year 1994 (Public Law 103-160) establishes the Chemical and Biological Defense Program. The Joint Program Executive Office for Chemical and Biological Defense (JPEO(CBD)) is now the joint services single focal point for advanced research and development, acquisition, fielding, and lifecycle support of chemical and biological defense equipment. Nevertheless, the military services possess legacy chemical and biological defense equipment, procured prior to the establishment of the JPEO(CBD). The committee directs the Assistant to the Secretary of Defense for Nuclear and Chemical and Biological Defense Programs, acting through the JPEO(CBD), in coordination with the military services, to develop a modernization plan for legacy nuclear, biological, and chemical contamination avoidance; biological defense; collective protection; individual protection; and decontamination systems and to also develop service sustainment plans for systems initially fielded by the JPEO(CBD).

Special operations forces operational enhancements

The budget request contained $434.5 million for special operations forces (SOF) operational enhancements, but included no funds for secure wireless local area network (LAN) cryptographic devices, and only $2.5 million for craft modifications.

The committee recognizes that U.S. Special Operations Command (USSOCOM) has the need to access and transmit classified data over a wireless LAN. Funding would allow USSOCOM to replace the legacy SECNET 11 wireless card with the SECNET 54 card. The committee notes that this item is on the unfunded priority list of the Commander, USSOCOM to provide required secure wireless capability.

The committee recognizes that naval special warfare relies on maritime combatant craft platforms to conduct target interdiction and insertion/extraction of combatant forces. Additional funds for craft modifications would fully equip the entire operational inventory with key technological upgrades. The committee notes that this item is on the unfunded priority list of the Commander, USSOCOM to accelerate technology insertion into this platform.

The committee recommends $444.5 million for SOF operational enhancements, an increase of $1.8 million for the procurement of secure wireless LAN cryptographic devices, and an increase of $8.2 million for craft modifications.

Unmanned aerial systems to counter improvised explosive devices

The committee is aware of numerous systems being offered by non-traditional defense companies seeking to support the global war on terrorism by providing already developed capabilities to counter the improvised explosive device threat.

The committee recommends that the Department of Defense fully review and consider all viable sensor technologies and currently available conventional and vertical take-off and landing unmanned aerial vehicles to address the improvised explosive device threat.

U.S. Special Operations Command aviation modernization

The committee recognizes that U.S. Special Operations Command (USSOCOM) relies primarily on the modification of C-130 aircraft to special operations-capable aircraft to provide its fixed wing special operations mission capability. USSOCOM has maintained its AC-130 and MC-130 fleet through several upgrade programs, to sustain USSOCOM's mission capability until a future fleet of special operations aircraft could be developed and fielded. Because of the increased operating hours placed on USSOCOM's fleet from on-going combat operations, USSOCOM will be unable to maintain its fixed wing capability until a future fleet can be fielded. The committee further understands that the C-130J model aircraft offers USSOCOM a platform that can be recapitalized and modified into tanker, infiltration/exfiltration, and gunship platforms.

Further, the committee recognizes that USSOCOM is expanding its fixed wing fleet with the CV-22 aircraft. The current CV-22 program projects an initial operating capability of 10 aircraft by fiscal year 2009 and a full operational capability of 50 aircraft by fiscal year 2017.

The committee believes that accelerated procurement both of the C-130J for conversion into special operations capable aircraft and of the CV-22 would allow USSOCOM to maintain its special operations mission capability that is currently stretched due to USSOCOM's high operational tempo. The committee directs the Secretary of Defense to submit a report by April 1, 2007, to the Senate Committee on Armed Services and the House Committee on Armed Services on the feasibility of accelerated procurement of the CV-22 and the C-130J aircraft.

LEGISLATIVE PROVISIONS

SUBTITLE A--AUTHORIZATION OF APPROPRIATIONS

SECTIONS 101-104--AUTHORIZATION OF APPROPRIATIONS

These sections would authorize the recommended fiscal year 2007 funding levels for all procurement accounts.

SUBTITLE B--ARMY PROGRAMS

SECTION 111--MULTIYEAR PROCUREMENT AUTHORITY FOR FAMILY OF MEDIUM TACTICAL VEHICLES

This section would grant authority to the Secretary of the Army in fiscal year 2008 to enter into a 3-year multiyear procurement (MYP) contract for the family of medium tactical vehicles (FMTV) for fiscal years 2008-2010. This section would require that should the Secretary of the Army exercise his MYP authority for FMTVs, the contract would follow all federal procurement regulations including full and open competition. Finally, this section would also require that FMTVs procured under this MYP contract to incorporate improvements from lessons learned from operations involving the global war on terrorism, as well as existing FMTV product improvement programs in the areas of force protection, survivability, reliability, network communications, situational awareness and safety.

The committee recognizes the current 5-year MYP contract for FMTV A1R vehicles ends with fiscal year 2007 funding and calendar year 2008 deliveries. The committee notes the Army's Tactical Wheeled Vehicle (TWV) Modernization Strategy Report to Congress stated, `As a risk mitigator, use of contract options will be sought to permit extension of current production models to avoid any breaks in vehicle supply.' The committee is concerned that single year contract awards would be extremely costly for the Army given the large quantity requirements that continue to exist for FMTVs within the modular force construct as well as the quantity requirements that should result from the Army `resetting the force' through repair, recapitalization and replacement of vehicles across the Future Years Defense Program. The committee expects the Army to modernize and recapitalize its TWV fleet with a more capable vehicle or platform that would at the minimum incorporate lessons learned from Operation Iraqi Freedom (OIF).

The committee is aware approximately 31,000 FMTVs have been produced under three successive multiyear contracts that have saved approximately 6-10 percent versus single year procurements. Furthermore, the committee notes that a MYP contract would potentially assure favorable, cost effective prices for a more advanced configuration FMTV that would incorporate lessons learned from OIF, as well as ensure stability in the industrial base.

The committee is aware the Army is conducting an advanced concept technology demonstration (ACTD) for a future tactical truck system as part of its TWV Modernization Strategy. The committee notes an essential component of this ACTD is the maneuver sustainment vehicle (MSV). The committee also notes this vehicle would potentially replace the FMTV and other heavy TWVs, as well as understands the MSV would help shape requirements for the next medium to heavy TWV. The committee notes no formal production schedule exists for the MSV other than the Army would conduct a system demonstration in late calendar year 2006. The committee recognizes that previous comparable TWV schedules would indicate a notional schedule for an MSV production beginning in the 2011 timeframe.

SECTION 112--MULTIYEAR PROCUREMENT AUTHORITY FOR MH-60R HELICOPTERS AND MISSION EQUIPMENT

This section would authorize the Secretary of the Army, acting as the executive agent for the Department of the Navy, to enter into a five-year, multiyear procurement contract for 144 MH-60R helicopters and associated mission equipment beginning with the fiscal year 2007 program year. Further, the multiyear procurement contract authority would be executed in accordance with section 2306b of title 10, United States Code.

SECTION 113--FUNDING PROFILE FOR MODULAR FORCE INITIATIVE OF THE ARMY

This section would require the Secretary of the Army to include the M1A2 Abrams SEP tank and Bradley A3 fighting vehicles within the Army's modularity funding profile beginning with the 2008 budget submission, in accordance with the March 2006 Army report to Congress, `The Army Modular Initiative.'

SECTION 114--BRIDGE TO FUTURE NETWORKS PROGRAM

This section would limit the amounts authorized to be appropriated or otherwise made available pursuant to the authorization of appropriations for the bridge to future networks program, to not more than 70 percent until the Secretary of the Army submits a report to the congressional defense committees. The report would include an analysis of how the Joint Network Node (JNN) and the Warfighter Information Network-Tactical (WIN-T) will be integrated and whether or not there are opportunities to leverage JNN technologies and equipment as part of the WIN-T development effort. The report would also describe the extent to which JNN and WIN-T components would be used together as elements of a single tactical network and the Army's strategy for completing the systems engineering necessary to ensure the end-to-end interoperability of this network.

SUBTITLE C--NAVY PROGRAMS

SECTION 121--ATTACK SUBMARINE FORCE STRUCTURE

This section would amend section 5062 of title 10, United States Code, mandating the Secretary of Defense maintain a minimum force structure of 48 operational attack submarines.

SECTION 122--ADHERENCE TO NAVY COST ESTIMATES FOR CVN-21 CLASS OF AIRCRAFT CARRIERS

This section would limit the total amount to be obligated or expended from funds appropriated or otherwise made available for Shipbuilding and Conversion, Navy, or for any other procurement account, for the detail design, non-recurring engineering and actual construction of the lead ship of the CVN-21 class aircraft carrier program to $10.5 billion. This section would further limit the total amount to be obligated or expended from funds appropriated or otherwise made available for Shipbuilding and Conversion, Navy, or for any other procurement account, for the actual construction of the follow-on ships of the CVN-21 class aircraft carrier program to $8.1 billion. This section would allow the Secretary of the Navy to adjust the limitation amount for economic inflation; changes in federal, State or local laws enacted after September 30, 2006; outfitting and post-delivery costs; and the amounts of increases or decreases in costs of the ship that are attributable to the insertion of new technology. The insertion of new technology would be limited to those technologies that could be used to either lower lifecycle costs or meet an emerging threat. This section would require the Secretary to report any adjustment to the cost limitation with the submission of the annual budget request.

SECTION 123--ADHERENCE TO NAVY COST ESTIMATES FOR LHA REPLACEMENT AMPHIBIOUS ASSAULT SHIP PROGRAM

This section would limit the total amount to be obligated or expended from funds appropriated or otherwise made available for Shipbuilding and Conversion, Navy, or for any other procurement account, for each ship of the LHA replacement amphibious assault ship program to $2.8 billion. This section would allow the Secretary of the Navy to adjust the limitation amount for economic inflation; changes in federal, State or local laws enacted after September 30, 2006; outfitting and post-delivery costs; and the amounts of increases or decreases in costs of the ship that are attributable to the insertion of new technology. The insertion of new technology would be limited to those technologies that could be used to either lower lifecycle costs or meet an emerging threat. This section would require the Secretary to report any adjustment to the cost limitation with the submission of the annual budget request.

SECTION 124--ADHERENCE TO NAVY COST ESTIMATES FOR SAN ANTONIO (LPD-17) CLASS AMPHIBIOUS SHIP PROGRAM

This section would limit the total amount to be obligated or expended from funds appropriated or otherwise made available for Shipbuilding and Conversion, Navy, or for any other procurement account, for eight San Antonio class amphibious ships (LPD-18, LPD-19, LPD-20, LPD-21, LPD-22, LPD-23, LPD-24 and LPD-25) to the cost estimates submitted for those ships with the fiscal year 2007 budget request. This section would allow the Secretary of the Navy to adjust the limitation amounts for economic inflation; changes in federal, State or local laws enacted after September 30, 2006; outfitting and post-delivery costs; and the amounts of increases or decreases in costs of the ship that are attributable to the insertion of new technology. The insertion of new technology would be limited to those technologies that could be used to either lower lifecycle costs or meet an emerging threat. This section would require the Secretary to report any adjustment to the cost limitation with the submission of the annual budget request.

SECTION 125--MULTIYEAR PROCUREMENT AUTHORITY FOR V-22 TILTROTOR AIRCRAFT PROGRAM

This section would authorize the Secretary of the Navy, acting as executive agent for the Secretary of the Air Force and the Commander, U.S. Special Operations Command, to enter into a multiyear contract, beginning with the fiscal year 2008 program year, for procurement of up to 211 V-22 tiltrotor aircraft, of which not more than 185 would be in the MV-22 configuration and not more than 26 would be in the CV-22 configuration.

SECTION 126--QUALITY CONTROL IN PROCUREMENT OF SHIP CRITICAL SAFETY ITEMS AND RELATED SERVICES

This section would amend chapter 633 of title 10, United States Code, by appending a new section 7317 that would require the Secretary of Defense to prescribe in regulations a quality control policy for the procurement of ship critical safety items and the procurement of modifications, repair, and overhaul of such items. This section would require the head of the design control activity for ship critical safety items establish processes to identify and manage

these activities, the head of the contracting activity for a ship critical safety item enter into a contract for these activities only with an approved source, and the ship critical safety items delivered and the services performed meet the technical and quality requirements specified by the design control activity. This section would define the term `ship critical safety item' as any part, assembly, or support equipment of a vessel, the failure, malfunction, or absence of which may cause a catastrophic or critical failure resulting in loss or serious damage to the vessel, or unacceptable risk of personal injury or loss of life. This section would also make conforming amendments to section 2319 of title 10, United States Code.

SECTION 127--DD(X) NEXT-GENERATION DESTROYER PROGRAM

This section would authorize $2.6 billion in Shipbuilding and Conversion, Navy for the next generation destroyer (DD(X)) program. This section would further authorize the Secretary of the Navy to enter into two contracts simultaneously for the DD(X) program during fiscal year 2007. One contract would provide for detail design and construction of a DD(X), while the other contract would provide only for detail design of a DD(X).

SECTION 128--SENSE OF CONGRESS THAT THE NAVY MAKE GREATER USE OF NUCLEAR-POWERED PROPULSION SYSTEMS IN ITS FUTURE FLEET OF SURFACE COMBATANTS

This section finds that securing and maintaining access to affordable sources of oil is a vital national security interest for the United States, and that the nation's dependence of foreign oil is a threat to that security. The section expresses the sense of Congress that the Navy should make greater use of alternative technologies, including nuclear power, as a means of vessel propulsion for its future fleet of surface combatants.

SUBTITLE D--AIR FORCE PROGRAMS

SECTION 131--REQUIREMENT FOR B-52 FORCE STRUCTURE

This section would prohibit the Air Force from retiring any B-52 aircraft, except for the one B-52 aircraft no longer in use by the National Aeronautics and Space Administration for testing. Additionally, this section would require the Air Force to maintain a minimum B-52 force structure of 44 combat coded aircraft until the year 2018, or until a long-range strike replacement aircraft with equal or greater capability than the B-52H model has attained initial operational capability status.

SECTION 132--STRATEGIC AIRLIFT FORCE STRUCTURE

This section would require the Air Force to maintain a minimum strategic airlift aircraft force structure of 299 aircraft beginning in fiscal year 2009, and would repeal section 132 of the National Defense Authorization Act for Fiscal Year 2004 (Public Law 108-136).

SECTION 133--LIMITATION ON RETIREMENT OF U-2 AIRCRAFT

This section would preclude the Department of Defense from retiring the U-2 aircraft in fiscal year 2007, and would permit retirement after fiscal year 2007 only if the Secretary of Defense certifies to Congress that the U-2's intelligence, surveillance and reconnaissance capabilities are no longer required.

SECTION 134--MULTIYEAR PROCUREMENT AUTHORITY FOR F-22A RAPTOR FIGHTER AIRCRAFT

This section would authorize the Secretary of the Air Force to enter into a multiyear contract, in accordance with section 2306b of title 10, United States Code, beginning with the fiscal year 2007 program year, for procurement of up to 60 F-22A Raptor fighter aircraft, for three program years, subject to the Secretary of Defense's certification that the conditions specified in subsection (a) of section 2306b of title 10, United States Code, have been satisfied with respect to that contract, and 30 days have elapsed after the date on which the Secretary has submitted the certification to Congress.

SECTION 135--LIMITATION ON RETIREMENT OF KC-135E AIRCRAFT DURING FISCAL YEAR 2007

This section would prohibit the Air Force from retiring more than 29 KC-135E aircraft during fiscal year 2007, and require the Secretary of the Air Force to maintain all retired KC-135Es, beginning in fiscal year 2007, in a condition that would allow recall to future service in the Air Force reserve, guard, or active forces aerial refueling force structure.

SECTION 136--LIMITATION ON RETIREMENT OF F-117A AIRCRAFT DURING FISCAL YEAR 2007

This section would limit the number of F-117A aircraft to be retired by the Secretary of the Air Force in fiscal year 2007 to 10 aircraft, and would require that the Secretary of the Air Force maintain each F-117A aircraft, retired after September 30, 2006, in a condition that would allow recall of that aircraft to future service.

TITLE II--RESEARCH, DEVELOPMENT, TEST, & EVALUATION

OVERVIEW

The budget request contained $73.2 billion for research, development, test, and evaluation (RDT&E). The committee recommends $74.1 billion, an increase of $908.6 million to the budget request.

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ARMY RESEARCH, DEVELOPMENT, TEST, & EVALUATION

OVERVIEW

The budget request contained $10.9 billion for Army research, development, test, and evaluation (RDT&E).

The committee recommends $10.9 billion, an increase of $76.7 million to the budget request.

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ITEMS OF SPECIAL INTEREST

Advanced hypersonic weapon mission planning and control

The budget request contained $11.2 million in PE 63305A for Army missile defense systems integration, but no funds for development of mission planning and control for the advanced hypersonic weapon.

The committee understands that the 2006 Quadrennial Defense Review focuses on the need to provide a prompt global strike capability and the advanced hypersonic weapon (AHW) has the potential to meet this mission with a rapid strike response over long distances. The committee notes that the U.S. Strategic Command and the U.S. Army Space and Missile Defense Command are already exploring the AHW concept. The committee is aware of the need to conduct research into the mission planning and control battle management capability that would integrate the AHW system into future command and control systems.

The committee recommends an increase of $6.0 million in PE 63305A to design, prototype and demonstrate the mission planning and control battle management capability for integration of the AHW into joint warfighting command exercises and simulations.

Applied communications and information networking

The budget request contained $44.0 million in PE 63008A for electronic warfare advanced technology, but included no funds for applied communications and information networking (ACIN).

The committee notes the importance to the Department of Defense (DOD) to integrate state-of-the-art commercial technologies in DOD command, control, communications, computer and intelligences systems. ACIN has supported this objective to enhance high-value military systems with rapidly advancing commercial information technologies and innovative applications of those technologies.

The committee supports the application of state-of-the-art commercial technology to improve military systems and recommends an increase of $7.0 million in PE 63008A for ACIN.

Armored systems modernization

The budget request included $3.3 billion in PE 64645A for armored systems modernization, including $65.5 million for reconnaissance platforms and sensors; $107.7 million for unmanned ground vehicles; $17.7 million for unattended sensors; $146.1 million for sustainment; $570.2 million for manned ground vehicles; and $2.4 billion for system of systems engineering and program management, as part of approximately $3.7 billion requested for the Future Combat Systems (FCS) program.

The committee continues to support a FCS program strategy that is affordable and enables early spin out of FCS technologies into the current force, a top priority of the Chief of Staff of the Army.

The committee continues to have several concerns with the FCS program:

(1) In a prepared statement before the Subcommittee on Tactical Air and Land Forces on April 4, 2006, the Government Accountability Office indicated, `The program remains a long way from having the level of knowledge it should have had before it started product development . . . FCS has all the markers for risk that would be difficult to accept for any single system, much less a complex multi-system effort.'

(2) The FCS Acquisition Decision Memorandum (ADM), approving the programs entry into systems development and demonstration, was signed on May 17, 2003. The ADM directed that there be a milestone B update and independent cost estimate by November 2004. Almost three years later there has been no milestone B update nor an independent cost estimate.

(3) Although firm system-level requirements should have been established at the start of the program, the process of setting and refining FCS system-level requirements may not be complete until the preliminary design review in 2008.

(4) The projected dates for maturing critical technologies have slipped, and some technologies are not expected to mature until well into the design phase of the program and possibly into production.

(5) FCS design and production maturity would not be demonstrated under the current acquisition strategy until after the production decision is made.

(6) The low level of knowledge available today on requirements and technologies makes FCS cost projections very uncertain. FCS program costs are estimated at $160.7 billion, an increase of 76 percent since the program began.

The committee notes that funding for the FCS program represents a significant portion of the Army's modernization budget for the next 20 or more years. According to the Congressional Budget Office (CBO), the Army estimates that total procurement costs for the first 15 brigades' worth of systems is just over $100.0 billion, which translates into an average unit procurement cost of $6.7 billion per brigade at three FCS BCTs per year. In 2005, based on resource constraints, the Army reduced the yearly procurement goal of three FCS brigade combat teams (BCTs) per year to 1.5 per year. With the planned purchase of 1.5 brigades per year to begin in 2015, the FCS program requires $8.0 billion to $10.0 billion annually. CBO notes that based on historical trends, the FCS program costs could grow by 60 percent. CBO estimates that such high rates may push the average annual funding needed for the FCS program from $8.0 billion to 10.0 billion per year to between $14.0 billion to 16.0 billion per year.

The committee is concerned that the spiraling cost growth for Department of Defense (DOD) acquisition programs is at a point where it directly places at risk the ability of the United States to field weapons platforms in sufficient numbers to support U.S. military strategy and national security requirements. The committee notes that the Army's spiraling costs per FCS BCT are forcing the Army into a situation similar to that experienced by the Navy with its next generation destroyer (DD(X)) program. Similar to the DD(X) program, the costs for a FCS BCT is approaching a price where the Army will have to continue to slow down procurement to make the program more affordable, reduce the quantities of FCS BCTs, or attempt to reduce force structure.

The committee believes that as the Department proceeds with its decisions in reference to the FCS program, that it must preserve its ability to change course on acquiring FCS capabilities to guard against a situation in which FCS would have to be acquired at any cost. The Department must hold the Army accountable for delivering FCS within programmed resources.

Accordingly, the committee recommends a decrease of $325.8 million in PE 64645A for armored systems modernization.

AT4 confined space weapon system enhancements

The budget request contained $118.1 million in PE 64808A for system development and demonstration of landmine warfare and barrier technology, but included no funds for enhancements to the AT4 confined space (CS) weapon.

The AT4CS is a shoulder fired weapon system that employs a warhead that produces high lethality and incendiary effects against armored combat vehicles. The committee notes the AT4CS has been utilized in Operation Iraqi Freedom and Operation Enduring Freedom by dismounted infantrymen and special operation forces to great effect, and is currently the only shoulder-fired weapon in the Department of Defense inventory capable of being fired from inside a room; making this weapon a critical combat multiplier in military operations over urban terrain.

The committee understands an anti-structure tandem warhead is in development for the AT4CS. The committee is aware this warhead would provide military personnel operating within a confined space the capability to penetrate 8-inch reinforced concrete and 12-inch triple brick walls. The committee is supportive of rapidly developing technologies that would promote the survivability of military personnel conducting the global war on terrorism.

The committee recommends $121.1 million in PE 64808A, an increase of $3.0 million to continue the development of an anti-structure tandem warhead for use in the AT4CS.

Center for rotorcraft innovation

The budget request included $32.8 million in PE 62211A for aviation and applied research and technology, but included no funds for the Center for Rotorcraft Innovation (CRI).

The Center for Rotorcraft Innovation is a joint effort between the rotorcraft industry, academic research centers and government partners to increase rotorcraft research in the United States. CRI collaborates to expand rotorcraft research and development already underway between the rotorcraft industry and its government partners in the National Rotorcraft Technology Center. It will focus its new research efforts on dual-use technologies that have national security and homeland defense applications. The committee is aware that the CRI is the only initiative of its kind and seeks to further international competitiveness and long-term growth of the U.S. rotorcraft industry.

Accordingly, the committee recommends an increase of $10.0 million in PE 62211A for the CRI.

Digital array radar

The budget request included $64.6 million in PE 63772A for advanced tactical computer science and sensor technology, but included no funds for digital array radar development.

The committee notes the need for reliable counter-fire radars for protection against short-range mortar attack. Technology advances warrant research and development to demonstrate this technology.

Therefore, the committee recommends an increase of $5.0 million to complete development and test digital array radar prototype antenna technology.

Dominant military operations on urban terrain viewer

The budget request included $19.2 million in PE 62270A, but included no funds for the dominant military operations on urban terrain viewer (DMV).

The committee is aware of an applied research technology that has been successfully demonstrated that provides the capability to detect, locate, and track moving and stationary persons within structures from in excess of 100 meters. Employment of such a capability could provide field commanders with a tactical advantage, improved situational awareness, and save lives. A tactical prototype is necessary to complete field evaluation and testing of this capability.

Therefore, the committee recommends an additional $7.4 million in PE 62270A for the design, development, and testing of a DMV prototype.

Environmental quality technology

The budget request contained $5.2 million in PE 63779A for projects focused on validating the general military utility or cost reduction potential of environmental quality technologies, but included no funds for promising research ongoing at facilities around the United States and in other countries to develop lightweight vanadium micro-alloyed steels. The committee recommends that the Department of Defense proceed with full-scale demonstration projects and the transfer of this technology to the domestic steel industry to increase the potential benefits of vanadium micro-alloyed steels.

The committee recommends $9.6 million in PE 63779A, an increase of $4.4 million for the Vanadium Technology Partnership.

Excalibur precision guided artillery munition

The budget request contained $102.5 million in PE 64814A for the Excalibur XM982 precision guided extended range artillery projectile and lifecycle management cost reduction strategies.

The committee recognizes the potential benefits provided through studies of manufacturing technologies and methodologies to help lower production costs without sacrificing stated performance requirements of a weapon system. The committee notes in fiscal year 2005, Excalibur XM982 lifecycle improvement program efforts were able to reduce the production cost of each projectile by 14.1 percent. The committee also notes the fiscal year 2006 cost reduction efforts built upon previous work and expanded production cost reduction of the canard actuation system, as well as insensitive munitions design improvements for the base and warhead of the projectile identified in the lean design review.

The committee is aware the Excalibur XM982 projectile is proceeding into early production to support an urgent fielding requirement in Operation Iraqi Freedom. The committee understands the Excalibur XM982 would potentially reduce collateral damage in urban environments and serve as a significant combat multiplier to military personnel.

Therefore, the committee recommends $112.5 million in PE 64814A, an increase of $11.0 million for the rapid fielding of the Excalibur XM982 Block Ia-1 projectile and for the continuation of lifecycle improvement costs.

Flexible display initiative

The budget request contained $38.4 million in PE 62120A for electronics and electronic devices, but included no funds for the flexible display initiative.

The committee is aware that new flexible display technology has the potential to provide the military with technology to fabricate high definition displays on rugged conformable, flexible substrates. The committee notes that the United States Display Consortium coordinates these efforts with over 80 companies, using investments from both the public and private industry to accelerate the development of technologies and products needed by the Army, other military services, and various national security agencies.

Therefore, the committee recommends an increase of $5.0 million in PE 62120A for the flexible display initiative.

Gas-engine driven air conditioning system demonstrations

The budget request contained $7.8 million in PE 63734A for military engineering, but included no funds for unitary gas-engine driven air conditioning (GEDAC) system demonstrations.

The committee is aware that GEDAC use on bases in the southwest has the potential to save significant electric power and reduce water usage.

Therefore, the committee recommends an increase of $6.0 million in PE 63734A for GEDAC system demonstrations.

High assurance secure object proxy

The budget request contained $120.5 million in PE 35208A for distributed common ground/surface systems, but included no funds for high assurance secure object proxy technology development.

The committee notes that high assurance secure object proxy (HASOP) technology could significantly enhance the ability of the Army to synchronize and integrate organic, joint and multinational sensors and collection capabilities.

The committee recommends an increase of $6.0 million in PE 35208A, for HASOP development.

Human systems integration

The budget request contained $18.9 million in PE 62716A for human factors engineering applied research, including $3.1 million for efforts supporting manpower and personnel integration (MANPRINT).

The committee recognizes human systems integration (HSI) initiatives as a means for reducing total ownership costs of weapons programs, and continues to support efforts to more formally consider HSI issues earlier in the acquisition cycle. As previously noted in the committee report accompanying the National Defense Authorization Act for Fiscal Year 2006 (H. Rept. 109-89), the committee remains concerned about the overall level of coordination and support of HSI efforts throughout the Department of Defense (DOD).

The committee notes the reporting requirement included in H. Rept. 109-89 to assess HSI activity throughout DOD acquisition programs. The committee is in receipt of a preliminary assessment and understands that a more comprehensive review is forthcoming. Concurrent with the recommendations contained in the interim report, the committee urges the department to establish a joint HSI Steering Group, continue the collaborative development of HSI modeling within and across all services, and strive for greater procedural and regulatory HSI uniformity throughout the Department. Further, the committee expects the completion of the comprehensive HSI review in an expeditious manner.

Therefore, the committee recommends an increase of $4.0 million in PE 62716A for MANPRINT.

Integrated digital environment service model

The budget request contained $21.2 million in PE 62782A for command, control, and communications technology, but included no funding for the Integrated Digital Environment Service Model. The committee understands that this program will allow the Army to conduct much needed interoperability analysis of the various communications, command, and control technologies now under development. Most of today's systems were designed for specific needs; such systems must be integrated into the overall Global Information Grid for continued effectiveness.

The committee recommends $25.2 million in PE 62782A for command, control, and communications technology, an increase of $4.0 million for the Integrated Digital Environment Service Model.

Intelligent surveillance sensor suite

The budget request included $44.3 million in PE 63710A for night vision advanced technology, but included no funds for the intelligent surveillance sensor suite.

The intelligence surveillance sensor suite is intended to be used for perimeter security and intrusion detection at high value sites, including chemical storage facilities, securing ammunition caches, and forward operating bases. It employs multiple detection and assessment technologies for a variety of terrain applications.

The committee recommends an additional $6.0 million in PE 63710A for the fabrication and testing of multiple versions of the intelligent surveillance and sensor suite to validate technical data prior to competitive procurement.

Joint land attack cruise missile defense and micro electro mechanical system

The budget request contained $264.5 million in PE 12419A for the Joint Land Attack Cruise Missiles Defense (JLENS) project.

The committee understands the critical role that the JLENS Elevated Netted Sensor program plays in cruise missile defense. The committee further understands that the Micro Electro Mechanical (MEMS) demonstration radar system is an important risk reduction effort in the JLENS acquisition strategy.

The committee recommends an increase of $2.0 million in PE 12419A to complete Phase II development of the Lightweight X-Band Radar MEMS Electronically Steerable Antenna technology demonstration.

Light utility vehicle

The budget request contained $59.3 million in PE 62601A for combat vehicle and automotive technology, but included no funds for the continued development of a light utility vehicle (LUV) demonstrator.

The committee is aware the development of a LUV demonstrator could be accelerated due to previous research in LUV technology by the National Automotive Center. The committee understands the base LUV platform would be improved based on lessons learned through previous development testing. The committee notes improvements to the base platform would include prognostics and diagnostics for systems such as the drive-train, suspension, and steering.

Accordingly, the committee recommends an increase of $6.0 million in PE 62601A to continue the design, development, and delivery of an improved LUV demonstrator.

Lightweight small arms technologies

The budget request contained $7.2 million in PE 63607A for the joint service small arms program, including $6.2 million for lightweight small arms technologies (LSAT). The LSAT program is attempting to reduce the weight of current soldier small arms and small caliber ammunition by 30 to 40 percent.

The committee understands small arms and small caliber ammunition account for two of the four heaviest items an infantryman wears or carries into combat. The committee notes that the basic infantryman entering combat can be required to carry combat configured loads of equipment, that combined, can exceed 90 pounds. The committee is supportive of efforts that would accelerate advanced technologies to reduce the combat carrying equipment load for dismounted infantrymen, as well as notes the benefits lighter combat configured equipment loads would have on soldier performance and mobility.

Therefore, the committee recommends $14.7 million in PE 63607A, an increase of $7.5 million to accelerate the development of caseless small caliber ammunition and to accelerate the early `spin out' of lightweight technology enhancements to existing small arms weapon programs.

Long-term armoring strategy

The committee understands the Army's long-term armoring strategy (LTAS) is a long-term capabilities-based armoring strategy for tactical wheeled vehicles (TWVs) that would provide greater protection to TWVs than the currently fielded add-on-armor kits, as well as provide battlefield commanders with the capability to change protection levels based on the mission, threat, or technology changes by using an A-Kit/B-Kit concept.

The committee understands LTAS is not a program in itself, but rather an armor initiative that would address commonality and standardization of armor-related components across the TWV fleet. The committee notes the LTAS supports the development of an integral A-Kit composed of hard-to-install components and armor panels with structural attachment points for B-Kit armor panels and components. The committee further notes the B-Kit concept would provide units with the flexibility to remove armor during peacetime operations, as well as improve reliability, maintainability, and fuel economy for TWVs. Finally, the committee notes the LTAS would allow for the upgrade of armor protection as the threat increases or as new armoring technologies are developed.

The committee supports this initiative and commends the Army for pursuing this capabilities based strategy. The committee has concerns over the implementation strategy and whether adequate resources are programmed for the LTAS for all families of TWVs across the Future Years Defense Program (FYDP). The committee strongly encourages the Army to adequately fund LTAS within the FYDP and to continue to pursue light weight vehicle armor technology solutions to maximize ballistic protection and vehicle payload capacity.

Medical advanced technology

The budget request contained $50.8 million in PE 63002A for advanced technology research for healthy, medically protected soldiers, but included no funds for the advancement of smart sensing technologies for remote notification of catastrophic physiological events, for evaluating the effectiveness of oxygen diffusion dressings to accelerate wound healing and reduce infection for soft tissue trauma care, or for advancements of the Propaq monitor.

The committee recommends $58.3 million in PE 63002A medical advanced technology, an increase of $3.0 million for Nightengale, remote on-body sensing technologies; an increase of $1.0 million for evaluation and development of oxygen diffusion dressings for accelerated healing of battlefield and other wounds; and an increase of $3.5 million for Thunderbolt, the advanced Propaq monitor.

Medical materiel/medical biological defense equipment--SDD

The budget request contained $14.5 million in PE 64807A for advanced development of medical materiel within the system demonstration and low rate initial production portions of the acquisition lifecycle, but included no funds for a Leishmania diagnostic skin test phase III clinical trial. The development of a diagnostic skin test for Leishmaniasis shows promise, having successfully been tested in phase I safety trials and with a phase II trial scheduled for 2006. Leishmaniasis is not easily diagnosed, yet U.S. military hospitals have treated over 700 clinical cases of Leishmaniasis in military personnel serving in Iraq and Afghanistan.

The committee recommends an increase of $1.7 million in PE 64807A for development of a Leishmania Diagnostic Skin Test.

Miniaturized sensors for small and tactical unmanned aerial vehicles

The budget request included $23.9 million in PE 62709A for night vision technology, but included no funds for miniaturized sensors for small and tactical unmanned aerial systems (UAVs).

The committee notes that among the major requirements for UAVs are miniaturized and wide bandwidth visible, infrared, and radar imaging sensors. Emphasis has been on the larger UAVs and sensor development has continued to lag behind vehicle development, which presents significant power, weight, and cooling challenges in adapting sensors for use in small and tactical UAVs.

Therefore, the committee recommends an additional $6.0 million for miniaturized sensor development for small and tactical UAVs.

Missile recycling capability technology

The budget request contained $10.3 million in PE 63103A for explosives demilitarization technology, but contained no funds for missile recycling capability technology.

The committee is aware missile recycling capability technology provides the Army with an environmentally friendly and cost effective means of disposal for tactical missiles. The committee is also aware this capability is transitioning to prototype production capability. The committee notes this capability reduces the usage of open burn/open detonation for disposing of tactical missiles, as well as complies with current environment regulations.

The committee recommends an increase of $6.0 million in PE 63103A to accelerate the transition of missile recycling capability technology.

Mobile assessment detection and response system

The budget request included $74.7 million in PE 63004A for weapons and munitions advanced technology, but included no funds for the mobile assessment detection and rapid response system (MDARS).

The MDARS unmanned ground vehicle currently provides the capability to patrol, detect intruders, and remotely determine inventory status. The committee is aware of requirements to increase vehicle speed, incorporate operator-controlled non-lethal weapons, and incorporate on-the-move intruder detection.

The committee recommends an additional $6.5 million in PE 63004A to integrate additional capabilities into MDARS.

Next-generation advanced materials research

The budget request contained $11.2 million in PE 63305A for Army missile defense systems integration.

The committee understands that the development of advanced composite materials can enhance the performance of both current and next generation weapons systems. The committee notes that lighter composite materials can significantly improve the design, manufacturing, and performance of future Army conventional missile launchers.

The committee recommends an increase of $6.0 million in PE 63305A to fabricate an integrated missile canister/multi-round pack using state-of-the-art lightweight high strength carbon composites.

Polymer matrix composites for rotorcraft drive systems

The budget request included $64.7 million in PE 63003A for aviation advanced technology, but included no funds for the demonstration of polymer matrix composite drive trains.

The committee notes the low level of funding for technology development for rotorcraft. Improving the capability of rotorcraft drive systems and reducing the operational cost of rotorcraft operation is fundamental to programs like the Joint Heavy Lift Program. These improvements may be achieved through the introduction of non-metallic structures as critical drive system components. Advancements in composite materials and process technologies offer significant improvements over their metallic counterparts and provide for the elimination of corrosion, less fatigue, significant reductions in weight, and lower acquisition and ownership costs.

The committee recommends an increase of $6.0 million in PE 63003A to demonstrate full scale polymer matrix composite drive train test articles under the rotorcraft drive system-21 program.

Portable and mobile emergency broadband system

The budget request contained $44.0 million in PE 63008A for electronic warfare advanced technology, but included no funds for the portable and mobile emergency broadband system.

The committee is aware the portable and mobile emergency broadband system, based on emerging commercial technology, would allow for the rapid establishment of emergency communications networks.

The committee recommends an increase of $4.0 million in PE 63008A to complete the critical development of the portable and mobile emergency broadband system.

Product lifecycle management plus

The budget request contained $55.3 million in PE 33141A for the global combat support system, but contained no funding to accelerate the Product Lifecycle Management Plus system.

The committee believes that the Army's legacy logistics business systems are outmoded and supports the creation of an integrated Army logistics environment. The committee believes the Product Lifecycle Management Plus system is an essential part of future Army logistics systems and supports its rapid deployment.

The committee recommends $61.3 million in PE 33141A for the global combat support system, an increase of $6.0 million to accelerated deployment of the Product Lifecycle Management Plus system.

Radiation hardening initiative

The budget request contained $11.2 million in PE 63305A for Army missile defense systems integration.

The committee is aware of the military requirement to protect our space assets from the effects of high-altitude nuclear weapons and the resulting electro-magnetic pulse. The committee supports efforts to enhance the ability of the developers of space technology to leverage the use of existing radiation hardened (RadHard) technology initiatives resident in the Missile Defense Agency's Space-based Infrared Phase II Radiation-Hardening Catalog effort and other space programs.

The committee recommends an increase of $4.0 million in PE 63305A for the radiation hardening initiative to collect RadHard technology and component information into one central database.

Smart energetics architecture

The budget request included $42.1 million in PE 63313A for missile and rocket advanced technology, but included no funds for the smart energetics architecture project.

The committee is aware that the smart energetics architecture project offers the potential to reduce traditional tactical missile launch system weight by 60 percent, significantly lower system power requirements, and provide savings in lifecycle costs by simplifying assembly, installation and use.

Therefore, the committee recommends an additional $6.0 million in PE 63313A for the smart energetics architecture project.

Stryker vehicle open architecture electronic enhancements

The budget request contained $5.4 million in PE 63653A for the advanced tank armament system, but included no funds for Stryker vehicle open architecture electronic enhancements.

The committee understands the Army's modernization strategy has identified capability gaps in current forces that require the integration of network-centric capabilities into the current Stryker brigade combat teams. The committee notes that the incorporation of open systems electronics architecture into the Stryker vehicles would support block upgrades and the early adoption of emerging network-centric warfare capabilities into the Stryker brigade combat teams.

The committee recommends an increase of $10.0 million in PE 63653A for Stryker vehicle open architecture electronic enhancements in support of the Army's modernization strategy.

Tactical wheeled vehicle product improvement program

The budget request contained no funds for the tactical wheeled vehicle (TWV) product improvement program (PIP).

The committee understands the Army is faced with the difficult challenge of implementing its TWV modernization strategy and must leverage three competing factors in support of current operations and fleets, transforming TWVs to attain future fleet capabilities and achieving modularity requirements. The committee notes the Army requires the flexibility to rapidly evaluate and integrate readily available technology into TWV platforms as part of this TWV modernization strategy.

The committee has concerns over the lack of funding programmed for the TWV PIP initiative in the President's request. The committee believes TWV PIP technologies would have a real-time impact and effect on existing TWVs and would provide increased capability in the areas of performance and survivability. Consistent with committee views as expressed in the committee report (H. Rept. 109-89) accompanying the National Defense Authorization Act for Fiscal Year 2006, the committee continues to support a TWV PIP initiative, as well as strongly encourages the Secretary of the Army to adequately fund this initiative in the Future Years Defense Program.

The committee recommends an additional $10.0 million to continue the TWV PIP initiative.

Training-based collaborative research in military consequence management

The budget request contained $18.9 million in PE 62716A for human factors engineering applied research, but contained no funding for training-based collaborative research in military consequence management efforts.

The committee recognizes the need for innovative approaches to improve military consequence management initiatives, especially in complex and dynamic threat environments. The committee understands advanced capabilities are necessary in the fields of military law enforcement, engineering, chemical-biological management and training, mines and unexploded ordnance, and non-lethal weapons. The committee believes a commitment to technology transfer initiatives, coupled with efforts to establish well-defined training performance measurements, offers the greatest potential for advances in training effectiveness.

Therefore, the committee recommends an increase of $20.0 million in PE 62716A for training-based collaborative research.

Transparent armor

The budget request contained $64.7 million in PE 63003A for aviation advanced technology, but contained no funding for advanced lightweight armored window technology.

The committee recognizes the unique threat confronting air crews operating rotary aircraft in forward deployed areas. The committee is supportive of efforts to rapidly field advanced technologies to enhance the protection of military personnel. The committee understands that significant opportunities exist to facilitate the transition of technologies from research and development to testing and fielding, particularly in the area of self-protection. The effort to develop transparent, lightweight armor is one such opportunity, as it offers the promise of improving rotary aircraft survivability.

The committee, therefore, recommends an increase of $2.5 million in PE 63003A for lightweight armored window technology.

Warfighter sustainment

The budget request included $25.4 million for warfighter technology in PE 62786A, but included no funds for improved packaging and content of combat rations.

The committee is aware of technology that offers to improve nutrition of combat rations, as well as reduce the cost and bulk of associated packaging. The committee is also aware that while combat rations meet the military recommended daily allowances for nutrients, but improved nutraceutical content could improve battlefield acuity and readiness.

Therefore, the committee recommends an increase of $5.3 million in PE 62786A for warfighter sustainment.

NAVY RESEARCH, DEVELOPMENT, TEST, AND EVALUATION

OVERVIEW

The budget request contained $16.9 billion for Navy research, development, test, and evaluation (RDT&E).

The committee recommends $17.4 billion, an increase of $465.5 million to the budget request.

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ITEMS OF SPECIAL INTEREST

Advanced composite riverine craft

The budget request contained $16.3 million in PE 63713N for ocean engineering technology development, but included no funds for advanced composite riverine craft.

The committee remains concerned with the maturity of the operational concept for the Navy Expeditionary Combat Command (NECC) and has reservations about the rapid pace with which the Navy is moving ahead with its development. The committee encourages the Navy to fully develop its operational requirements for the NECC mission. However, the committee does believe that the Navy should investigate options for advanced composite hulls for the specialized missions the NECC might be required to perform. Advanced composite hulls are expected to provide the Navy with the technology for critical capabilities in speed, weight, draft, stability, wake and g-force reduction.

Accordingly, the committee recommends an increase of $10.0 million in PE 63713N for development and construction of advanced composite riverine craft.

Advanced materials for acoustic window applications

The budget request contained $9.4 million in PE 25620N for surface anti-submarine warfare combat system integration, but included no funds for advanced materials for acoustic window applications.

The committee is aware that advanced materials for acoustic window applications have the potential to reduce signature and improve survivability of naval sonar dome windows at a reduced cost. Current materials used to minimize turbulence and hydrodynamic drag, and protect the sonar system from impacts with debris use a non-corroding sandwich dome concept constructed using fiber reinforced polymer composite skins with a layered elastomeric core. Although this technology meets current mission requirements, the committee understands there is a need for lower-cost, structurally robust materials for acoustic window applications.

Therefore, the committee recommends an increase of $4.0 million in PE 25620N for a development program on lower cost advanced materials for warship design concepts.

Affordable towed array construction/fiber optic towed array construction

The budget request contained $94.8 million in PE 64503N for submarine systems equipment development, including $5.7 million to continue the development of affordable towed array technology.

The affordable towed array construction program utilizes fiber optic thin line arrays to provide increased operational capabilities and reliability improvements over existing submarine thin line towed systems. The committee believes that the development and fielding of fiber optic towed array technology is important to maintain clear acoustical, tactical and operational undersea dominance in the littorals.

Consequently, the committee recommends an increase of $4.5 million in PE 64503N to accelerate reliability testing and introduction into the fleet of fiber optic towed arrays.

Affordable weapon system

The budget request contained $18.6 million in PE 63795N for land attack technology, but included no funding for affordable weapon system (AWS).

AWS is a low cost surface launched cruise missile based on commercial-off-the-shelf technology that is designed to carry a 200 pound payload to a range of over 600 miles. AWS is a global positioning system/inertial navigation system guided weapon with both line-of-sight and satellite data links to allow reprogramming in flight. Designed with the capability to loiter, the weapon can be commanded by a forward observer to attack precise targets on the ground in support of expeditionary operations.

The committee continues to support the concept of a loitering missile and is encouraged that the Navy is reviewing a capabilities development document for a multipurpose loitering missile. The committee supports the restructuring of this program to implement a more disciplined approach to system engineering and quality assurance, which the committee believes is achievable without substantially altering the cost objectives of the program.

The committee recommends an increase of $27.0 million for PE 63795N to complete system design and demonstration, to support live-fire testing aboard an amphibious warfare vessel subsequent to successful testing from the Self Defense Test Ship, and for limited rate initial production (LRIP) of an additional 40 missiles. However, the committee expects that no funds shall be available for LRIP prior to successful completion of an operational evaluation with production representative missiles.

Airborne reconnaissance systems

The budget request contained $35.0 million in PE 35206N for airborne reconnaissance systems, but included no funding for passive collision avoidance and reconnaissance (PCAR).

The committee is aware that unmanned aerial vehicles (UAV) must fly in regions that make them a potential hazard to commercial and other manned aircraft. The committee notes that PCAR will sense an impending collision and allow the UAV to safely avoid approaching aircraft.

Therefore, the committee recommends $40.0 million, an increase of $5.0 million in PE 35206N for PCAR to improve the safety of UAV operations.

Aircraft carrier launch and recovery and support equipment modernization

The budget request contained $33.4 million in PE 64512N for shipboard aviation systems development, but included no funds to continue development of the aircraft carrier launch and recovery (ALRE) and support equipment (SE) modernization program.

The committee understands that the ALRE/SE modernization program would develop modernization strategies for existing ALRE/SE systems to reduce human error and operating costs while improving safety and reliability. The committee also understands that ALRE/SE technologies and design tools are being developed for the CVN-21 future carrier, and believes that application of these technologies to the Navy's existing aircraft carrier fleet could substantially reduce operating costs for the remainder of their useful life.

Accordingly, the committee recommends an increase of $1.0 million in PE 64512N to continue the ALRE/SE modernization program.

Ballistic trajectory extended range munition

The budget request contained $18.6 million in PE 63795N for land attack technology, but included no funds to continue the ballistic trajectory extended range munition (BTERM) demonstration program.

The committee notes that the Navy's current effort to field the extended range guided munition (ERGM) faces significant technological, cost and schedule performance challenges to meet the Navy's requirement for precision targeting. The committee understands that the BTERM program provides the Navy with an alternative to the ERGM global positioning system/inertial navigational system long-range, precise fire capability. The committee further notes that until recently, the Navy intended to re-compete the system design and development contract, but later decided to reverse course and continue with ERGM development. The committee remains greatly concerned with the Navy's ability to provide naval surface fire support for expeditionary forces ashore and strongly recommends that the Navy re-compete this requirement.

Accordingly, the committee recommends an increase of $10.0 million in PE 63795N, to continue the development of the BTERM demonstration program.

Bio-film packaging applied research

The budget request contained $90.0 million for PE 62236N for warfighter sustainment applied research, but included no funds for bio-film packaging applied research.

The committee notes that environmental quality technologies enable sustained world-wide Navy operations in compliance with all local, State, regional, national and international laws, regulations and agreements. The committee understands that bio-film packaging offers an environmentally friendly alternative to solve the plastic waste disposal issue aboard Navy ships. Unlike plastic packaging that cannot be thrown overboard and disposed of because it is derived from hydrocarbons, bio-film packaging waste can be disposed of at sea because it will break down into bio-compatible components in ocean water.

The committee recommends an increase of $2.0 million in PE 62236N for development of durable bio-pallet wrap and packaging.

Cobra Judy ship replacement

The budget request contained $135.4 million in PE 35149N for the Cobra Judy ship replacement program.

The Cobra Judy program is a single ship-based radar suite for world-wide technical data collection against ballistic missiles in flight. The current Cobra Judy ship, the USNS Observation Island, is unsustainable and is scheduled to go out of service in 2012. The radar data and imaging from the Cobra Judy platform supports a range of activities including Department of State treaty monitoring and verification, and ballistic missile defense development and testing. Failure to replace the Cobra Judy ship by 2011 will result in a potential gap in coverage.

The committee fully supports the Cobra Judy ship replacement program and recommends $135.4 million in PE 35149N, the amount of the budget request.

Common submarine radio room

The budget request contained $94.8 million in PE 64503N for SSN-688 and Trident modernization, but included no funds for the common submarine radio room.

The committee is aware that the common submarine radio room provides a modern, automated, high capacity, interoperable communications system across submarine classes. It employs an open system architecture that maximizes the use of commercial-off-the-shelf hardware and software. The committee recommends funds to accelerate the development and deployment of the common submarine radio room.

The committee recommends an increase of $4.5 million in PE 64503N to be used for the common submarine radio room.

Conventional Trident modification

The budget request contained $77.0 million in PE 64327N for development of an advanced strike capability which will demonstrate the feasibility of modifying the Trident II (D5) strategic weapon system to carry conventional payloads.

The Navy is undertaking this effort to develop the conventional precision global strike capability called for in the 2001 Nuclear Posture Review. The committee understands that the existing Trident weapons system provides an opportunity to develop this long-range conventional strike capability by leveraging existing technology at relatively low cost.

The committee, however, is concerned that the development of this conventional capability on a submarine platform that has historically carried nuclear armed ballistic missiles may present concerns relating to the misinterpretation of the launch of a missile carrying a conventional warhead for one carrying a nuclear warhead. The committee is aware that the Department of Defense is beginning to engage members of the international community to discuss the U.S. intent behind the conventional strike capability, as well as measures to preclude misinterpretation of a conventional launch. The committee directs the Secretary of Defense to continue this important policy dialog with others in the international community.

The committee is also concerned with the costs associated with the expenditure of a conventional warhead carried on a Trident missile. While there may be high-value targets worth the price of a conventionally equipped Trident missile, it is not clear what scenarios would call for employment of the conventional Trident missile.

The committee directs the Secretary to submit to the congressional defense committees by February 1, 2007, a report on the following:

(1) The status of discussions with other countries on the concern of misinterpretation of a conventional Trident missile strike for a nuclear attack;

(2) The proposed concept of operations detailing the sequence of events for employing this weapon; and

(3) An assessment of the cost-effectiveness of using this weapon against selected targets.

The committee recommends $30.0 million in PE 64327N to explore the feasibility of modifying the Trident II strategic weapon system to carry conventional payloads, a decrease of $47.0 million.

Defense research sciences

The budget request contained $366.6 million in PE 61153N for defense research sciences, but included no funds for investigations of carbon nanotube-based radiation hard non-volatile random access memory (RAM) or for expanding the naval science and educational pipeline pilot program.

The committee recognizes the need to protect essential electronic systems and applications during critical operations from the harsh effects of natural and man-made radiation. Therefore, the committee believes there is a need to ensure the continual improvement of radiation-hardened memory, with particular emphasis on a new generation of radiation hardened devices constructed with single-walled carbon nanotube materials.

The committee also recognizes the need to reverse the trend of fewer U.S. students entering college programs to pursue science, technology, engineering, and math degrees. The naval science and educational pipeline (N-STEP) pilot program in Virginia has provided science-related curriculum enhancements at the K-12 level, in partnership with the Naval Surface Warfare Center--Dahlgren Division.

The committee recommends $383.1 million in PE 61153N, an increase of $9.0 million for development of carbon nanotube-based radiation hard non-volatile RAM and an increase of $7.5 million to expand the N-STEP pilot program to other states with naval warfare center laboratories, such as California, Maryland, and Rhode Island.

Detection and recovery of unexploded ordnance

The budget request contained $25.3 million in PE 65873M for Marine Corps program wide support, but included no funds to provide technology that would advance the detection and recovery of unexploded ordnance (UXO).

The committee is aware that many former and current military training sites pose a high safety risk because of the presence of UXO that could sometimes include 1,000 pound bombs. The committee understands that no single sensor is capable of providing the complete solution for detection, recovery, and removal of UXO. The committee encourages the continued development of a system of systems approach that would utilize existing and near-term technology to identify, recover, and remove UXO at military training sites.

The committee recommends $29.3 million in PE 65873M, an increase of $4.0 million to advance the development of a sensor suite and platform that would rapidly detect, recover, and remove UXO at military training sites.

Dismounted soldier training test instrumentation

The budget request contained $218.5 million in PE 26313M for Marine Corps communications systems development, but included no funds for dismounted soldier or marine training test instrumentation.

The committee understands this system provides advanced training capabilities for marines conducting individual and small unit operations through the use of commercially available communication system and movement tracking technology. The committee recognizes this project develops an instrumentation capability that allows real-time tracking of individual dismounted infantrymen or marines conducting training on military training ranges as well as allows for rapid post-operation reconstruction and feedback to soldiers and marines. The committee notes this particular capability augments the training readiness of soldiers and marines preparing for combat deployment in the global war on terrorism.

The committee recommends an increase of $1.0 million in PE 26313M for dismounted soldier or marine training test instrumentation.

Distributed common ground system

The budget request included $16.6 million in PE 35208N for the Distributed Common Ground System-Navy (DCGS-N), as well as $78.3 million in Common Imagery Ground Surface Systems for the DCGS-N.

The committee recognizes the potential benefits of a fully capable, completely interoperable DCGS-N system for service, joint, and interagency connectivity in support of combatant command priorities. The committee understands that the acquisition plan includes funding for the procurement and fielding of 34 DCGS-N 1.1 systems, with an eventual transition to a more advanced 1.2 configuration. The committee understands the DCGS-N 1.2 version represents a greater level of capability in terms of enterprise interoperability with other service, joint, and interagency connections.

The committee is concerned about the DCGS-N program delay since submission of the fiscal year 2006 budget request. The committee understands that the fiscal year 2007 budget request included funding for the procurement of as many as six 1.1 DCGS-N systems prior to completion of the program's operational evaluation (OPEVAL) milestone, and notes that OPEVAL is not expected to occur until the latter part of the fiscal year. The committee notes that a typical low to moderate risk acquisition schedule completes OPEVAL prior to low-rate initial production (LRIP) activities.

The committee strongly recommends that the Department of the Navy further accelerate technology development for a more robust and interoperable DCGS-N system. The committee further urges the Department to reduce programmatic risk resulting from a lack of concurrency between research and development and LRIP activities.

DockShock ship shock test system

The budget request contained $61.5 million for PE 63123N for force protection advanced technology, but included no funds for DockShock ship shock test system.

The committee is aware that DockShock is a proposed replacement system for the current practice of conducting ship shock testing using large explosives in the open ocean. The DockShock concept employs non-explosive, electro-chemical or electro-mechanical pressure source arrays that can be used at shore side or near shore locations. The committee understands that the DockShock system would provide the Navy with a more accurate, environmentally friendly, less costly process for testing the survivability of Navy ships.

The committee recommends an increase of $8.0 million in PE 63123N to continue development and testing of the DockShock ship shock test system.

DP-2 vectored thrust aircraft

The budget request contained $76.8 million in PE 63114N for power projection advanced technology, but included no funding for the DP-2 vectored thrust aircraft program.

The committee understands that the DP-2 is a twin engine, thrust vectored, high-speed combat transport aircraft capable of hover, as well as vertical take-off and landing. DP-2 has the potential to provide leap-ahead capabilities to special operations forces and other forces. The Office of Naval Research set a series of milestones for unmanned tethered and untethered hover testing, leading to manned, untethered testing in ground effect at Yuma Proving Ground.

The committee recommends an increase of $8.0 million for PE 63114N to continue execution of the current DP-2 program test plan.

E-2 advanced hawkeye identification friend or foe technology development

The budget request contained $497.8 million in PE 64234N for the development, demonstration and testing of the E-2 advanced hawkeye (AHE) aircraft, but included no funds to accelerate the development of identification friend or foe (IFF) systems.

The E-2 AHE program is developing a replacement for the existing radar and other system components to modernize the E-2C weapon system to maintain open ocean mission capability while providing an effective littoral surveillance, battle management and theater air and missile defense capability. The committee understands that one of the key technologies in the E-2 AHE program is the development of Mode 5 and Mode S IFF systems which will provide improved identification of friendly or civilian aircraft. The committee is aware that accelerating the development of this technology in fiscal year 2007 would reduce program risk and ensure that Mode 5 and Mode S IFF capabilities are integrated into the first E-2 AHE prior to delivery.

Therefore, the committee recommends $505.0 million in PE 64234N for the E-2 AHE development program, an increase of $7.2 million for acceleration of Mode 5 and Mode S development.

Electro-optic passive antisubmarine warfare system

The budget request contained $16.8 million in PE 63254N for antisubmarine warfare (ASW) systems development, including $9.9 million for the electro-optic passive ASW system (EPAS).

The committee is concerned by the proliferation and expansion of submarine forces worldwide, and views as a high priority the development of ASW capabilities for acoustically challenging littoral environments. The committee understands that EPAS will incorporate a variety of optical and infrared sensors into fieldable prototype systems to improve airborne ASW capability.

The committee recommends an increase of $4.0 million in PE 63254N for EPAS to accelerate development, fielding, and testing of prototype systems.

F/A-18 squadrons

The budget request contained $31.1 million in PE 24136N for F/A-18 squadron development, but included no funds for an aircraft composite missile launcher improvement program, for accelerated development of a digital electronic warfare (EW) system for F/A-18C/D and AV-8B aircraft, or for an F/A-18 digital heads-up display (HUD) upgrade.

The committee understands that existing aluminum aircraft missile launch suspension equipment may have limited life and may not support the next generation of guided missiles. The committee further understands that new technologies have emerged that may have the potential to increase missile launch suspension equipment service life and reduce lifecycle costs. Consequently, the committee recommends an increase of $2.0 million to develop, design, and demonstrate technologies that would improve missile launcher suspension equipment. The demonstration should include a side-by-side test of the improved missile launcher with an existing system to evaluate the advantages of new technologies.

The committee understands that EW technologies developed for the future F-35 and F-22 aircraft can be applied to address deficiencies in the Navy and Marine Corps' existing ALQ-126B defensive countermeasures system, the ALQ-164 jamming pod, and the ALR-67(V)2 radar warning receiver. The committee also understands that development of a digital EW system for the Navy's F/A-18C/D and the Marine Corps' AV-8B aircraft would provide improved capabilities against future electronic threats and improve commonality across the F/A-18C/D and AV-8B aircraft fleets, thereby reducing future operations and support costs. Accordingly, the committee recommends an increase of $10.0 to accelerate the development of a digital EW system for F/A-18C/D and AV-8B aircraft.

The F/A-18 HUD, which serves as the pilot's primary targeting system, currently uses a cathode ray tube (CRT) and is characterized as an analog solution to display targeting information to the pilot. The committee understands that the F/A-18's CRTs are becoming unreliable and that procurement sources for CRTs are diminishing. To address this supportability problem, the committee believes that migration to a digital HUD solution will lower lifecycle costs, improve reliability and performance, and provide higher accuracy with a capability to process and display more information to the pilot. Therefore, the committee recommends an increase of $5.1 million to begin the development of an F/A-18 digital HUD upgrade.

In total, the committee recommends $48.2 million in PE 24136N for F/A-18 squadron development, an increase of $17.1 million.

Flexible payload module and payload interface module development

The budget request contained $169.6 million in PE 64558N for the new design SSN, but included no funds for flexible payload module and payload interface module development.

The committee understands the flexible payload module will allow payloads, such as Tomahawk missiles, to be located outside of the submarine's pressure hull, resulting in significant cost savings. The flexible payload module will house the new or existing payloads in a pressure proof or free-flooded environment. The payload interface module is the shipboard structure and standardized interface linking the submarine's combat system with the payload.

The committee recommends an increase of $25.0 million in PE 64558N to be used for the flexible payload module and payload interface module development.

High performance FM fiber-optic link

The budget request contained $84.9 million in PE 62114N for power projection applied research, but included no funding for high performance FM fiber-optic links.

The committee understands that FM fiber optic links could be used for high bandwidth transmission of microwave and millimeter wave signals, and have potential military applications for remoting of communication and radar antennae.

The committee recommends an increase of $2.0 million for PE 62114N for applied research leading to development of high performance FM fiber-optic links.

Human systems integration

The budget request included $82.0 million in PE 63236N for warfighter sustainment advanced technology and $8.8 million in PE 64703N for personnel, training, simulation, and human factors, but contained no funding for Navy manpower and personnel integration (SEAPRINT).

The committee supports further development of SEAPRINT in conjunction with other Department of Defense human systems integration efforts, and urges additional resources in this area.

Therefore, the committee recommends an increase of $3.0 million in PE 63236N and $1.0 million in PE 64703N for SEAPRINT, in an effort to further develop human systems integration modeling throughout the Department.

Integrated shipboard intelligent surveillance

The budget request contained $817.5 million for total ship system engineering, but included no funding for integrated shipboard intelligent surveillance (ISIS).

The committee places a particularly high priority on force protection. The committee believes that commercial-off-the-shelf surveillance and monitoring technologies offer opportunities to improve shipboard security, with respect to both the exterior environment and critical interior engineering and control spaces. From an engineering and cost perspective, the best point to integrate those technologies is early in the design process.

The committee recommends an increase of $5.0 million for PE 64300N for integration of ISIS on future Navy combatants.

Joint integrated systems for advanced digital networking

The budget request contained $748.7 million in PE 33109N for satellite communications, but included no funding for joint integrated systems for advanced digital networking (JIST-NET).

JIST-NET has shown great promise in providing integrated communications systems situational awareness to combatant commanders by identifying satellite communications systems gaps and performance issues. The committee is encouraged by JIST-NET progress to date and believes further funding to complete integration of the network will provide important communications capability for the warfighting commander.

The committee recommends $754.7 million in PE 33109N, an increase of $6.0 million for JIST-NET.

Large aperture bow array

The budget request contained $169.6 million in PE 64558N for the new design SSN, but included no funds for the development of the large aperture bow (LAB) array sonar for the Virginia class attack submarine.

The committee is aware that the LAB array is a water-backed replacement for the air-backed spherical array in the bow of Virginia class submarines. The LAB uses longer-lived, lower cost sensors and commercial-off-the-shelf electronics, yielding a cost savings of about $15.0 million per ship and additional lifecycle cost savings. The committee is also aware that with a larger aperture and expanded frequency coverage, there will be a significant improvement to the anti-submarine warfare capabilities of the Virginia class submarine. Importantly, the LAB

also allows additional payload by providing bow dome arrangement flexibility and allows for rapid insertion of future sensor technologies, and is a transformational approach to outboard sonar array design. The committee understands the preliminary design will be completed in 2006 and if inserted in the 2009 Virginia class hull, would provide $300.0 million in savings for the remainder of the Virginia class submarine construction program.

The committee recommends an increase of $20.0 million in PE 64558N to be used for the development of the LAB array sonar for the Virginia class attack submarine.

Large displacement unmanned undersea vehicle at-sea launch and recovery system

The budget request contained $140.4 million in PE 63561N for advanced submarine system development, but included no funds to develop an at-sea launch and recovery system for the large displacement unmanned undersea vehicle (LD-UUV).

The committee understands that the LD-UUV provides the Navy with next-generation capability to detect, track, mitigate and defeat enemy threats. The committee notes that the LD-UUV is to be compatible with the SSGN platform, serving as a force multiplier with its improved payload capabilities and enhanced long-range endurance for intelligence, surveillance and reconnaissance missions. The committee strongly encourages the Navy to devote adequate resources within the Future Years Defense Program to continue concept design, development and integration of the LD-UUV into the SSGN platform, including its requisite stowage, launch and recovery systems.

The committee recommends an increase of $6.0 million in PE 63561N to develop and demonstrate the LD-UUV at-sea launch and recovery hardware for the SSGN.

Lightweight multi-threat encapsulated ceramic body armor

The budget request contained $47.6 million in PE 26623M for Marine Corps ground combat and supporting arms systems, but included no funds to advance the development of encapsulated ceramic body armor.

The committee recognizes encapsulating ceramic tiles through enhanced bonding and residual compression could potentially improve the ballistic performance and durability of enhanced small arms protective inserts used in outer tactical vests that constitute the Interceptor Body Armor (IBA) system. The committee understands the Army and the Marine Corps are continuously upgrading and modifying existing IBA components.

The committee recommends an increase of $2.0 million in PE 26623M to refine and test encapsulated ceramic protective inserts. Further, should these tests prove to generate a more effective solution than existing IBA ceramic inserts, the committee encourages the Secretary of the Navy to use portions of funds provided in title XV of this report to begin initial procurement of these inserts.

Lithium battery technology

The budget request contained $124.5 million in PE 11221N for strategic submarine and weapons system support, but included no funds for superior lithium polymer battery development.

The committee understands that the Navy and the Naval Surface Warfare Center, Crane, Indiana are moving away from traditional lead acid, nickel cadmium and silver zinc batteries and toward newer lithium secondary batteries.

The committee also understands that a new technology known as the superior lithium polymer battery offers improved power densities, higher continuous discharge and recharge capabilities and wider operating temperatures, with potential military application to submersibles and other vehicles.

The committee recommends an increase of $2.5 million in PE 11221N for superior lithium polymer battery development.

Marine expeditionary rifle squad

The budget request contained $0.5 million in PE 63635M for Marine Corps ground combat support systems, but included no funds for the development of the Marine Expeditionary Rifle Squad (MERS) program.

The MERS program focuses on the holistic, system level integration of all items worn, consumed or carried by the marine infantry rifle squad and is integral to the Marine Corps concept of distributed operations (DO). The committee understands MERS, in the near-term would address integration issues resulting from the rapid fielding of urgently needed weapons and equipment to infantry squads currently operating in Operation Iraqi Freedom. The committee understands MERS's long-term objective strategy would provide marine infantry rifle squads with fully integrated future equipment systems that would be integral to the effectiveness of conducting DO.

The committee recommends $3.5 million in PE 63635A, an increase of $3.0 million to continue the phase development strategy of the MERS program.

Maritime identification surveillance technology phased array radar

The budget request contained $61.7 million in PE 63235N for common picture advanced technology, but included no funds for the maritime identification surveillance technology (MIST) phased array radar system.

The development of the MIST phased array radar system is expected to provide continuous surveillance, identification and tracking of all surface ships around naval platforms at sea, or in coastal waters and harbors. In addition, the committee is aware that this radar system will provide the Navy with an advanced phased array radar technology test bed to support future radar system technology development and validation.

The committee recommends an increase of $4.8 million in PE 63235N for the development and demonstration of a prototype phased array radar system for integration into a MIST sensor and networking technology test bed.

Maritime technology

The budget request contained no funds in PE 78730N for the maritime technology program.

The committee understands that the purpose of the maritime technology (MARITECH) program is to reduce the cost of naval ship construction, modification, and repair by enhancing the efficiency and competitiveness of the U.S. shipbuilding and ship repair industries. The committee understands that since the late 1970s the Navy has considered capital for facility investments to be an allowable cost on contracts that are not firm fixed price. The committee is also aware that in the past three years, the Navy and industry have agreed to specific recapitalization contract incentives in the Virginia class submarine and the CVN-21 programs. These incentive clauses have allowed the Navy and the contractors to identify improvements in sequencing and build processes to lower construction costs. The committee encourages the expansion of these efforts to all ship procurements, including the Lewis and Clark (T-AKE) class program.

The committee includes a provision (section 1014) that creates a shipbuilding industrial base improvement program through which the Secretary of the Navy shall award grants and loan guarantees to qualified shipyards to improve their productivity and cost effectiveness. These authorities will allow the Navy to work to an even greater extent with shipbuilders to identify and finance process changes, equipment investments, and facilities improvements to lower the cost of Navy ship procurement. The committee expects that these authorities will allow the Navy to achieve savings in the construction of the T-AKE class ships, in addition to other ship classes, and improve the competitiveness of U.S. shipyards. Consequently, the committee recommends providing funds for the shipbuilding industrial base improvement program and for the enhancement of the U.S. shipbuilding and ship repair industrial base.

The committee recommends $120.0 million in PE 78730N for the maritime technology program.

National shipbuilding research program

The budget request contained no funds in PE 78730N for the national shipbuilding research program.

The committee understands that the national shipbuilding research program (NSRP) provides a unique collaborative environment where shipbuilders and government agencies examine processes, tooling and management techniques to improve the efficiency of the United States shipbuilding industry. The committee understands that NSRP operates on a 50-50 cost share between government and industry, all results are shared with all members, and a conservative estimate for NSRP's return on investment is five to one.

The committee recommends $20.0 million in PE 78730N for the national shipbuilding research program.

Shipbuilding industrial base improvement grants

The budget request contained no funds in PE 78730N for shipbuilding industrial base improvement grants.

The committee understands the national security importance of sustaining viable and efficient shipbuilding and ship repair industries in the United States. Accordingly, the committee recommends providing grants to U.S. shipyards to facilitate the development of innovative design and production technologies and processes for naval vessel construction, and the development of modernized shipbuilding infrastructure.

The committee recommends $50.0 million in PE 78730N for shipbuilding industrial base improvement grants.

Shipbuilding industrial base improvement loan guarantees

The budget request contained no funds in PE 78730N for shipbuilding industrial base improvement loan guarantees.

The committee understands the national security importance of sustaining viable and efficient shipbuilding and ship repair industries in the United States. Accordingly, the committee recommends providing loan guarantees to U.S. shipyards to facilitate the acquisition of technologies, processes and infrastructure to enhance the efficiency and competitiveness of the U.S. shipbuilding and ship repair industries.

The committee recommends $50.0 million in PE 78730N for shipbuilding industrial base improvement loan guarantees.

Naval surface fire support

The committee remains deeply concerned by Navy shortfalls in providing naval surface fire in support of expeditionary warfare.

At the Navy's request, in the National Defense Authorization Act for Fiscal Year 2006 (Public Law 109-163) Congress authorized the Secretary of the Navy to strike from the Naval Vessel Register the battleships USS Wisconsin and USS Iowa. With these retirements, the Navy loses the longest range guns in its fleet, 16-inch 50-caliber guns capable of ranging 24 nautical miles. In the meantime, Navy efforts to improve upon, much less replace, this capability have been highly problematic.

The near-term effort involves extending the range of 5-inch 62-caliber guns on existing Arleigh Burke class destroyers from 13 nautical miles to more than 40 nautical miles with a rocket assisted projectile. The 5-inch extended range guided munition (ERGM) contains only 7.2 pounds of high explosive, but incorporates global positioning system/inertial navigation system guidance to provide precision targeting.

The ERGM program was initiated in 1996 with a planned research and development cost of $78.6 million, which has now grown more than 400 percent. Schedule performance has been similarly disappointing, with initial operational capability slipping a decade from fiscal year 2001 to fiscal year 2011. As late as the submission of the President's budget request for fiscal year 2007, the Navy planned to recompete the system demonstration and development (SDD) contract in the third quarter of fiscal year 2006, but recently reversed course and elected to continue the current contract. The committee questions the advisability of this decision. Notwithstanding the not insignificant technical challenges, the committee believes that program performance has been wanting. The committee further notes the existence of other responsible sources for the capabilities provided by ERGM, specifically the ballistic trajectory extended range munition (BTERM) program and a five-inch variant of the long-range land attack projectile (LRLAP). The committee strongly believes that fair and open competition would best serve the near-term naval surface fire support objectives of the Navy.

The Navy plans to meet its mid-term precision strike requirement of greater than 63 nautical miles with the 6-inch LRLAP projectile in combination with the advanced gun system (AGS), both of which are under development as part of the Navy's next generation destroyer (DD(X)) program. The committee is encouraged by the progress demonstrated in both the LRLAP and AGS engineering development models. The committee notes, however, that the first DD(X) will not become operational until 2012, assuming current timelines hold. Further, the committee does not expect that DD(X) will be procured in the quantity determined by the Marine Corps as necessary to support major combat operations within desired timeframes. In fact, the Navy's current long-range shipbuilding plan calls for procurement of only seven DD(X)s. Accordingly, the committee has strong reservations regarding the Navy's ability to meet mid-term fire support requirements.

In summary, the committee is concerned that the Navy has foregone the long-range fire support capability of the battleship, has given little cause for optimism with respect to meeting near-term developmental objectives, and appears unrealistic in planning to support expeditionary warfare in the mid-term. The committee views the Navy's strategy for providing naval surface fire support as `high risk,' and will continue to monitor progress accordingly.

Network communication system technology for extreme environments

The budget request contained $218.5 million in PE 26313M for Marine Corps communication systems, but included no funds to demonstrate network communication system technology for extreme environments.

The committee understands this technology would use digital signal processing software that would enable military personnel to rapidly transmit and receive networked services such as voice, video, and data, while operating in dense urban or heavily forested areas. The committee notes this technology would provide capability to transmit services with greater bandwidth and more flexibility than provided by current systems. The committee also notes this technology could improve command decision times and enhance situational awareness at the tactical level in both non-line-of-sight and beyond-line-of-sight conditions.

The committee recommends an increase of $4.3 million in PE 26313M for Marine Corps communication systems to allow for further research and engineering support for network communication system technology for extreme environments.

Next-generation electronic warfare simulator

The budget request contained $372.4 million in PE 64269N for the development, demonstration and testing of the EA-18G electronic attack aircraft, but included no funds to develop, configure and install next-generation electronic warfare simulators in the Advanced Weapons Laboratory (AWL) at Naval Air Station (NAS) China Lake, California.

The EA-18G electronic attack aircraft program is developing a replacement for the currently used and aging EA-6B aircraft to provide a capability to detect, identify, locate, and suppress hostile emitters. The committee understands that the Department of the Navy has used the F-18 AWL for integration and development testing of previous F-18 variants, and believes that EA-18G development, test, and evaluation will require next-generation electronic warfare simulators to maximize laboratory testing, avoid additional flight testing, and reduce cost and schedule risk.

Accordingly, the committee recommends $380.4 million in PE 64269N for the EA-18G development program, an increase of $8.0 million to develop, configure and install next-generation electronic warfare simulators in the AWL at NAS China Lake.

Next-generation Phalanx

The budget request contained $46.4 million in PE 64756N for ship self defense (hard kill), but included no funding for next-generation Phalanx.

Phalanx has been a mainstay of close-in ship self defense against anti-ship cruise missiles. The committee believes that the Phalanx weapon system has evolutionary potential for improved performance, broader capability, and lower lifecycle cost. This capability could be applied to the detection, tracking, and engagement of small water craft in swarm attacks. The committee particularly notes the rapid fielding and recent operational success of a land-based Phalanx system for defeating indirect fire in Operation Iraqi Freedom, a mission for which the system was not originally intended.

The committee recommends an increase of $9.0 million for PE 64756N for development of a next-generation Phalanx weapon system.

Permanent magnet motor

The budget request contained $817.5 million in PE 64300N for next generation destroyer (DD(X)) total ship systems engineering, but included no funds to continue development and testing of the permanent magnet motor (PMM).

The committee is aware that the Navy originally intended to integrate the PMM propulsion and power support technology into the DD(X) due to its enhanced power density, acoustic performance and weight reduction advantages over competing motors. The committee understands that the PMM technology experienced a stator insulator failure during the factory testing phase; consequently, the Navy decided to forgo this technology in favor of the backup advanced induction motor (AIM) technology. Since then, the committee understands that the stator insulator failure problem encountered with the PMM technology has been rectified by substituting a conventional insulation material and that the motor has repeatedly passed successful tests at full power. The committee recognizes that the PMM technology offers significant power efficiency and weight reduction advantages over the AIM technology and encourages the Navy to consider incorporating this technology into future Navy ships.

Accordingly, the committee recommends an increase of $15.0 million in PE 64300N to continue land-based testing of the PMM.

Retroreflecting optical communications for special operations

The budget request contained $84.9 million in PE 62114N for power projection applied research, but included no funding for retroreflecting optical communications for special operations.

The committee understands that free space optical communications provide advantages over longer wavelength techniques in terms of bandwidth, spectrum congestion, resistance to jamming, and probability of detection and interception. A compact modulating retroreflector with a special operations team on the ground would secure a tactical data link to an airborne platform without requirement for precise pointing.

The committee recommends an increase of $4.0 million for PE 62114N to continue development of retroreflecting optical communications and to fabricate prototype hardware for a tactical data link.

Sea Fighter (X-Craft)

The budget request contained $61.5 million in PE 63123N for force protection advanced technology, but included no funding for Sea Fighter.

Sea Fighter, formerly known as X-Craft, is a high speed, shallow draft demonstration vessel for littoral warfare. The vessel as currently configured has limitations with respect to its

deployability. The committee believes that deployment of Sea Fighter can demonstrate and validate many of the Navy's operational concepts for littoral warfare, and more specifically reduce risk in the Littoral Combat Ship program.

The committee recommends an increase of $25.7 million for PE 63123N for modifications to survivability, command and control, armament, and other ship systems to make Sea Fighter an operationally deployable asset.

Secure infrastructure technology laboratory

The budget request contained $61.5 million in PE 63123N for force protection advanced technology, but included no funding for Secure Infrastructure Technology Laboratory (SINTEL). SINTEL has developed a suite of sensing technologies and complementary computer analysis that shows great potential to reliably detect hostile, underwater threats in both domestic and foreign ports, a critical force protection requirement for the Navy.

The committee recommends an increase of $8.0 million in PE 63729N for the Secure Infrastructure Technology Laboratory.

Shipboard wireless maintenance assistant

The budget request contained $14.1 million in PE 63513N for shipboard system component development, but included no funding for the shipboard wireless maintenance assistant (SWMA).

The committee believes that advances in information technology can help to dramatically improve productivity and reduce manning for shipboard maintenance. The committee understands that SWMA allows maintenance data, text, and associated drawings and imagery to be shared wirelessly in the shipboard environment, and provides real-time `reach back' to remote experts.

The committee recommends an increase of $3.0 million for PE 63513N for SWMA prototype shipboard testing and development of pre-production models.

Small arms and crew served weapons shot counter

The budget request contained $47.6 million in PE 26623M for Marine Corps ground combat and supporting arms systems, but included no funds for the test and evaluation of weapon shot counters for Marine Corps small arms and crew-served weapons.

The committee understands the Marine Corps has a requirement to track service life and wear rates of small arms and crew-served weapon systems. The committee notes a lightweight, easily manageable weapons shot counter that could readily fit into the stock or grip of existing small arms and crew-served weapon systems would potentially address this requirement. The committee recognizes the additional funds would be used to initiate a lightweight weapons shot counter program.

The committee recommends an increase of $3.3 million in PE 26623M for the initiation, demonstration and evaluation of weapon shot counters for Marine Corps small arms and crew-served weapon systems.

Smart valve

The budget request contained $14.1 million in PE 63513N for shipboard system component development, but included no funding for smart valve.

The committee understands that in a shipboard environment with plentiful power and robust networking, linear electromechanical actuator technology presents some interesting opportunities to eliminate high pressure hydraulic and pneumatic systems. The committee believes that technologies like smart valve can offer reduced size and weight, lower maintenance, and a self diagnostic capability that would warn of impending malfunction.

The committee recommends an increase of $2.0 million for PE 63513N for development of smart valve technology.

Tactical electric field buoy development program

The budget request contained $16.8 million in PE 63254N for anti-submarine warfare systems development, but included no funding for the tactical electric (E) field buoy development program.

The committee supports the Navy's efforts to develop enhanced anti-submarine warfare capabilities using networked sensor systems. Countering emerging threats in the acoustically problematic littorals may require the exploitation of phenomenology that has previously received little attention. The tactical E-field buoy development program designs and tests air deployable sensors capable of detecting the electric field signature of a threat submarine.

The committee recommends an increase of $6.0 million for PE 63254N to design, build and test 10 engineering development model E-field buoys for evaluation at sea.

Validation of prognostic and health management systems

The budget request contained $82.0 million in PE 63236N for warfighter sustainment advanced technology, but included no funds for a program to validate prognostic and health management systems.

The committee understands that advanced modeling and simulation software has been developed for determining the remaining life of critical joint strike fighter engine components. However, the committee further understands that a program to certify the key models used in the software are required to validate prognostic and health management systems, and that such a program would enable engine life assessment modeling tools to be verified for fleet management purposes.

Consequently, the committee recommends an increase of $2.5 million in PE 63236N for a program to validate prognostic and health management systems.

VH-71

The budget request included $682.6 million in PE 64273N for the VH-71 helicopter program.

The committee understands that the VH-71 will replace the current fleet of VH-3 and VH-60 helicopters which provide transportation to the President. Section 220 of the National Defense Authorization Act for Fiscal Year 2006 (Public Law 109-163) limited the expenditure of funds on VH-71 until the Secretary of the Navy delivered to Congress an event driven acquisition strategy that incorporates no more than moderate risk for increment two of the program. Section 220 also required an operational evaluation using production representative test vehicles. Further, section 220 directed that the Director, Operational Test and Evaluation (DOT&E) provide an evaluation of the acquisition strategy.

The committee received the Navy's report on the new acquisition strategy for the VH-71 program along with comments from the Director, Operational Test and Evaluation on March 14, 2006. Although some beneficial changes have been made to the program including the creation of a Senior Leadership Council (SLC), the schedule for the program remains high risk and the test and evaluation planned to occur prior to production of increment two aircraft will not include production representative test vehicles. Further, the DOT&E recommends the addition of readiness reviews prior to award of contracts for production of low rate initial production (LRIP) lots two and three. The current program plan would approve all three lots of LRIP at the same time. The committee directs that the Secretary of the Navy include the readiness reviews recommended by the DOT&E in the VH-71 program schedule. The committee further directs that these additional reviews should occur with the participation of the SLC, and that approval be given for LRIP contract award only with the consensus of all members of the SLC.

The committee notes that the budget request included $39.0 million to procure long lead materials for three LRIP aircraft in the increment two configuration, known as the VH-71B. The committee understands that the first contractor-provided test article for the VH-71B will not be delivered to the Navy until 2008, and that the modification of VH-71A test articles into the VH-71B configuration will not start until the later half of fiscal year 2008 and will not be completed until the later half of fiscal year 2009. The committee believes that the obligation of funds to begin long lead procurement of materials for VH-71B aircraft in fiscal year 2007 is premature.

The committee recommends $643.6 million, a decrease of $39.0 million in PE 64273N for the VH-71 helicopter program.

Virtual-at-sea training technologies

The budget request contained $82.0 million in PE 63236N for warfighter sustainment advanced technology, but included no funding for leveraging virtual-at-sea training (VAST) technologies in support of qualification and readiness training for the Littoral Combat Ship (LCS).

The committee understands that training in a simulated environment can provide valuable crew experience in a cost effective manner, and provides in some cases the only means to train for certain contingencies. The committee notes that the Navy's `Report to Congress on Annual Long-Range Plan for Construction of Naval Vessels for FY 2007' describes a future force structure that includes 55 LCSs, although none have been commissioned to date. Given the large number of ships in this class planned for procurement, the committee believes investment in training technologies is particularly prudent.

The committee recommends an increase of $5.0 million for PE 63236N for extension of VAST technologies to support crew training for LCS.

Warfare protection advanced technology

The budget request contained $18.0 million in PE 63729N for warfare protection advanced technology, but included no funds for the Naval Special Warfare Performance and Injury Prevention Program. The committee is aware that the Performance and Injury Prevention Program would implement intervention models that will permit Navy special operations forces to mitigate the risk of musculoskeletal injury and optimize physical performance.

The committee recommends $20.5 million in PE 63729N, an increase of $2.5 million for the Naval Special Warfare Performance and Injury Prevention Program.

Wet end installation system element

The budget request contained $58.3 million in PE 64784N for distributed surveillance system, but included no funding for the wet end installation system element (WISE).

The committee supports the Navy's efforts to enhance anti-submarine warfare (ASW) capability by shifting the focus from expensive platforms to relatively inexpensive networked sensors. The Navy's current program, the advanced deployable system, is a passive acoustic surveillance system that will be deployed from a littoral combat ship equipped with the ASW mission package. The committee believes the value of such systems is further enhanced by covert deployment. WISE will employ submarine based expendable unmanned underwater vehicles to install fixed sensor fields, with a goal of reducing system cost by 50 percent.

The committee recommends an increase of $3.4 million for PE 64784N for continued development of WISE and the expendable array installation vehicle.

Wireless maritime inspection system

The budget request contained $817.5 million in PE 64300N for SC-21 total ship engineering, but included no funds for the wireless maritime inspection system.

The wireless maritime inspection system will establish an operational capability that reduces the risk associated with military interception operations. The committee recognizes that this system will allow Navy personnel to board ships, as needed, to effectively inspect personnel, cargo and other items on the suspect ship while being connected in near real-time to critical Navy organizations. Specifically, it will enable boarding teams to transmit intelligence such as photos of crew, passports and evidence to the operational commander and national agencies in near-real time. The committee notes this will allow senior personnel to remotely make decisions without having to recall a portion of the interdiction team. This capability will provide improved force protection, as well as enable real-time correlation with other interdiction operations to ensure broader effectiveness.

The committee recommends an increase of $5.0 million in PE 64300N to be used for the wireless maritime inspection system.

AIR FORCE RESEARCH, DEVELOPMENT, TEST, AND EVALUATION

OVERVIEW

The budget request contained $24.4 billion for Air Force research, development, test, and evaluation (RDT&E).

The committee recommends $24.8 billion, an increase of $413.3 million to the budget request.

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ITEMS OF SPECIAL INTEREST

Active feedback flow control technology

The budget request contained $112.8 million in PE 62201F for aerospace vehicle technologies, including $2.0 million for advancement of intelligent aerospace systems (AIAS).

The committee understands that AIAS focuses on the concept and development of valuable simulation tools for Air Force engineers and scientists for assessment of proposed future Air Force weapons systems. AIAS incorporates active feedback flow control (AFFC) technology for simulation and modeling tools in the evaluations of unsteady aerodynamic, turbulence, thermal and noise studies. Currently, there are no universal, validated tools available for the new weapon systems development program designer interested in using AFFC concepts at the beginning stages of design. The committee also understands AFFC tools are highly relevant for a broad spectrum of designs and development such as onboard intelligence for maneuvering missiles and projectiles, and onboard intelligence for unmanned air vehicles, and micro-unmanned air vehicles utilizing neurobiological inspired computational processes.

Therefore, the committee recommends an increase of $3.0 million in PE 62201F for AIAS in the development of AFFC.

Advanced engine starter/generator system prototype

The budget request contained $170.9 million in PE 62203F for aerospace propulsion, but included no funds for the development of an advanced engine starter/generator (AESG) system for future aircraft.

The committee notes that existing engine starter/generator systems on current and future designed aircraft are physically heavy and expensive to procure and sustain. The AESG contains design and technology advancements in power-electronics and high-speed-machinery. Subsequently, the AESG has the potential to provide future aircraft with a high-powered, engine starter/generator system that is 30 percent less in weight and 28 percent lower in lifecycle cost.

Therefore, the committee recommends an increase of $3.5 million for development of an advanced engine starter/generator system.

Advanced optics and laser space technology

The budget request contained $51.3 million in PE 63605F for advanced weapons technology, including $21.4 million for advanced optics and laser space technology.

The committee believes that characterization of laser propagation through atmospheric turbulence and demonstration of advanced adaptive optical and tracking technologies are critical enabling technologies for applications such as high-resolution satellite imaging, space object illumination and tracking, and satellite diagnostics testing. However, the committee is concerned by the potential applicability of this technology development for anti-satellite and advanced space weapons capabilities. Therefore, the committee directs that none of the funds authorized for this program element shall be used for development or demonstration of laser space technologies with anti-satellite weapons purposes.

The committee recommends $44.8 million in PE 63605F, a decrease of $6.5 million for advanced optics and laser space technology.

Advanced spacecraft technology

The budget request contained $68.0 million in PE 63401F for advanced spacecraft technology, but included no funds for precision integrated navigation and position-intelligent networking technology (PINPOINT), small, low-cost reconnaissance spacecraft, or intelligent free space optical satellite communications nodes.

The committee is aware that PINPOINT operates through cooperative navigation, which enables an array of satellites to form a more accurate, integrated navigation solution through the fusion of all global positioning satellite system information available within the array. With this approach, a satellite that cannot form a complete navigation solution on its own, due to poor geometry plasma effects, jamming or interference, can now accurately determine its position through interaction with other array members. The committee believes that this technology directly improves warfighter capabilities by enabling improved situational awareness and relative position accuracies.

The committee recognizes that small reconnaissance spacecraft that cost less than $4.0 million each could fulfill a variety of military and intelligence applications. The committee believes that a program focused on integrating low-mass, low-cost components into a single purpose imaging satellite, while maintaining 80 percent of the performance specifications of other larger imaging spacecraft currently in development could be of great value to the Department of Defense and the Intelligence Community.

Further, the committee is aware that on-going military operations require dramatic increases in space communications bandwidth through secure communications networks. The committee feels that lightweight, low-cost spacecraft laser communications hardware technology can reduce the development risk of the transformation communication architecture program by providing the capability for low-cost, adaptive, multi-access laser and radio frequency communications.

The committee recommends $84.0 million in PE 63401F, an increase of $16.0 million, including $5.0 million for PINPOINT, $4.0 million for small, low-cost reconnaissance spacecraft, and $7.0 million for intelligent free space optical satellite communications nodes.

Affordable lightweight power supply development

The budget request contained $170.9 million in PE 62203F for applied research in aerospace propulsion, but included no funds for lightweight proton exchange membrane fuel cells.

The committee notes the need of U.S. armed forces for efficient and robust power sources. Fuel cells, which are lighter than conventional batteries or generator power supplies, offer a high potential for reducing vehicle fuel consumption, the weight of the subsistence and combat load carried by individual soldiers, marines, sailors, and airmen in the field, environmental pollution, and an enemy's ability to detect combat vehicles. The committee further notes advances in technology and the potential for development of durable and cost-effective high temperature proton exchange membrane fuel cells that would address these operational requirements.

The committee recommends an increase of $3.2 million in PE 62203F for applied research in lightweight proton exchange membrane fuel cells.

B-52 internal weapons bay upgrade

The budget request contained $71.4 million in PE 11113F for B-52 squadrons, but contained no funds for the military-standard-1760 (MIL-STD-1760) integration for the B-52 internal weapons bay upgrade.

The committee understands modernization and upgrade efforts are underway for the B-52 aircraft to enable employment of precision guided weapons from both the internal weapons bay and the external wing pylons. These upgrades will allow the aircraft to employ advanced precision guided weapons such as the joint direct attack munition, the joint air-to-surface stand- off missile, and the joint stand-off weapon. The committee understands that the MIL-STD-1760 provides a common interface between the weapons and the aircraft, and is used to transfer guidance information to the weapons located in the internal bay racks and on the external wing pylons.

Therefore, the committee recommends $77.4 million in PE 11113F, an increase of $6.0 million for accelerated integration of the MIL-STD-1760 into the internal weapons bay of the B-52.

B-52 stand-off jammer program

The budget request contained no funds in PE 64429F for the B-52 stand-off jammer (SOJ) program. The budget request also terminated the B-52 SOJ program in order to fund Air Force transformational activities in the remaining Future Years Defense Program (FYDP).

The committee notes that in PE 64429F, Congress appropriated $107.1 million in fiscal year 2006 for the B-52 SOJ program. The committee notes that current Air Force electronic attack requirements are being fulfilled by Marine Corps EA-6B platforms scheduled to be completely retired in 2012. Further, the committee understands the B-52 SOJ program was originally developed to fulfill future Air Force electronic attack requirements beginning in 2012 to mitigate the capability gap created by the retirement of the EA-6B.

Consequently, the committee is deeply concerned that the Air Force will not have a replacement electronic attack capability once the Marine Corps EA-6B platform is retired, and strongly encourages the Secretary of the Air Force to reexamine the decision to cancel the B-52 SOJ program in light of this capability gap.

Biostatic protective clothing

The budget request contained $1.0 million in PE 48011F for agile combat support, but included no funds for development of biostatic protective clothing.

The committee understands that the capabilities of biostatic protective clothing include a thermally efficient wicking concept made with an extruded continuous filament yarn which has the potential for superior moisture management. The committee is aware that early biostatic protective clothing prototypes have been tested and found to resolve some shortcomings associated with clothing used by those military personnel currently deployed to combat theaters of operation.

Consequently, the committee recommends $3.9 million in PE 48011F, an increase of $2.9 million for biostatic protective clothing.

C-130 airlift squadrons

The budget request contained $248.3 million in PE 41115F for C-130 development programs, but included no funds for development of the automated inspection, repair, corrosion and aircraft tracking (AIRCAT) system.

The AIRCAT system develops tools for collection and analysis of data for the purpose of instituting a condition-based maintenance (CBM) program on the C-130 aircraft. The committee understands CBM techniques are used in many aviation activities because they improve fleet maintenance planning and management, improve safety through a better awareness of flight worthiness, and reduce total ownership costs. The committee notes that Congress appropriated $2.5 million for the AIRCAT system for fiscal year 2006, and believes that this program should be continued.

Accordingly, the committee recommends $255.4 million in PE 41115F for C-130 development programs, an increase of $7.1 million for the AIRCAT system.

Combatant commanders' integrated command and control system

The budget request contained $50.9 million in PE 35906F for the combatant commanders' integrated command and control system (CCIC2S).

The committee believes that the modernization and integration of the command and control systems at Cheyenne Mountain, Colorado is critical to adequately support the North American Aerospace Defense Command, U.S. Northern Command, and U.S. Strategic Command. However, the committee is aware of management deficiencies in the program that are resulting in a significant cost overrun and an undefined delivery schedule.

Therefore, the committee directs the Secretary of Defense to maintain essential operation and maintenance activities, and limit future investment to only the developmental activities deemed essential to national security needs. Prior to proceeding with further development, the committee directs the Secretary of Defense to ensure that the Department of Defense (DOD) approves an acquisition approach that designates the program as a major automated information system. In addition, the committee directs the Secretary of Defense to submit a report by March 1, 2007, to the congressional defense committees that includes an affordability assessment to demonstrate that the program's resource estimates will be available and realistic in terms of DOD's overall long-range modernization priorities and investment plans, an economic analysis that assesses the lifecycle costs and benefits of the program, and an independent estimate of program lifecycle cost.

The committee recommends no funding in PE 35906F for CCIC2S, a decrease of $50.9 million.

Distributed mission interoperability toolkit program

The budget request contained $0.2 million in PE 64740F for development of integrated command and control applications, but included no funds for the distributed mission interoperability toolkit (DMIT) program.

The DMIT is a suite of software tools that enables on-demand, trusted, interoperability among and between air mission command, control, communication, computer and intelligence (C4I) systems and mission simulator models. The committee understands that the DMIT program leverages best practices from the commercial sector including the use of open architectures, existing and emerging web standards, and state-of-the-art technologies to provide a more efficient translation of air mission tasks from C4I systems into a format compatible with mission simulator formats. The committee notes that Congress appropriated an increase of $5.0 million in fiscal year 2006 for this purpose, and believes that the DMIT program should be continued in fiscal year 2007.

Accordingly, the committee recommends $5.2 million in PE 64740F, an increase of $5.0 million for continuation of the DMIT program.

Engineering tool improvement program

The budget request contained $106.1 million in PE 62500F for multi-disciplinary space technology, but included no funding for the engineering tool improvement program (ETIP).

The committee notes Congress has appropriated funding for the ETIP since fiscal year 2003. The ETIP effort provides the Air Force Research Laboratory with the ability to rapidly assess system viability and mission suitability by performing design and analysis of aerospace vehicles and propulsion technologies during the design phase.

The committee recommends an increase of $3.0 million in PE 62500F for ETIP.

High accuracy network determination system

The budget request contained $6.0 million in PE 63444F Maui space surveillance system, but included no funds for the high accuracy network determination system (HANDS).

The committee believes that low cost, innovative technologies are needed to address critical space situational awareness needs and notes that HANDS research is leading to a networked, operationally secure, multi-sensor system, which could obtain highly accurate observations of space objects and reduce the potential for collisions of space objects by reducing errors in the current space-object maintenance catalog.

The committee recommends $11.0 million for PE 63444F, an increase of $5.0 million for HANDS.

High modulus polyacrylonitrile carbon fiber

The budget request contained $111.1 million in PE 62102F for materials, but included no funds for high modulus polyacrylonitrile (PAN) carbon fiber.

The committee notes that high modulus PAN carbon fiber research and development is in line with and supportive of the Air Force's initiatives for advanced composite parts development and carbon fiber sourcing. High modulus PAN carbon fiber is in demand by composite manufacturers for the production of military aircraft, as well as components of missiles and satellites where there is a need for material stiffness at a relatively low weight. Currently only one manufacturer of high modulus PAN carbon fiber exists and is located overseas. The committee urges the Department of Defense to secure a domestic-based manufacturer of high modulus PAN carbon fiber.

Therefore, the committee recommends an increase of $3.0 million in PE 62102F for the development and certification of a domestic-based manufacturer of high modulus PAN carbon fiber.

Human systems integration

The budget request included $92.9 million in PE 62202F for human effectiveness applied research, but contained no funding for improved performance research integration (IMPRINT).

The committee supports further development of IMPRINT in support of the airman performance integration (AIRPRINT) program and in conjunction with other Department of Defense human systems integration efforts.

Therefore, the committee recommends an increase of $3.0 million in PE 62202F for IMPRINT to further develop human systems integration modeling throughout the Department.

Interactive avionics roadmap

The budget request contained no funds in PE 72239F for avionics component improvement programs, and other program elements included no funds for development of the interactive avionics roadmap.

The interactive avionics roadmap is a tool that provides program managers with real-time, internet web-based data that is used to continually monitor and forecast program requirements. The interactive avionics roadmap would enable program managers to monitor changes as they occur and implement mitigation alternatives as required on a real-time basis. The committee understands that existing roadmap documents are heavily manpower dependent, and are subject to degradation as changes in program requirements are encountered; and the committee believes that the use of interactive avionics roadmaps would automate data feeds, reduce costs for avionics systems, and enhance the ability of program managers to more proactively manage and prioritize budgets based on more up-to-date system requirements.

Therefore, the committee recommends $2.0 million in PE 72239F, an increase of $2.0 million for development of the interactive avionics roadmap.

Joint advanced global strike demonstration

The budget request contained $14.7 million in PE 65860F for the Rocket Systems Launch program, but included no funds for prompt global strike development.

The committee notes that the 2006 Quadrennial Defense Review called for improved capability for prompt, conventional global strike. The committee is aware that U.S. Strategic Command has approved the concept of a joint advanced global strike (JAGS) demonstration that would use ballistic missile boosters currently in the inventory, as vehicles for a new land-based prompt global strike capability. The committee notes that the Rocket Systems Launch program can use its excess ballistic missile assets to develop a land-based prompt conventional global strike capability.

The committee recommends $26.7 million in PE 65860F, an increase of $12.0 million for the JAGS demonstration program.

Joint strike fighter development

The budget request contained $2.0 billion in PE 64800F for the Department of the Air Force's development of the joint strike fighter (JSF), also known as the F-35, but included no funds for research and development of a second aircraft tire source for the JSF and other existing combat aircraft, or for development of an alternate JSF engine. The committee notes that the budget request also includes $2.0 billion in PE 64800N for the Department of the Navy's development of JSF.

The committee understands that aircraft tires are a high-demand, critical component needed to sustain high military operational tempos, and believes that a second JSF tire source

should be established in the United States to ensure that a reliable and sustainable source of aircraft tires are available to meet requirements for the JSF and other aircraft. Consequently, the committee recommends an increase of $1.5 million for research and development of a second tire source for the JSF and other existing combat aircraft. The committee expects that these funds will be used for the development of advanced reinforced materials and new materials for combat aircraft tires.

The JSF alternate engine program is developing the F136 engine which would provide an alternative to the currently-planned F135 engine. In the committee report (H. Rept. 109-89) accompanying the National Defense Authorization Report for Fiscal Year 2006, the committee expressed its belief that a two-engine source for the single-engine JSF would be the most cost effective and operationally effective engine solution during the JSF's service life, and is disappointed that the budget request did not include funds for development of an alternate JSF engine beyond fiscal year 2006. During a hearing held by the Subcommittee on Tactical Air and Land Forces on March 16, 2006, the Under Secretary of Defense for Acquisition, Technology, and Logistics testified, `While the benefits of a second supplier are undeniable, our judgment is that those benefits are not worth the substantial financial cost of a second supplier.' To confirm those judgments, the committee requested that the Government Accountability Office (GAO) witness at the hearing review and report on the Department of Defense's analysis that resulted in the judgment to terminate the JSF alternate engine program. On April 12, 2006, the GAO witness reported to the committee that the `Department of Defense's quantitative analysis focuses only on potential savings for engine acquisition and does not appear to fully examine potential savings that may be possible when competition exists for providing support for maintenance and operations over the lifecycle of the engine.' The committee concurs with GAO's observation, and believes that the JSF alternate engine program should continue until the Department of Defense fully analyzes potential costs and savings resulting from competition over the JSF engine's lifecycle.

Accordingly, the committee recommends an increase of $408.0 million to continue the JSF alternate engine program for fiscal year 2007. Additionally, the committee recommends a provision (section 211) that would require that the Department of the Navy and the Department of the Air Force obligate not less than $408.0 million, of the funds authorized to be appropriated for the system development and demonstration program for the Joint Strike Fighter, for continued development of an alternate engine for the Joint Strike Fighter. The committee also recommends a provision (section 215) that would require both the Secretary of Defense, acting through the Department of Defense Cost Analysis Improvement Group, and the Comptroller General to conduct independent analyses of the JSF alternate engine program and provide a report to the congressional defense committees by March 15, 2007.

In total, the committee recommends $2.4 billion in PE 64800F for the Department of the Air Force's portion of JSF development, an increase of $409.5 million.

KC-135 aerial refueling aircraft recapitalization program

The budget request contained $203.9 million in PE 41221F for the KC-135 aerial refueling aircraft recapitalization program (KC-X).

The committee fully supports recapitalization of the KC-135 aerial refueling fleet. The committee notes that a system development and design (SDD) contract would not likely be awarded until the end of fiscal year 2007, in accordance with the estimated acquisition schedule of the Air Force. Further, Congress appropriated $100.0 million in fiscal year 2005 for the Tanker Replacement Transfer Fund, and $97.8 million in fiscal year 2006 for the KC-X program, of which only $10.2 million has been obligated thus far. The committee understands that approximately $70.0 million is required to execute an SDD contract in fiscal year 2007. The committee believes the unobligated balance of $187.6 million should be sufficient to support funding requirements for the KC-X program in fiscal year 2007.

Therefore, the committee recommends $152.4 million in PE 41221F, a decrease of $51.5 million for the KC-X program.

Large aircraft countermeasures system for AC-130U aircraft

The budget request contained $34.9 million in PE 41134F for development and integration of the large aircraft countermeasures (LAIRCM) system on various airlift and tanker aircraft, but included no funds to integrate the LAIRCM system on the AC-130U aircraft.

The AC-130U is a heavily-armed aircraft which uses side-firing weapons integrated with sensor, navigation, and fire control systems to provide precise firepower for close air support, air interdiction and force protection missions. The LAIRCM system, which is planned for integration on various airlift and tanker aircraft, provides a capability to detect, track, jam and counter incoming surface-to-air, infra-red guided missiles. The committee notes that the Air Force Chief of Staff has included the integration of the LAIRCM system on the Air Force Special Operations Command's (AFSOC) HC-130 and MC-130 aircraft among his top unfunded priorities for fiscal year 2007, and believes that the LAIRCM system should be integrated into AFSOC's AC-130U fleet.

Accordingly, the committee recommends $49.9 million in PE 41134F, an increase of $15.0 million to integrate the LAIRCM system on the AC-130U aircraft.

Laser peening fatigue life extension

The budget request contained $36.7 million in PE 78011F for various manufacturing technology programs, but included no funds for testing, demonstration, and evaluation of laser peening technology for military aircraft landing gear.

The committee understands that the laser peening process has the potential to strengthen metals thereby extending the life and improving the fatigue strength, while also providing increased resistance to corrosion and cracking. The committee further understands that the laser peening process is used in the commercial aviation industry and has shown promise in improving the fatigue strength of commercial aircraft landing gear. Based on commercial experience, the committee believes that the laser peening process also has the potential to improve fatigue strength for military landing gear systems.

Consequently, the committee recommends an increase of $3.0 million in PE 78011F for the testing, demonstration and evaluation of laser peening technology as a metal fatigue prevention tool to extend the life of military aircraft landing gear.

Low emission hybrid electric engine propulsion

The budget request contained $10.6 million in PE 78611F for support systems development, but included no funds for the testing of low emission and fuel efficient hybrid electric engine propulsion systems for Air Force heavy tactical wheeled vehicles such as aviation refueling trucks.

The committee is aware that existing Air Force aviation refueling trucks operate over short distances in a manner that causes high fuel use, high emissions and decreased engine life. The committee notes that a first generation hybrid electric vehicle has been delivered to the Air Force for testing and understands this technology would potentially deliver a better than 40 percent improvement in fuel efficiency.

The committee recommends $13.6 million in PE 78611F, an increase of $3.0 million for the continued refinement in system development and demonstration of low emission and fuel efficient hybrid electric engine propulsion for use by aviation refueling trucks.

Major test and evaluation investment

The budget request contained $58.5 million in PE 64759F for major test and evaluation investment, but included limited funds for acquisition of hardware and software for data management and archiving systems for the effective collection, management, distribution, and long-term availability of flight test data.

The committee recommends an increase of $5.8 million in PE 64759F for an enterprise test data management system at the Air Force Flight Test Center, Edwards Air Force Base, California, and an additional increase of $3.0 million in PE 64759F for hardware and software to improve the flight test ground infrastructure and tools at the Air Armament Center, Eglin Air Force Base, Florida.

Materials

The budget request contained $111.1 million in PE 62102F for materials applied research, but included no funds for research for electronic type-specific buckytubes.

The committee recognizes the national need for electronic type-specific buckytubes for military, intelligence, and homeland security applications. Therefore, the committee believes there is a need to ensure the continual improvements of capabilities in these areas.

The committee recommends an increase of $9.4 million in PE 62102F for development of electronic type-specific buckytubes.

Measurement and signature intelligence (MASINT) visualization tools program

The budget request contained $119.2 million in PE 62702F for command, control and communications, but included no funds for the measurement and signature intelligence (MASINT) visualization tools program.

The committee notes that the (MASINT) visualization tools program would integrate measurement and signature intelligence into existing and future information processing architectures so that information could be managed and displayed in real-time without processing delays.

The committee recommends $125.2 million in PE 62702F, an increase of $6.0 million for the accelerated development of the MASINT visualization tools program.

Metals affordability initiative

The budget request included $48.9 million in PE 63112F for advanced materials for weapon systems.

The committee supports the continued government-industry collaboration provided through the Metals Affordability Initiative, providing significant improvements in the manufacturing of specialty metals for aerospace applications for the private and government sectors of the aerospace industry.

The committee recommends an additional $11.3 million in PE 63112F for the Metals Affordability Initiative.

Nanocrystalline diamond coatings

The budget request included $111.1 million in PE 62102F for materials applied research and $64.7 million in PE 63003A for aviation advanced technology, but included no funds for nanocrystalline diamond coatings.

The committee understands that a nanocrystalline diamond coating has been developed with characteristics that offer increased durability, transparency, and protective characteristics to include anti-icing and abrasion protection for aircraft surfaces.

The committee recommends an additional $2.9 million in PE 62102F and $2.9 million in PE 63003A for development and application of nanocrystalline coatings on radome and high wear aircraft components for testing.

Operationally responsive space

The budget request contained $35.6 million in PE 64857F for operationally responsive space.

The committee recognizes that the Department of Defense recently began developing an affordable, rapid reaction combination of spacelift, launch control, and satellites in an effort to provide responsive tactical satellite capabilities to the warfighter. The committee commends this effort and believes that continued pursuit of low-cost, responsive tactical capabilities can fill a niche capability requested by the warfighter and lead to long-term benefits by advancing technology, enhancing the skills of the space cadre, and broadening the space industrial base.

The committee recommends $55.6 million in PE 64857F, an increase of $20.0 million for operationally responsive space.

Radio frequency identification tag rapid adoption initiative, phase 2

The budget request contained $36.7 million in PE 78011F for industrial preparedness, but contained no funding for the Frequency Identification Tag Rapid Adoption Initiative, Phase 2.

The committee believes that great efficiencies can be gained, and more importantly, capability delivered rapidly to the front line troops, through a systemic adoption of radio frequency identification tagging within the Department of Defense's logistics enterprise. Given the disparate logistics systems throughout the Department, no single entity is focused on the system wide adoption of this promising technology.

The committee recommends an increase of $3.0 million in PE 78011F for the Radio Frequency Identification Tag Rapid Adoption Initiative, Phase 2.

Small diameter bomb

The budget request included $224.2 million in PE 64240F for the B-2 advanced technology bomber, but contained no funds for the integration of the small diameter bomb.

The committee recognizes the unique attributes of the B-2 bomber as a stealthy, long-range delivery platform and supports further development of the fleet as a means to address the evolving nature of potential threats.

The committee recognizes the potential benefit of maintaining a long-range delivery system with the capacity to carry heavy and medium, as well as relatively lightweight munitions. The committee is encouraged with the potential capabilities of the 250-pound small diameter bomb and intrigued with the possibility of coupling this technology with the B-2 program.

Therefore, the committee recommends an increase of $16.0 million in PE 64240F to integrate the small diameter bombs aboard the B-2 bomber.

Space-based radar

The budget request contained $266.4 million in PE 63858F for space-based radar.

The committee is aware that the Executive Agent for Space of the Department of Defense is taking steps to restructure the space-based radar program in order to address concerns about the affordability of space-based radar, and is evaluating the potential to develop on-orbit demonstration satellites to validate technology maturity and costs. The committee commends the Department for this effort and encourages continued progress towards an effective and affordable space radar capability. However, the committee believes that a 171 percent increase over fiscal year 2006 funded level is unwarranted as the space radar program does not have a finalized development approach or a concept of operations.

The committee recommends $236.4 million in PE 63858F, a decrease of $30.0 million for space-based radar.

Space control test capabilities

The budget request contained $47.3 million in PE 64421F for counterspace systems, but contained no funds for space control test capabilities (SCTC).

The committee is aware that the integration of new space control systems and requirements into the existing command and control architecture requires significant objective analysis in order to optimize systems effectiveness and prevent degradation or failure of the command and control infrastructure. The committee believes that SCTC provides a method of assessing the effects of loading data from newly developed systems into the existing command and control infrastructure, thereby providing a test capability prior to development of system requirements.

The committee recommends $52.3 million in PE 64421F, an increase of $5.0 million for space control test capabilities.

Space technology

The budget request contained $85.6 million in PE 62601F for space technology, but contained no funds for elastic memory composites or for deployable structures for space.

The committee notes space-qualified elastic memory composite materials can significantly improve the reliability of on-orbit spacecraft deployment mechanisms and may enable composite tank structures for spacecraft applications.

The committee believes that continued improvement in spacecraft deployment systems is necessary to achieve the large apertures needed to support enhanced imaging and improved space situational awareness requirements.

The committee recommends $91.6 million for PE 62601F, an increase of $6.0 million, to include $3.0 million for elastic memory composites and $3.0 million for deployable space structures.

Tactical automated security system advanced communications module

The budget request contained $0.2 million in PE 63287F for physical security equipment, but included no funds for the tactical automated security system (TASS) advanced communications module.

TASS systems are widely deployed by the U.S. Air Force and other services supporting current operations and provide both physical security and force protection. The committee is aware the current communications element of TASS has limited bandwidth capability and is subject to obsolescence due to age.

The committee recommends $3.2 million in PE 63287F, an increase of $3.0 million to complete the development of the TASS advanced communications module.

Transformational satellite communications system

The budget request contained $867.1 million in PE 63845F for the transformational satellite communications systems (TSAT).

The committee is aware that the TSAT program has been restructured into a block-build approach that will reduce the complexity and capacity of the first block of satellites in an effort to reduce development and integration risk and increase schedule confidence. While the committee believes this restructuring, along with budgeting TSAT to 80/20 cost confidence, is appropriate based on historical performance of the TSAT program, the committee is concerned that the two-fold increase in the TSAT budget can not be prudently executed.

The committee recommends $787.1 million in PE 63845F, a decrease of $80.0 million for TSAT.

Winglets for in-service aircraft

The committee commends the Air Force in its efforts to increase aircraft fuel efficiency and decrease fuel consumption. The committee notes that initiatives such as re-engining aircraft, modifying in-flight profiles, and revising aircraft ground operations contribute to decreased fuel consumption and increased life-cycle savings.

The committee is aware that winglet technology exists for aircraft to increase fuel efficiency, improve take-off performance, increase cruise altitudes, and increase payload and range capability. The committee notes that winglets are currently used on commercial aircraft and result in a five to seven percent increase in fuel efficiency. On September 16, 1981, the National Aeronautics and Space Administration released the KC-135 Winglet Program Review on the incorporation of winglets for KC-135 aerial refueling aircraft. However, the Air Force concluded that the cost of adding winglets to the KC-135 did not provide sufficient payback in fuel savings or increased range to justify modification. Although the Air Force did conclude that modifying aircraft with winglets could increase fuel efficiency, the Air Force determined that

re-engining the KC-135 aircraft produced a greater return on investment. The committee believes that incorporating winglets on military aircraft could increase fuel efficiency on certain platforms and that the Air Force should reexamine incorporating this technology onto its platforms.

Therefore, the committee directs the Secretary of the Air Force to provide a report to the congressional defense committees by March 1, 2007, examining the feasibility of modifying Air Force aircraft with winglets. The report shall include a cost comparison analysis of the cost of winglet modification compared to the return on investment realized over time for each airlift, aerial refueling, and intelligence, surveillance, and reconnaissance aircraft in the Air Force inventory; the market price of aviation fuel at which incorporating winglets would be beneficial for each Air Force platform; all positive and negative impacts to aircraft maintenance and flight operations; and investment strategies the Air Force could implement with commercial partners to minimize Air Force capital investment and maximize investment return.

DEFENSE-WIDE RESEARCH, DEVELOPMENT, TEST, AND EVALUATION

OVERVIEW

The budget request contained $20.8 billion for Defense-wide research, development, test, and evaluation (RDT&E).

The committee recommends $20.8 billion, a decrease of $46.9 million to the budget request.

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ITEMS OF SPECIAL INTEREST

Accelerated intelligence analyst education and training

The budget request contained no funds in PE 33140G within the information systems security program for intelligence analyst education and training.

The committee is aware that the defense intelligence community needs a new generation of intelligence analysts due to the emergence of new missions and the retirement of older analysts. The committee further understands that there are very few colleges and universities that provide organized degree programs that can lead to intelligence analyst certification in preparation for subsequent entry into the defense intelligence analyst career field. The lack of such programs is compounded by the lengthy security clearance process, making it more challenging to develop a qualified analyst pool.

The committee recommends an increase of $3.0 million in PE 33140G for the National Security Agency to establish a process to identify those college and university curriculums that may lead to intelligence analyst certification. The committee also recommends this funding be used to identify those security clearance eligible students enrolled in such programs who may also be interested in pursuing a career as an intelligence analyst.

Advanced data encryption technology

The budget request contained $404.3 million in PE 33140G for the information systems security program, but included no funding for advanced data encryption technology.

The committee supports the Department of Defense's (DOD) increased emphasis on information assurance programs in the budget request, but believes that more should be done to address future cyber security threats. The committee is concerned that the proliferation of super computers around the globe renders DOD systems vulnerable to cyber attack, and believes that the Department should pursue the development and deployment of polymorphic encryption and decryption technology to provide for more secure computer and data systems.

The committee recommends an increase of $4.0 million in PE 33140G for the development of the polymorphic encryption and detection protocol.

Advanced SEAL Delivery System

The budget request contained $32.5 million in PE 1160426BB for advanced SEAL delivery systems development, but included no funds for a new design competition.

The committee understands that the Department of Defense recently cancelled the advanced SEAL delivery system (ASDS) due to its performance and reliability to date. The committee believes a new design competition will ensure that the most current technologies are incorporated into future ASDS designs and will provide valuable information for future decisions regarding the ASDS program.

The committee recommends $42.5 million in PE 1160426BB for advanced SEAL delivery systems development, an increase of $10.0 million for a new design competition.

Advanced surface radar technologies

The budget request contained no funds in PE 63720S for advanced surface radar technologies (ASuRT).

The ASuRT program will focus on the development and adaptation of electronic components for application in the Navy's next-generation surface ship radar systems. The committee notes that future theater air and missile defense (TAMD) radar systems for next- generation surface ships must be modular and scalable, have a designed-in growth path for technology insertion upgrades, and must include major improvements over current radar systems in power, sensitivity and cost.

To support these requirements, the committee recommends an increase of $8.0 million in PE 63720S and encourages the Defense Microelectronics Activity organization to focus on the development of lower cost, modular and open architecture radar components for use in future TAMD radar systems.

Advanced tactical laser program

The budget request contained $80.4 million in PE 1160402BB for special operations advanced technology development, including $45.0 million for the advanced tactical laser advanced concept technology demonstration (ATL ACTD).

The committee has previously expressed concern with the ATL ACTD program but recognizes that funding in the fiscal year 2007 budget allows a full test of the integrated system and completion of the ACTD.

Therefore, the committee recommends that no change be made to the budget request of $45.0 million for the completion of the ATL ACTD. The committee makes it clear that this funding completes the ATL ACTD and that no further funding will be provided past fiscal year 2007.

Ballistic missile defense

The budget request contained $9.3 billion for the ballistic missile defense programs of the Missile Defense Agency (MDA).

The committee supports the more cautious, measured approach to missile defense testing arising out of the Independent Review Team recommendations and standup of the Mission Readiness Task Force in 2005. While the committee understands that the spiral development strategy employed by the Department of Defense (DOD) for ballistic missile defense (BMD) is appropriate to the research and development nature of the BMD program elements, the committee also notes that rigorous testing that leads to fielding of operational systems should take priority over future block research and development efforts.

A March 2006 Government Accountability Office (GAO) report titled, `Missile Defense Agency Fields Initial Capability but Falls Short of Original Goals,' is critical of several fundamental management processes within the MDA, and cites costs overruns at $458.0 million in fiscal year 2005, with Ground-based Midcourse Defense (GMD) accounting for $365.0 million of this overrun, as well as a failure to meet program goals for many program elements. The report states that while both the Airborne Laser (ABL) and the Kinetic Energy Interceptor (KEI) programs follow a knowledge-based strategy, the GMD program has not. The GMD program is permitted by the Department to concurrently mature technology, complete design activities, and produce and field assets before end-to-end testing of the GMD system. The GAO

report finds that the failure to require this knowledge-based strategy of the GMD program has resulted in poor quality control, cost overruns, and inability to achieve performance goals.

The committee strongly encourages the Secretary of Defense to implement a knowledge-based acquisition strategy for all Ballistic Missile Defense System (BMDS) program elements, which the committee understands is consistent with the DOD's acquisition regulations. The committee agrees with GAO's findings that BMDS program elements would benefit from the more detailed knowledge-based review conducted by other DOD acquisition programs.

The committee also agrees with certain aspects of GAO's report, which questions whether MDA's current two-year block strategy is compatible with the knowledge-based development strategy. While stopping short of directing the Department to restructure the two-year block organization of BMDS elements, the committee directs the Secretary of Defense to conduct a detailed review of the knowledge-based strategy in the context of the existing two-year block organization of BMDS elements, and report to the congressional defense committees by March 1, 2007, the findings and recommendations of this review. This report shall specifically assess whether there are changes that need to be made to the two-year block organization to more appropriately reflect wider application of knowledge-based strategies as has been utilized in the restructuring of the ABL and KEI programs.

The committee recommends a reallocation of the request to focus on testing and fielding of near-term capability ballistic missile defense elements while deferring more long-term efforts.

The committee recommends $9.1 billion, a decrease of $183.5 million for BMD programs of the Missile Defense Agency.

Aegis ballistic missile defense

The budget request contained $1.0 billion in PE 63892C for Aegis ballistic missile defense (BMD).

The committee is encouraged by the Aegis BMD program performance and overall cost/schedule performance. The committee understands that budget constraints have reduced planned SM-3 interceptor procurement, thereby delaying SM-3 interceptor deployment to Aegis BMD platforms.

The committee recommends $1.1 billion in PE 63892C for Aegis BMD, an increase of $40.0 million, to include: $10.0 million for continued S-band advanced radar algorithm work for missile defense applications, $10.0 million for Aegis open architecture program acceleration, and $20.0 million to increase the SM-3 production rate from two per month to four per month.

Boost defense segment

The budget request contained $631.6 million in PE 63883C for boost phase defense.

The committee notes that the Airborne Laser (ABL) program achieved several significant milestones in 2005, including the successful System Integration Laboratory laser long run performance test and is scheduled to conduct a lethal demonstration in calendar year 2008. While the ABL program still faces risks associated with cutting-edge technology, the committee believes that the potential benefits to national security of a successful lethal demonstration warrant continued program support. The committee notes with approval the knowledge point-based foundation for the ABL program.

The committee recommends $631.6 million for PE 63883C, the amount of the budget request.

Core

The budget request contained $473.1 million in PE 63890C for ballistic missile defense systems (BMDS) core.

The committee is concerned with the results of a March 2006 Department of Defense Inspector General report finding weaknesses in the Missile Defense Agency's systems engineering plans and processes. The committee is particularly concerned with the report's finding that the Aegis missile defense system, an element of the BMDS that has achieved success in actual intercept tests and that is being fielded and deployed now, lacks an approved systems engineering plan. The committee directs the Secretary of Defense to submit a report to the congressional defense committees by February 1, 2007, stating the specific deficiencies in the Aegis systems engineering plan and the required corrective action.

The committee recommends $483.1 million in PE 63890C, an increase of $10.0 million for additional support for the Aegis missile defense system information assurance and systems engineering integration efforts.

Midcourse defense segment

The budget request contained $2.9 billion in PE 63882C for ballistic missile defense (BMD) midcourse defense segment.

The committee supports the restructured Ground-Based Midcourse Defense (GMD) testing program following the recommendations of the Independent Review Team and the new charter from the Mission Readiness Task Force. As in previous years, the committee continues to urge the Director of the Missile Defense Agency to focus on robust testing of near-term block capabilities even where that means deferring work on future blocks. As noted above, the committee shares the concerns of the Government Accountability Office (GAO) in their March 2006 report, `Missile Defense Agency Fields Initial Capability but Falls Short of Original Goals,' that the rush to deploy GMD capabilities while concurrently developing future blocks has negatively impacted the program. In order to sustain the current fielded system, the committee recommends an increase of $20.0 million to support concurrent test and operations of the existing block 2004/2006 capability.

The committee notes that the budget request contained $354.9 million for block 2008 development, including the development and testing of new and evolving BMD systems technologies. The budget request specifically referenced Block 2008 efforts that will include enhanced exo-atmospheric kill vehicle (EKV) and sea-based X-band radar capabilities, and additional GMD fire control capabilities and countermeasures mitigation. While the committee understands that investing in future capabilities is integral to a spiral development program, the committee also believes it is premature to spend funds on future technology development when the initial block 2004/2006 capability is yet to be tested in a successful end-to-end flight intercept test. While the committee recommends authorization of the requested $354.9 million for GMD Block 2008 development, the committee also withholds $200.0 million of the request until 30 days after receiving certification from the Secretary of Defense that the planned FTG-04 and FTG-05 intercept tests referenced in the March 17, 2006, GMD corrected testing schedule forwarded to the committee have met their test objectives. In the event that these tests objectives are not met, the committee directs the Secretary to report to the congressional defense committees within 30 days of the completion of these intercept tests as to whether the remaining block 2008 funds should be reallocated for additional testing of the block 2004/2006 configuration.

The committee notes that the budget request contained $118.9 million for block 2010, including $55.8 million for the third site in Europe, and $63.1 million for long-lead items for European site interceptors. The committee believes it is premature to invest in the third site until the existing block 2004/2006 GMD configuration successfully completes integrated end-to-end testing. Accordingly, the committee authorizes no funds for the third site. With respect to long-lead procurement of third site interceptors, the committee authorizes $63.1 million, the amount of the request, to initiate long-lead procurement for interceptors 41-50 understanding that these interceptors could be available for use as assets at either the Fort Greeley, Alaska, or Vandenberg, California GMD sites.

The committee is concerned with reports of GMD costs overruns, $365.0 million was reported by the GAO in the March 2006 report, as well as with problems GAO noted with the EKV. The committee urges the Department of Defense to swiftly address these issues with contractor performance.

The committee recommends $2.8 billion in PE 63882C, a decrease of $35.8 million for the midcourse defense segment.

Multiple kill vehicle

The budget request contained $165.0 million in PE 63894C for the Multiple Kill Vehicle program.

The committee notes that the request is triple the amount of funding in fiscal year 2006 and is for a program that would support the ballistic missile defense system program no earlier than 2010. The committee believes the amount of the request to be excessive for a program that is oriented for block 2010 prior to successful demonstration of the Exo-atmospheric Kill Vehicle technology resident in the block 2004/2006 Ground-based Midcourse Defense configurations.

The committee recommends $100.0 million, a decrease of $65.0 million in PE 63894C for the Multiple Kill Vehicle program, and encourages the Department of Defense to focus on risk reduction for critical technologies.

System interceptor

The budget request contained $405.5 million in PE 63886C for system interceptor.

The committee notes that in the National Defense Authorization Act for Fiscal Year 2006 (Public Law 109-163), the conferees stated that the Department of Defense had designated the Airborne Laser (ABL) program as the primary boost phase defense and that the system interceptor, or Kinetic Energy Interceptor (KEI) program, represented a risk-mitigation strategy should ABL fail to perform as expected. The conferees directed that fiscal year 2006 funding for the program be focused on reducing high-technology challenges. The committee understands that future funding profiles have resulted in shifting the system interceptor from a 2012 to 2014 capability and that the Department is also exploring use of the interceptor in midcourse defense scenarios.

The committee is concerned with the affordability of pursuing both the ABL and KEI programs in parallel through the projected 2008 knowledge point demonstrations. Given that ABL is the primary boost phase defense program and that the KEI capability is not scheduled to be fielded until the 2014 time-frame, the committee believes that the KEI program should focus

on only those critical technology efforts that support the 2008 booster demonstration. Any long-term efforts not directly associated with the 2008 booster tests should be deferred until a decision is made on the future of both the ABL and KEI programs.

The committee recommends $305.5 million in PE 63886C, a decrease of $100.0 million for the system interceptor program, and directs that the KEI program focus its priority on the 2008 booster demonstration.

Technology

The budget request contained $206.7 million in PE 63175C for ballistic missile defense (BMD) technology.

The committee notes that the BMD technology request includes $40.7 million for the High Altitude Airship (HAA); however, the HAA program did not meet its weight or advanced concept technology demonstration criteria last year. The committee also notes that the request states that the benefit to the ballistic missile defense system (BMDS) is for potential use as a sensor and communications and/or weapons platform without any greater connection to a specific BMDS element. The committee does not view the HAA program as an essential element of the BMDS system.

The committee recommends no funding for the HAA program.

The committee provides an additional $8.0 million in PE 63175C for the Net-Centric Airborne Defense Element (NCADE) to continue the NCADE risk-mitigation program that commenced in fiscal year 2006.

The committee recommends $173.9 million in PE 63175C for BMD technology, a decrease of $32.7 million.

Biological warfare defense

The budget request contained $112.2 million in PE 62383E for biological warfare defense applied research, but included no funds for the development of asymmetrical protocols to enhance biological defense capabilities.

The committee notes that there are a number of biological agents that could, with the appropriate development and weaponization, be used in biological warfare and terrorist attack. Yet, developing specific protections against all possible biological agents is not feasible. The cost of developing one new medicine is currently estimated at $800.0 million and the average development time is 10 to 15 years. As a result, the committee believes there is a need for therapeutics that would provide broad spectrum protection against a range of possible biological agents, necessitating research in approaches for enhancing individual non-specific immunities and blocking pathogens to a degree commensurate with the biological warfare threat.

The committee recommends $124.2 million in PE 62383E for biological warfare defense, an increase of $12.0 million for asymmetrical protocols for biological defense enhancement.

Business transformation agency

The budget request contained $140.2 million in PE 65020BTA for the research and development activities of the Business Transformation Agency (BTA).

The committee supports the mission of the agency, but believes that a new agency such as BTA will not be able to effectively execute this funding.

The committee recommends $190.2 million in PE 65020BTA, a decrease of $50.0 million for the Business Transformation Agency.

Chemical-biological collective protective shelters

The budget request included $280.4 million in PE 62384BP for chemical and biological defense applied research, but contained no funds for low-cost collective protection shelters.

The committee continues to support efforts to improve collective protection against chemical and biological agents.

Therefore, the committee recommends an increase of $5.0 million in PE 62384BP for low-cost collective protection shelters.

Chemical and biological defense program

The committee recommends continuation of the chemical and biological basic research, applied research, and advanced technology development initiatives established in the Ronald W. Reagan National Defense Authorization Act for Fiscal Year 2005 (Public Law 108-375). These initiatives would provide opportunities for emerging technologies and concepts to compete for funding on the basis of technical merit and on the contribution that such technologies could make to the chemical and biological defense capabilities of the armed forces and to homeland defense.

The committee also notes that the 2006 Quadrennial Defense Review recommended an investment of more than $1.5 billion over the next five years to develop broad-spectrum medical countermeasures against advanced bio-terror threats, referred to as the Transformational Medical Technology Initiative (TMTI). This is an ambitious program, for which initial efforts began in late fiscal year 2006. While the committee supports both TMTI and the concept of broad-spectrum medical countermeasures, the committee is concerned that the supporting technologies identified in fiscal year 2006 will not be sufficiently mature in fiscal year 2007 to execute the funding proposed in the President's request for related applied research and advanced technology development.

Advanced technology development

The budget request contained $207.1 million in PE 63384BP for chemical and biological warfare defense advanced technology development.

The committee recommends that the technologies to be considered for funding under the chemical and biological advanced technology development initiative, would include, but would not be limited to the following:

(1) Antioxidant micronutrient therapeutic countermeasures for chemical agents; and

(2) Advanced technologies for biological and chemical agent detection sensor systems.

The committee recommends $197.1 million in PE 63384BP for chemical and biological defense, an increase of $10.0 million for the chemical and biological advanced technology development initiative and a decrease of $20.0 million for the Transformational Medical Technology Initiative.

Applied research

The budget request contained $280.4 million in PE 62384BP for chemical and biological warfare defense applied research.

The committee recommends that the technologies to be considered for funding under the chemical and biological applied research initiative, would include, but would not be limited to the following:

(1) Novel vaccine/therapeutic delivery means, particularly for recombinant protein vaccines;

(2) Multipurpose biodefense immunoarrays and diagnostic tools;

(3) Self-decontaminating polymer-based coatings for fabrics and other substrates; and

(4) Novel prophylaxis/therapeutics effective against biological warfare agents.

The committee recommends an increase in PE 62384BP of $20.0 million for the chemical and biological applied research initiative and a decrease of $30.0 million in PE 62384BP for the Transformational Medical Technology Initiative.

Basic research

The budget request contained $99.2 million in PE 61384BP for chemical and biological warfare defense basic research.

The committee recommends that the technologies to be considered for funding under the chemical and biological basic research initiative, would include, but would not be limited to the following:

(1) Mismatch repair technology for the development of human antibodies for prophylactic and therapeutic treatments; and

(2) Superstructural particle evaluation and characterization with targeted reaction analysis of emerging prophylactics for chemical and biological agent protection.

The committee recommends $109.2 million in PE 61384BP for chemical and biological defense, an increase of $10.0 million for the chemical and biological basic research initiative.

Combating terrorism technology support

The budget request contained $65.8 million in PE 63122D8Z for combating terrorism technology support, but included no funds for additional prototypes of technologies for which the Technical Support Working Group (TSWG) and its international partners have previously invested.

The committee recommends TSWG support the development of a limited number of additional prototypes of the following systems for more rapid military utility evaluation: (1) SHIELD, (2) COLD FIRE, (3) Wall Street, and (4) Muzzle Flash Detection System.

The committee recommends an increase of $18.0 million in PE 63122D8Z for cooperative research, development, and prototyping.

Generic logistics research and development technology demonstrations

The budget request contained $23.4 million in PE 63712S for generic logistics research and development technology demonstrations, but included no funds for the expansion of the Connectory program for rapid identification of technology sources for the Department of Defense (DOD), for the emerging critical interconnection technology program, or for vacuum-aided mobility packing technology.

The committee notes that the Department needs access to the best available technologies from all sources, especially small and medium size companies not normally accessed by the defense acquisition process. The committee encourages the Defense Logistics Agency to:

(1) Expand Connectory profiles to include detailed sources for high-priority DOD required products and services;

(2) Collaborate with DOD agencies and other government organizations having databases of technology products in order to test the feasibility of linking the Connectory to these other data sources; and

(3) Explore ways to allow small companies to obtain first-time business with the Department using the Connectory program.

The committee also notes that printed circuit boards are fundamental components of military navigation, guidance and control, electronic warfare, missile, and surveillance and communications equipment. Printed circuit boards for military systems have unique design requirements for high performance, high reliability, and the ability to operate under extreme environmental conditions that require the use of high density, highly rugged, and highly reliable interconnection technology. Moreover, the commercial printed circuit board industry focuses on the design and high-volume production of low-cost boards and the United States has lost much of its printed circuit board manufacturing capability to overseas sources. The committee recognizes the need to enhance the United States' capability for development and production of high density, highly reliable printed circuit boards for use in U.S. military systems.

Finally, the committee understands vacuum-aided mobility packing technology may provide considerable benefits for transporting troop supplies. The committee is aware that such technology may provide significant improvements in weight, space, and handling requirements and may facilitate more efficient utilization of military lift assets.

The committee recommends $34.4 million in PE 63712S for generic logistics research and development technology demonstrations, an increase of $1.0 million for the Connectory program for rapid identification of technology sources for the Department and an increase of $10.0 million for the emerging critical interconnection technology program. The committee also urges the Secretary of Defense to explore vacuum-aided mobility packing technology as a potential cost saving measure.

Improved suborbital operations

The budget request contained $254.9 million in PE 63287E for space programs and technology, but contained no funds for improved suborbital space operations.

The committee believes that the design and development of an unmanned, reusable suborbital launch vehicle to provide a platform for tactical battlefield surveillance, can provide quick reaction, fast turnaround, and frequent regional reconnaissance capabilities.

The committee recommends $259.9 million in PE 63287E, an increase of $5.0 million for improved suborbital space operations.

Joint training transformation

The budget request contained $72.9 million in PE 63757D8Z for joint training transformation, but included no funds for the development of a joint simulation capability for linking campaign analysis to warfighter mission rehearsal. The committee recommends the Department of Defense capitalize on the joint infrastructure and connectivity built into the Joint Warfare System (JWARS) simulation program to expand into complementary mission space areas, by linking in-theater tools to campaign analysis capabilities and database providers in the continental United States.

The committee recommends $76.9 million in PE 63757D8Z for joint training transformation, an increase of $4.0 million for joint simulation for linking campaign analysis to warfighter mission rehearsal.

Office of force transformation

The budget request contained $20.4 million in PE 66799D8Z for the Office of Force Transformation, including unspecified funding for the Project Sheriff initiative, but included no funds for the tactical re-directed energy technology initiative.

The committee notes that the Project Sheriff initiative meets a validated and approved urgent operational need to provide combat commanders with more options for dealing with the chaos of urban operations. Project Sheriff is a combat system that incorporates a unique blend of lethal and non-lethal capabilities that have never before been integrated together into a single vehicle.

The tactical re-directed energy technology initiative intends to quickly develop an experimental prototype that can be rapidly fielded to gain new insights into the use of directed energy at the tactical level. The committee notes that this initiative focuses on targeting those who lay improvised explosive devises (IEDs) rather than the IEDs themselves.

The committee recommends $30.4 million in PE 66799D8Z, an increase of $10.0 million, $5.0 million for the Project Sheriff initiative and $5.0 million for the tactical re-directed energy initiative program.

Special operations advanced technology development

The budget request contained $80.4 million in PE 1160402BB for special operations advanced technology development, but included no funds for special operations modular computing technology, for the surveillance augmentation vehicle-insertable on request (SAVIOR) system, or for Foxhound Arabic software.

The committee understands that U.S. Special Operations Command (USSOCOM) is currently procuring non-ruggedized modular personal computers and that the Naval Postgraduate School's Coalition and Operating Area Surveillance and Targeting System (COASTS) plans to further develop the modular personal computer application to broader configurations. Additional funds would allow the development of a ruggedized version of the modular PC.

The committee understands that the SAVIOR system is a mobile, intelligent sensor suite that can alert ground forces to the presence of a threat with its intensive surveillance network. SAVIOR meets USSOCOM's need for a rapidly configurable, highly mobile sensor and command and control platform.

The committee understands that Foxhound Arabic transliteration and genealogical search software provides USSOCOM with enhanced capability to conduct automated transliteration and link-analysis key to counter-terrorism operations. The software is currently being used at headquarters level and further funding would provide the capability to operator levels.

The committee recommends $92.9 million in PE 1160402BB for special operations advanced technology development, an increase of $5.0 million for special operations modular computing technology, an increase of $3.5 million for development of the SAVIOR system and an increase of $4.0 million for Foxhound Arabic software.

Special operations forces operational enhancements

The budget request contained $99.0 million in PE 1160408BB for special operations forces (SOF) operational enhancements, but included no funds for miniaturized tracking devices. The committee understands that these devices provide SOF the ability to successfully track and monitor high value targets.

The committee recommends $106.0 million in PE 1160408BB for SOF operational enhancements, an increase of $7.0 million for miniaturized tracking devices.

Special operations intelligence systems development

The budget request contained $29.0 million in PE 1160405BB for special operations (SO) intelligence systems development, but included no funds for the U.S. Special Operations Command (USSOCOM) joint meteorological and oceanographic (METOC) program. The joint METOC program provides USSOCOM with deployable sensors to measure weather conditions and other environmental and situational parameters. The joint METOC program would further develop an air-droppable version and would meet requirements for additional measurement capabilities.

The committee recommends $34.0 million in PE 1160405BB for SO intelligence systems development, an increase of $5.0 million for the joint METOC program.

Special operations tactical systems development

The budget request contained $45.3 million in PE 1160404BB for special operations tactical systems development, but contained no funds for the special operations forces (SOF) combat assault rifle (SCAR) or for Dominant Vision, and only $1.4 million for covert wave packet modulation (WPM).

The committee understands that SCAR will replace five different weapons systems currently used by SOF and that low rate initial production will support milestone C final validation for inclusion of SCAR in U.S. Special Operations Command's (USSOCOM) 2008 program objective memorandum.

The committee understands that Dominant Vision enhances USSOCOM's capability to conduct special operations by enhancing aircrew's situational awareness and ability to locate, identify and engage targets. Additional funding would continue development of spectral targeting, integrated defense capability, and ground station capability, and would integrate and test the digital sensor recorder.

The committee understands that covert WPM waveform modules will be embedded into USSOCOM communication, networked threat warning and networked sensor systems that are critical to the safety and covertness of special operations missions. The effort will develop a new joint tactical radio system-compliant covert communication capability with embedded positive threat identification.

The committee recommends $58.3 million in PE 1160404BB for special operations tactical systems development, an increase of $4.1 million for the SOF combat assault rifle, an

increase of $4.5 million for Dominant Vision, and an increase of $4.4 million for covert WPM waveform modules.

Special operations technology development

The budget request contained $12.7 million in PE 1160401BB for special operations technology development, but included no funds for AngelFire and no funds for Global Observer.

The AngelFire program is derived from the full-spectrum active protection close-in layered shield (FCLAS) to protect special operations forces' assets from rocket propelled grenades by using counter munitions. The committee understands that AngelFire will provide increased protection to lightly protected aircraft and vehicles operating in hostile environments.

Global Observer promises to fulfill U.S. Special Operations Command's (USSOCOM) requirements for persistent intelligence, surveillance and reconnaissance. Global Observer will develop a seven day endurance, hydrogen-fueled unmanned aircraft system that will significantly expand USSOCOM's ability to identify, track, and interdict targets, as well as enhance force protection of U.S. forces.

The committee recommends $32.7 million in PE 1160401BB for special operations technology development, an increase of $10.0 million for the AngelFire for FCLAS program, and an increase of $10.0 million for the Global Observer program.

OPERATIONAL TEST AND EVALUATION, DEFENSE

OVERVIEW

The budget request contained $181.5 million for Operational Test and Evaluation, Defense.

The committee recommends $181.5 million, no change to the budget request.

LEGISLATIVE PROVISIONS

SUBTITLE A--AUTHORIZATION OF APPROPRIATIONS

SECTION 201--AUTHORIZATION OF APPROPRIATIONS

This section would establish the amounts authorized to be appropriated for research, development, test, and evaluation for the Department of Defense for fiscal year 2007.

SECTION 202--AMOUNT FOR DEFENSE SCIENCE AND TECHNOLOGY

This section would establish basic, research, applied research, and advanced technology development funding levels for the Department of Defense for fiscal year 2007.

SUBTITLE B--PROGRAM REQUIREMENTS, RESTRICTIONS, AND LIMITATIONS

SECTION 211--ALTERNATE ENGINE FOR JOINT STRIKE FIGHTER

This section would require that the Departments of the Navy and the Air Force obligate not less than $408.0 million of the funds authorized to be appropriated for the system development and demonstration program for the Joint Strike Fighter, for continued development of an alternate engine for the Joint Strike Fighter.

SECTION 212--EXTENSION OF AUTHORITY TO AWARD PRIZES FOR ADVANCED TECHNOLOGY ACHIEVEMENTS

This section would amend section 2374a of title 10, United States Code, to extend the authority of the Director, Defense Advanced Research Projects Agency (DARPA), to award prizes for advanced technology achievements through September 30, 2010. The Director's current prize authority would expire on September 30, 2007.

SECTION 213--EXTENSION OF DEFENSE ACQUISITION CHALLENGE PROGRAM

This section would amend section 2359b of title 10, United States Code, to remove the September 30, 2007, termination clause for the Defense Acquisition Challenge Program. This program, established as a pilot program, has shown its value to provide opportunities for the increased introduction of innovative and cost-saving technology in acquisition programs of the Department of Defense.

This section would also direct the Under Secretary of Defense for Acquisition Technology and Logistics to ensure that the identity of each proposed challenger is not disclosed outside the federal government, without the consent of the challenger.

SECTION 214--FUTURE COMBAT SYSTEMS MILESTONE REVIEW

This section would require the Secretary of Defense to conduct a Future Combat Systems (FCS) milestone review, following the preliminary design review, by September 30, 2008. This section would also require the Secretary to submit a report on the results of the FCS milestone review which will be a go/no-go review of the FCS program that is based on its demonstration of a sound business case to the congressional defense committees not later than February 13, 2009.

SECTION 215--INDEPENDENT COST ANALYSES FOR JOINT STRIKE FIGHTER ENGINE PROGRAM

This section would require the Comptroller General and the Secretary of Defense through the Cost Analysis Improvement Group to conduct independent cost analyses and provide independent reports on alternate engine acquisition strategies for the Joint Strike Fighter (JSF). The reports would include an analysis of an acquisition strategy resulting in the JSF powered with the F135 engine, an acquisition strategy resulting in the JSF powered by either the F135 or the F136 engine through a competitive program, or any other alternative, whether competitive or sole source, that would reduce the total program lifecycle cost, improve program schedule, or both.

SECTION 216--DEDICATED AMOUNTS FOR IMPLEMENTING OR EVALUATING DD(X) AND CVN-21 PROPOSALS UNDER DEFENSE ACQUISITION CHALLENGE PROGRAM

This section would require the Secretary of Defense to provide the Defense Acquisition Challenge Program with an additional $4.0 million to evaluate or implement challenge proposals specifically for the DD(X) next-generation destroyer and the CVN-21 next-generation aircraft carrier programs.

SUBTITLE C--BALLISTIC MISSILE DEFENSE

SECTION 221--FIELDING OF BALLISTIC MISSILE DEFENSE CAPABILITIES

This section would allow funds to be authorized to the Secretary of Defense for research, development, test, and evaluation for the Missile Defense Agency to be used for the development and fielding of ballistic missile defense capabilities.

SECTION 222--LIMITATION ON USE OF FUNDS FOR SPACE BASED INTERCEPTOR

This section would prevent the Department of Defense from obligating funds for the testing or deployment of a space-based interceptor program until 90 days after submitting a report to Congress describing the program and its national security implications.

SUBTITLE D--OTHER MATTERS

SECTION 231--REVIEW OF TEST AND EVALUATION POLICIES AND PRACTICES TO ADDRESS EMERGING ACQUISITION APPROACHES

This section would amend section 239(b)(2) of title 10, United States Code, to require the Director, Operational Test and Evaluation (DOT&E) to state whether the results of operational test and evaluation of major defense acquisition programs confirm that the items tested are operationally acceptable under limited conditions. Under current law, DOT&E prepares a report at the conclusion of operational test and evaluation, stating: (1) whether the test and evaluation performed were adequate, and (2) whether the results of such test and evaluation confirm that the items tested are effective and suitable for combat.

The committee is aware that in the Director's report, DOT&E evaluates a system as not operationally effective or suitable for combat if the system does not fully meet the Capabilities Development Document (CDD), or similar description of the user's standards for effectiveness and suitability as reflected in the requirements process. DOT&E has also informally included assessments of military utility for mission environments which are less than those set forth in the system's requirements. This section would formalize this valuable analysis by DOT&E to enable reasoned decision making by the combatant commanders and acquisition program managers regarding the fielding of systems which meet some, but not all, of the systems' requirements.

This section would also require the Under Secretary of Defense for Acquisition, Technology, and Logistics (USD(AT&L)), in coordination with DOT&E and the Director of the Defense Test Resource Management Center (DTRMC) to review Department of Defense test and evaluation (T&E) policies and practices and issue new or revised guidance, as necessary, to ensure test and evaluation practices keep pace with emerging acquisition approaches.

The committee is aware that T&E policies and practices have been impacted by both the spiral development authorities and the rapid acquisition authorities of sections 803 and 806, respectively, of the Bob Stump National Defense Authorization Act for Fiscal Year 2003 (Public Law 107-314). T&E policies and practices could potentially be further impacted by other emerging acquisition approaches. For example, should USD(AT&L) accept the

recommendations of the `Defense Acquisition Performance Assessment' (DAPA) report issued in January 2006, T&E policies and practices could be affected by the implementation of time-certain development programs. The DAPA report defines time-certain development programs as development programs which are assigned, `. . . a specific length of time in which milestone events will be accomplished by contract.' The committee wishes to ensure that T&E policies and practices neither impede the intended flexibilities of these authorities nor fail to provide an independent assessment of system capabilities. Lastly, the committee believes T&E policies and practices should be reviewed to ensure the Department is properly testing and evaluating materiel, such as outer tactical vests, that do not fall within the purview of DOT&E, because they do not meet the acquisition thresholds set forth in sections 2366 and 2399 of title 10, United States Code, but which do require limited operational test and evaluation to ensure the safety and survivability of the materiel and the personnel using the materiel.

This section would also require the Director of DTRMC to ensure that any revisions to T&E policies and practices are reflected in a description of and in the budgeting for the testing needs of the Department. Finally, this section would require USD (AT&L) to report to the congressional defense committees within nine months after the enactment of the this Act on the review conducted and on any new or revised guidance issued.

TITLE III--OPERATION AND MAINTENANCE

OVERVIEW

The budget request contained approximately $154.8 billion in operation and maintenance funds to ensure the U.S. military can meet the demands identified by each combatant commander. These funds will be used to train U.S. forces, purchase equipment and spare parts, repair older equipment, and transport equipment and personnel around the world. The budget request represents an increase of $7.4 billion over spending levels authorized and appropriated for fiscal year 2006. The challenge for the Department of Defense is that most of the $7.4 billion covers civilian pay raises and general inflation ($4.0 billion) and price growth due to rising fuel costs ($3.0 billion). The committee is concerned that the total budget increase does not accurately reflect the impact of inflation and increased fuel prices.

The committee is concerned about the state of military readiness, as the global war on terrorism (GWOT) enters its fifth year. The committee notes that the increased budget request actually funds fewer operation and maintenance related activities critical to ensuring the armed forces' ability to fight and win our nation's wars. As the Department faces rising health care costs, fuel costs and inflation, budget challenges are found in the operation and maintenance accounts. Currently, all the services are funded below the levels required to conduct the minimal training necessary to maintain military readiness. For example, the shortfalls in fiscal year 2007 budget are as follows:

(1) Navy funds only 36 steaming days a quarter versus the required 51 steaming days per quarter;

(2) Navy increases deferred maintenance from $54.0 million in fiscal year 2005 to $240.0 million in fiscal year 2007;

(3) Army funds 615 tank miles a year versus the combined arms training strategy requirement of 899 miles;

(4) Army funds 11.6 helicopter flying hours per month versus 14.5 helicopter flying hours per month;

(5) Marine Corps funds 88 percent of the combat ready days--equipment and training requirement; and

(6) Air Force funds 98 percent of the flying hour training requirement while mission capable rates are scheduled to fall to 75 percent for the first time since 1998.

In the fiscal year 2006 Future Years Defense Program (FYDP), the services anticipated receiving $154.7 billion for operation and maintenance programs in fiscal year 2007. Instead, this year's budget request is $154.8 billion, a decrease of $0.1 billion. Combined with the $4.0 billion in price growth due to inflation and the $3.0 billion in price growth due to rising fuel costs, the budget request reduces critical training and maintenance programs by close to $7.0 billion. The committee is concerned by this overall decrease in the dollars available to conduct training and maintenance activities and its long-term impact on military readiness.

In addition, the committee notes an increasing propensity by the Department to fund activities, or portions of activities, formerly found in the procurement and military construction accounts with operation and maintenance dollars. In particular, the military services are increasing their use of service contracts for military flight simulator training and initial flight screening and classifying this training as a `commercial' service. These contracts include facility site surveys, construction of training facilities and leasing of training equipment. The committee is concerned about the consequences of poor performance on any of these service contracts and the potential gap in vital military training if these contracts are terminated, leaving the department with no organic capacity to conduct the training.

For the last three years, the committee has closely examined the ability of the secretaries of the military departments to reset and reconstitute military equipment that has returned from deployment. The committee is concerned that the high rate of equipment damage and battle loss, coupled with continuing equipment requirements in theater and at home station, present the services with a growing problem. To address this critical challenge, the service secretaries must develop sound strategies to fulfill their reset requirements. The committee believes that, despite other service initiatives such as transformation and modernization, equipment reset must be among the services' highest priorities. This requires not only a commitment to adequately fund, but also carefully considered policies in areas that support equipment reset, such as industrial facility utilization and the procurement of next generation weapons systems. The service secretaries must also base these well reasoned strategies on full and accurate information. The committee is concerned that, in some cases, a lack of information prevents the services from accurately programming for equipment reset. For example, the Department has not yet made a decision on what will be done with the equipment currently in Iraq. The committee urges the service secretaries to adequately provide for the equipment needs of the reserve component, and in the case of the Army, to identify and segregate the requirements and funding associated with equipment reset and the service's transformation to modularity.

Finally, the committee recognizes the contribution and performance of the public depots and arsenals. The GWOT requirement on these industrial facilities continues and the committee commends them for their ongoing role in ensuring our national security.

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ITEMS OF SPECIAL INTEREST

BUDGET REQUEST ADJUSTMENTS--READINESS

The committee recommends the following adjustments to the fiscal year 2007 amended budget request:

[in millions of dollars]
Department of the Army Adjustments:
BA 1 Army Management Headquarters Activities	(19.1)
BA 1 Combat Development Core	(47.7)
BA 1 M-Gator	+1.0
BA 1 Restoration of Training Requirement	+82.1
BA 1 Standing Joint Forces Headquarters	(5.0)
BA 1 Unfunded Requirements in Depot Maintenance	+101.0
BA 2 Logistics Modernization Program	(2.3)
BA 2 Restoration of Prepositioned Stocks	+105.8
BA 3 Live Training Instrumentation for Air and Missile Defense Units	+4.0
BA 3 Leadership for Leaders Command and General Staff College	+1.0
BA 3 Spirit of America JROTC Youth Conference	+0.4
BA 4 Army Operations Center Headquarters	(50.0)
BA 4 Army Knowledge Online Disaster Recovery	+3.5
BA 4 Combat Readiness Center	(16.2)
BA 4 Continue Holocaust Education Exhibits	+0.5
BA 4 Future Business Systems	(4.9)
BA 4 Logistics Modernization Program	(4.6)
BA 4 Other Contracts--Excessive Growth	(31.1)
Undistributed Operational Unobligated Balances Estimate	(100.0)
BA 1 National Guard Advanced Solar Covers	+1.0
BA 1 National Guard Army National Guard Battery Modernization Program	+6.0
BA 1 National Guard Extended Cold Weather Clothing System	+1.0
BA 1 National Guard Homeland Defense Operational Planning System	+10.0
BA 1 National Guard Nationwide Dedicated Fiber Optic Network	+2.5
BA 1 Weapons of Mass Destruction Civil Support Teams	+9.5
BA 4 National Guard Citizen Soldier Support Program	+0.9
Undistributed National Guard restore Funding to Support 350K End Strength	+220.0
BA 4 Reserve Citizen Soldier Program	+0.9
Department of the Navy Adjustments:
BA 1 Damage Control Inventory Management and Stowage System	+3.0
BA 1 Man Overboard Safety System Installation	+3.0
BA 1 METBENCH Automated Calibration System	+3.7
BA 1 Navy Enterprise Resource Planning	(10.0)
BA 1 Restore Ship Deferred Maintenance	+145.0
BA 1 Restore Steaming Day Reduction	+121.0
BA 1 Shipyard Rate Savings--Mission Funding Conversion	(262.0)
BA 1 Unfunded Aviation Requirements	+75.0
BA 2 U.S. Navy Ship Disposal Program	+8.0
BA 3 Continued Education for Childcare Providers	+1.0
BA 3 Naval Sea Cadet Corps	+0.3
BA 3 Navy National Guard RINGGOLD Linguists	+0.4
BA 4 Flash Detection System	+4.0
BA 4 FYDP Improvement Project	(9.6)
BA 4 Navy/Marine Corps Intranet	(70.0)
BA 4 NAV 2030 Vision Principals	(2.0)
BA 4 Other Contracts--Excessive Growth	(15.0)
BA 4 PR-07/POM-08 Planning and Analysis	(3.0)
BA 4 Special Project Aircraft	+3.0
BA 4 Trident	+3.0
BA 4 Unjustified Growth for HQ Staff	(8.9)
Undistributed Navy Civilian Personnel Overstatement	(96.8)
Undistributed Operational Unobligated Balances Estimate	(135.0)
United States Marine Corps Adjustments:
BA 1 Cold Weather High Performance Layering System	+2.0
BA 1 EMI Hardened Fluorescent Stringable Tent Lighting System	+7.0
BA 1 Marine Air Traffic Control and Landing System	+9.0
BA 1 Maritime Prepositioning Reconstitution	+9.9
BA 1 Redesignation / Establishment of Unnecessary Command Structures	(5.9)
BA 1 Unfunded Requirements in Depot Maintenance	+40.1
BA 3 Formal School Support	+8.6
BA 3 Recruit Training Support	+2.4
BA 3 Training Support Requirements	+25.0
Undistributed Operational Unobligated Balances	(3.0)
Department of the Air Force Adjustments:
BA 1 B-52 Attrition Reserve	+49.8
BA 1 Counter Space Operations	(10.0)
BA 1 MBU-20/P Oxygen Mask with Lights	+2.0
BA 1 Nevada Test and Training Range / Utah Test and Training Range	+8.0
BA 1 Unjustified Transformational Efficiencies	+70.0
BA 3 Euro NATO Jet Pilot Training	(10.0)
BA 3 Initial Flight Screening	(5.0)
BA 3 National Space Center Study	+2.0
BA 4 Administration--General Reduction	(10.0)
BA 4 Air Force Manufacturing Technical Assistance Production	+4.0
BA 4 Unjustified Growth	(115.0)
Undistributed Executive General Schedule	(180.0)
Undistributed Other Contracts--Excessive Growth	(50.0)
Undistributed Ranch Hand Data	+0.9
Defense-Wide Activities Adjustments:
BA 1 JCS--Excessive Growth	(10.0)
BA 4 Capital Security Cost Share	(33.0)
BA 4 Commercial Technologies for Maintenance Activities (CMTA)	+15.0
BA 4 Kids Voting Pilot Program	+0.2
BA 4 Meals Ready to Eat Reserve	+5.0
BA 4 Port of Corpus Christi Seaport Infrastructure	+5.0
BA 4 Procurement Technical Assistance Program	+6.8
BA 4 Readiness and Environmental Protection Initiative (REPI)	+30.0
BA 4 Starbase	+1.0
BA 4 WHS Excessive Growth	(14.0)
Undistributed Cold War Medal	+2.0
Undistributed DOD Supplementary Impact Aid	+50.0
Undistributed DOD Supplementary Impact Aid--Force Structure/Relocation	+15.0
Undistributed Operational Unobligated Balances Estimate	(272.1)
Undistributed Ranch Hand Data	+0.2

ARMY KNOWLEDGE ONLINE DISASTER RECOVERY

The budget request contained $70.8 million for the Army Knowledge Management program.

The Knowledge Management program is an enterprise wide program that will transform the Army into a network-centric, knowledge-based force. An essential part of this effort is the Army Knowledge Online (AKO) Disaster Recovery initiative, which serves as the communications center for AKO Disaster Recovery operations throughout the Army.

Accordingly, the committee recommends $74.3 million for the Knowledge Management program, an increase of $3.5 million in operation and maintenance for the Army to upgrade the AKO Disaster Recovery operation.

CAPITAL SECURITY COST SHARE

The budget request contained $126.7 million for capital security cost share.

The committee notes that a November 2004 Government Accountability Office report estimated the cost share for the Department of Defense (DOD) for fiscal year 2007 to be $93.1 million. Furthermore, the committee is concerned that the Secretary of Defense has no accounting of defense personnel stationed in overseas diplomatic facilities and therefore can not reconcile the cost share levied by the Secretary of State. Accordingly, this Act contains a provision (Section 344) that would require the Secretary of Defense to perform an annual accounting of DOD overseas staffing requirements.

Therefore, the committee recommends $93.7 million for the Capital Security Cost Share program, a decrease of $33.0 million.

COMBAT ENHANCEMENT FORCES AND COMBAT COMMUNICATIONS

The budget request contained $603.7 million for Air Force combat enhancement forces and $1.6 billion for combat communications.

The committee notes that most of these critical forces have been operating above maximum surge levels since the beginning of the global war on terrorism and reports continue to reflect a declining trend in the readiness of these forces. The committee strongly believes that special operations forces and weather teams, combat rescue forces, combat control teams, manned reconnaissance platforms, and electronic warfare capabilities are critical defense assets and this decline in readiness must be addressed.

The committee recommends an increase of $40.0 million for combat enhancement forces and an increase of $30.0 million for combat communications.

HOMELAND DEFENSE OPERATIONAL PLANNING SYSTEM

The budget request contained no funds for operation and maintenance of the California Army National Guard's homeland defense operational planning system (HOPS).

The committee understands HOPS received initial funding in fiscal year 2004 and continued collaboration with Lawrence Livermore National Laboratory will further develop the operational capability of HOPS, which provides highly detailed situational awareness that

enhances the California Army National Guard's ability to prepare for, and respond to, weapons of mass destruction attacks and to defend facilities critical to the U.S. infrastructure.

The committee recommends an increase of $10.0 million for HOPS.

MARITIME PREPOSITIONING SHIP LEASE BUYOUT

The budget request contained $35.1 million in the National Defense Sealift Fund to exercise the purchase options on 1 of the 10 remaining maritime prepositioning ships on long- term lease.

The committee is aware of the continuing need for these ships beyond the original 25-year-term and the lifecycle cost savings garnered by exercising the purchase options. The committee recommends exercising the purchase option on all of the 10 remaining maritime prepositioning ships, as soon as possible.

The committee recommends $101.9 million in the National Defense Sealift Fund to exercise the purchase option on 2 of the 10 remaining maritime prepositioning ships on long-term lease, an increase of $66.8 million.

NATIONWIDE DEDICATED FIBER OPTIC NETWORK

The budget request contained no funding for the Nationwide Dedicated Fiber Optic Network (NDFON).

NDFON will provide a dedicated, high speed, high bandwidth fiber optic network backbone to support national guard operations. The committee continues to urge the Department of Defense to complete this network, which showed its value in the national guard's response to Hurricane Katrina. When no cell phones were working on the storm ravaged Gulf Coast, the NDFON backbone provided critical, reliable communications capability.

Accordingly, the committee recommends an increase of $2.5 million in operation and maintenance for the Army National Guard to complete the NDFON nationwide engineering design package.

NAVY MARINE CORPS INTRANET

The committee supports the Navy Marine Corps Intranet (NMCI) and commends the Secretary of the Navy for resolving the long standing contract dispute on the NMCI contract. The committee remains concerned, however, about the cost of the contract and the enduring nature of legacy programs that a now mature NMCI was designed to replace. For that reason, the committee cannot support the increased funding contained in the budget request.

Accordingly, the committee recommends $240.5 million in servicewide communications for NMCI, a decrease of $70.0 million.

PORT OF CORPUS CHRISTI

The committee directs the Director of the Department of Defense Office of Economic Adjustment to provide $5.0 million to the Port of Corpus Christi for military seaport infrastructure upgrades.

READINESS AND ENVIRONMENTAL PROTECTION INITIATIVE

The budget request contained $20.0 million for the Readiness and Environmental Protection Initiative (REPI).

The committee expects the secretaries of the military departments to use the authority and funding available through the REPI program to enter into agreements with willing entities to prevent or limit the use of property in the vicinity of a military installation that would impede the mission of that military installation. The committee is pleased by the recent successes of the REPI program at installations such as Fort Carson, and expects the Secretary of the Army to continue to adequately fund the REPI efforts at Fort Carson, which the Army identifies as its highest priority site. The committee also encourages the other services to explore the utilization of this authority at installations such as Whiteman Air Force Base, McChord Air Force Base, Fairchild Air Force Base, and Naval Air Station Whidby.

The committee recommends $50.0 million for the Readiness and Environmental Protection Initiative, an increase of $30.0 million.

WEAPONS OF MASS DESTRUCTION CIVIL SUPPORT TEAMS

The budget request contained no funding for additional Weapons of Mass Destruction Civil Support Teams (WMD-CST).

The committee recognizes the value of the Army National Guard's WMD-CST in rapid support of civilian first responders in the event of a chemical, biological, or radiological incident. Now that each state's national guard has a WMD-CST, the committee believes that states possessing obvious targets should be identified for a second team. In that regard, the committee is pleased to note that California has a second team, and believes that New York should have a second team as well.

Accordingly, the committee recommends an additional $9.5 million for the Army National Guard to establish a second WMD-CST in New York.

ENVIRONMENTAL ISSUES

FUEL TANK REPLACEMENT AT POINT LOMA, CALIFORNIA

The committee is concerned about the fuel tank leakage at the Defense Energy Support Center (DESC) Fuel Storage Point (DFSP) at Naval Base Point Loma, California. Data from recent monitoring of the ground soil indicate that the leakage is more extensive than originally estimated. In addition to ongoing mitigation efforts, the committee is aware that the DESC has a military construction project in the fiscal year 2008 Future Years Defense Program that would replace all existing bulk storage infrastructure with modern, Department of Defense-standard storage tanks and support equipment. The committee notes that the DFSP is part of the strategic reserve, and its capabilities and readiness are matters of national security. The committee expects the Navy and the DESC to expedite to the furthest extent practicable their clean up actions, and to continue an ongoing dialogue about data, findings, and status with the congressional defense committees and the local community.

NON-THERMAL TREATMENT OF ASBESTOS AND ASBESTOS CONTAINING MATERIAL

The committee is concerned about the long-term effects of the disposal of asbestos and asbestos containing material (ACM). The committee recognizes the benefits of transforming asbestos and ACM into a non-hazardous material and notes the problems associated with thermal treatment of hazardous waste. The committee is aware that the Department of Defense (DOD) is currently testing the application of non-thermal treatment processes. The committee encourages the Department to continue its exploration of non-thermal asbestos technology and to consider its use when treating asbestos or ACM at DOD installations.

REPORT ON URANIUM LOCATED IN GORE, OKLAHOMA

The committee acknowledges that since completion of work in 1993, 1.5 million pounds (approximately 1,200 barrels) of U.S. Government-provided uranium is being stored at the former Sequoyah Fuels Corporation site located in Gore, Oklahoma. This site was used to convert DU6 to DU4 for use by the Army in anti-tank ammunition. The storage of this uranium at the Gore, Oklahoma, site may impede the efforts to decontaminate and decommission the facility.

Therefore, the committee directs the Secretary of Defense to work in conjunction with the Secretary of Energy to submit a report to the Senate Committee on Armed Services and the House Committee on Armed Services no later than six months after the enactment of this Act that would identify whether a remediation plan is necessary regarding the uranium located in Gore, Oklahoma, and, if so, the plans for remediation.

SITE ASSESSMENT OF FORMER WORLD WAR II ORDNANCE MANUFACTURING FACILITY, ROSEMOUNT, MINNESOTA

The committee is aware that the United States Army Corps of Engineers recently completed a preliminary assessment of property in Rosemount, Minnesota. The property, once the site of an ordnance manufacturing facility (Gopher Ordnance Works), is now owned by the University of Minnesota. The committee notes that one potential next action in this environmental cleanup process is for the U.S. Army Corps of Engineers to conduct a site inspection of the property. The committee is interested in the expeditious resolution of this matter, and therefore requests the Secretary of the Army to initiate the next action in the process. Furthermore, the committee expects the Secretary to continue an ongoing dialogue about data, findings, and status with the congressional defense committees and the local community.

INFORMATION TECHNOLOGY ISSUES

INFORMATION TECHNOLOGY OVERVIEW

The committee remains deeply concerned with information technology (IT) development, procurement, and management across the Department of Defense (DOD). The committee recognizes the challenges of building a fully integrated, secure, reliable system for a world-wide deployable military force. The committee also recognizes that the challenge is complicated by conflicting user requirements and a decentralized procurement system. In many ways, the Department's IT difficulties are a subset of DOD's larger acquisition challenges. Notwithstanding the difficulties, the committee believes that too many of the Department's IT programs are poorly managed and would benefit from increased scrutiny and a new way of doing business.

The committee supports the Department's broad goal of net centric operations, but is troubled by the procurement history of the Global Information Grid, the backbone of net centric operations. The committee notes the findings of the Government Accountability Office report `DOD Management Approach and Processes Not Well-Suited to Support Development of Global Information Grid,' dated January 30, 2006. This report clearly describes the great risk of attempting to build an enterprise-wide system for which no one entity is in charge and for which no one can enforce operational or investment decisions.

For these reasons, the committee believes a prudent pause in selected IT programs is in order to allow the broader development of the Global Information Grid to progress. In that way, spending on these systems of the future can be more precisely directed to the reality of a more mature GIG backbone, resulting in greater efficiency and more rapid deployment of new systems. To that end, the committee has recommended funding reductions elsewhere in this report in several programs.

Similarly, the committee has recommended legislation that would require new business systems to come swiftly to fruition or lose funding. The committee believes that this change, along with other, broader acquisition initiatives recommended by the committee, will begin to realize greater efficiencies in DOD information technology programs. The committee believes that information technology is one of the critical elements that make our military forces as lethal as they are--but for almost $31 billion, we must do better.

BUSINESS TRANSFORMATION AGENCY AND ENTERPRISE RISK ASSESSMENT MODEL

The committee is heartened by the Deputy Secretary of Defense's decision to create the Business Transformation Agency (BTA), and will monitor its activities closely to ensure it adds value to the management of enterprise-wide business programs. Far too often, information technology (IT) programs are created with great promise, only to fall victim to the impossible goal of perfection. The result: expensive new programs drag on for years, not realizing their potential, while the legacy systems they were designed to replace continue to consume operation and maintenance dollars.

To that end, the committee also supports the recently announced Enterprise Risk Assessment Model (ERAM), which promises to speed the delivery of DOD wide business systems and provide streamlined execution of programs. The committee applauds these initiatives and urges the Secretary of Defense to support these new enterprises.

READINESS ISSUES

AIR FORCE TRANSFORMATION

The committee is aware that the Air Force has initiated a transformation plan in an effort to modernize and recapitalize the force structure by focusing on three major areas: streamlining the organizational structure, incorporating process efficiencies, and continuing force structure reductions to become a more lethal, agile, and balanced total force. Although not clearly justified, the fiscal year 2007 operation and maintenance budget request reflects a $945.0 million reduction due to efficiencies that the Air Force anticipates reaping through transformation. The committee is aware of declining trends in readiness, and is concerned that these trends will continue to decline as a result of this swift move to organizational change.

Therefore, the committee directs the Secretary of the Air Force to submit a report to the Senate Committee on Armed Services and the House Committee on Armed Services by April 1, 2007, describing transformational initiatives, evaluating the impact of these changes on unit-level readiness, detailing force structure realignments and reductions, and accounting actual cost savings accrued through the transformational initiatives.

ARMY LOGISTICS MODERNIZATION

The committee is encouraged by the Army's efforts to transform its logistics processes and is interested in the potential of the Logistics Modernization Program (LMP) to streamline logistics and improve financial management. However, a June 2005 report by the Government Accountability Office (GAO), Army Depot Maintenance: Ineffective Oversight of Depot Maintenance Operations and Systems Implementation Efforts, describes the problems associated with the implementation of LMP at Tobyhanna Army Depot. The committee is concerned with these findings and directs the Secretary of the Army to submit a report to the House Committee on Armed Services and the Senate Committee on Armed Services by December 31, 2006, on the status of the LMP deficiencies outlined in GAO's report.

BASE OPERATING SUPPORT AND FACILITIES RECAPITALIZATION BUDGET SHORTFALLS

In the committee report (H. Rept. 109-89) accompanying the National Defense Authorization Act for Fiscal Year 2006, the committee expressed concern that shortfalls in base operating support (BOS) budgets at U.S. military installations were causing the services to consider a decrease in basic services such as child care, dining hall operations, and facilities management activities. As such, the committee urged the Department of Defense (DOD) to fully fund and execute BOS sustainment, and facilities recapitalization accounts.

Despite this level of congressional interest in and commitment to BOS and facilities recapitalization accounts, the fiscal year 2007 budget request once again contains severe shortfalls in these areas. For instance, Army BOS budgets are underfunded by at least $1.9 billion, Army National Guard and Reserve BOS budgets are underfunded by more than $360.0 million, and Air Force BOS budgets are underfunded by more than $250.0 million.

In general, BOS requirements are `must pay' bills, failure to fully fund these accounts will result in a decrease in base services, such as shortened hours at dining facilities, elimination of recreational activities, or increased fees for morale, welfare, and recreation activities. While DOD leaders have expressed their intent to transfer funds into these accounts during the fiscal year, this approach is a haphazard manner of managing budget accounts that are significant both in size and impact on personnel.

In addition to the Department's general failure to support BOS requirements, analysis of facilities restoration, and modernization budgets indicates that the services have essentially ceased to fund these accounts.

The services have justified their actions, in part, by citing DOD models for facilities sustainment and recapitalization which show facilities `recap rates' that are below DOD targets. Unfortunately, these indicators were skewed by the impact of base closure activities and funding to rebuild after natural disasters. Nevertheless, these results, which effectively overstate the level of funding provided to the general inventory of facilities, have been used to justify severe decreases in restoration and modernization accounts. The committee is greatly concerned with this misapplication of facilities management model results.

After decades of failing to fund facilities construction, sustainment, restoration, and modernization budgets, the Department's recent efforts to ensure that its facilities are properly maintained over their lifecycles is `one step forward'. Unfortunately, budget requests that virtually eliminate facilities restoration and modernization funding, such as the fiscal year 2007 request, represent `two steps backward'.

This `pause' in restoration and modernization budgets will be difficult to reverse in the current budget environment, likely resulting in an entire generation of facilities passing through mid-lifecycle periods without renovations required to maintain the ability to support military requirements.

The committee urges the service secretaries to increase funding for facilities restoration and modernization in future budget requests. Supporting such requirements is critical to extending the useful lifecycle of DOD facilities while maintaining quality work and living environments.

In general, the committee is greatly concerned by the direction of the Department's requests for installation operation and management budgets. If the Department continues to fail to fund these accounts, there will be substantial negative impacts on both military readiness and quality of life. As such, the committee urges DOD leadership to renew its commitment to installations management budgets by fully funding BOS sustainment, restoration, and modernization accounts in current and future fiscal years.

BERYLLIUM SUPPLY INDUSTRIAL BASE

The Department of Defense (DOD) issued a report in May 2004, at the direction of Congress, concluding that the strategic and critical metal, beryllium, plays a key role in systems that support the transformational armed services. This report also noted that the domestic supply of beryllium is in danger of being depleted because the only domestic supplier has closed its primary metal production facility.

A total of $10.8 million was appropriated by congress during the past two years, through the Defense Production Act purchases for the design and construction of a new beryllium production plant. In order to complete the timely construction of the plant, the committee supports the $7.5 million in the President's request for the Beryllium Supply Industrial Base Project.

DEPOT MAINTENANCE STRATEGY AND IMPLEMENTATION PLANS

The committee notes that in fiscal year 2005 the Air Force's three air logistics centers exceeded scheduled aircraft production, reduced costs, achieved the highest ever on-time delivery record, and improved overall quality of work. The committee believes that the implementation of the 2002 Air Force Depot Maintenance Master Strategy was a driving factor in this transformational success and commends the Air Force for these achievements.

Furthermore, the committee notes that despite the direction in the committee report (H. Rept. 108-106) accompanying the National Defense Authorization Act for Fiscal Year 2004, the Secretary of Defense has not developed a comprehensive, results-oriented management plan to guide future service depot maintenance and has not provided a framework that assures the long-term viability of the depot system. The committee believes that it is essential that the Secretary build upon past strategic planning efforts, including the recent successes generated by implementation of the Air Force's Depot Maintenance Master Strategy, to help guide future

service depot maintenance. Therefore, the committee directs the Secretary to develop an overarching depot maintenance strategy for the department and to submit a report on this strategy, by March 1, 2007, to the congressional defense committees. This report, at a minimum, shall include:

(1) An assessment of the extent to which current facilities will continue to be used;

(2) An assessment of the extent to which the appropriate work is being performed in the depots to maintain core capability;

(3) Future planning for core capability and the identification of workloads by depot and commodity group that are currently being performed in the depots;

(4) Current workforce breakdown and a personnel requirements strategy for maintaining the required workforce;

(5) Planned equipment and facility improvements and the associated funding stream, by depot with distinction made for that which is planned as a replacement and that which will provide capability for a new system;

(6) A specification of statutory, regulatory or operational impediments, if any, to achieving a strategy that enables a capital investment in facilities, equipment, processes and personnel of an amount not less than six percent of the actual total revenue; and

(7) A description of the benchmarks established by each depot for capital investment and the relations of the benchmarks to applicable performance methods used in the private sector.

The committee directs the Comptroller General to evaluate this report and provide comment and analysis to the congressional defense committees no later than 90 days after the Secretary of Defense submits the report.

HIGH ALTITUDE AVIATION TRAINING

The committee is aware that a portion of non-hostile losses of Army rotary winged aircraft in Operation Enduring Freedom and Operation Iraqi freedom are related to operations in high elevations and mountainous terrain. The committee believes that high altitude aviation training can reduce the number of the accidents by ensuring that crews are properly trained and current in the procedures for operating in such a challenging environment. Therefore, the committee requests the Secretary of the Army provide a report on high altitude aviation training to the congressional defense committees by December 15, 2006. The report should include:

(1) The current location and type of high altitude training, to include the percentage of pilots who receive such training on an annual basis at each location and the types of aircraft used in such training;

(2) The number and type of helicopters required to provide the high altitude aviation training needed to sustain the war strategies contained in the 2006 Quadrennial Defense Review, assuming that priority for such training is given to commanders, instructor pilots, aviation safety officers, and deploying units; and

(3) A thorough evaluation of the accident rates for deployed Army helicopter pilots who received high altitude training and deployed helicopter pilots who did not receive such training, including the number of accidents related to power management, using high and low estimates and the number of accidents involving combat and non-combat environments.

NATIONAL SPACE STUDIES CENTER STUDY

The committee is well aware of the increasing reliance on space to support both our warfighters and our global economy and believes that it is imperative to have a comprehensive understanding of how dependence on space assets, both military and commercial, can impact U.S. national security and economic security. Therefore, the committee directs the Secretary of Defense, through the National Space Studies Center, to expand ongoing efforts to assess the value of space contributions with emphasis on the United States dependence on space, innovative ideas contributing to ensuring freedom of action in space, and integration of all space forces.

LEGISLATIVE PROVISIONS

SUBTITLE A--AUTHORIZATION OF APPROPRIATIONS

SECTION 301--OPERATION AND MAINTENANCE FUNDING

This section would authorize $129.8 billion in operation and maintenance funding for the military departments and defense-wide activities.

SECTION 302--WORKING CAPITAL FUNDS

This section would authorize $2.6 billion for working capital funds of the Department of Defense and the National Defense Sealift Fund.

SECTION 303--OTHER DEPARTMENT OF DEFENSE PROGRAMS

This section would authorize $22.4 billion for other Department of Defense Programs for (1) the Defense Health Program; (2) Chemical Agents and Munitions Destruction; (3) Drug Interdiction and Counter-Drug Activities, Defense-Wide; and (4) the Defense Inspector General.

SUBTITLE B--ENVIRONMENTAL PROVISIONS

SECTION 311--REVISION OF REQUIREMENT FOR UNEXPLODED ORDNANCE PROGRAM MANAGER

This section would rescind the authority extended to the Secretary of Defense to delegate the unexploded ordnance program manager position to one of the military departments. This section would also add research to the list of duties for this position.

SECTION 312--IDENTIFICATION AND MONITORING OF MILITARY MUNITIONS DISPOSAL SITES IN OCEAN WATERS EXTENDING FROM UNITED STATES COAST TO OUTER BOUNDARY OF OUTER CONTINENTAL SHELF

This section would require the Secretary of Defense to identify, research, monitor, and provide navigational and safety information on conventional and chemical military munitions disposal sites in the ocean waters that extend from the United States coast to the outer boundary of the outer continental shelf. Specifically, it would require the Secretary to review historical records to determine the number and probable locations of disposal sites, the size of these sites, and the types and quantities of military munitions disposed of at these sites. The Secretary shall release periodically to the public and submit annually to Congress the information obtained in this review. This section would also require the Secretary to cooperate with the National Oceanic and Atmospheric Administration to inform those who use the ocean environment of known or potential hazards. Finally, this section would require the Secretary to conduct research on the effects of military munitions, and to monitor certain disposal sites to recognize and track potential contamination.

SECTION 313--REIMBURSEMENT OF ENVIRONMENTAL PROTECTION AGENCY FOR CERTAIN COSTS IN CONNECTION WITH MOSES LAKE WELLFIELD SUPERFUND SITE, MOSES LAKE, WASHINGTON

This section would authorize the Secretary of Defense to transfer not more than $111,114.03 to the Moses Lake Wellfield Superfund Site, 10-6J Special Account, to reimburse the Environmental Protection Agency for costs incurred in overseeing a remedial investigation and feasibility study performed by the Department of the Army.

SECTION 314--FUNDING OF COOPERATIVE AGREEMENTS UNDER ENVIRONMENTAL RESTORATION PROGRAM

This section would amend section 2701(d)(2) of title 10, United States Code, to allow cooperative agreements entered into for environmental restoration at defense facilities to extend beyond the present two-year limitation when the agreements are funded out of either the Department of Defense Base Closure Account 1990 or the Department of Defense Base Closure Account 2005.

SECTION 315--ANALYSIS AND REPORT REGARDING CONTAMINATION AND REMEDIATION RESPONSIBILITY FOR NORWALK DEFENSE FUEL SUPPLY POINT, NORWALK, CALIFORNIA

This section would require the Secretary of the Air Force to report to Congress not later than January 30, 2007, on matters relating to contamination and remediation of property at the Norwalk Defense Fuel Supply Point in Norwalk, California. This section would also prohibit the Secretary from conveying the property by public auction before pursuing a fair market value transfer of the property to the city of Norwalk, submitting the report required, and providing an explanation of why efforts to transfer the property to the city have not been successful.

SUBTITLE C--WORKPLACE AND DEPOT ISSUES

SECTION 321--EXTENSION OF EXCLUSION OF CERTAIN EXPENDITURES FROM PERCENTAGE LIMITATION ON CONTRACTING FOR DEPOT-LEVEL MAINTENANCE

This section would extend for five years the authority to exclude amounts expended for the performance of depot-level maintenance and repair workload by non-federal government personnel at a Center of Industrial and Technical Excellence from the percentage limitation in section 2466(a) of title 10, United States Code, if the personnel performing the work are provided pursuant to a public-private partnership.

SECTION 322--MINIMUM CAPITAL INVESTMENT FOR AIR FORCE DEPOTS

This section would require the Secretary of the Air Force to invest a minimum of six percent of the total revenue of the Air Force depots in the capital investment budget to improve or sustain depot maintenance facilities, equipment, or processes.

SECTION 323--EXTENSION OF TEMPORARY AUTHORITY FOR CONTRACTOR PERFORMANCE OF SECURITY GUARD FUNCTIONS

This section would amend subsection 332(c) of the Bob Stump National Defense Authorization Act for Fiscal Year 2003 (Public Law 107-314) to extend the temporary authority to contract for increased performance of security guard functions. The authority would expire at the end of fiscal year 2008. This section would require the Secretary of Defense to submit a report by February 1, 2007, to the Senate Committee on Armed Services and House Committee on Armed Services detailing progress towards implementing the recommendations of the Government Accountability Office report entitled, `Army's Guard Program Requires Greater Oversight and Reassessment of Acquisition Approach.' The extension of authority granted in this section would not be effective until the report is submitted to the Senate Committee on Armed Services and the House Committee on Armed Services.

SUBTITLE D--REPORTS

SECTION 331--REPORT ON NUCLEAR ATTACK SUBMARINE DEPOT MAINTENANCE

This section would require the Secretary of the Navy to submit a report to the Senate Committee on Armed Services and the House Committee on Armed Services by February 1, 2007, on criteria used when a nuclear attack submarine is sent for maintenance to a facility other than a facility located at the homeport of the submarine.

SECTION 332--REPORT ON NAVY FLEET RESPONSE PLAN

This section would require the Secretary of the Navy to submit a report to the Senate Committee on Armed Services and the House Committee on Armed Services by December 1, 2006, on the Navy Fleet Response Plan. The committee expects the report would include assessments from senior enlisted officers, for example chief engineers and command master chiefs, who served on aircraft carriers, destroyers and cruisers that participated in the Fleet Response Plan regarding the following:

(1) material condition of the ship;

(2) maintenance of the ship;

(3) en-route training;

(4) professional development training available on the ship;

(5) combat skill training;

(6) personnel assignments and manning;

(7) retention of personnel; and

(8) suggestions for improvement.

This section would also require the Comptroller General to submit a review of the Secretary of the Navy report to the Senate Committee on Armed Services and the House Committee on Armed Services that includes a recommendation on the extension of the Fleet Response Plan to expeditionary strike groups by March 15, 2007. Finally, this section would postpone the expansion of the Fleet Response Plan beyond the carrier strike groups until October 1, 2007.

The committee has concerns regarding expansion of the Fleet Response Plan to other ships beyond those in a carrier strike group. The committee notes the Navy has neither fully tested and evaluated the Fleet Response Plan nor formally implemented the required operational, training and personnel directives to manage this program.

SECTION 333--REPORT ON NAVY SURFACE SHIP ROTATIONAL CREW PROGRAMS

This section would require the Secretary of the Navy to submit a report to the Senate Committee on Armed Services and the House Committee on Armed Services by April 1, 2007, on ship rotational crew experiments. This section would also require the Comptroller General to submit an assessment of the Secretary of Navy's report to the Senate Committee on Armed Services and the House Committee on Armed Services by July 15, 2007.

This section would further require the Director of the Congressional Budget Office to submit a report to the Senate Committee on Armed Services and the House Committee on Armed Services that examines long-term benefits and costs of surface ship crew rotational programs by July 15, 2007. Finally, this section would postpone the implementation of any new surface ship rotational crew experiment or program until October 1, 2009.

The committee is concerned about the expansion of the surface ship rotation crew program formally known as Sea Swap to other surface ships. Potential disadvantages of Sea Swap include extensive wear and tear on the deployed ship due to a lengthy period of time at sea, reduced sense of crew ownership of a given ship, reduced opportunities for transit port calls and a negative impact on crew morale and retention.

SECTION 334--REPORT ON ARMY LIVE-FIRE RANGES IN HAWAII

This section would require the Secretary of the Army to submit a report to Congress by March 1, 2007, on the adequacy of live-fire training facilities in the state of Hawaii in relation to current and future training requirements, and plans for modifications or additions to the live-fire training infrastructure in Hawaii.

SECTION 335--COMPTROLLER GENERAL REPORT ON JOINT STANDARDS AND PROTOCOLS FOR ACCESS CONTROL SYSTEMS AT DEPARTMENT OF DEFENSE INSTALLATIONS

This section would require the Comptroller General to submit a report to the Senate Committee Armed Services and the House Committee on Armed Services within one year of enactment of this Act, on joint standards and protocols for access control systems at Department of Defense (DOD) installations. The report would contain an assessment of whether the establishment of joint standards and protocols for access control at DOD installations would improve access control across all installations by providing greater consistency and improved force protection.

SECTION 336--REPORT ON PERSONNEL SECURITY INVESTIGATIONS FOR INDUSTRY AND NATIONAL INDUSTRIAL SECURITY PROGRAM

This section would require the Secretary of Defense to submit, within 90 days of enactment, a report on the future requirements of the Department of Defense with respect to the Personnel Security Investigations for Industry and the National Security Investigations for Industry Security Program of the Defense Security Service. The report would be delivered to the congressional defense committees, the Committee on Homeland Security and Governmental Affairs of the Senate, and the Committee on Government Reform of the House of Representatives.

This report would include an accounting of clearance investigations completed, the number of each type of clearance granted, the unit cost of each clearance granted, the unit cost to the Department of Defense of each security clearance granted, the amount of any fee or surcharge paid by the Office of Personnel Management as a result of conducting a personnel security clearance investigation, a description of the procedures used to estimate future investigations to be performed, and a plan for meeting increased demand of clearances. It would also require subsequent semi-annual reports on future funding requirements, backlog size, and progress toward meeting implemented changes in the investigation process. Lastly, it would require the Government Accountability Office to examine the Department's plan and to conduct an independent assessment after the initial report is submitted by the Department of Defense.

The Committee recommends that the Office of Management and Budget further open and extend its review and reform efforts for the security clearance process to include the appropriate external expert sources such as defense contractors, academic institutions, workforce providers, and research and development organizations to provide intelligence and resources to assist in the development of a new clear human capital management system, as current process does not fully address the needs and impacts of the institutions and organizations outside of the federal government and related agencies.

The committee is disappointed by an announcement that the Defense Security Service has suspended the processing of new clearances and is concerned about the potential impact on national security and the defense industrial base. The committee is concerned by the Defense Security Service's failure to warn Congress of this failure in advance so that the problem might have been averted. The committee remains committed to finding a solution to the problem of clearance investigations as soon as possible.

SUBTITLE E--OTHER MATTERS

SECTION 341--DEPARTMENT OF DEFENSE STRATEGIC POLICY ON PREPOSITIONING OF MATERIEL AND EQUIPMENT

This section would amend chapter 131 of title 10, United States Code, to require the Secretary of Defense to establish a comprehensive approach to Department of Defense (DOD) prepositioning programs. This section would also limit the diversion of materiel and equipment from prepositioned stocks except for the purpose of supporting a contingency operation, or in accordance with a change to the prepositioning policy required under this section. This section would require the Secretary to notify the congressional defense committees before implementing or changing the prepositioning policy. Finally, this section would require the Secretary to establish the prepositioning policy within six months after the enactment of this Act.

The committee recognizes that prepositioned materiel offers significant strategic flexibility, as demonstrated in Operation Iraqi Freedom. The committee is concerned, however, that there is a lack of clear DOD policy to guide the prepositioning programs of the services. Furthermore, the committee notes that the Secretary of Defense has failed to report on DOD prepositioned equipment and materiel as required in section 1046 of the Ronald W. Reagan National Defense Authorization Act of Fiscal Year 2005 (Public Law 108-375).

Additionally, the committee is discouraged by recent decisions regarding Army prepositioned stocks. For example, the Army recently programmed the download of an entire

brigade set from its afloat prepositioned combat capability. Furthermore, the Government Accountability Office (GAO) testified before the Subcommittees on Readiness and Tactical Air and Land Forces on March 30, 2006, that the Army is making plans to reduce its contractor workforce in Charleston, South Carolina, where it performs the maintenance on its afloat stocks. GAO also noted that the Army has a large military construction project well underway at a site in Italy, but the Army's draft prepositioning strategy identifies no significant prepositioning mission in Europe. The committee believes these recent changes to the Army prepositioning program, together with the continued challenge of maintaining the combat capability of the Army prepositioned stocks in Korea and Southwest Asia, contribute to a severe underinvestment in these assets.

SECTION 342--AUTHORITY TO MAKE DEPARTMENT OF DEFENSE HORSES AVAILABLE FOR ADOPTION AT END OF USEFUL WORKING LIFE

This section would amend section 2583 of title 10, United States Code to include horses owned by the Department of Defense. The committee notes that currently private adoption of caisson horses from the 1st Battalion, 3rd United States Infantry Regiment is prohibited. The committee notes the contributions of these animals and their service to the public good.

SECTION 343--SALE AND USE OF PROCEEDS OF RECYCLABLE MUNITIONS MATERIALS

This section would authorize the Secretary of the Army to establish a separate program to sell recyclable munitions materials resulting from the demilitarization of conventional military munitions such as brass, scrap metal, propellants, and explosives. Furthermore, this section would credit the proceeds from the sales to the funds available to the Army for reclamation, recycling, and reuse of conventional military munitions. This process would be consistent with the Solid Waste Disposal Act, commonly referred to as the Resource Conservation and Recovery Act (42 U.S.C. 6901 et seq.) and its implementing regulations.

SECTION 344--CAPITAL SECURITY COST SHARING

This section would require the Secretary of Defense to perform an annual accounting of Department of Defense (DOD) overseas staffing requirements in order to reconcile cost-sharing fees levied by the Secretary of State, in accordance with section 629(e)(1) of the Consolidated Appropriations Act, 2005 (Public Law 108-447).

SECTION 345--PRIORITIZATION OF FUNDS WITHIN NAVY MISSION OPERATIONS, SHIP MAINTENANCE, COMBAT SUPPORT FORCES, AND WEAPONS SYSTEM SUPPORT

This section would require the Secretary of Navy to ensure that 100 percent of the requirements for steaming days per quarter for deployed and non-deployed ship operations and 100 percent of the projected ship and air depot maintenance workload are funded before funds appropriated to the Department of Navy for operation and maintenance may be expended for the Navy Expeditionary Combat Command. This section would also require the Secretary of Navy to submit a report with the annual budget request that certifies these requirements are fully funded.

The committee is aware that the Department of Navy has funded ship and air operations and depot maintenance below the operational requirements. For example, ship operation funding for deployed ships was funded at 71 percent of the requirement. Accordingly, carrier strike groups and expeditionary strike groups will be unable to fully execute missions in their assigned area of responsibility.

Against this backdrop, the committee has learned that the Department of Navy has expanded its role and function to ground and river combat missions. The Navy Expeditionary Combat Command was established on January 13, 2006, in order to expand the Navy's capabilities for participating in the global war on terrorism. The Navy will deploy Riverine Group 1 to patrol the waterways of Baghdad, Iraq in 2007. At the moment, these sailors have no boats, no manuals, and no past mission to draw experience from before they engage in combat operations.

While the committee understands the Department of Navy's desire to expand its role from the sea to the river and land, we have concerns that the traditional role and mission of the Navy is not being adequately funded.

SECTION 346--PRIORITIZATION OF FUNDS WITHIN ARMY RECONSTITUTION AND TRANSFORMATION

This section would require the Secretary of the Army to fully fund in each fiscal year after fiscal year 2007 the reset of equipment used in the global war on terrorism, the fulfillment of equipment requirements for units transforming to modularity, and the reconstitution of prepositioned stocks. This section would require the Secretary to submit a report to the congressional defense committees at the time the budget request is transmitted to Congress. This report would provide information on the funding priorities described in this section and would be required annually until the requirements of these priorities are met. This section would also limit to $2.85 billion the funds to be appropriated in any fiscal year after fiscal year 2007 for the Future Combat Systems (FCS) until the funding priorities described in this section are met in that fiscal year. If the Army does not meet this requirement, this section would require funds that were not expended for FCS to be used for the identified funding priorities.

For the purposes of this section, the requirements of the identified funding priorities shall be based on the following guidelines. The Army has testified, based on equipment combat losses and battle damage, that the amount needed in fiscal year 2006 to repair, recapitalize, and replace equipment used in the global war on terrorism is $13.5 billion. The committee is also aware that a recent cost estimate to payback equipment to the reserve component in accordance with Department of Defense Directive 1225.6 is $4.8 billion. The committee assumes that the current use of equipment in Operation Iraqi Freedom and Operation Enduring Freedom will continue at the same level as experienced in fiscal year 2006. Therefore, the committee calculates that at least $72.3 billion over the fiscal year 2008 Future Years Defense Program would be required to adequately fund equipment reset in both the active and reserve components.

The committee considers the equipment requirements for units transforming to modularity to be those that were described in the Modular Force Initiative report submitted to Congress in March 2006. Additionally, the committee expects the Army to include the procurement of M1A2 Abrams SEP tanks and Bradley Fighting Vehicle A3s in the funding requirements for modularity. The cost estimate for equipment requirements for modularity stated in this section includes this additional requirement.

The committee also considers the requirement for the reconstitution of Army Prepositioned Stocks (APS) to be consistent with the materiel configuration outlined in APS Strategy 2012 or a subsequent strategy created in accordance with section 2229 of title 10, United States Code, a section added to title 10 in another section of this Act.

TITLE IV--MILITARY PERSONNEL AUTHORIZATIONS

OVERVIEW

The committee continues to believe that the manpower levels in the budget request for the active components of the Army and the Marine Corps are too low for the requirements placed on those services by the national security strategy. Beginning with the National Defense Authorization Act for Fiscal Year 2003, as passed by the House of Representatives, the committee has recommended active end strength levels, especially for the Army, greater than those requested. Similarly, the committee's recommendations for fiscal year 2007 increase the active Army end strength by six percent, and the Marine Corps end strength by nearly three percent above the budget request. In recognition of the integral roles and missions performed by the reserve components, the committee commends and supports the decision by the Secretary of the Army and the chief of staff of the Army to request an Army National Guard end strength of 350,000, and recommends an increase of $789.0 million in Army National Guard personnel, operations and maintenance, defense health and procurement accounts to support the Army leadership's request.

LEGISLATIVE PROVISIONS

SUBTITLE A--ACTIVE FORCES

SECTION 401--END STRENGTHS FOR ACTIVE FORCES

This section would authorize the following end strengths for active duty personnel of the armed forces as of September 30, 2007:

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Service   FY 2006 authorized   FY 2007                              Change from                    

                               Request Committee recommendation FY 2007 request FY 2006 authorized 

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

Army                 512,400   482,400                  512,400          30,000                  0 

Navy                 352,700   340,700                  340,700               0            -12,000 

USMC                 179,000   175,000                  180,000           5,000              1,000 

Air Force            357,400   334,200                  334,200               0            -23,200 

DOD                1,401,500 1,332,300                1,367,300          35,000            -34,200 

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The authorizations contained in this section for the Army and Marine Corps exceed by 30,000 and 5,000 respectively the end strengths for those services requested in the budget because the committee does not believe that the budget request provided adequate manning levels for the Army and Marine Corps. Additional funding for these increases is provided in title XV of the bill.

SECTION 402--REVISION IN PERMANENT ACTIVE DUTY END STRENGTH MINIMUM LEVELS

This section would establish new minimum active duty end strengths for the Army, Navy, Marine Corps and Air Force as of September 30, 2007. The committee recommends 504,400 as the minimum active duty end strength for the Army. The minimum strengths of the Navy, Marine Corps and Air Force are identical to the committee recommendations for those services shown in section 401.

SECTION 403--ADDITIONAL AUTHORITY FOR INCREASES OF ARMY AND MARINE CORPS ACTIVE DUTY END STRENGTHS FOR FISCAL YEARS 2008 AND 2009

This section would authorize additional increases of active duty end strength for the Army and for the Marine Corps in fiscal years 2008 and 2009 above the strengths authorized for those services in fiscal year 2007. Over the two-year period, the Army would be authorized to increase active duty end strength up to a total of 532,400, and the Marine Corps would be authorized to increase active duty end strength to 184,000.

SUBTITLE B--RESERVE FORCES

SECTION 411--END STRENGTHS FOR SELECTED RESERVE

This section would authorize the following end strengths for selected reserve personnel, including the end strength for reserves on active duty in support of the reserves, as of September 30, 2007:

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

Service              FY 2006 authorized FY 2007                              Change from                    

                                        Request Committee recommendation FY 2007 request FY 2006 authorized 

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

Army National Guard             350,000 350,000                  350,000               0                  0 

Army Reserve                    205,000 200,000                  200,000               0             -5,000 

Navy Reserve                     73,100  71,300                   71,300               0             -1,800 

Marine Corps Reserve             39,600  39,600                   39,600               0                  0 

Air National Guard              106,800 107,000                  107,000               0                200 

Air Force Reserve                74,000  74,900                   74,900               0                900 

DOD Total                       848,500 842,800                  842,800               0             -5,700 

Coast Guard Reserve              10,000  10,000                   10,000               0                  0 

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The committee notes that subsequent to the receipt of the budget request, which proposed a fiscal year 2007 end strength for the Army National Guard of 332,900, the Secretary of Defense submitted a revised Army National Guard end strength authorization of 350,000 for fiscal year 2007. The committee recommendation supports that higher authorization and provides the required additional funding of $471.0 million in the authorizations of appropriations for military personnel, operations and maintenance and defense health. Title I of this Act also recommends an additional $318.0 million for Army National Guard procurement to support the recommended end strength.

SECTION 412--END STRENGTHS FOR RESERVES ON ACTIVE DUTY IN SUPPORT OF THE RESERVE COMPONENTS

This section would authorize the following end strengths for reserves on active duty in support of the reserves as of September 30, 2007:

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Service              FY 2006authorized FY 2007                              Change from                   

                                       Request Committee recommendation FY 2007 request FY 2006authorized 

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

Army National Guard             27,396  27,441                   28,165             724               769 

Army Reserve                    15,270  15,416                   15,416               0               146 

Naval Reserve                   13,392  12,564                   12,564               0              -828 

Marine Corps Reserve             2,261   2,261                    2,261               0                 0 

Air National Guard              13,123  13,206                   13,291              85               168 

Air Force Reserve                2,290   2,707                    2,707               0               417 

DOD Total                       73,732  73,595                   74,404             809               672 

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The committee's recommendation in section 411 would support the Secretary of Defense's revised request for an end strength higher than what was initially requested for fiscal year 2007 for the Army National Guard. Consistent with that recommendation, the committee also recommends an increase in the end strength of Army National Guard personnel on active duty in support of that component. Furthermore, the committee recommends an increase of 85 Air National Guard personnel to improve the capability of the E-8C Joint Surveillance Target Attack Radar System (Joint STARS) to support the combatant commanders. In title XV of this Act, the committee recommends the funding for this Air National Guard increase.

SECTION 413--END STRENGTHS FOR MILITARY TECHNICIANS (DUAL STATUS)

This section would authorize the following end strengths for military technicians (dual status) as of September 30, 2007:

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Service             FY 2006 authorized (floor) FY 2007                                     Change from                   

                                               Request Committee recommendation (floor) FY 2007request FY 2006authorized 

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

Army National Guard                     25,563  26,050                           27,615          1,565             2,052 

Army Reserve                             7,649   7,912                            7,912              0               263 

Air National Guard                      22,971  23,255                           23,255              0               284 

Air Force Reserve                        9,852  10,124                           10,124              0               272 

DOD Total                               66,035  67,341                           68,906          1,565             2,871 

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The committee's recommendation in section 411 would support the Secretary of Defense's revised request for an end strength higher than what was initially requested for fiscal year 2007 for the Army National Guard. Consistent with that recommendation, the committee also recommends an increase in the end strength of Army National Guard military technicians (dual status). The committee's recommendation would provide for a 4.3 percent growth in the strength of military technicians above the levels authorized in fiscal year 2006.

SECTION 414--FISCAL YEAR 2007 LIMITATION ON NUMBER OF NON-DUAL STATUS TECHNICIANS

This section would establish the maximum end strengths for the reserve components of the Army and Air Force for non-dual status technicians as of September 30, 2007:

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Service             FY 2005 authorized FY 2006                             Change from                   

                                       Request Committee recommendation FY 2006request FY 2005authorized 

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

Army National Guard              1,600   1,600                    1,600              0                 0 

Army Reserve695                    595     595                      595              0              -100 

Air National Guard                 350     350                      350              0                 0 

Air Force Reserve                   90      90                       90              0                 0 

DOD Total                        2,735   2,635                    2,635              0              -100 

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SECTION 415--MAXIMUM NUMBER OF RESERVE PERSONNEL AUTHORIZED TO BE ON ACTIVE DUTY FOR OPERATIONAL SUPPORT

This section would authorize, as required by section 115(b) of title 10, United States Code, the maximum number of reserve component personnel who may be on active duty or full-time national guard duty during fiscal year 2007 to provide operational support. The personnel authorized here do not count against the end strengths authorized by sections 401 or 412.

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Service              FY 2006authorized FY 2007                             Change from                   

                                       Request Committee recommendation FY 2007request FY 2006authorized 

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

Army National Guard             17,000  17,000                   17,000              0                 0 

Army Reserve                    13,000  13,000                   13,000              0                 0 

Naval Reserve                    6,200   6,200                    6,200              0                 0 

Marine Corps Reserve             3,000   3,000                    3,000              0                 0 

Air National Guard              16,000  16,000                   16,000              0                 0 

Air Force Reserve               14,000  14,000                   14,000              0                 0 

DOD Total                       69,200  69,200                   69,200              0                 0 

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SUBTITLE C--AUTHORIZATION OF APPROPRIATIONS

SECTION 421--MILITARY PERSONNEL

This section would authorize $1,098.2 million to be appropriated for military personnel. This authorization of appropriations reflects both reductions and increases to the budget request for military personnel that are itemized below:

Military personnel
	Amount (in thousands of dollars)
H411 ARNG: Restore funding to support 350,000 end strength	189,000
H411 ARNG: Restore TRICARE accrual funding	62,000
H601 Additional 0.5% basic pay raise	300,000
H615 Expanded eligibility of dental officers for special pay	4,000
H623: Incentives for high-demand, low density skills	5,000
H632 Ship second privately owned vehicle to non-foreign overseas areas	30,000
Army: Recruiting and retention bonuses	100,000
Army: Expanded Army early commissioning program (Skelton)	3,500
USAR: Army-wide office basic course funding	39,200
Navy: Deferred PCS (CNO UFR)	100,000
Air Guard: Recruiting and retention bonuses	59,000
Leg. proposal not adopted: Extend basic pay table to 40 years of service	-4,000
Targeted pay raise savings due to 0.5% basic pay increase	-5,000
Unexpended MILPERS balances	-1,839,000

SECTION 422--ARMED FORCES RETIREMENT HOME

This section would authorize $54.8 million to be appropriated for the operation of the Armed Forces Retirement Home during fiscal year 2007.

TITLE V--MILITARY PERSONNEL POLICY

OVERVIEW

The committee's recommendations reflect heavily the views and issues raised by servicemembers to committee Members and staff during oversight visits in the United States, in the combat zones of Southwest Asia, and across the world. Furthermore, the recommendations in this title represent the committee's continuing commitment to support the dedicated, exceptional Americans who serve in the armed forces. The committee recognizes that the active duty, national guard, and reserve members serving today are performing superbly, notwithstanding the many stresses of the global war on terrorism. The committee trusts that the recommendations made here will help to relieve some of that stress and also recognize the significant sacrifices that take place each day in the lives of the men and women who serve in uniform, and in the lives of the families that support them.

A major focus of this title involves not only servicemembers who have been wounded or injured, but also the surviving family members of those who have died or been seriously injured in service. Such focus continues the committee's initiatives enacted in the National Defense Authorization Act for Fiscal Year 2006 (Public Law 109-163) to improve programs that directly affect the injured, the wounded and the survivors. Therefore, the committee recommends the following:

(1) The remains of military personnel who die during combat operations or who die of non-combat related injuries in the theater of combat, would be moved by dedicated aircraft, from Dover Air Force Base, Delaware, to the military airfield nearest to the servicemember's place of interment and would be accompanied by military personnel who would render military honors at the destination airfield.

(2) The military services' physical evaluation board (PEB) process would be reformed to address concerns of military members, particularly reserve component members, about the consistency and timeliness of PEB decisions, the ability of members to gain information about PEB procedures, and the rationale supporting board decisions.

(3) The Secretary of Defense would be authorized to provide computer/electronic assistive technology, devices, and technology services to military personnel who have sustained a severe or debilitating illness or injury while serving in support of a contingency operation and keep those devices after they separate from the military.

The reserve components constitute another major focus of this title. Their roles and responsibilities have changed dramatically since the start of the global war on terrorism and the committee believes it is necessary to adjust existing authorities and create new authorities to better reflect the nation's continuing reliance on the national guard and the reserves. Therefore, the committee recommends:

(1) New authority to enable the mobilization of members of the reserve components to provide assistance in serious natural or manmade disasters.

(2) An extension from 270 days to 365 days the maximum period of mobilization under what is known as the President's Selected Reserve Call-up authority.

(3) New authority that formally authorizes current practices in which full-time national guard and reserve members are performing many additional functions beyond their traditional support to the reserve components. Such additional functions include instructing and training active duty members, Department of Defense civilians and foreign military personnel in the United States.

(4) New authority that would authorize State governors, under title 32, United States Code, to mobilize national guard forces to support operational missions taken at the request of the President or the Secretary of Defense, and to perform training operations and missions assigned by the secretaries of the Army or Air Force.

Finally, in this title, the committee makes recommendations to improve the quality of the service and the quality of life of servicemembers and their families and to recognize that service. Those recommendations include the following:

(1) Supplementary funding, totaling $65.0 million, for local educational agencies that are heavily impacted by the attendance of military dependents or that experience significant increases or decreases in the average daily attendance of military dependent students due to military force structure changes.

(2) Permanent authority for the military services, especially the Army, to reduce from 24 months to 18 months the minimum time-in-grade required for promotion from 1st lieutenant to captain, using an Army example. This authority would assist the military departments in meeting long-term unit and operational requirements.

(3) Improved transition assistance for servicemembers leaving active duty by directing that the Secretary of Defense require attendance at the Department of Labor transition assistance programs of all who had not previously attended.

(4) Authorization of a Cold War Victory Medal that would be issued upon the application of an eligible enlisted member, officer, or warrant officer who served during the Cold War; and the authorization of the award of the Purple Heart to members of the armed forces who died as prisoners of war in captivity, or who died after captivity due to illness or injury sustained while a prisoner of war.

ITEMS OF SPECIAL INTEREST

ACADEMY LANGUAGE TRAINING

The committee notes that the Department of Defense has placed great emphasis on improving the strategic language posture of the United States. The military academies of the United States are implementing new plans to strengthen their current programs. Accordingly, the committee directs the secretaries of the Army, Navy, and Air Force to report on the current state of language programs and the plans for implementing a strategic language development program at the United States Military Academy, the United States Naval Academy, and the United States Air Force Academy. In consultation with the superintendents of each academy, the secretaries should provide data on the number of students participating in language training, the languages in which they are participating, levels of proficiency, and language classes offered. In addition, the superintendents should identify their plans for expanding foreign language programs, provide an update on their current implementation of the language initiatives included in the fiscal year 2007 budget request, and describe the costs required for the programs.

The committee directs the Secretaries to submit their plans for the expansion of language programs and the resource requirements to accomplish them to the Senate Committee on Armed Services and the House Committee on Armed Services 180 days after the date of enactment of this Act.

CLOSURE OF ARTICLE 32 INVESTIGATIONS IN CASES OF SEXUAL ASSAULT OR DOMESTIC VIOLENCE

The committee directs the Secretary of Defense to review the procedures used in pretrial investigations under Article 32 of the Uniform Code of Military Justice. The purpose of the review is to identify additional criteria and factors for inclusion in the Manual for Courts-Martial that would better serve to guide commanders and investigating officers, in cases of sexual assault and domestic violence, in determining when, and to what extent, such Article 32 proceedings should be closed to spectators, the media, and others in order to protect witnesses and victims of crime against inappropriate treatment, intimidation, or embarrassment, or from unwarranted publicity or sensationalism resulting from their role in testifying or providing evidence in the investigation. The review shall be conducted with the particular interests in mind for victims of sexual assault and domestic violence and the unique concerns that may be associated with or accompany their testimony in a public forum, as well as for all other victims and witnesses who may provide less than complete testimony in a public setting due to embarrassment or timidity. In conducting the review, the Secretary should also consider the recommendation made on this matter in the June 2005 `Report of The Defense Task Force on Sexual Harassment & Violence at the Military Service Academies' that Congress should amend Title 10 of the U.S. Code regarding Article 32 to explicitly permit commanders to close the hearings to the public. The Secretary should also consider, in this review, prior precedent regarding the closing of Article 32 proceedings to the public in decisions of the United States Supreme Court, United States Court of Appeals for the Armed Forces, and the Military Departments' Courts of Criminal Appeals. The committee directs the Secretary of Defense to present to the House Committee on Armed Services and the Senate Committee on Armed Services a report on the results of this review and any recommendations for change to the Manual for Courts-Martial no later than April 15, 2007.

DEPARTMENT OF THE NAVY PERSONAL RESPONSIBILITY AND VALUES: EDUCATION AND TRAINING PROGRAM

The Committee is aware that the Navy's Personal Responsibility and Values: Education and Training (PREVENT) program has enjoyed great success in addressing alcohol and drug abuse issues among new recruits and enlisted sailors between the ages of 18-26. The committee is impressed that the Navy is using the PREVENT program to empower junior members to take responsibility for their lives by making positive choices designed to enhance personal and professional effectiveness. Specifically, the committee notes that the program gives sailors the tools they need to avoid, reduce, or eliminate risky, self-destructive behaviors such as alcohol and substance abuse that adversely impact Navy readiness and performance.

Given the positive outcomes this program has achieved in the lives of sailors and its contributions to readiness and mission performance, the committee urges the Secretary of the Navy to increase funding for this program to ensure that additional Navy personnel have the opportunity to participate. Additionally, the committee recommends that the Secretary extend the benefits of participation in the PREVENT program to enlisted personnel in the Marine Corps. Accordingly, the committee directs the Secretary of the Navy to study the feasibility of allocating additional funding to the PREVENT program and extending eligibility to Marine Corps personnel.

The committee directs the Secretary to report his findings and recommendations by March 31, 2007, to the Senate Committee on Armed Services and the House Committee on Armed Services.

EDUCATIONAL OPPORTUNITIES IN INTERAGENCY COORDINATION AT THE MILITARY WAR COLLEGES

The committee believes that improving interagency coordination is vital to U.S. national security, and that the military war colleges should provide educational opportunities in the area of interagency coordination. The committee commends the Department on the steps it has already taken to incorporate the subject of interagency coordination in its professional educational activities but believes that opportunities may exist to increase the interagency component in those educational activities.

Therefore, the committee directs the Secretary of Defense to submit to the Senate Committee on Armed Services and the House Committee on Armed Services, by April 1, 2007, a report on the steps the military war colleges should take to provide educational opportunities in the area of interagency coordination. The report shall address the advisability of creating faculty positions or chairs in each war college to allow faculty representation from the Department of Justice, the Department of State, the Department of Homeland Security, and agencies under the oversight of the Director of National Intelligence. The report shall include estimates of the cost of implementing the findings of the report.

JOINT ADVERTISING, MARKET RESEARCH AND STUDIES

The Joint Advertising, Market Research and Studies (JAMRS) program is the Department of Defense's (DOD) corporate level effort to bolster the effectiveness of the recruiting programs conducted by the military services. Among its principal initiatives is a campaign to build advocacy and support among parents, teachers, and coaches for service to the nation by ensuring that these key influencers of youth have the facts about military service and are able to engage in conversations with youth about serving the nation in the military. The committee has received testimony from a wide range of senior DOD personnel regarding the challenges recruiters face in convincing youth influencers about the value of service to the nation. The committee notes that despite such testimony, the budget request for JAMRS has not increased over the last two years, remaining at $7.0 million. The committee believes that this funding level is insufficient and urges the Secretary of Defense to substantially increase future funding for JAMRS.

OPERATION OF ARMY AIR AMBULANCE DETACHMENTS

The committee understands that the Army will discontinue the operation of the Army air ambulance detachment at Fort Drum, New York, and replace the military capability with a contracted air ambulance service to support only the installation needs. Replacing the military air ambulance capability with a contracted, on-call civilian service could potentially result in reduced aeromedical evacuation capability and responsiveness for on-post emergencies and accidents. Furthermore, the loss of the military air ambulance unit means the end of military support under the Military Assistance to Safety and Traffic (MAST) program. As a result, the region surrounding Fort Drum will face a devastating loss of emergency response capability. Providing at least an equal replacement capability, in a cost-effective manner, will be extremely difficult, because of the relative isolation of the installation and the climatic challenges of the region. Given the potential negative impact on both the installation and the region, the committee directs the Secretary of the Army to continue to provide military air ambulance support to the Fort Drum installation, as well as to support to the region surrounding the installation under the MAST program. To evaluate any future decision regarding the continuation of military air ambulance support at Fort Drum, the committee also directs the Secretary of the Army to provide the committee with the following:

(1) The plan for stationing air ambulance detachments at U.S. military installations and the discreet criteria used to determine that stationing;

(2) A report on the cost-effectiveness and changes in medical response factors at other installations where Army air ambulance detachments have been replaced by contracted capabilities; and

(3) A review of the potential contracting out options at Fort Drum, to include, an analysis of the feasibility of an umbrella contract for aeromedical evacuation that provides not only support to Fort Drum, but also to the region.

PERMANENT IDENTIFICATION CARDS FOR ADULT DISABLED CHILDREN

The committee is concerned by reports that military members with permanently disabled dependent children are required to periodically renew identification cards for their children. This process is especially cumbersome and demanding for elderly parents of adult children who must meet the challenge of the verification process repeatedly over the course of many years. The committee believes that there is an option to develop a procedure to grant permanent identification cards for adult children without significant risk to the integrity of the military identification system. Therefore, the committee directs the Secretary of Defense to study the feasibility of providing discretionary authority to the secretaries concerned to grant permanent military identification cards to adult children of military members when disabilities can be medically validated as permanent and financial support qualification can be assessed as being of indefinite duration.

The committee directs the Secretary to submit a report on his findings and recommendations by March 31, 2007, to the Senate Committee on Armed Services and the House Committee on Armed Services.

PERSONNEL PLAN FOR LINGUISTS

The committee continues to be very concerned about the need to develop a comprehensive plan for better management of both officer and enlisted linguists in the armed forces. The committee believes that current personnel programs fail to provide linguists adequate incentives to achieve their full potential in language and cultural skills and sufficient promotion opportunities within the linguist career path. The committee is particularly concerned that enlisted members are denied promotion opportunities to senior noncommissioned officer grades. The committee believes that the military departments should invest sufficient grade structure in the services' career paths for linguists to allow highly skilled members to compete for promotion within their linguist specialties without feeling that they must either change their specialty to improve their promotion opportunity or remain a linguist and sacrifice their promotion potential. The committee anxiously awaits the Secretary's report on the need for a personnel plan for linguists in the armed forces, required by section 581 of the National Defense Authorization Act for Fiscal Year 2006 (Public Law 109-163) and trusts that it will address the Committee's concerns about the promotion of linguists.

PROCESS FOR RESTRUCTURING THE ARMY NATIONAL GUARD

The Army's active, reserve, and national guard are integral partners in the sustained success of the `one' Army concept. The committee, therefore, is concerned that force structure changes proposed in December 2005 would have had a profound impact on the national guard if developed without the active participation of, or consultation with, the Army National Guard. The committee strongly believes that any plan to restructure the Army National Guard should be achieved through a transparent and inclusive process. The National Guard Bureau and the Adjutants General should be full partners in the development of Army National Guard transformation plans. The committee urges senior Army leadership, the National Guard Bureau, and the Adjutants General to confer jointly to develop a process to ensure the Army National Guard is properly postured, prepared, and equipped to meet its warfighting requirements, as well as its homeland defense and emergency response requirements.

SOCIAL SECURITY NUMBERS ON MILITARY IDENTIFICATION CARDS

The committee is aware that many service members are concerned that the inclusion of their social security numbers on military identification cards places them at greater risk of identity theft. Although the committee recognizes that a new generation of identity cards may eliminate this risk in the future, there would seem to be a more urgent need for the Department of Defense to develop an alternative that would allow servicemembers to request that the social security number be eliminated from their identification cards or another number be substituted for the social security number. The committee notes that other State and local governments have responded to the increasing risk of identity theft with similar alternative procedures. Therefore, the committee directs the Secretary of Defense to study the feasibility of developing an alternative process that would allow servicemembers to immediately request that their military identification cards do not include their social security numbers.

The committee directs the Secretary to submit a report on his findings and recommendations by March 31, 2007, to the Senate Committee on Armed Services and the House Committee on Armed Services.

TRAFFICKING IN PERSONS

The committee has followed with interest the Department of Defense's (DOD) response to the crime of human trafficking. The Committee appreciates the steps that the DOD and various combatant commanders have taken to address human trafficking since 2002. The Secretary of Defense's strongly worded memo of September 16, 2004 entitled `Combating Trafficking in Persons,' was particularly welcome. Such unequivocal leadership is essential for setting standards and creating a culture that deters any sort of human trafficking. Further, the committee believes that actions must be taken by DOD to implement the zero tolerance policy mandated by the Secretary of Defense. To this end, the committee directs the following:

(1) The Secretary of Defense is to ensure that combatant commanders designate a person on their respective staffs to carry out anti-trafficking programs and oversee implementation of OSD anti-trafficking directives; and

(2) Military criminal investigators and prosecutors be trained on how to use existing provisions in the Uniform Code of Military Justice, the Manual for Courts-Martial, and the Military Extraterritorial Jurisdiction Act to identify and prosecute human trafficking cases;

(3) The Joint Service Committee on Military Justice study whether the Uniform Code of Military Justice and Manual for Courts-Martial are adequate to proscribe trafficking in persons by military personnel; and

(4) The Office of the Secretary of Defense shall compile and disseminate to combatant commanders best practices to combat trafficking, particularly those which have already been used effectively by one or more combatant commander.

VICTIM SERVICE ORGANIZATION PRIVILEGE IN CASES ARISING UNDER UNIFORM CODE OF MILITARY JUSTICE

The committee directs the Secretary of Defense to review the issue of privileged or protected communications made by victims of sexual assaults to health care providers and victim advocates. The purpose of the review is to identify whether potential changes to the Manual for Courts-Martial should be made to extend the privileges that are already included within Section V of the Military Rules of Evidence to include heath care providers and victim advocates.

This review should include:

(1) Existing privileged or protected communications that currently exist in Federal and state law and the Manual for Courts-Martial for both victim advocates, which include any representative of a victim service organization, and health care providers, or a representative of a health care provider, and the reasoning behind those privileges;

(2) Definitions and qualifications of victims advocates and or health care providers, as defined above; especially the education and training that is involved in order to become a victim advocate or health care provider; and whether those qualifications should be a factor in defining the privilege.

(3) The nature of the relationship between the victim, victims advocate and health care provider.

(4) The role and responsibilities of the victim advocate.

(5) The extent to which the privilege can be claimed by individuals other than the victim, victims advocate and health care professionals.

(6) Whether these individuals are military personnel or civilians and whether there are any state licensing requirements for these positions. If there are state licensing requirements or if individuals are licensed in a state then the review should include what the state licensing requirements entail and whether or not any state requirements could conflict if privileged communication were to be extended to victim advocates and health care providers.

(7) An analysis of the recommendation made on this matter in the June 2005 `Report of The Defense Task Force on Sexual Harassment & Violence at the Military Service Academies' that Congress should create a statutory privilege protecting communications made by victims of sexual assault to health care providers and victim advocates. This recommendation stated that the privilege should extend to both medical and mental health care providers and to those victim advocates designated and trained to perform that duty in a manner prescribed by Department of Defense regulation.

(8) A review of prior precedent regarding privilege and the rights of the accused, weighing the accused rights and the rights of the victim in decisions of the United States Supreme Court, United States Court of Appeals for the Armed Forces, and the Military Departments' Courts of Criminal Appeals.

The committee directs the Secretary of Defense to present to the Senate Committee on Armed Services and the House Committee on Armed Services a report on the results of this review and any recommendations for change to the Manual for Courts-Martial no later than April 15, 2007.

WEB-BASED ENHANCEMENT TO SUPPORT FAMILY READINESS PROGRAMS

The committee commends the Department of Defense and the military services for their efforts to improve family support programs for both active duty and reserve families. However, the committee is concerned that extended and multiple deployments may have an adverse impact on the stability of military families and believes the services should explore efforts to use new technologies to further enhance outreach and support to such families. It has been shown that the use of volunteer-based family support groups has been very effective in helping to build self-sufficient families and provide critical support in times of need. The committee understands that the Army is using a new technology called the Virtual Family Readiness Group that is proving to be an effective tool for family support groups to communicate and collaborate across geographic, temporal and other boundaries such as geography, war zones, languages, installations, and deployments. The committee urges the other services to explore using similar interactive technology to support their family readiness teams to improve efficiency and create more effective outreach avenues for military families particularly during this period of high deployment tempo.

LEGISLATIVE PROVISIONS

SUBTITLE A--OFFICER PERSONNEL POLICY

SECTION 501--AUTHORIZED STRENGTH OF NAVY RESERVE FLAG OFFICERS

This section, while retaining the authorized strength of Navy Reserve flag officers at 48, would eliminate existing limitations on the distribution and allocation of those flag officers. Present law mandates a numerical boundary between the line and staff corps and makes specific flag officer allocations among the staff corps elements.

SECTION 502--STANDARDIZATION OF GRADE OF SENIOR DENTAL OFFICER OF THE AIR FORCE WITH THAT OF SENIOR DENTAL OFFICER OF THE ARMY

This section would require that the officer serving as the senior dental officer in the Air Force be appointed in the grade of major general. This is the same grade to which the officer serving as the Chief of the Dental Corps in the Army is appointed.

SECTION 503--MANAGEMENT OF CHIEF WARRANT OFFICERS

This section would authorize the secretary concerned to retain Chief Warrant Officers, W-4, after twice failing to be promoted using procedures prescribed by the secretary without a mandatory selective continuation board, as required under current law. This section would also increase the years of service as a warrant officer that would require mandatory retirement from 24 to 30 years of service.

SECTION 504--REDUCTION IN TIME-IN-GRADE REQUIREMENT FOR PROMOTION TO CAPTAIN IN THE ARMY, AIR FORCE, AND MARINE CORPS AND LIEUTENANT IN THE NAVY

This section would make permanent the authority to reduce from 24 months to 18 months the minimum time-in-grade required as an 0-2 before being eligible for promotion to the grade of 0-3.

SECTION 505--MILITARY STATUS OF OFFICERS SERVING IN CERTAIN INTELLIGENCE COMMUNITY POSITIONS

This section would clarify that general and flag officers assigned to senior level positions within the Central Intelligence Agency and the Office of the Director of National Intelligence shall not be subject to the supervision or control of the Secretary of Defense and shall not exercise supervision or control over Department of Defense personnel. This section would further clarify that the assignment of an officer to such a position would not affect the officer's status, grade, rank, compensation, rights, or benefits and that officer's military pay and allowances would be reimbursed to the Department of Defense from funds available to the Director, Central Intelligence Agency or the Director of National Intelligence, as appropriate.

SUBTITLE B--RESERVE COMPONENT MANAGEMENT

SECTION 511--REVISIONS TO RESERVE CALL-UP AUTHORITY

This section would extend from 270 days to 365 days the duration of service for members of the Selected Reserve and Individual Ready Reserve involuntarily called to active duty to support operational missions. This section would also permit the President to use this authority to order reserve component members to active duty to provide assistance in serious natural or manmade disasters, accidents or catastrophes that occur in the United States, its territories and possessions, the District of Columbia and the Commonwealth of Puerto Rico. This section would also establish criteria that the Secretary of Defense must consider to ensure the fair treatment of reserve component personnel before mobilizing them under this authority.

SECTION 512--MILITARY RETIREMENT CREDIT FOR CERTAIN SERVICE BY NATIONAL GUARD MEMBERS PERFORMED WHILE IN A STATE DUTY STATUS IMMEDIATELY AFTER THE TERRORIST ATTACKS OF SEPTEMBER 11, 2001

This section would authorize reserve retirement credit for members of the Army National Guard and the Air National Guard who were mobilized in a State active duty status in response to the declaration of federal emergencies in the counties of the State of New Jersey surrounding New York City following the terrorist attacks of September 11, 2001.

SECTION 513--REPORT ON PRIVATE SECTOR PROMOTION AND CONSTRUCTIVE TERMINATION OF MEMBERS OF THE RESERVE COMPONENTS CALLED OR ORDERED TO ACTIVE SERVICE

This section would require the Secretary of Defense to report on the post-mobilization effects on the private sector employment of members of the reserve components. Thus, this section would require the secretary to provide data, based on information voluntarily provided by reserve component members, not only on post-mobilization private sector promotions, but also on the voluntary resignations by the reservist because of private sector working conditions the employee found unbearable. The secretary's report to the Senate Committee on Armed Services and the House Committee on Armed Services would be due no later than March 1, 2007.

SUBTITLE C--EDUCATION AND TRAINING

SECTION 521--AUTHORITY TO PERMIT MEMBERS WHO PARTICIPATE IN THE GUARANTEED RESERVE FORCES DUTY SCHOLARSHIP PROGRAM TO PARTICIPATE IN THE HEALTH PROFESSIONS SCHOLARSHIP PROGRAM AND SERVE ON ACTIVE DUTY

This section would authorize the Secretary of the Army to modify agreements entered into by cadets in the Reserve Officers' Training Corps who participate in the Guaranteed Reserve Forces Duty Scholarship Program so that a cadet or former cadet could receive assistance under the Armed Forces Health Professions Scholarship Program (HPSP) and serve on active duty as required by the HPSP. At present, a cadet who participates in the Guaranteed Reserve Forces Duty Scholarship Program must serve in a reserve component troop program unit.

SECTION 522--JUNIOR RESERVE OFFICERS' TRAINING CORPS INSTRUCTION ELIGIBILITY EXPANSION

This section would allow the employment of retired reserve and national guard members as Junior Reserve Officers' Training Corps (JROTC) instructors. Existing law only allows the employment of active duty and retired regular officers and non-commissioned officers as JROTC instructors. This section would also decouple the JROTC instructor salaries of retired reserve and national guard from active duty pay and military retirement entitlements and allow the secretary of the military department concerned to determine their salaries and to reimburse the JROTC host institution by an amount determined by the secretary concerned.

SECTION 523--AUTHORITY FOR UNITED STATES MILITARY ACADEMY AND UNITED STATES AIR FORCE ACADEMY PERMANENT MILITARY PROFESSORS TO ASSUME COMMAND POSITIONS WHILE ON PERIODS OF SABBATICAL

This section would authorize the secretaries of the Army and the Air Force to assign military officers who are permanent professors at the United States Military and Air Force Academies, respectively, to act in a command capacity while on sabbaticals outside the academic realm of the academies.

SECTION 524--EXPANSION OF SERVICE ACADEMY EXCHANGE PROGRAMS WITH FOREIGN MILITARY ACADEMIES

This section would increase from 24 to 100 the number of cadets at the United States Military Academy and the United States Air Force Academy, and the number of midshipmen at the United States Naval Academy, who may participate in exchange programs with foreign military academies. This section would also increase from 24 to 100 the number of students from foreign military academies whom may receive instruction at each of the service academies. Furthermore, this section would increase from $120,000 to $1.0 million the amount of appropriated funding that each service academy could expend in support of the exchange programs and would authorize the academies to also use additional funding that was provided from other than appropriated sources to support the exchange programs. The committee, however, does not intend that the additional funding from other than appropriated sources be used to fund exchange students in excess of the limit set by this section.

SECTION 525--REVIEW OF LEGAL STATUS OF JUNIOR ROTC PROGRAM

This section would require the Secretary of Defense to review the 1976 legal opinion issued by the Department of Defense General Counsel that determined that Junior Reserve Officers' Training Corps (JROTC) instructors may be transported to a non-host school only to teach students previously enrolled in the JROTC unit at the host school, and only when it is impractical to require them to take courses at that host school. The purpose of the secretary's review would be to determine whether changes in law since 1976, including the repeal of the statutory limits on the number of JROTC units, and local school redistricting, which have split a host school's JROTC students into nearly equal groups, would now allow for the instructors from a host school to travel to and instruct JROTC students at another nearby school. This section also would allow a host school that is currently providing for the assignment of JROTC instructors to another school with 70 or more students the authority to continue such support until 180 days following the submission of the report by the Secretary of Defense.

SUBTITLE D--GENERAL SERVICE AUTHORITIES

SECTION 531--TEST OF UTILITY OF TEST PREPARATION GUIDES AND EDUCATION PROGRAMS IN ENHANCING RECRUIT CANDIDATE PERFORMANCE ON THE ARMED SERVICES VOCATIONAL APTITUDE BATTERY (ASVAB) AND ARMED FORCES QUALIFICATION TEST (AFQT)

This section would require the Secretary of Defense to administer a test program conducted by the secretaries of the military departments to determine the utility of commercially available test preparation guides and education programs to assist recruit candidates in achieving improved scores on military recruit qualification tests. The Secretary would identify 2,000 recruit candidates to receive test preparation assistance and a like number of recruit candidates to participate in a control group to allow comparisons of test performance and subsequent duty performance in training and unit settings following active duty entry. The Secretary would begin the test within nine months following the date of enactment of this Act. The test would identify participants over a 1-year period from the start of the test and shall assess duty performance for each participant for 18 months following entry on active duty.

The committee has observed that there are many self-paced, computer assisted, and instructor led options for providing test preparation assistance for recruit qualification tests. The committee is interested in exploring the potential that these test preparation guides and education programs offer for the military to assist recruit candidates to achieve higher and more accurate aptitude and qualification scores. The committee believes that the test program proposed in this section would allow the Secretary to determine if test preparation assistance can be reliably used to improve the process by which recruits are placed in specialties and increase the number of youth that qualify for entry into the armed forces.

SECTION 532--NONDISCLOSURE OF SELECTION BOARD PROCEEDINGS

This section would clarify that selection board proceedings regarding promotion, retention, retirement, separation, and other personnel actions shall not be disclosed to any person who is not a board member and board records shall be immune from legal process, not be admitted as evidence, and not used for any judicial or administrative proceeding without the consent of the secretary concerned.

SECTION 533--REPORT ON EXTENT OF PROVISION OF TIMELY NOTICE OF LONG-TERM DEPLOYMENTS

This section would require the Secretary of Defense to report on the number of members of the Armed Forces who, since September 11, 2001, have not received at least 30-days notice prior to a deployment that was scheduled to last 180 days or more. This section would require the report be made to the Senate Committee on Armed Services and the House Committee on Armed Services no later than March 1, 2007.

SUBTITLE E--AUTHORITIES RELATING TO GUARD AND RESERVE DUTY

SECTION 541--TITLE 10 DEFINITION OF ACTIVE GUARD AND RESERVE DUTY

This section would establish a new definition of `active guard and reserve' in section 101 of title 10, United States Code, and would also clarify the definition of `active guard and reserve duty' in the same section.

SECTION 542--AUTHORITY FOR ACTIVE GUARD AND RESERVE DUTIES TO INCLUDE SUPPORT OF OPERATIONAL MISSIONS ASSIGNED TO THE RESERVE COMPONENTS AND INSTRUCTION AND TRAINING OF ACTIVE-DUTY PERSONNEL

This section would authorize reserve component personnel performing active guard and reserve duty, as well as military technicians (dual status), to also instruct or train active duty members of the armed forces, members of the foreign military forces, and Department of Defense contractor personnel and civilian employees. This section would limit the instructional or training duty only to that conducted in the United States, its possessions, the District of Columbia and the Commonwealth of Puerto Rico. This section would also require that the performance of such instructional and training duty be in addition to, not in lieu of, the primary duties of personnel on active guard and reserve duty and military technicians (dual status), which is to assist in the organizing, administering, recruiting, instructing and training the reserve components.

SECTION 543--GOVERNOR'S AUTHORITY TO ORDER MEMBERS TO ACTIVE GUARD AND RESERVE DUTY

This section would authorize the governor of a State, or the Commonwealth of Puerto Rico, or the Virgin Islands, or the commanding general of the District of Columbia, to order members of the national guard to perform active guard and reserve duty, under title 32, United States Code, to support operations or missions at the request of the President or Secretary of Defense, or to support training operations and training missions assigned in whole or in part by the Secretary of the Army or the Secretary of the Air Force.

SECTION 544--NATIONAL GUARD OFFICERS AUTHORITY TO COMMAND

This section would permit, with Presidential authorization and consent of the governor, any national guard officer to retain a State commission in the national guard while serving on active duty. Thus, the officer would possess a dual status, State and federal, that would permit the officer to command forces and mixed component units operating under title 10, United States Code, and under title 32, United States Code. This section would provide that the Presidential authorization and gubernatorial consent be obtained in advance in order to establish command succession in active duty and mixed component units.

SECTION 545--EXPANSION OF OPERATIONS OF CIVIL SUPPORT TEAMS

This section would expand the types of emergencies to which members of the reserve components who are assigned to weapons of mass destruction civil support teams might respond. Thus, this section would authorize employment of such teams in the United States in natural or manmade disasters, or in the intentional or unintentional release of nuclear, biological, radiological, or toxic or poisonous chemical materials in the United States that results, or could result, in the catastrophic loss of life or property.

SUBTITLE F--DECORATIONS AND AWARDS

SECTION 551--AUTHORITY FOR PRESENTATION OF MEDAL OF HONOR FLAG TO LIVING MEDAL OF HONOR RECIPIENTS AND TO LIVING PRIMARY NEXT-OF-KIN OF DECEASED MEDAL OF HONOR RECIPIENTS

This section would allow the purchase and presentation of a Medal of Honor flag to all living Medal of Honor recipients or, if deceased, to their living primary next-of-kin.

SECTION 552--COLD WAR VICTORY MEDAL

This section would require the Secretary of Defense to design a Cold War Victory Medal and issue it, upon application by a servicemember, to those individuals who:

(1) Performed active duty or inactive duty for training as an enlisted member, officer, or warrant officer, during the Cold War and completed an initial term of enlistment or obligation; or

(2) If discharged before completion of the initial term of enlistment or obligation, was honorably discharged after completion of not less than 180 days of service on active duty.

SECTION 553--POSTHUMOUS AWARD OF PURPLE HEART FOR PRISONERS OF WAR WHO DIE IN OR DUE TO CAPTIVITY

This section would require the Secretary of Defense to award, posthumously, the Purple Heart to a member of the armed forces who died while in captivity as a prisoner of war or died due to injury or illness obtained while in captivity as a prisoner of war. If a servicemember died prior to the enactment of this Act then the secretary concerned would award the Purple Heart, upon receipt of an application that is made to the secretary containing such information as the secretary requires, to the appropriate next-of-kin of the servicemember.

SECTION 554--ADVANCEMENT ON THE RETIRED LIST OF CERTAIN DECORATED RETIRED NAVY AND MARINE CORPS OFFICERS

This section would require the Secretary of the Navy to advance to the next higher on the retired list of officers who had been specifically commended for performance of duty in combat during World War II. Advancement on the retired list had been promised to a number of officers with valor decorations during World War II, but officers have been denied the honor because they retired after the expiration of the authority in law. This section would allow advancement on the retired list, but would only be honorary and would have no affect on compensation or benefits.

SECTION 555--REPORT ON DEPARTMENT OF DEFENSE PROCESS FOR AWARDING DECORATIONS

This section would require the Secretary of Defense to review the policy, procedures, and processes of the military departments for awarding decorations to members of the Armed Forces. The object of the review is to ensure that award recommendations are submitted and processed in a timely fashion and that the same consideration and timeliness that is afforded recommendations for active duty personnel is also provided to recommendations for reserve component members. This section would require the Secretary of Defense, no later than 90 days after the date of the enactment of this act, to submit a report to the Senate Committee on Armed Services and the House Committee on Armed Services regarding the findings and recommendations, if any, for changes to the procedures and processes of the military departments.

SUBTITLE G--MATTERS RELATING TO CASUALTIES

SECTION 561--CRITERIA FOR REMOVAL OF MEMBER FROM TEMPORARY DISABILITY RETIRED LIST

This section would clarify that a member with less than a 30 percent disability rating may not be removed from the temporary disability retired list (TDRL) and separated prior to the maximum TDRL period allowed by law unless the disability is of a permanent nature and stable.

SECTION 562--DEPARTMENT OF DEFENSE COMPUTER/ELECTRONIC ACCOMMODATIONS PROGRAM FOR SEVERELY WOUNDED MEMBERS

This section would authorize the Secretary of Defense to provide assistive technology, assistive technology devices, and assistive technology services to a member of the armed forces who has sustained a severe or debilitating illness or injury while serving in support of a contingency operation. This section would further authorize the Secretary to continue to provide such devices and services for an indefinite period, without regard to whether the person being assisted continues to be a member of the armed forces.

SECTION 563--TRANSPORTATION OF REMAINS OF CASUALTIES DYING IN A THEATER OF COMBAT OPERATIONS

This section would require the Secretary of Defense to transport by air, when air transport is appropriate, the remains of military servicemembers who died during combat operations or who died of non-combat related injuries in the theater of combat, from Dover Air Force Base, Delaware, to the military airfield nearest to the servicemember's place of internment or, if the next-of-kin requests it, to the commercial airfield nearest the interment location. This section would also require that:

(1) Either military aircraft or aircraft contracted by the military be dedicated to the exclusive mission of moving the remains;

(2) Active or reserve component military personnel escort the remains during transportation from Dover Air Force Base until the remains are delivered to the next-of-kin of the deceased servicemember or a representative of the next-of-kin; and

(3) A proper military escort, made up of, either, members of the active or reserve components, are present in sufficient number at the arrival airfield to remove the servicemember's remains from the aircraft and to render proper military honors.

This section would permit one exception to the use of military aircraft by authorizing the use of commercial airlines to move the servicemember's remains from Dover to the airport nearest to the servicemember's interment only if requested by the next-of-kin of the servicemember. The committee makes these recommendations based on a strong belief that the remains of our military men and women should be transported with the utmost ceremony, honors, and respect.

SECTION 564--ANNUAL BUDGET DISPLAY OF FUNDS FOR POW/MIA ACTIVITIES OF DEPARTMENT OF DEFENSE

This section would require the Secretary of Defense to submit to Congress, as a part of the Department of Defense justification material that supports the President's annual budget request, a consolidated budget justification display that includes the prior year and future year funding for all programs and activities of the following organizations whose missions involve the accounting for and recovery of military personnel of the armed forces who are missing in action or prisoners of war: the Defense Prisoner of War/Missing Personnel Office (DPMO), the Joint POW/MIA Accounting Command (JPAC), the Armed Forces DNA Identification Laboratory (AFDIL), and the Air Force's Life Sciences Equipment Laboratory (LSEL). The budget display should include for each of these organizations:

(1) The amount, by appropriation and functional area, originally requested for the fiscal year of the budget request, with the supporting narrative describing the rationale for the requested funding levels;

(2) A summary of actual or estimated expenditures for the two fiscal years preceding the fiscal year for which the budget is being submitted;

(3) The amounts requested in the budget for the fiscal year of the request;

(4) A detailed explanation of any inconsistencies between the amount originally requested by each organization and the amount of funds requested by the President's annual budget; and,

(5) The budget estimates for these organizations for the next five years.

The committee makes these recommendations because it believes that the mission to account for our missing servicemembers from past conflicts is a critical mission and to effectively perform its range of missions DPMO, JPAC, AFDIL, and LSEL must be fully resourced.

SUBTITLE H--ASSISTANCE TO LOCAL EDUCATIONAL AGENCIES FOR DEFENSE DEPENDENTS EDUCATION

SECTION 571--CONTINUATION OF AUTHORITY TO ASSIST LOCAL EDUCATIONAL AGENCIES THAT BENEFIT DEPENDENTS OF MEMBERS OF THE ARMED FORCES AND DEPARTMENT OF DEFENSE CIVILIAN EMPLOYEES

This section would provide $50.0 million for assistance to local educational agencies that have military dependent students comprising at least 20 percent of the students in average daily attendance during a year. This section would also provide $15.0 million for assistance to local educational agencies that experience significant increases or decreases in the average daily attendance of military dependent students due to military force structure changes, the relocation of military forces from one base to another, and from base closures and realignments. The committee makes this recommendation in connection with its continuing strong support of the need to help local school districts with significant concentrations of military students.

SECTION 572--ENROLLMENT IN DEFENSE DEPENDENTS' EDUCATION SYSTEM OF DEPENDENTS OF FOREIGN MILITARY MEMBERS ASSIGNED TO SUPREME HEADQUARTERS ALLIED POWERS, EUROPE

This section would authorize the Secretary of Defense to enroll on a space-required, tuition-free basis a limited number of dependents of foreign military members who are assigned to the Supreme Headquarters Allied Powers Europe, in the Department of Defense dependents' education system in Mons, Belgium.

SUBTITLE I--POSTAL BENEFITS

SECTION 575-POSTAL BENEFITS PROGRAM FOR MEMBERS OF THE ARMED FORCES

This section would require the Secretary of Defense, in consultation with the United States Postal Service, to provide a program of postal benefits to military members who are serving in Iraq or Afghanistan, or who are hospitalized at a medical facility under the jurisdiction of the armed forces as a result of disease or injury incurred while serving in Iraq or Afghanistan. The postal benefit would be provided using coupons or other forms of evidence indicating a mailing privilege to be used to mail letters, sound and video recordings, printed materials, or ground parcels not exceeding 15 pounds in weight at no cost. The section would require that the mailing privilege be exercised at a United States post office and be addressed to a qualified individual.

SECTION 576--FUNDING

This section would specify that the Secretary of Defense shall provide funding to support the operation of the postal benefit program from funds appropriated for a contingent emergency reserve fund or as an emergency supplemental appropriation. This section would also require the Secretary to closely coordinate the transfer of funding to support the program with the United States Postal Service.

SECTION 577--DURATION

This section would specify that the Secretary of Defense shall operate the postal benefit program for the one-year period beginning on the date on which the Secretary publishes regulations to administer the program.

SUBTITLE J--OTHER MATTERS

SECTION 581--REDUCTION IN DEPARTMENT OF DEFENSE ACCRUAL CONTRIBUTIONS TO DEPARTMENT OF DEFENSE MILITARY RETIREMENT FUND

This section would reduce the Department of Defense's accrual contributions into the Military Retirement Fund by requiring the department to contribute at the lower, more appropriate part-time rate for reserve component soldiers who are mobilized or on active duty for special work. Under current law, the department must make a contribution for such reserve component personnel at the higher, full-time rate even though when the reserve component personnel retire their reserve retirement annuity would be lower than the retirement annuity of an active component member.

SECTION 582--DENTAL CORPS OF THE BUREAU OF MEDICINE AND SURGERY

This section would change the current structure of the Department of the Navy Bureau of Medicine and Surgery by eliminating the requirement for a separate dental division within the bureau. However, this section would also establish the Dental Corps within the bureau and provide for the integration of the Dental Corps into the operations of the bureau.

SECTION 583--PERMANENT AUTHORITY FOR PRESENTATION OF RECOGNITION ITEMS FOR RECRUITMENT AND RETENTION PURPOSES

This section would make permanent the authority in section 2261 of title 10, United States Code, to expend appropriated funds to procure recognition items of nominal or modest value for recruitment or retention purposes and to present such items to members of the armed forces and to family members of members of the armed forces, and other individuals, recognized as providing support that substantially facilitates service in the armed forces.

SECTION 584--REPORT ON FEASIBILITY OF ESTABLISHMENT OF MILITARY ENTRANCE PROCESSING COMMAND STATION ON GUAM

This section would require the Secretary of Defense to submit a report by June 1, 2007, on the feasibility and cost effectiveness of establishing on Guam a military entrance processing station for new recruits of the armed forces who are drawn from the western Pacific region. The Secretary's report would be provided to the Senate Committee on Armed Services and to the House Committee on Armed Services.

SECTION 585--PERSONS AUTHORIZED TO ADMINISTER ENLISTMENT AND APPOINTMENT OATHS

This section would allow the Secretary of Defense to designate who is authorized to administer an enlistment or appointment oath, and would expand the number of people eligible to administer such oaths when the situation dictates. Sections 502 and 1031 of title 10, United States Code, currently permit any commissioned office of any component of the armed forces to administer such oaths. By contrast, section 936(b)(6) of title 10 provides that the authority to administer oaths includes `[a]ll other persons designated by regulations of the armed forces or by statute.' This change would clarify any apparent contradictions between these sections of law.

SECTION 586--REPEAL OF REQUIREMENT FOR PERIODIC DEPARTMENT OF DEFENSE INSPECTOR GENERAL ASSESSMENTS OF VOTING ASSISTANCE COMPLIANCE AT MILITARY INSTALLATIONS

This section would eliminate the requirement for the Inspector General of the Department of Defense (DOD) to conduct periodic assessments of compliance with voting assistance requirements at military installations. The inspectors general of the Army, Navy and Air Force already conduct installation visits to assess this compliance; therefore, any visits made by the DOD Inspector General would duplicate that effort. This section would not change the requirement that the DOD inspector general provide Congress with an annual report consolidating, summarizing and independently assessing the results of the reviews by the military service inspectors general. Furthermore, the DOD Inspector General would still maintain the statutory authority to conduct installation assessment visits throughout the Department to augment those conducted by the inspectors general of the military services.

SECTION 587--PHYSICAL EVALUATION BOARDS

This section would make the following improvements to Physical Evaluation Board (PEB) operations and timeliness and consistency of decisions:

(1) Require the secretaries of the military departments to ensure that documents announcing decisions of PEBs convey the findings and conclusions of the board in an orderly and itemized fashion with specific attention to each issue presented by the member in regard to that member's case.

(2) Require the Secretary of Defense to publish regulations establishing requirements and training standards for Physical Evaluation Board liaison officers and to assess the compliance of the secretaries of the military departments with those regulations at least once every three years; and

(3) Require the Secretary of Defense to publish regulations establishing standards and guidelines concerning PEB assignment and training of staff, operating procedures, and consistency and timeliness of board decisions and to assess the compliance of the secretaries of the military departments with those regulations at least once every three years.

As the war placed greater demands on the disability evaluation system, the committee observed increased complaints from servicemembers, particularly reserve component members, about the consistency and timeliness of PEB decisions, the ability of members to gain information about PEB procedures, and the rationale supporting board decisions. The committee also noted that the Government Accountability Office report, Military Disability System: Improved Oversight Needed to Ensure Consistent and Timely Outcomes for Reserve and Active Duty Service Members (GAO-06-362), March 2006, was critical of the absence of oversight management of the PEBs exercised by the Department of Defense. The committee believes that the initiatives proposed in this section would result in enhanced consistency and timeliness of PEB decisions and improved communication with members being serviced by the disability evaluation system.

SECTION 588--DEPARTMENT OF LABOR TRANSITIONAL ASSISTANCE PROGRAM

This section would require participation by eligible members of the armed forces within the Department of Defense in the transitional assistance program provided by the Secretary of Labor. The Secretary of Defense is not required but shall encourage members to attend the program if they have previously participated in the program or upon discharge from active duty, are returning to an employment position or are enrolled in school.

SECTION 589--REVISION IN GOVERNMENT CONTRIBUTIONS TO MEDICARE-ELIGIBLE RETIREE HEALTH CARE FUND

This section would change the formula by which the government makes annual contributions to the Medicare-eligible Uniformed Services Retiree Health Care Fund. This fund is used to finance the health care provided by the uniformed services to retirees of those services who are also eligible to receive health care under Medicare. The section would not make any change in the health care benefits provided to Medicare-eligible uniformed services retirees. The section, however, would reduce the annual government contribution to the fund by changing the formula for calculating that contribution, as follows:

(1) Excluding the cadets and midshipmen at the service academies of the armed forces;

(2) Excluding members of the reserve components who are not counted against active component end strength by reason of section 115(i) of title 10, United States Code; and

(3) Basing the calculation on Selected Reserve strength, not the strength of the larger Ready Reserve.

The section would also restate and clarify Congressional intent, enacted by section 725 of the Ronald W. Reagan National Defense Authorization Act for Fiscal Year 2005 (Public Law 108-375), by prohibiting any funds authorized or appropriated to the Department of Defense from being used to make any payment to the fund. Then, as now, the committee intends that the Secretary of the Treasury, not the Secretary of Defense, be wholly, completely and exclusively responsible for making the annual accrual payments required by Chapter 56 of title 10 United States Code. Therefore, the committee also directs that no annual accrual payment required by Chapter 56 be charged, credited, or classified in any budget formulation, budget functional classification or scoring of mandatory or discretionary spending against the Department of Defense. The committee takes this action because budget requests since the enactment of section 725 have not complied with Congressional intent.

SECTION 590--MILITARY CHAPLAINS

This section would establish that chaplains in each of the military services would have the prerogative to pray according to the dictates of their own consciences, except as must be limited by military necessity. The section would also clarify that whenever a limitation for military necessity was applied it would be imposed in the least restrictive manner feasible.

SECTION 591--REPORT ON PERSONNEL REQUIREMENTS FOR AIRBORNE ASSETS IDENTIFIED AS LOW-DENSITY, HIGH-DEMAND AIRBORNE ASSETS

This section would require the Secretary of Defense to submit a report, not later than 90 days after enactment of this Act, on personnel requirements and shortfalls for airborne assets identified as low-density, high-demand airborne assets based on combatant commander requirements to conduct and sustain operations for the global war on terrorism, and would include: the number of operations and maintenance crews to meet tasking contemplated to conduct operations for the global war on terrorism; the current numbers of operations and maintenance crews; if applicable, shortages of operations and maintenance crews; whether such shortages are addressed in the future years defense program; whether end-strength increase are required to meet any such shortages; costs of personnel needed to address shortfalls; and if applicable, the number and types of equipment needed to address training shortfalls.

SECTION 592--ENTREPRENEURIAL SERVICE MEMBERS EMPOWERMENT TASK FORCE

This section would require the Secretary of Defense, in coordination with the Administrator of the Small Business Administration, to establish a task force to provide timely input and recommendations to both the secretary and the administrator on:

(1) Measures to improve not only programs designed to address the economic concerns, challenges and opportunities of reserve component members; and,

(2) The coordination among various governmental entities whose programs could assist reserve component members with those economic concerns, challenges and opportunities.

This section would authorize the task force to operate until September 30, 2009.

SECTION 593--COMPTROLLER GENERAL REPORT ON MILITARY CONSCIENTIOUS OBJECTORS

This section would require the Comptroller General to submit to Congress, not later than 180 days after enactment of this Act, a report concerning members of the Armed Forces who have claimed the status as a military conscientious objector between January 1, 1989 and December 31, 2006.

SECTION 594--COMMISSION ON THE NATIONAL GUARD AND RESERVES

This section would amend section 513 of the Ronald W. Reagan National Defense Authorization Act for Fiscal Year 2005 (Public Law 108-375) to extend the Commission on the National Guard and Reserves by six months. This section would also direct the commission to study and report to Congress by March 1, 2007, on the following additional matters: the advisability and feasibility of implementing the provisions of H.R. 5200 of the 109th Congress; whether the Chief, National Guard Bureau, should serve in the grade of general in his current capacity; and whether the Department of Defense processes for defining the equipment and funding necessary for the National Guard to perform its responsibilities, under title 10, United States Code, and title 32, United States Code, are adequate.

TITLE VI--COMPENSATION AND OTHER PERSONNEL BENEFITS

OVERVIEW

The committee continues to believe that successful recruiting and retention in a wartime environment is directly dependent on the close oversight of compensation and benefit programs to ensure that they remain current, flexible, and effective. Accordingly, the committee recommends an across-the-board pay raise of 2.7 percent and a further adjustment to the military pay table to target increases to mid-grade and senior noncommissioned officers and warrant officers. The committee also recognizes that some previously adopted compensation policies, bonuses, and special pays require modification to ensure they remain current and effective and the committee has recommended a number of such adjustments.

The committee remains committed to protecting and enhancing military exchange, commissary, and morale, welfare, and recreation programs. Accordingly, the committee has included provisions that would clarify the primacy of nonappropriated fund activities in providing ancillary support services when government property is leased to private parties, specify the allocation of revenue received by commissaries for certain products, and require a test of golf carts that are accessible to disabled persons.

ITEMS OF SPECIAL INTEREST

ELIMINATION OF THE SURVIVOR BENEFIT PLAN TWO-TIER ANNUITY COMPUTATION SYSTEM

The committee has learned that there may be approximately 137 Survivor Benefit Plan (SBP) annuitants experiencing a reduction in their overall compensation as a result of the phased elimination of the two-tier annuity computation for surviving spouses enacted in the National Defense Authorization Act for Fiscal Year 2005 (Public Law 108-136). The committee believes that the reduction in overall income may result in those cases where annuitants receive full payment of Dependency Indemnity Compensation (DIC) from the Department of Veterans Affairs and Supplemental Survivor Benefit Program (SSBP) benefits without the dollar for dollar offset that is taken from standard SBP payments. The committee notes that retirees were charged higher premiums to participate in SSBP and specifically counter the reduction in SBP benefits that occurs when annuitants arrive at age 62 and social security benefits became available. The committee fears that as the phased elimination of the two-tier system progresses, the SSBP payments are being incrementally replaced by payments from the standard SBP. This means that income that has not been subject to the DIC offset is being replaced with income that is subject to the offset thus resulting in a loss of income to the annuitant. The committee is troubled that the loss of income being experienced by annuitants is potentially an unintended consequence of the process to eliminate the two-tier annuity computation system. Therefore, the committee directs the Secretary of Defense to study this issue to confirm that the problem exists and determine the number of annuitants that are losing income, the extent of the income being lost, the cause of the income loss, and, if appropriate, the legislative solution.

The committee directs the Secretary to report his findings and recommendations, including any legislative proposals, by March 31, 2007 to the Senate Committee on Armed Services and the House Committee on Armed Services.

MILITARY DECORATIONS AND UNIFORM ACCOUTERMENTS SOLD IN MILITARY EXCHANGE STORES

The committee strongly believes that all medals associated with military decorations and military ribbons, badges, insignia, and other uniform accouterments offered to military members in military exchange stores should be manufactured within the United States. The committee is aware of concerns that some medals and uniform accouterments manufactured outside the United States have appeared in exchange and other government procurement channels. Accordingly, the committee directs the Secretary of Defense to review the policies and procedures used by the Army Air Force Exchange Service, the Navy Exchange Service Command, and Marine Corps exchanges to procure military medals and military ribbons, badges, insignia, and other uniform accouterments to determine the extend to which foreign made products are available for sale to servicemembers.

The committee directs the Secretary to submit a report on his findings and recommendations by March 31, 2007, to the Senate Committee on Armed Services and the House Committee on Armed Services.

RECOUPMENT OF SURVIVOR BENEFIT PLAN OVERPAYMENTS

The committee is concerned by reports that many survivors of military retirees are experiencing great anxiety, inconvenience, and financial hardship as a result of the procedures employed by the Defense Finance and Accounting Service (DFAS) when reconciling the simultaneous payment of the Survivor Benefit Plan (SBP) and Dependency and Indemnity Compensation (DIC) benefits. The committee understands that the survivors are normally subjected to an automated and impersonal process that provides little opportunity for survivors to understand the details of the recoupment process that frequently involves thousands of dollars. The survivors are also routinely required to pay a large recoupment amount, which is typically followed by a refund back to the survivor of SBP premiums that no longer apply because of DIC eligibility. The committee believes that DFAS, in cooperation with the Department of Veterans Affairs, is capable of providing better customer service, that is more sensitive to limiting the financial disruption imposed on survivors. Therefore, the committee directs the Secretary of Defense to study the problems associated with the current DFAS procedures regarding the simultaneous entitlement to SBP and DIC with a view toward improving customer service and minimizing the financial disruptions imposed on survivors.

The committee directs the Secretary to submit a report on his findings and recommendations by March 31, 2007, to the Senate Committee on Armed Services and the House Committee on Armed Services.

SECOND DESTINATION TRANSPORTATION OF EXCHANGE STORE GOODS

The committee was disappointed to learn that the Secretary of the Army had failed to include funding in the fiscal year 2007 budget request for second destination transportation of Army and Air Force Exchange Service (AAFES) goods for resale at overseas stores. Although the Secretary has been quick to make the needed adjustment to the budget request to fully account for AAFES' second destination transportation requirements, there remains the obvious conclusion that the Secretary chose to ignore the specific requirement in law requiring the use of appropriated funds to pay for second destination transportation expenses (10 U.S.C., 2643). The committee concludes that this oversight reflects a lack of commitment within the Army to protecting the quality of life of members and families residing overseas. The Secretary should take note that the committee does not tolerate such an oversight and that the committee is closely monitoring the second destination transportation funding level during fiscal year 2007 and in future budget requests. The committee trusts that the Secretary is in a position to prevent such oversights in the future.

TREATMENT OF DUAL MILITARY COUPLES

The committee recognizes that there are over 90,000 military members who are married to other military members and that the number of these dual military couples is increasing. However, the committee notes that personnel and compensation law and policy that have been established over time have not taken into account the changing marital demographics of the force. For example, this Act includes a provision that would ensure that a surviving dual military spouse of a service member who dies while serving on active duty is provided the same continuation of basic allowance for housing as other surviving spouses who are not military members. This issue raises concerns that there may be other circumstances when law or policy disadvantages dual military couples. Therefore, the committee directs the Secretary of Defense to review personnel and compensation law and policy to ensure that dual military couples are treated equitably and fairly.

The committee directs the Secretary to submit a report on his findings and recommendations by March 31, 2007, to the Senate Committee on Armed Services and the House Committee on Armed Services.

UNITED SERVICE ORGANIZATIONS

The committee recognizes that the United Service Organization (USO) celebrity tours are well known and beloved by our men and women in uniform, particularly among those deployed overseas. Over the years, the USO has offered thousands of entertainers the opportunity to volunteer their time and talents entertaining the troops and their families. The committee is aware that the Armed Forces Entertainment (AFE) program has limited resources available to support USO celebrity tours to the levels being requested, but the committee acknowledges the dedicated effort by AFE to support morale and welfare within the worldwide military community. The committee commends the USO for its support for our military personnel and their families and in particular for its extraordinary celebrity tour program that provides world class entertainment in collaboration with the AFE to deployed military forces across the globe.

LEGISLATIVE PROVISIONS

SUBTITLE A--PAY AND ALLOWANCES

SECTION 601--INCREASE IN BASIC PAY FOR FISCAL YEAR 2007

This section would increase basic pay for members of the armed forces by 2.7 percent effective January 1, 2007. This raise would continue to fulfill Congress' commitment to enhance pay raises for the armed forces and would reduce the gap between military and private sector pay increases from 4.5 percent to 4.0 percent.

SECTION 602--TARGETED INCREASE IN BASIC PAY RATES

This section would target mid-grade and senior noncommissioned officers and warrant officers for additional pay raises effective April 1, 2007. The targeted raises would allow these groups to achieve a level of income that is more comparable with their private sector peers.

SECTION 603--CONFORMING CHANGE IN GENERAL AND FLAG OFFICER PAY CAP TO REFLECT INCREASE IN PAY CAP FOR SENIOR EXECUTIVE SERVICE PERSONNEL

This section would increase the cap on general and flag officer pay levels from Level III to Level II on the Executive Schedule. This section would allow general and flag officer pay levels to keep pace with Senior Executive Service pay levels.

SECTION 604--AVAILABILITY OF SECOND BASIC ALLOWANCE FOR HOUSING FOR CERTAIN RESERVE COMPONENT OR RETIRED MEMBERS SERVING IN SUPPORT OF CONTINGENCY OPERATIONS

This section would authorize the secretary concerned to provide a second monthly basic allowance for housing to reserve component members without dependents mobilized in support of a contingency operation and serving in a duty location that does not allow the members to reside at their permanent residence.

SECTION 605--EXTENSION OF TEMPORARY CONTINUATION OF HOUSING ALLOWANCE FOR DEPENDENTS OF MEMBERS DYING ON ACTIVE DUTY TO SPOUSES WHO ARE ALSO MEMBERS

This section would authorize military members who are surviving spouses of members who die while serving on active duty to receive the basic allowance for housing that would be due to the deceased member for 365 days in the same way that such an allowance would be paid to surviving spouses who are not military members.

SECTION 606--CLARIFICATION OF EFFECTIVE DATE OF PROHIBITION ON COMPENSATION FOR CORRESPONDENCE COURSES

This section would clarify that the prohibition barring reserve component members from receiving compensation for work or study performed in a correspondence course is effective September 7, 1962, and includes members of the national guard while not in federal service.

SECTION 607--PAYMENT OF FULL PREMIUM FOR COVERAGE UNDER SERVICEMEMBERS' GROUP LIFE INSURANCE PROGRAM DURING SERVICE IN OPERATION ENDURING FREEDOM OR OPERATION IRAQI FREEDOM

This section would require the secretary concerned to increase the allowance paid to members serving in either Operation Enduring Freedom or Operation Iraqi Freedom to reimburse the cost of all levels of coverage under the Servicemember's Group Life Insurance (SGLI) elected by the members. Section 613 of the National Defense Authorization Act for Fiscal Year 2006 (Public Law 109-163) required that the Secretaries concerned pay an allowance to reimburse the cost of only the first $150,000 of insurance coverage elected by the member.

SUBTITLE B--BONUSES AND SPECIAL AND INCENTIVE PAYS

SECTION 611--EXTENSION OF CERTAIN BONUS AND SPECIAL PAY AUTHORITIES FOR RESERVE FORCES

This section would extend the authority for the Selected Reserve reenlistment bonus, the Selected Reserve affiliation or enlistment bonus, special pay for enlisted members assigned to certain high priority units, the Ready Reserve enlistment bonus for persons without prior service, the Ready Reserve enlistment and reenlistment bonus for persons with prior service, and the Selected Reserve enlistment bonus for persons with prior service until December 31, 2007.

SECTION 612--EXTENSION OF BONUS AND SPECIAL PAY AUTHORITIES FOR HEALTH CARE PROFESSIONALS

This section would extend the authority for the nurse officer candidate accession program, the accession bonus for registered nurses, the incentive special pay for nurse anesthetists, the special pay for Selected Reserve health care professionals in critically short wartime specialties, the accession bonus for dental officers, and the accession bonus for pharmacy officers until December 31, 2007. This section would also extend the authority for repayment of educational loans for certain health professionals who serve in the Selected Reserve until January 1, 2008.

SECTION 613--EXTENSION OF SPECIAL PAY AND BONUS AUTHORITIES FOR NUCLEAR OFFICERS

This section would extend the authority for the special pay for nuclear-qualified officers extending a period of active service, nuclear career accession bonus, and the nuclear career annual incentive bonus until December 31, 2007.

SECTION 614--EXTENSION OF OTHER BONUS, SPECIAL PAY, AND SEPARATION PAY AUTHORITIES

This section would extend the authority for the aviation officer retention bonus, assignment incentive pay, the reenlistment bonus for active members, the enlistment bonus for active members, the retention bonus for members with critical military skills, the accession bonus for new officers in critical skills, the military occupational specialty conversion incentive bonus and the transfer between armed forces incentive bonus until December 31, 2007, except for assignment incentive pay which is extended until December 31, 2008.

SECTION 615--EXPANSION OF ELIGIBILITY OF DENTAL OFFICERS FOR ADDITIONAL SPECIAL PAY

This section would clarify that dentists may be paid additional special pay notwithstanding their participation in internship or residency programs.

SECTION 616--INCREASE IN MAXIMUM ANNUAL RATE OF SPECIAL PAY FOR SELECTED RESERVE HEALTH CARE PROFESSIONALS IN CRITICALLY SHORT WARTIME SPECIALTIES

This section would increase the maximum annual rate of special pay for Selected Reserve health care professionals in critically short wartime specialties from $10,000 to $25,000.

SECTION 617--AUTHORITY TO PROVIDE LUMP SUM PAYMENT OF NUCLEAR OFFICER INCENTIVE PAY

This section would authorize nuclear officer incentive pay to be paid as a lump sum or in variable annual amounts in addition to payment in equal annual installments.

SECTION 618--INCREASE IN MAXIMUM AMOUNT OF NUCLEAR CAREER ACCESSION BONUS

This section would increase the maximum amount of the nuclear career accession bonus from $20,000 to $30,000.

SECTION 619--INCREASE IN MAXIMUM AMOUNT OF INCENTIVE BONUS FOR TRANSFER BETWEEN ARMED FORCES

This section would increase the maximum amount of the incentive bonus for transfer between armed forces from $2,500 to $10,000.

SECTION 620--CLARIFICATION REGARDING MEMBERS OF THE ARMY ELIGIBLE FOR BONUS FOR REFERRING OTHER PERSONS FOR ENLISTMENT IN THE ARMY

This section would clarify that military retirees, to include a member of a reserve component under 60 years of age who, but for age, would be eligible for retired pay, are eligible to be paid the referral bonus.

SECTION 621--PILOT PROGRAM FOR RECRUITMENT BONUS FOR CRITICAL HEALTH CARE SPECIALTIES

This section would authorize the Secretary of Defense to establish a two-year pilot program to offer additional financial recruiting incentives under the Armed Forces Health Professions Scholarship and Financial Assistance Program for up to five critical medical specialties. The Secretary would be required to submit a mid-term and final report on lessons learned from the pilot program to the Senate Committee on Armed Services and the House Committee on Armed Services.

SECTION 622--ENHANCEMENT OF TEMPORARY PROGRAM OF VOLUNTARY SEPARATION PAY AND BENEFITS

This section would expand the temporary program of voluntary separation pay and benefits authorized in section 643 of the National Defense Authorization Act for Fiscal Year 2006 (Public Law 109-163) to remove the bar prohibiting participation of enlisted personnel and officers with between 12 and 20 years of service. This section would also extend the expiration date of the authority from December 31, 2008 to December 31, 2009.

SECTION 623--ADDITIONAL AUTHORITIES AND INCENTIVES TO ENCOURAGE RETIRED MEMBERS AND RESERVE COMPONENT MEMBERS TO VOLUNTEER TO SERVE ON ACTIVE DUTY IN HIGH-DEMAND, LOW-DENSITY ASSIGNMENTS

This section would authorize the Secretary of Defense to pay a bonus of up to $50,000 to encourage retired members, reservists, and former members discharged from the military who possess critical skills to return to active duty to fill shortage manpower requirements in units tasked to provide high-demand, low-density military capabilities or to fill other critically manned specialties, as designated by the Secretary. This section would also authorize the Secretary to develop additional incentives to encourage personnel with critical high-demand, low-density skills to return to active duty which the Secretary may implement after notifying the Congressional defense subcommittees of the reasons why the proposal is needed and waiting 30 days. The authority would expire on December 31, 2010.

SUBTITLE C--TRAVEL AND TRANSPORTATION ALLOWANCES

SECTION 631--AUTHORITY TO PAY COSTS ASSOCIATED WITH DELIVERY OF MOTOR VEHICLE TO STORAGE LOCATION SELECTED BY MEMBER AND SUBSEQUENT REMOVAL OF VEHICLE

This section would authorize the secretary concerned to pay the costs for members to deliver and remove privately owned vehicles from storage locations chosen by the member. Such payments would not be authorized to exceed the total cost that would have been incurred by the government if the government storage location had been used.

SECTION 632--TRANSPORTATION OF ADDITIONAL MOTOR VEHICLE OF MEMBERS ON CHANGE OF PERMANENT STATION TO OR FROM NONFOREIGN AREAS OUTSIDE THE CONTINENTAL UNITED STATES

This section would authorize members with at least one family member eligible to drive to ship two privately owned vehicles during permanent change of station moves to nonforeign duty locations located outside the continental United States. Nonforeign duty locations outside the continental United States include Alaska, Hawaii, Puerto Rico, Guam, and other territories and possessions.

SECTION 633--TRAVEL AND TRANSPORTATION ALLOWANCES FOR TRANSPORTATION OF FAMILY MEMBERS INCIDENT TO ILLNESS OR INJURY OF MEMBERS

This section would expand the authority to pay for travel and transportation of family members to visit ill or injured members to include family members that are also military members.

SUBTITLE D--RETIRED PAY AND SURVIVOR BENEFITS

SECTION 641--MILITARY SURVIVOR BENEFIT PLAN BENEFICIARIES UNDER INSURABLE INTEREST COVERAGE

This section would allow military retirees who participate in the Survivor Benefit Plan and elect the insurable interest coverage to select a new insurable interest if their beneficiary dies.

SECTION 642--RETROACTIVE PAYMENT OF ADDITIONAL DEATH GRATUITY FOR CERTAIN MEMBERS NOT PREVIOUSLY COVERED

This section would correct a technical error in section 664 of the National Defense Authorization Act for Fiscal Year 2006 (Public Law 109-163) that prevented the payment of an additional $150,000 death gratuity intended for surviving family members of non-combat active duty deaths that occurred during the period from May 12, 2005 through August 31, 2005.

SECTION 643--EQUITY IN COMPUTATION OF DISABILITY RETIRED PAY FOR RESERVE COMPONENT MEMBERS WOUNDED IN ACTION

This section would authorize the retired pay for a member of a reserve component to be calculated using the member's total years of service in lieu of active duty years of service when the retirement involves a disability that was incurred under circumstances that resulted in the award of the Purple Heart.

SUBTITLE E--COMMISSARY AND NONAPPROPRIATED FUND INSTRUMENTALITY BENEFITS

SECTION 651--TREATMENT OF PRICE SURCHARGES OF TOBACCO PRODUCTS AND CERTAIN OTHER MERCHANDISE SOLD AT COMMISSARY STORES

This section would clarify that for products that are sold as special exceptions to the standard surcharge of five percent of the revenue above cost of the products shall be applied to the surcharge fund as if it were a uniform surcharge product. The products that would be handled in this manner include tobacco products and, during the ongoing test of the sale of impulse purchase products, one-time use cameras, film, and telephone cards.

SECTION 652--LIMITATION ON USE OF DEPARTMENT OF DEFENSE LEASE AUTHORITY TO UNDERMINE COMMISSARIES AND EXCHANGES AND OTHER MORALE, WELFARE, AND RECREATION PROGRAMS AND NONAPPROPRIATED FUND INSTRUMENTALITIES

This section would bar ancillary services from being provided in facilities on property leased by the government to private entities if the secretary concerned determines that those ancillary services will be provided in direct competition with exchanges, commissaries, and morale, welfare, and recreation activities. This section would make an exception for facilities on leased property that is part of a base closure site.

The committee believes that the military exchanges, commissaries, and morale, welfare and recreation activities have primacy in providing ancillary services and merchandise over the interests of private sector entities leasing government property if the facilities on the leased property will directly compete with the exchanges, commissaries, and morale, welfare, and recreation activities.

SECTION 653--USE OF NONAPPROPRIATED FUNDS TO SUPPLEMENT OR REPLACE APPROPRIATED FUNDS FOR CONSTRUCTION OF FACILITIES OF EXCHANGE STORES SYSTEM AND OTHER NONAPPROPRIATED FUND INSTRUMENTALITIES, MILITARY LODGING, FACILITIES, AND COMMUNITY FACILITIES

This section would authorize the Secretary of Defense to allocate nonappropriated funds to augment or replace appropriated funding of construction of military exchange, military lodging; morale, welfare, and recreation; and community facilities. This section would also require that the Secretary provide notification to the congressional defense committees when allocating nonappropriated funding to support any construction project.

SECTION 654--REPORT ON COST EFFECTIVENESS OF PURCHASING COMMERCIAL INSURANCE FOR COMMISSARY AND EXCHANGE FACILITIES AND FACILITIES OF OTHER MORALE, WELFARE, AND RECREATION PROGRAMS AND NONAPPROPRIATED FUND INSTRUMENTALITIES

This section would require the Secretary of Defense to conduct a study to determine the cost effectiveness of nonappropriated fund activities purchasing commercial insurance to protect financial interests in facilities operated by morale, welfare and recreation activities, military exchange stores, and commissary stores. This section would require the Secretary to submit a report on his findings and recommendations by July 31, 2007.

The committee notes that many nonappropriated fund facilities destroyed and damaged during the 2005 hurricane season will be replaced using appropriated funds. The committee recognizes that commercial insurance may be a better option for protecting nonappropriated fund property. However, the committee is concerned that more must be understood about the cost effectiveness of purchasing commercial insurance and whether such insurance represents a useful option in all cases or only for the most high risk locations. The committee believes that the study proposed in this section would provide the needed information.

SUBTITLE F--OTHER MATTERS

SECTION 661--REPEAL OF ANNUAL REPORTING REQUIREMENT REGARDING EFFECTS OF RECRUITMENT AND RETENTION INITIATIVES

This section would repeal the requirement in section 1015 of title 37, United States Code, for the Secretary of Defense to submit an annual recruiting and retention report.

SECTION 662--PILOT PROJECT REGARDING PROVIDING GOLF CARTS ACCESSIBLE FOR DISABLED PERSONS AT MILITARY GOLF COURSES

This section would require the Secretary of Defense to conduct a test to determine the cost effectiveness, demand, and utility of purchasing golf carts that are accessible to disabled persons. This section would require the Secretary to purchase or acquire from other Department of Defense resources a minimum of three golf carts designed to provide access to disabled golfers at a minimum of three military golf courses. The three golf courses would be geographically dispersed, but one would be in the Washington D.C. metropolitan area. The test would be conducted for a minimum of one year. This section would require the Secretary to submit a report on his findings and recommendations not later than 180 days after the conclusion of the test.

The committee believes that it is important for military golf courses to lead the nation in facilitating the participation of disabled golfers by offering the latest in golf cart technology. However, the committee appreciates that more must be understood about the cost effectiveness, demand, and utility of purchasing the specialized golf carts. The committee believes that the study proposed in this section would provide the needed information.

SECTION 663--ENHANCED AUTHORITY TO REMIT OR CANCEL INDEBTEDNESS OF MEMBERS OF THE ARMED FORCES INCURRED ON ACTIVE DUTY

This section would extend the termination date of the temporary expanded authority for the secretaries of the military departments to remit or cancel indebtedness of military members included in section 683 of the National Defense Authorization Act for Fiscal Year 2006 (Public Law 109-163) from December 31, 2007, to December 31, 2009. This section would also increase the period of time following honorable discharge or separation during which the secretaries may exercise the expanded authority to remit and cancel indebtedness from one year to five years.

TITLE VII--HEALTH CARE PROVISIONS

OVERVIEW

The committee is concerned about the capability of the Defense Health Program to sustain the long-term quality and accessibility of the health care provided to the members of the armed forces and their families, along with retirees and their families. In the face of the growing cost of health care, the committee recognizes that the Department of Defense (DOD) may face significant challenges controlling that cost while providing for the medical readiness and force health protection for the men and women in uniform and ensuring health care services to all other beneficiaries. In this context, the committee closely examined the Department of Defense proposals to reduce the cost of health care and concluded that the plan relies too narrowly on increasing the costs of TRICARE to retirees. The committee believes that a more comprehensive approach to sustaining the military health care benefit is required and that changes to the military health care benefit require careful, deliberate consideration with a full accounting of the impact across the board. Therefore, the committee recommends legislation to require a review of DOD plans to reduce the cost of health care and an assessment and recommendations for sustaining the military health care services provided to members of the armed forces, retirees, and their families. The committee makes these recommendations to allow for a period of time to shape a comprehensive approach to address the cost of military health care.

The committee remains strongly committed to ensuring that members of the armed forces, retirees, and their families have access to quality health care. Accordingly, the committee recommends legislation to provide coverage for forensic examinations following sexual assaults and domestic violence and coverage for anesthesia and hospital costs for dental care provided to children and certain other beneficiaries. In addition, the committee directs the Secretary of Defense to conduct a demonstration project to provide over-the-counter medications under the pharmacy benefit program.

Finally, the committee is steadfast in its view that the Department of Defense and the federal government should not be doubly liable for the cost of financial incentives paid by DOD contractors to employees to enroll in the TRICARE program and still be at risk for the cost of providing health care to TRICARE-eligible employees. As such, the committee recommends legislation that would establish as unallowable the contract costs that result when DOD contractors pay or otherwise create financial incentives for TRICARE-eligible employees to use the TRICARE or other government-sponsored health care programs in lieu of the contractor-provided health care program.

In light of the many challenges faced by the military health care system, the committee continues to believe that the Defense Health Program must be fully funded.

ITEMS OF SPECIAL INTEREST

COMPREHENSIVE COMBAT CASUALTY CARE CENTER

The committee is aware of an effort by the Department of the Navy to establish a comprehensive combat casualty care center at the Naval Medical Center, San Diego, California, for all military personnel. The center would allow wounded servicemembers to continue their rehabilitation closer to their families in the western region of the United States. Currently, there is no regional Department of Defense (DOD) center to support such efforts in the west. The center would complement the activities at Walter Reed Army Medical Center and Brooke Army Medical Center, enhance efforts with the Department of Veterans Affairs (VA) in providing specialized care to wounded servicemembers, and allow for a seamless transition the Department of Veterans Affairs, if necessary. The committee urges the Department of Defense to consider funding such a center through the DOD-VA Joint Incentive Fund.

COMPTROLLER GENERAL REPORT ON A UNIFIED MEDICAL COMMAND PLAN

The committee notes with great interest the Department of Defense's (DOD) effort to improve the effectiveness and enhance military medicine through a unified medical command. The Army, Navy, and Air Force medical communities have provided superior, high-quality health care to our servicemembers, particularly those who have been injured or wounded on the front lines of combat. However, efforts to improve and streamline care have been hampered by the lack of standardized equipment and processes. The committee believes a unified medical command could improve the care being provided by the services with significant cost savings. The committee understands that the Department has established a Joint/Unified Medical Command Working Group to develop recommendations for two specific commands, a single joint/unified medical command responsible for all market areas of private sector care, and a joint/unified medical command responsible for operational/deployed medicine. The committee is concerned that two separate and distinct commands, one for operational medicine and one for private sector care, may actually hamper efforts to achieve greater efficiencies. As such, the committee directs the Comptroller General to conduct a review of the various studies that the Department of Defense and other organizations have undertaken and provide an analysis of the various unified medical command structures under consideration by the Department and outside organizations. The Comptroller General review shall include the studies undertaken by DOD's Joint/Unified Medical Command Working Group, as well as reviews conducted by the Center for Naval Analysis Corporation and other organizations, such as the Defense Business Board. The committee directs the Comptroller General to submit a report on his findings to the Senate Committee on Armed Services and the House Committee on Armed Services by March 31, 2007.

FORT DRUM HEALTH CARE PILOT PROGRAM

The Ronald W. Reagan National Defense Authorization Act for Fiscal Year 2005 (Public Law 108-375) established a pilot program to test initiatives that build cooperative health care arrangements and agreements between military installations and local regional non-military health care systems. As an installation undergoing profound growth, Fort Drum, New York, was selected as one of two test sites for the pilot program. The committee recommends $0.4 million for the Fort Drum regional health planning organization that has been organized to coordinate the pilot program, as well as to help conduct necessary assessments and/or studies.

MENTAL HEALTH PROGRAMS FOR COMBAT VETERANS AND THEIR FAMILIES

The committee recognizes the need for programs that assist military veterans who return from Iraq and Afghanistan to effectively deal with mental health issues and applauds the efforts of the Department of Defense and the Veterans Administration to provide mental health programs to combat veterans and their families. The committee urges both Departments to expand their current programs to include training programs, services and resources designed by behavioral health personnel with experience in a combat theater and focused on addressing combat stress and reintegration issues for active and reserve component personnel and their families.

SCREENING FOR TRAUMATIC BRAIN INJURY

The committee applauds the efforts of the Department of Defense to implement a comprehensive policy for assessing the health status of military personnel prior to deploying, upon redeployment and again three to six months after returning home. However, the committee is aware of Defense and Veterans Brain Injury Center studies showing that 31 percent of combat injured patients evacuated from Iraq and Afghanistan have a traumatic brain injury (TBI). According to the studies, many of these injuries result from blasts and are not always accompanied by obvious head trauma. Formal screening by trained medical personnel is required to identify these injuries and many injuries are never diagnosed. The committee is concerned that servicemembers with undiagnosed and untreated traumatic brain injuries may compromise operational readiness and may experience long-term medical effects from the injury. To address this issue, the committee directs the Secretary of Defense to modify the pre- and post-deployment assessments and the post-deployment reassessment by March 31, 2007, to contain questions that screen for traumatic brain injury.

In addition, the committee directs the Secretary to develop a comprehensive and systematic approach for the identification, treatment, disposition and documentation of TBI, including mild to moderate TBI, for combat and peace time injuries. The committee directs the Secretary to develop a comprehensive approach by May 1, 2007, and to report its actions to the Senate Committee on Armed Services and the House Committee on Armed Services.

TRICARE MAIL ORDER PHARMACY PROGRAM

The committee is aware that the TRICARE Mail Order Pharmacy program is an outstanding benefit for members of the armed services, retirees and their families. The mail order pharmacy is a cost effective and burden free method for beneficiaries to obtain medications. However, the committee is concerned that a lack of awareness and understanding of the program may exist among providers who prescribe medication within the facilities of the uniformed services and in the purchased care system. In addition, the committee is concerned that prescribing medications for distribution through the TRICARE Mail Order Pharmacy is time consuming and burdensome for providers.

The committee directs the Secretary of Defense to implement a comprehensive education program on the TRICARE Mail Order Pharmacy program that targets providers within the facilities of the uniformed services and in the purchased care system. The committee further directs the Secretary to take the necessary steps to ensure that the Pharmacy Data Transaction System and the Armed Forces Health Technology Application are modified to provide electronic transmission of prescriptions directly to the TRICARE Mail Order Pharmacy System. The committee directs the Secretary of Defense to implement these recommendations and submit a report on the progress of the implementation to the Senate Committee on Armed Services and the House Committee on Armed Services by December 31, 2007.

LEGISLATIVE PROVISIONS

SUBTITLE A--TRICARE PROGRAM IMPROVEMENTS

SECTION 701--TRICARE COVERAGE FOR FORENSIC EXAMINATION FOLLOWING SEXUAL ASSAULT OR DOMESTIC VIOLENCE

This section would provide coverage under the TRICARE program for forensic examinations following sexual assault or domestic violence.

SECTION 702--AUTHORIZATION OF ANESTHESIA AND OTHER COSTS FOR DENTAL CARE FOR CHILDREN AND CERTAIN OTHER PATIENTS

This section would provide coverage under the TRICARE program for anesthesia services and institutional costs for dental treatment for beneficiaries with developmental, mental or physical disabilities and for children under the age of five.

SECTION 703--IMPROVEMENTS TO DESCRIPTIONS OF CANCER SCREENING

This section would update the terminology used in the description of primary and preventive health care screenings authorized for female beneficiaries of the military health system. This section would authorize screening tests for cervical cancer and breast cancer without prescribing the use of the Papanicolau test or the mammogram. The committee understands that as new medical technology develops, legacy screening methods may become obsolete.

SECTION 704--PROHIBITION ON INCREASES IN CERTAIN HEALTH CARE COSTS FOR MEMBERS OF THE UNIFORMED SERVICES

This section would prohibit the Department of Defense (DOD) from increasing the premium, deductible and copayment for TRICARE Prime, the charge for inpatient care for TRICARE Standard, and the premium for TRICARE Reserve Select and TRICARE Standard for members of the Selected Reserve during the period from April 1, 2006 to December 31, 2007. The committee shares the DOD's concern about the rise in the cost of military health care and the potential for the escalating cost to have a negative impact on the ability of the Department to sustain the benefit over the long-term. However, the committee believes that changes to the military health care benefit require careful, deliberate consideration with a full accounting of the impact across the board. The committee makes these recommendations to allow for a period of time to shape a more balanced approach to address the cost of military health care.

SECTION 705--SERVICES OF MENTAL HEALTH COUNSELORS

This section would allow mental health counselors, without prior physician referral or supervision, to be reimbursed for services provided to TRICARE beneficiaries. This section would also amend section 704 of the National Defense Authorization Act for Fiscal Year 1995 (Public Law 103-337) to allow mental health counselors to enter into personal service contracts with the Department of Defense for the purpose of providing mental health services to TRICARE beneficiaries. Further, this section would require that mental health counselors meet the licensure or certification requirements for `health care professional' established by section 1094 of title 10, United States Code.

SECTION 706--DEMONSTRATION PROJECT ON COVERAGE OF SELECTED OVER-THE-COUNTER MEDICATIONS UNDER THE PHARMACY BENEFIT PROGRAM

This section would require the Secretary of Defense to conduct a demonstration project that would authorize the use of over-the-counter medications, in lieu of the equivalent prescription drugs. The demonstration program would take place in at least two of the three venues (military treatment facilities, TRICARE mail order pharmacy and retail pharmacies) where medications are dispensed to beneficiaries. At a minimum, the Secretary would be required to conduct the demonstration in at least five sites in each of the TRICARE regions for each of the two venues selected. The committee urges the Secretary to select the retail pharmacy program as one of the two venues in which to conduct the demonstration.

SECTION 707--REQUIREMENT TO REIMBURSE CERTAIN TRAVEL EXPENSES OF CERTAIN BENEFICIARIES COVERED BY TRICARE FOR LIFE

This section would allow a beneficiary who receives initial care at a military treatment facility prior to attaining the age of 65 to receive reimbursement for travel expenses associated with limited follow up care at the same facility in which the initial care was received. In addition, the beneficiary must reside over 100 miles from the military treatment facility and must be referred to the facility by a specialty care provider to be eligible.

SECTION 708--INFLATION ADJUSTMENT OF DIFFERENTIAL PAYMENTS TO CHILDREN'S HOSPITALS PARTICIPATING IN TRICARE PROGRAM

This section would require the Secretary of Defense to establish an annual inflationary adjustment for the TRICARE children's hospital differential payment rate beginning in fiscal year 2007.

SECTION 709--EXPANDED ELIGIBILITY OF SELECTED RESERVE MEMBERS UNDER TRICARE PROGRAM

This section would provide coverage under the TRICARE Standard program to all members of the Selected Reserves and their families while in a non-active duty status. Participants would be required to pay a premium that would be 28 percent of the total amount determined by the Secretary of Defense as being reasonable for the TRICARE coverage. This section would not extend TRICARE eligibility to reservists who were also federal employees entitled to Federal Employee Health Benefits Plan coverage under title 5, United States Code. Further, this section would repeal the three tiered cost share TRICARE program for reserves established by the fiscal year 2006 National Defense Authorization Act.

SECTION 710--EXTENSION TO TRICARE OF MEDICARE PROHIBITION OF FINANCIAL INCENTIVES NOT TO ENROLL IN GROUP HEALTH PLAN

This section would extend to the TRICARE program the same rule that currently applies to the Medicare program, making it unlawful for an employer or other entity to offer any financial or other incentive for a TRICARE retired beneficiary (military retirees and their

dependents) not to enroll under a health plan which would under law be primary payer to TRICARE. Further, this section would authorize the Secretary of Defense to adopt exceptions to the provision that the Secretary deems necessary for implementation of the prohibition. This section would also authorize the Secretary to discontinue the relationship with a contractor for repeated violations of this section. The committee makes this recommendation to address the growing concern that employers are shifting the financial responsibility of providing health care benefits to their employees to the federal taxpayers. Such cost shifting, left unchecked, would greatly increase government costs.

SUBTITLE B--STUDIES AND REPORTS

SECTION 711--DEPARTMENT OF DEFENSE TASK FORCE ON THE FUTURE OF MILITARY HEALTH CARE

This section would require the Secretary of Defense to establish a task force to assess the future of military health care. The task force would consist of 14 members appointed by the Secretary and would be required to develop recommendations on the actions the Department of Defense would have to take to improve and sustain the military health system over the long-term. This section would require the Secretary to develop a plan based on the recommendations of the task force, and submit the plan to the Senate Committee on Armed Services the House Committee on Armed Services not later than six months after receipt of the task force report.

SECTION 712--STUDY AND PLAN RELATING TO CHIROPRACTIC HEALTH CARE SERVICES

This section would require the Secretary of Defense to develop a plan for providing chiropractic health care services to all members of the uniformed services, as required by the Floyd D. Spence National Defense Authorization Act for Fiscal Year 2001 (Public Law 106-398). In addition, this section would require the Secretary to study the cost, feasibility, health benefit and potential cost savings of providing chiropractic care for active duty family members, members of the reserves and their family members, and retirees and their family members. The study would also include the cost of providing chiropractic care on a space available basis in those medical treatment facilities currently providing chiropractic care. The effects of chiropractic care on readiness and the acceleration of the return to duty of the members of the armed forces following an injury that can be appropriately treated with chiropractic health care services would also be included in the study. The Secretary shall submit a report, including the plan and the study, to the Senate Committee on Armed Services and the House Committee on Armed Services by March 31, 2007.

SECTION 713--COMPTROLLER GENERAL STUDY AND REPORT ON DEFENSE HEALTH PROGRAM

This section would require the Comptroller General to conduct a study of the cost savings projections included by the Department of Defense in the fiscal year 2007 budget request for the Defense Health Program. The study would include an evaluation of the rationale for the Department's calculation of the cost and the cost increases of the Defense Health program, the amounts paid by beneficiaries for health care, and the estimated savings associated with implementation of cost sharing increases. Further, the study would include a review of the rates of inflation in governmental and non-governmental health care programs, as well as other health care indexes. The Comptroller General is required to present his findings to the Senate Committee on Armed Services and the House Committee on Armed Services by June 1, 2007.

SECTION 714--TRANSFER OF CUSTODY OF THE AIR FORCE HEALTH STUDY ASSETS TO MEDICAL FOLLOW-UP AGENCY

This section would require the Secretary of the Air Force to notify and contact participants of the Air Force Health Study (commonly referred to as the Ranch Hand Study) to obtain written consent to transfer their data and biological specimens to the Institute of Medicine of the National Academy of Science by September 30, 2007. The Secretary of the Air Force is required to submit a report to the Armed Services Committees of the Senate and the House of Representatives on the results of the disposition of the assets and must maintain the specimens that were not able to be transferred for at least one year following submission of the report.

SECTION 715--STUDY ON ALLOWING DEPENDENTS OF ACTIVATED MEMBERS OF THE RESERVE COMPONENTS TO RETAIN CIVILIAN HEALTH CARE COVERAGE

This section would require the Secretary of Defense to conduct a study on the feasibility of allowing family members of reservists who are mobilized to continue health care coverage under a civilian health care program. The study would include an assessment of the number of family members with special health care needs, who would benefit from remaining in a member's civilian health plan, the feasibility of reimbursing the member for the civilian health coverage and a recommendation on the appropriate rate of reimbursement. Further, the study would include the feasibility of allowing family members of mobilized reservists, who do not have access to TRICARE providers, to continue civilian health care coverage. Not later than 180 days after enactment, the Secretary shall submit a report on the study to the Senate Committee on Armed Services and the House Committee on Armed Services.

SUBTITLE C--OTHER MATTERS

SECTION 721--COSTS OF INCENTIVE PAYMENTS TO EMPLOYEES FOR TRICARE ENROLLMENT MADE UNALLOWABLE FOR CONTRACTORS

This section would establish as unallowable the contract costs that result when Department of Defense (DOD) contractors pay or otherwise create financial incentives for TRICARE-eligible employees to use the TRICARE or other government-sponsored health care programs in lieu of the contractor provided health care program. The committee makes this recommendation because it believes that neither the DOD nor the federal government should be doubly liable for the cost of financial incentives paid by DOD contractors to employees to enroll in the TRICARE program and still be at risk for the cost of providing health care to TRICARE-eligible employees.

SECTION 722--REQUIREMENT FOR MILITARY MEDICAL PERSONNEL TO BE TRAINED IN PRESERVATION OF REMAINS

The section would require the Secretary of Defense to develop a program requiring each military department to include training in the preservation of remains for their health care professionals. The committee believes that all medical professionals need to be trained in the

proper post mortem care in theater in order to ensure that the proper preservation of remains is accomplished. The committee does not intend for the responsibilities of mortuary affairs to become the responsibility of medical professionals but rather, under certain circumstances, for medical professionals to assist in the preservation of remains.

SUBTITLE D--PHARMACY BENEFITS PROGRAM IMPROVEMENTS

SECTION 731--TRICARE PHARMACY PROGRAM COST-SHARE REQUIREMENTS

This section would require the Secretary of Defense to establish beneficiary cost sharing requirements for the TRICARE Mail Order Pharmacy program that are the same as for generic and formulary drugs provided to beneficiaries at military treatment facilities. At present, beneficiaries are not charged for generic and formulary drugs obtained through the military treatment facilities. Further, the section would limit the cost sharing requirements for drugs provided through the TRICARE retail pharmacy program to amounts not more than $6 for generic drugs, $16 for formulary drugs and $22 for non-formulary drugs. The committee makes these recommendations in order to provide incentives to beneficiaries to make greater use of the TRICARE Mail Order Pharmacy Program. The cost sharing schedules established by this section would end December 31, 2007.

TITLE VIII--ACQUISITION POLICY, ACQUISITION MANAGEMENT, AND RELATED MATTERS

OVERVIEW

Simply put, the Department of Defense (DOD) acquisition process is broken. The ability of the Department to conduct the large scale acquisitions required to ensure our future national security is a concern of the committee. The rising costs and lengthening schedules of major defense acquisition programs lead to more expensive platforms fielded in fewer numbers. The committee's concerns extend to all three key components of the Acquisition process including requirements generation, acquisition and contracting, and financial management.

The Joint Capabilities Integration and Development System (JCIDS) and Joint Requirements Oversight Council (JROC) are not operating as envisioned. The Under Secretary of Defense for Acquisition, Technology & Logistics (USD(AT&L)) is failing to control spiraling costs of major defense acquisition programs. As a result, programs to replace key weapons systems are attempting to place all necessary and imagined capabilities onto developing platforms. The JCIDS/JROC process is under intense pressure to ensure that a follow-on system meets all the military departments' current, future and anticipated needs. Consequently, by relying on one system to meet all the necessary requirements, the Department is increasing the costs and development time to field new systems. Ultimately, this process results in low quantities of higher priced systems delivered on a longer schedule.

The unintended consequence of these pressures is a JCIDS/JROC process reflecting a culture of forced cooperation, where the members must approve other military department's programs in order to have their programs approved. The `jointness' required in the JROC process creates a culture where each member faces pressure to accept the criticality of approving a new system for their sister service. The process also encourages military departments to request expensive added capabilities on systems, paid for by other departments in the name of jointness.

In the wake of a ten-year decrease in the acquisition workforce, the Department is facing a critical shortage of certain acquisition professionals with technical skills related to systems engineering, program management and cost estimation. While Congress has directed this decrease in the acquisition workforce over the past decade, the committee is dissatisfied with the Department's approach to these statutory decreases. Instead of cutting overhead and minimizing bureaucracy related to the acquisition workforce, the Department cut critical resources such as production and systems engineers, opting to outsource these functions to contractors. As a result of these workforce-structure decisions, there is a potential conflict of interest developing between contractors acting as `lead-system integrators' on projects for which they have oversight. In addition, the Department has outsourced too many processes closely related to `inherently governmental functions,' ceding de facto project responsibility and decision-making to industry. The reductions of the past decade were an effort to create a streamline corps of acquisition professionals utilizing best practices to obtain the best value for all DOD-related acquisitions. Instead, there is a critical shortage of individuals necessary to ensure systems with the best technology on the fastest schedule at the most competitive price are available to the Department. The committee believes that the Department lacks a coherent strategic human capital plan for the future of the acquisition workforce. A strategy is necessary to define and shape the DOD's future workforce. One essential focus of this strategy should be the continuity of program managers. The committee recommends that the tenure of program managers be extended to ensure program stability. In addition, the committee believes the strategy should focus on the value of systems engineers in ensuring affordability and producability of future systems.

Furthermore, training programs at the Defense Acquisition University need to expand their focus beyond just the contracting side of acquisition. The Department should create training programs that will ensure requirements personnel and financial managers are adequately trained. The Department should also seek to integrate acquisition and financial management information technology systems to ensure interoperability.

The Deputy Secretary of Defense recently commissioned a comprehensive overview of the acquisition process. The Defense Acquisition Performance Assessment (DAPA) consisted of a panel of leading acquisition experts from both the government and industry. Their review provided a series of recommendations related to defense acquisition reform. Of note is a recommendation to have the JROC presided over by an objective civilian--possibly the USD(AT&L). The DAPA report also found the JCIDS/JROC process does not adequately prioritize requirements provided by the combatant commanders, whom DAPA believes should have a greater say in determining requirements for future programs. Additionally, the committee recommends that the Department consider a prompt transition to a capabilities based acquisition system where combatant commanders are considered the major stakeholders and the military services act primarily as implementers.

Based on the recommendations of the DAPA report, the committee believes that the model for the future DOD acquisition system should be considered by determining requirements based primarily on capabilities needed by combatant commanders. A revised JCIDS/JROC process could objectively validate programs and these validated `joint' capability requirements could be executed by the military services, which would conduct acquisition and program management functions to deliver the combatant commanders identified `joint' capability rather

than focusing on service specific solutions. In addition, the Department should further consider `competing' missions among the services. This does not mean that one service will only conduct one mission with one platform. Instead, the services should compete at the design and concept level to encourage a creative means of accomplishing missions with new and innovative solutions.

Ultimately, the Department must carefully consider its ability to cost effectively put metal on targets. Some missions do not require cutting-edge technology to accomplish their objectives. The USD(AT&L), in collaboration with the JROC should reemphasize the need to focus on `best value' as it relates to accomplishing current and future DOD missions.

ITEMS OF SPECIAL INTEREST

MAJOR DEFENSE ACQUISITION PROGRAM REFORM

The committee enacted major reform of the acquisition process for Major Defense Acquisition Programs (MDAPs) through two sections of the National Defense Authorization Act for Fiscal Year 2006 (Public Law 109-163). In particular, section 801 required the certification of numerous requirements related to technological maturity, affordability, alternative acquisition strategies and compliance with relevant Department of Defense policies, regulations and directives, prior to approval of Milestone B for a MDAP. Section 802 rewrote the `Nunn-McCurdy' amendment (10 U.S.C. 2433), to prevent rebaselining of original baseline estimates for MDAPs. It also redefined the thresholds at which Congress requires notification. In particular, section 802 defined a `significant cost growth threshold' as programs that exceed 15 percent over the current baseline estimate or 30 percent over the original baseline estimate and a `critical cost growth threshold' as programs that exceed 25 percent over the current baseline estimate or 50 percent over the original baseline estimate. Notably, after enactment of section 802, in the first submission of the Selected Acquisition Report, the Department reported 36 programs in breach of either the `significant' or `critical' cost growth thresholds. The committee directs the Under Secretary of Defense for Acquisition, Technology and Logistics to submit a consolidated report describing efforts taken to implement major defense acquisition reform, as implemented by sections 801 and 802 of the National Defense Authorization Act for Fiscal Year 2006 (Public Law 109-163). The report shall be delivered to the Senate Committee on Armed Services and the House Committee on Armed Services by March 1, 2007.

PRIME VENDOR PROGRAM

The committee understands that the overall purpose of the Prime Vendor Program is to streamline supply chain management, lower overall costs to the government, and improve services to military customers by allowing them to buy commercial products directly from a list of pre-established commercial distributors. Concerns about the prices of products being procured through the Defense Logistics Agency's (DLA) Prime Vendor Program were raised at a hearing before the House Committee on Armed Services on November 9, 2005. As a result of this hearing, DLA officials recognized the need to improve management oversight and internal controls over the program and proposed a series of corrective actions. In order to allow time for DLA to implement these actions and ensure effective results, the committee directs the Comptroller General to review the actions taken by the Department of Defense to improve the Prime Vendor Program and submit a report to the Senate Committee on Armed Services and the House Committee on Armed Services by March 1, 2007.

SPECIAL OPERATIONS COMMAND REQUIREMENTS

The committee recognizes that title 10, United States Code, grants U.S. Special Operations Command (USSOCOM) specific acquisition authority for special operations peculiar equipment, material, supplies and services. The committee is concerned that USSOCOM is not fully capable of executing this Department-like authority under current Department of Defense policies and practices, which is particularly troubling because of the key role USSOCOM plays in current combat operations in Iraq and Afghanistan and in the global war on terrorism. The committee strongly urges the Secretary of Defense to consider the unique role and authorities of USSOCOM as the Department makes needed reforms to its acquisitions and logistics processes, to ensure USSOCOM can efficiently, responsively, and effectively execute authorities granted in title 10.

UNDEFINITIZED CONTRACT ACTIONS

Undefinitized Contract Actions (UCAs), also known as `unpriced' contracts or `letter' contracts, authorize contractors to start work and incur costs before reaching a final agreement on terms and conditions, including price. The committee recognizes UCAs can be helpful to support urgent operational needs, but such contracts are not a desirable form of contracting because they place the Department of Defense in an unfavorable negotiating position and do not provide incentives to achieve cost controls, since the contractor operates in a cost-plus mode until negotiations are complete. The committee directs the Comptroller General to undertake a study to determine if the Department is properly using such contracts and pricing them on time. At a minimum, the committee directs the Comptroller General determine: (1) Why the Department is using UCAs; and (2) whether certain sufficient management controls restrict the use of such contracts in urgent situations, ensure limited scope modifications and appropriate profits. The committee directs the Comptroller General to submit a report on the finding of this study to the Senate Committee on Armed Services and the House Committee on Armed Services by March 1, 2007.

LEGISLATIVE PROVISIONS

SUBTITLE A--PROVISIONS RELATING TO MAJOR DEFENSE ACQUISITION PROGRAMS

SECTION 801--REQUIREMENTS MANAGEMENT CERTIFICATION TRAINING PROGRAM

This section would require the Under Secretary of Defense for Acquisition, Technology and Logistics, in consultation with the Defense Acquisition University, to establish competency requirements and a certification training program to improve the ability of civilian and military personnel of the Department of Defense to generate requirements that are added to Major Defense Acquisition Programs (MDAPs). This section would require instruction on the interdependence and interfaces between the requirements generation system; the planning, programming, budgeting and execution system; and the defense acquisition system that collectively contribute to the outcomes of MDAPs. This section would require the Under

Secretary of Defense for Acquisition, Technology and Logistics to ensure compliance with the training program.

SECTION 802--ADDITIONAL REQUIREMENTS RELATING TO TECHNICAL DATA RIGHTS

This section would require the Secretary of Defense to establish regulations to ensure that a major system developed with federal or private funds acquires sufficient technical data to allow competition for contracts required for sustainment of the system. This section would also require any contract for a major system to include price and delivery options for acquiring, at any point during the lifecycle of the system, major elements of technical data not acquired at the time of initial contract award. The regulations would establish a standard for acquiring rights in technical data to enable the lowest possible lifecycle cost for the item or process acquired.

The committee notes, in recent years, acquisition program managers have minimized their purchases of technical data rights for new weapons systems. The committee understands that guidance issued in the 1990s intentionally sought to reverse the previous policy on technical data rights, which may have inappropriately assumed that all rights to technical data should be purchased, even in unnecessary situations. This section would require program managers to negotiate price options for acquiring additional data rights, at the time of award, when the government has maximum leverage in negotiations. The committee believes that this balanced approach will require program managers to buy those data rights necessary to minimize lifecycle cost without requiring the purchase of unneeded technical data rights.

SECTION 803--STUDY AND REPORT ON REVISIONS TO SELECTED ACQUISITION REPORT REQUIREMENTS

This section would require the Under Secretary of Defense for Acquisition, Technology and Logistics, in coordination with the service acquisition executives of each military department, to conduct a study on revisions to requirements related to Selected Acquisition Reports (SARs), as set forth in section 2432 of title 10, United States Code.

The SAR provides the committee with a critical tool for providing oversight of major defense acquisition programs. The SAR gives the committee access to clear and regular information on program progress, including information of a classified nature. The committee understands that the elements currently required to be included in the SAR have not been updated for a number of years. Some important elements of program progress are not included in the current SAR, and in some cases, information which may have previously been a good measure of program progress may no longer be as relevant to program oversight.

The committee recognizes that in order for the SAR to be useful to both the Department of Defense (DOD) and the committee, it should focus on those measures of program progress for major defense acquisition programs that are the most useful for oversight across a broad range of programs, without placing an undue reporting burden. One element in the current SAR that is clearly critical to congressional oversight is the unit cost information which provides the basis for reporting of cost growth under the Nunn-McCurdy Act (10 U.S.C. 2433). However, many elements of program progress beyond unit cost are essential to both departmental and congressional oversight. The committee believes that a revised SAR should be based upon the normal, internal-working documents utilized by the program manager on a day-to-day basis and not created exclusively in response to a congressional reporting requirement. The SAR should be a tool that provides both appropriate congressional oversight, validates the health of a program, and demonstrates that the program management techniques being employed are appropriate. DOD's recommendations shall be submitted to the committee by March 1, 2007.

SECTION 804--QUARTERLY UPDATES ON IMPLEMENTATION OF ACQUISITION REFORM IN THE DEPARTMENT OF DEFENSE

This section would require the Secretary of Defense to provide quarterly reports to the Senate Committee on Armed Services and the House Committee on Armed Services on the implementation of plans to reform the defense acquisition system. The updates would cover implementation of reforms of the processes for Acquisition, including generation of requirements, award of contracts, and financial management. The quarterly updates would include, at a minimum, consideration of recommendations made by:

(1) The Defense Acquisition Performance Assessment Panel;

(2) The Defense Science Board Summer Study on Transformation;

(3) The Center for Strategic and International Studies: Beyond-Goldwater-Nichols Study;

(4) The Quadrennial Defense Review; and

(5) The Committee Defense Review of the House Committee on Armed Services.

The first quarterly update would be required no later than 45 days after the enactment of this Act and the first day of each successive quarter. The requirement would terminate on the first day of the quarter in which the Selected Acquisition Reports indicate that no new programs have breached either the significant cost growth threshold or the critical cost growth threshold.

The ability of the Department of Defense to analyze and synthesize these reform recommendations into a series of meaningful and actionable implementation plans concerns the committee. In the past, bureaucratic impediments, changing senior leadership, and numerous other factors prevented implementation of major acquisition reform despite comprehensive studies on the subject. In particular, the committee notes that the President's Blue Ribbon Commission on Defense (1986), commonly known as the `Packard Commission,' recommended numerous reforms to the acquisition system that, despite the efforts of Congress and the Department, have not been fully realized. Nearly twenty years later, the four major acquisition reform studies of 2005 identify the same challenges identified by the `Packard Commission' including rampant cost growth, unreliable cost estimates, and requirements relying on immature technology increasing overall program cost. The committee is concerned about the ability of the Department to solve these decades' old problems.

SECTION 805--ESTABLISHMENT OF DEFENSE CHALLENGE PROCESS FOR CRITICAL COST GROWTH THRESHOLD BREACHES IN MAJOR DEFENSE ACQUISITION PROGRAMS

This section would amend section 2359b of title 10, United States Code, to establish requirements for Defense Acquisition Challenge Program proposals (referred to as `challenge proposals') solicited in response to a critical cost growth threshold breach for a major defense acquisition program (MDAP). A critical cost growth threshold breach occurs when an MDAP has exceeded the critical cost growth threshold established by section 2433 of title 10, United States Code. This section would require the Under Secretary of Defense for Acquisition, Technology, and Logistics (USD(AT&L)) to issue a solicitation for challenge proposals that may result in near-term improvements in affordability for an MDAP that has experienced a critical cost growth breach, in addition to the current Defense Acquisition Challenge Program (DACP) annual broad agency announcement and unsolicited proposal processes. The committee believes that challenge proposals for critical cost growth breaches warrant expeditious procedures for both preliminary and full review and evaluation. Therefore, this section would require critical cost growth breach DACP solicitations to be issued within 14 days following the date that the Selected Acquisition Report on the MDAP is submitted to Congress, as described in sections 2433(g) and 2432(f) of title 10, United States Code. Such a solicitation should provide sufficient detail on the cost and schedule variances and the design, engineering, manufacturing, and technology integration issues contributing to the MDAP cost growth, to allow responders to prepare responsive proposals for consideration in no less than 30 days. This section would require a panel established by USD(AT&L) to complete a preliminary evaluation of such challenge proposals within 60 days following the date that the Selected Acquisition Report on the MDAP is submitted to Congress. The panel would also be required to share the results of its preliminary evaluation with the Secretary of Defense to aid in the completion of the Secretary's written certification required by section 2433(e)(2)(B) of title 10, United States Code.

In the event a critical cost breach challenge proposal is found to have merit during the full review and evaluation process, this section would require the MDAP to fund such a challenge proposal following contract award. In the event a critical cost breach challenge proposal is found to have merit upon preliminary review, but later receives an unfavorable evaluation during full review by the office carrying out the MDAP, this section would require the MDAP program manager to provide a narrative explaining the rationale for the unfavorable evaluation to the panel that conducted the preliminary evaluation. If the panel does not agree with the MDAP program manager's rationale, the panel may request that the MDAP program manager reconsider. If after further consideration, the MDAP program manager still evaluates the challenge proposal unfavorably, the full review and evaluation is complete. Upon the conclusion of full review and evaluation, USD(AT&L) shall provide a report to the congressional defense committees detailing the rationale for each unfavorable evaluation and documenting the dissenting opinion of the panel, as applicable. This section would require full review and evaluation and the report to the congressional defense committees, as necessary, to be completed within 60 days following the preliminary evaluation by the panel.

In addition, this section would amend section 2433 of title 10, United States Code, to require the Secretary of Defense to carry out an additional assessment under the requirements of paragraph (e)(2) of such section, to assess the availability of alternative components, subsystems, or systems that may result in near-term improvements in affordability for any MDAP that has exceeded the critical cost growth threshold. The Secretary shall carry out this assessment through DACP.

This section would further amend section 2433 of title 10, United States Code, to require the Secretary to include an additional statement in the written certification required by paragraph (e)(2) of such section, stating that DACP, having issued a competitive solicitation for critical cost breach challenge proposals and having completed a preliminary review of proposals received, found no promising proposals meriting full review and evaluation.

Finally, this section would also amend section 2433(g) of title 10, United States Code, to require the Secretary to include a description of design, engineering, manufacturing, and technology integration issues in the narrative of significant occurrences contributing to critical cost growth, which is a component of the Selected Acquisition Report required in section 2433(e) of title 10, United States Code.

SECTION 806--MARKET RESEARCH REQUIRED FOR MAJOR DEFENSE ACQUISITION PROGRAMS BEFORE PROCEEDING TO MILESTONE B

This section would require certification that market research has been conducted prior to technology development to reduce duplication of existing technology and products. The committee believes that conducting market research before issuing a technology development contract will prevent duplication of existing technology and reduce program costs before a major defense acquisition program receives Milestone B approval. The committee urges the Department to consider new and creative means of ensuring that appropriate market research is conducted to advance technological development of unique capabilities and eliminate reinvention by using proven technologies available in the marketplace.

The committee is concerned that the Department of Defense (DOD) may not comply with the requirements of part 10 of the Federal Acquisition Regulation related to market research, which results in the lack of reasonable inclusion of large and small businesses with cost-effective and superior technologies in defense contracting. The committee is concerned that current DOD acquisition practices might limit the use of innovative solutions from both large and small businesses and fail to create incentives for DOD prime contractors to embrace innovative technologies from large and small businesses that are commercially available. Traditional cost-reimbursable labor contracts under the cost-plus-fixed-fee or cost-plus-award-fee structure may increase the difficulty of offering proven capabilities to the Department by inadvertently rewarding higher expenditures and reducing incentives to cut costs. The committee notes that cost-plus-percentage-of-cost contracts are prohibited by statute and encourages the Department to take action to ensure that the intent of this prohibition is followed.

SUBTITLE B--ACQUISITION POLICY AND MANAGEMENT

SECTION 811--APPLICABILITY OF STATUTORY EXECUTIVE COMPENSATION CAP MADE PROSPECTIVE

This section would amend section 808(e)(2) of the National Defense Authorization Act for Fiscal Year 1998 (Public Law 105-85) to clarify that the underlying provision is prospective from the date of enactment. Currently, compensation of certain executives in excess of a `benchmark' set by regulations is unallowable. As a result, in General Dynamics Corporation v. United States, 47 Fed.Cl. 514 (Fed. Cl. 2000), the court held that application of the statutory cap to a contract awarded prior to the enactment section 808(e)(2) constituted a breach of contract, and that the U.S. Government was liable for breach damages due to the retroactive application of the cap. This section would still subject executive compensation to a test of reasonableness.

SECTION 812--PROHIBITION ON PROCUREMENT FROM BENEFICIARIES OF FOREIGN SUBSIDIES

This section would prohibit the Secretary of Defense from entering into a contract with a foreign person (including a joint venture, cooperative organization, partnership or contracting team), who has received a subsidy from the government of a foreign country that is a member of the World Trade Organization, if the United States has requested a consultation with that foreign country on the basis that the subsidy is prohibited under the Agreement on Subsidies and Countervailing Measures.

SECTION 813--TIME-CERTAIN DEVELOPMENT FOR DEPARTMENT OF DEFENSE INFORMATION TECHNOLOGY BUSINESS SYSTEMS

This section would require that Department of Defense information technology business systems be fielded within five years of the system entering the technology development phase of the acquisition process, known as Milestone A approval. The committee is concerned that many large information technology acquisition programs begin with great promise, yet linger in the development phase for many years without delivering any useful products to the Department. This section would limit the time allowed for development of such systems.

SECTION 814--ESTABLISHMENT OF PANEL ON CONTRACTING INTEGRITY

This section would establish a panel on contracting integrity to eliminate areas of vulnerability of the defense contracting system to fraud, waste and abuse. The panel would be chaired by the Deputy Secretary of Defense and include the service acquisition executive of each military department, the Inspector General of the Department of Defense, the Director of the Defense Logistics Agency, the Director of the Defense Contract Management Agency and the Director of the Defense Contract Audit Agency. This section would require the panel to submit an annual report on its activities to the congressional defense committees.

SUBTITLE C--AMENDMENTS TO GENERAL CONTRACTING AUTHORITIES, PROCEDURES, AND LIMITATIONS

SECTION 821--EXTENSION OF SPECIAL TEMPORARY CONTRACT CLOSEOUT AUTHORITY

This section would allow the Department of Defense to maximize its efforts to close contracts by extending the authority. Section 804 of the National Defense Authorization Act for Fiscal Year 2004 (Public Law 108-136) as amended, permits the Department to close contracts entered prior to October 1, 1996, provided the contracts are administratively complete and the financial account has an unreconciled balance, either positive or negative, that is less than $0.1 million.

SECTION 822--LIMITATION ON CONTRACTS FOR THE ACQUISITION OF CERTAIN SERVICES

This section would prohibit the Secretary of Defense from entering into a contract for covered services if the amount of the contract exceeds 75 percent of the estimated value of the asset required for the provision of services under the contract or exceeds $150.0 million in payments over the life of the contract.

SECTION 823--USE OF FEDERAL SUPPLY SCHEDULES BY STATE AND LOCAL GOVERNMENTS FOR GOODS AND SERVICES FOR RECOVERY FROM NATURAL DISASTERS, TERRORISM, OR NUCLEAR, BIOLOGICAL, CHEMICAL, OR RADIOLOGICAL ATTACK

This section would provide the Administrator of General Services the authority to allow State or local governments to use General Services Administration's (GSA) federal supply schedules for goods and services to facilitate recovery from natural disasters, terrorism or nuclear, biological, chemical, or radiological attack. This section would build on the successful cooperative purchasing program authorized in section 211 of the E-Government Act of 2002 (Public Law 107-347) which opened GSA's schedules for information technology for use by State and local governments.

SECTION 824--WAIVERS TO EXTEND TASK ORDER CONTRACTS FOR ADVISORY AND ASSISTANCE SERVICES

This section would amend section 2304b(b) of title 10, United States Code, and section 253i(b) of title 41, United States Code, to allow the head of an agency to issue a waiver to extend an Advisory and Assistance Services (AAS) contract up to ten years maximum through five one-year options, if he determines in writing that the contract provides engineering or technical services of such a unique and substantial technical nature that recompetition is harmful to the continuity of the program; that recompetition would create a large disruption in ongoing support due to prime contract recompetition when the Department of Defense has a successfully performing prime contractor; and the Department would endure program risk during critical program stages due to loss of program corporate knowledge of ongoing program activities.

The committee is concerned about the Department's growing reliance on AAS contracts. This section would require the Secretary of Defense to submit a report to the Senate Committee on Armed Services and the House Committee on Armed Services by April 1, 2007. The report would include the following information:

(1) Methods used by the Department to identify a contract as an AAS contract;

(2) Number of AAS contracts awarded by the Department in the five years prior to the enactment of this Act;

(3) Average annual expenditures by the Department for AAS contracts;

(4) Average length of AAS contracts;

(5) Number of AAS contracts recompeted and awarded to the previous award winner;

(6) Number of AAS contractors who previously qualified as a small business but no longer qualify as a small business for a recompetition;

(7) Number of AAS contracts required for a period of greater than five years and a justification as to why those services are required for greater than five years, including rationale for not performing the service inside the Department;

(8) Percentage of AAS contracts awarded by the Department in the five years prior to the enactment of this Act for assistance in the introduction and transfer of engineering and technical knowledge for fielded systems, equipment, and components; and

(9) Steps taken by the Department to prevent organizational conflicts of interest in the use of AAS contracts.

This waiver authority would be ineffective if the Secretary of Defense fails to issue the required report by April 1, 2007.

SECTION 825--ENHANCED ACCESS FOR SMALL BUSINESS

This section would amend section 9(a) of the Contract Disputes Act of 1978 (41 U.S.C. 608) to provide that the Armed Services Board of Contract Appeals and the Civilian Board of Contract Appeals shall provide for expedited disposition of appeals of small businesses where the amount in dispute is $150,000 or less.

SECTION 826--PROCUREMENT GOAL FOR HISPANIC-SERVING INSTITUTIONS

This section would amend section 2323 of title 10, United States Code to extend the contract goals for small disadvantaged businesses and certain institutions of higher education to include Hispanic-serving institutions.

SECTION 827--PROHIBITION ON DEFENSE CONTRACTORS REQUIRING LICENSES OR FEES FOR USE OF MILITARY LIKENESSES AND DESIGNATIONS

This section would require that any contract entered into by the Department of Defense include a provision prohibiting the contractor from requiring toy and hobby manufacturers, distributors, or merchants to obtain licenses from or pay fees to the contractor for the use of military likenesses or designations on items provided under the contract.

SUBTITLE D--UNITED STATES DEFENSE INDUSTRIAL BASE PROVISIONS

SECTION 831--PROTECTION OF STRATEGIC MATERIALS CRITICAL TO NATIONAL SECURITY

This section would amend title 10, United States Code, by inserting section 2533b, `Requirement to buy strategic materials critical to national security from American sources; exceptions.' This section would prohibit the use of appropriated funds for the procurement of a specialty metal or an item critical to national security, as determined by the Strategic Materials Protection Board, unless the item is reprocessed, reused, or produced in the United States.

The committee believes this section will build on the strong tradition of section 2533a of title 10, United States Code, known as the `Berry Amendment,' while simultaneously addressing certain issues related to the procurement of specialty metals. In particular, the committee is concerned by claims that confusion exists over the applicability of the Berry Amendment to all tiers of the supply chain. This section would clarify the original intent of the Berry Amendment by noting that the section applies to subcontracts at any tier under a prime contract, as well as the prime contract. This section would maintain all current exceptions and waivers to the current Berry Amendment. The committee notes that application of this section would allow foreign governments to purchase only specialty metals or items critical to national security from the United States or from their own domestic suppliers. The committee believes that allowing foreign governments to purchase specialty metals from any source not only defeats the intent of the Berry Amendment but also creates a grave risk to national security. This section would prohibit the practice of delivering non-compliant components to the federal government without charge in order to be considered compliant with the Berry Amendment.

The committee is aware that certain suppliers currently claim that they are inadvertently non-compliant with the Berry Amendment as it relates to specialty metals. This section would allow a 12-month `get well' period for suppliers at all levels of the supply chain to become compliant with section 2533b of title 10, United States Code. This section would require public notice of non-compliant suppliers on Fedbizoops.gov, a website that allows the commercial venders to seek federal markets for their products, written notification of non-compliance to the supplier and prime contractor, and receipt of a compliance plan from the non-compliant supplier and prime contractor. This section would allow a waiver for inadvertent non-compliance to be granted only after public posting of non-compliance and the opportunity for a challenger to offer the federal government the opportunity to substitute the non-compliant components with compliant components. This inadvertent non-compliance waiver would require approval from the secretary of the military department concerned.

SECTION 832--STRATEGIC MATERIALS PROTECTION BOARD

This section would establish a Strategic Material Protection Board. The board would be established by the Secretary of Defense and include the Under Secretary of Defense for Acquisition, Technology and Logistics, the Under Secretary of Defense for Intelligence, the Secretary of the Army, the Secretary of the Navy, and the Secretary of the Air Force. The committee believes that the Department of Defense should create a process to identify items that are critical to national security. In particular, the committee notes that certain materials, should they be unavailable domestically would severely impair our national security. This section would require the board to publish a list of items determined to be critical to national security. Additionally, this section would prohibit the removal of specialty metals listed in section 2533b of title 10, United States Code, from the list of items critical to national security.

TITLE IX--DEPARTMENT OF DEFENSE ORGANIZATION AND MANAGEMENT

ITEMS OF SPECIAL INTEREST

IMPORTANCE OF PLACING FOREIGN AREA OFFICERS IN COMBAT UNITS

The committee notes the contribution made by Foreign Area Officers (FAOs) to the military services, in terms of their knowledge of the language, culture, and personalities of their regions of expertise. While this contribution is routinely limited to strategic levels of operations, the committee believes that this contribution proves valuable at every level of military operations. To encourage that end, the military services should provide sufficient numbers of FAOs so that each regional combatant commander can provide at least one FAO to each subordinate combat units commanded by a two-star general or flag officer. The committee recommends that these FAOs be assigned to the policy and plans staff of the subordinate commands to allow the command to benefit from their regional expertise in its exercise of command and control functions.

INCREASED BUDGETARY CONFIDENCE LEVEL IMPLEMENTATION IN SPACE ACQUISITION

Historically, space acquisitions have been budgeted to a 50 percent certainty that the final cost will be at or below the estimate. The committee believes that cost estimating at a 50 percent confidence level leaves little management reserve, reduces probability of program execution, and increases total program costs by requiring budget and schedule adjustments during execution. Furthermore, the committee believes that budgeting to an 80 percent confidence level mitigates problems caused by inaccurate cost estimating and therefore, encourages the Secretary of Defense to raise the required budgetary confidence level of all new and restructured space programs from 50 percent to 80 percent.

NATIONAL SECURITY SPACE MANAGEMENT

The committee recognizes efforts within the national security space community to enhance relationships and coordinate activities that span acquisition, research and development, and operations in order to create more responsive and agile space capabilities to support critical intelligence and defense missions. In particular, the committee recognizes the need for the Department of Defense's Executive Agent for Space, the Director, National Reconnaissance Office, and the Under Secretary of the Air Force to maintain close coordination in oversight and management of space capabilities.

The committee requests the Secretary of Defense, in consultation with the Director of National Intelligence, submit a report to the congressional defense committees by March 1, 2007, describing the roles and responsibilities of each of these positions with respect to resource and staffing requirements, program development, requirements processes, and acquisition authority. The committee also requests a description of the additional roles, responsibilities, and authorities of the Director, National Reconnaissance Office, as the Assistant to the Secretary of the Air Force for Intelligence Space Technology.

REPORT ON DEVELOPING EXPERTISE IN EMERGING NATIONAL SECURITY CHALLENGES

The committee believes that the Department of Defense (DOD) should consider how best to develop expertise in emerging national security challenges and distribute appropriately such knowledge throughout the Department, including the military services. For example, the committee notes the role that the Center for the Study of Chinese Military Affairs within the National Defense University has played in developing knowledge and expertise in a focused area of military importance. The committee believes that DOD personnel currently may be benefiting, or may benefit in the future, from similar concentration in other key defense and security areas, such as stability and support operations.

Therefore, the committee directs the Secretary of Defense to submit to the Senate Committee on Armed Services and the House Committee on Armed Services by March 31, 2007, a report that identifies key defense and security areas and the capabilities required to educate DOD personnel appropriately. The report shall note what capabilities the Department already has in these areas and ways in which the Department may develop these capabilities as competencies, whether through the development of Centers of Excellence, the fusing of existing institutions, integration into the professional military education curriculum, or any other steps the Secretary may recommend.

REPORT ON COORDINATION AND OVERSIGHT OF MILITARY CULTURAL AND LINGUISTIC POLICIES AND TRAINING

The committee believes that the relevance and importance of cultural knowledge, regional expertise, and linguistic capability will remain critical to national security for decades to come, in the long war and in future wars. The committee commends the Department for its initiative in respect to coordinating and setting a direction for language skills, and commends the services for the multiple initiatives they have taken in regards to cultural training.

The committee believes it may be beneficial to synchronize efforts in the cultural training and regional expertise fields across the Department by creating an office within the Office of the Secretary of Defense that would provide oversight for the Department's cultural and linguistic policies and training. Therefore, the committee directs the Secretary of Defense to submit to the Senate Committee on Armed Services and the House Committee on Armed Services by April 1, 2007, a report on the options to provide such oversight, to include consideration of the establishment of an office within the Office of the Secretary of Defense for that function, and the resources required to create such an office.

LEGISLATIVE PROVISIONS

SUBTITLE A--DEPARTMENT OF DEFENSE MANAGEMENT

SECTION 901--STANDARDIZATION OF STATUTORY REFERENCES TO `NATIONAL SECURITY SYSTEM' WITHIN LAWS APPLICABLE TO DEPARTMENT OF DEFENSE

This section would amend sections 2222, 2223, and 2315 of title 10, United States Code, to ensure the definition of national security systems contained in title 10 is consistent with the definition provided in the Federal Information Security Management Act (FISMA) of 2002 (Public Law 107-347). FISMA applies federal government wide and provides a broader definition of national security systems than contained in title 10, expanding the term to apply to all systems used for classified data, as well as those operated by a contractor of an agency or other organization on behalf of the agency.

SECTION 902--CORRECTION OF REFERENCE TO PREDECESSOR OF DEFENSE INFORMATION SYSTEMS AGENCY

This section would amend section 193 of title 10, United States Code, to reflect the current name of the Defense Information Systems Agency.

SECTION 903--ADDITION TO MEMBERSHIP OF SPECIFIED COUNCIL

This section would amend section 179 of title 10, United States Code, to include the Commander, United States Strategic Command, on the Nuclear Weapons Council.

SECTION 904--CONSOLIDATION AND STANDARDIZATION OF AUTHORITIES RELATING TO DEPARTMENT OF DEFENSE REGIONAL CENTERS FOR SECURITY STUDIES

This section would streamline the management of Department of Defense Regional Centers for Security Studies, which to date have operated under different authorities. This section would allow the Centers to pursue research in addition to communication and exchange of ideas involving U.S. and foreign military officers, civilian governmental personnel, and non-governmental personnel.

This section would allow foreign governments and U.S. federal agencies to fund foreign participation in center activities and the Secretary of Defense to waive reimbursement of costs of activities for military officers and civilian defense and security officials from developing countries. This section would continue an annual requirement for the Secretary of Defense to submit to Congress a report on the regional centers' status, objectives, budgets, international participation, and foreign gifts and donations.

SECTION 905--REDESIGNATION OF THE DEPARTMENT OF THE NAVY AS THE DEPARTMENT OF THE NAVY AND MARINE CORPS

This section would designate the Department of the Navy as the Department of the Navy and the Marine Corps and change the title of its Secretary to Secretary of the Navy and Marine Corps. This provision would formally recognize the responsibility of the Office of the Secretary of the Navy over both the Navy and Marine Corps and the Marine Corps' status as an equal partner with the Navy.

SUBTITLE B--SPACE ACTIVITIES

SECTION 911--DESIGNATION OF SUCCESSOR ORGANIZATIONS FOR THE DISESTABLISHED INTERAGENCY GLOBAL POSITIONING EXECUTIVE BOARD

This section would amend section 2281 of title 10, United States Code, to reflect the new organizational structure created by the United States Space-Based Positioning, Navigation, and Timing Policy issued December 8, 2004, and permit continued multi-agency funding for this activity.

SECTION 912--EXTENSION OF AUTHORITY FOR PILOT PROGRAM FOR PROVISION OF SPACE SURVEILLANCE NETWORK SERVICES TO NON-UNITED STATES GOVERNMENT ENTITIES

This section would extend the expiring authority of the Secretary of Defense to conduct a pilot program that would allow non-U.S. government entities to purchase space surveillance network services from assets owned or controlled by the Department of Defense through September 30, 2009. The current authority would expire on May 22, 2007.

SECTION 913--OPERATIONALLY RESPONSIVE SPACE

This section would require establishment of an Operationally Responsive Space Program Office, and would require the Secretary of Defense to submit a report to the congressional defense committees setting forth a plan for acquisition of capabilities for operationally responsive space support to the warfighter.

SUBTITLE C--CHEMICAL DEMILITARIZATION PROGRAM

SECTION 921--TRANSFER TO SECRETARY OF THE ARMY OF RESPONSIBILITY FOR ASSEMBLED CHEMICAL WEAPONS ALTERNATIVES PROGRAM

This section would transfer program management responsibility for the Assembled Chemical Weapons Alternatives (ACWA) program from the Under Secretary of Defense for Acquisition, Technology, and Logistics (USD (AT&L)) to the Secretary of the Army by January 1, 2007; would provide for management of the program as a part of the Department of the Army organization for management of the chemical weapons demilitarization program as specified in section 1521 of title 50, United States Code; and would require the Secretary of the Army to implement fully the alternative technologies previously selected for destruction of lethal chemical munitions at Pueblo Chemical Depot, Colorado, and Blue Grass Army Depot, Kentucky. The transfer of management of the ACWA program to the Secretary of the Army would in no way diminish the responsibility of the USD (AT&L) for oversight of the chemical weapons demilitarization program, including ACWA, nor the USD (AT&L)'s responsibility as defense acquisition executive for the acquisition category 1D program.

SECTION 922--COMPTROLLER GENERAL REVIEW OF COST-BENEFIT ANALYSIS OF OFF-SITE VERSUS ON-SITE TREATMENT AND DISPOSAL OF HYDROLYSATE DERIVED FROM NEUTRALIZATION OF VX NERVE GAS AT NEWPORT CHEMICAL DEPOT, INDIANA

This section would require the Comptroller General to review and report to Congress by December 1, 2006, on the adequacy of the cost benefit analysis prepared by the Secretary of the Army comparing options to treat and dispose of the hazardous material that is a byproduct of the process of neutralizing VX nerve gas stored at Newport Chemical Depot, Indiana. This section would also prohibit the Secretary from proceeding with any action to transport this hazardous material, or hydrolysate, until 60 days after the Comptroller General's report is received by Congress. Pending enactment of this section, the committee intends that the Secretary of the Army take no action to transport hydrolysate from Newport Army Depot until the actions that would be required by this section are completed.

SECTION 923--SENSE OF CONGRESS REGARDING THE SAFE AND EXPEDITIOUS DISPOSAL OF CHEMICAL WEAPONS

This section would express the sense of Congress that the process used for selecting a site for remote disposal of hazardous material remaining after the initial processing of chemical munitions should be free from political influence and that a process similar to that used for base closure and realignment be considered for adoption.

SUBTITLE D--INTELLIGENCE-RELATED MATTERS

SECTION 931--REPEAL OF TERMINATION OF AUTHORITY OF SECRETARY OF DEFENSE TO ENGAGE IN COMMERCIAL ACTIVITIES AS SECURITY FOR INTELLIGENCE COLLECTION ACTIVITIES ABROAD

This section would amend section 431(a) of title 10, United States Code, to repeal the termination of authority for the Secretary of Defense to engage in commercial activities as security for intelligence collection activities abroad.

TITLE X--GENERAL PROVISIONS

ITEMS OF SPECIAL INTEREST

COUNTER-DRUG ACTIVITIES

OVERVIEW

The budget request contained $926.9 million for drug interdiction and counter-drug activities, in addition to $131.9 million, for operational tempo which is included within the operating budgets of the military services. The fiscal year 2007 budget is organized to address four broad national priorities: (1) international support; (2) domestic support; (3) intelligence and technology support; and (4) demand reduction.

The committee recommends an authorization for fiscal year 2007 Department of Defense counter-drug activities as follows:

FY07 Drug Interdiction and Counter-Drug Request	$926,890
International Support	$435,919
Domestic Support	$205,416
Intelligence and Technology Support	$151,322
Demand Reduction	$134,233
Recommended Decreases
SOUTHCOM
NORTHCOM	$7,000
PACOM	$2,000
CENTCOM	$1,000
Intelligence and Technology	$2,000
Support	$4,000
Recommended Increases
Southwestern Border Fence	$10,000
Maritime Domain Awareness	$6,000
Recommendation	$926,890

ITEMS OF SPECIAL INTEREST

Budget requests

The fiscal year 2007 drug interdiction and counter-drug activities budget request of $926.9 million covers all counternarcotics resources in the Department of Defense (DOD) with the exception of those resources in the operating budget for the military services for operational tempo, military personnel, and military construction. The committee notes that the services' budget requests include an additional $131.9 million for operational tempo expenses related to counter-drug activities in their respective appropriations. The committee, therefore, directs the Secretary of Defense to integrate the associated operational tempo costs contained in the services' budgets for drug interdiction and counter-drug activities into DOD's drug interdiction and counter-drug activities budget justification material for fiscal year 2008, and thereafter. The committee directs that the budget justification material which lists drug resources by function shall include the associated operational tempo costs to the services in the total budget request by the Department for counter-drug activities.

Counternarcotics policy for Afghanistan

The committee supports the efforts of the Department of Defense (DOD) to use drug interdiction and counternarcotics resources to support the global war on terrorism and notes that there are clear links between international narcotics trafficking and international terrorism. In that regard, the committee supports DOD's unified campaign against narcotics trafficking and activities by organizations designated as terrorist organizations in Colombia and Afghanistan. The committee notes with regards to Afghanistan, the Department has responded to requests for support from the Department of State, the Drug Enforcement Administration and the Government of the United Kingdom to help the Government of Afghanistan develop the capacity to address the country's serious and growing narcotics problem. The committee believes that the high level of DOD support to the Department of State in building law enforcement capacity in Afghanistan is the correct approach.

The committee is concerned that despite the development of an interagency implementation plan for U.S. counternarcotics activities in Afghanistan and the surrounding region, the Department is being asked to fund and manage activities that are well beyond its core mission. The Department must continue to play an important role in the international and

interagency fight against narcotics in Afghanistan, but it must not take on roles in which other countries or other agencies of the U.S. Government have core capabilities.

Intelligence and technology

The budget request contained $151.3 million for intelligence and technology support.

The committee understands the importance of intelligence and technology in the counternarcotics program. Intelligence and technology are used to dismantle narcotics networks and terrorist organizations linked to drug trafficking. The committee notes that the authorization of funds for intelligence and technology will result in increased development, testing, evaluation, and deployment of technologies that collect and monitor narcotics intelligence on land, sea, and in the air.

Accordingly, the committee recommends $147.3 million for intelligence and technology, a decrease of $4.0 million. The recommended funding represents a significant increase over the fiscal year 2006 authorization.

Maritime domain awareness

The budget request contained $2.5 million for research and development of a detection and monitoring domain awareness system. This system integrates multiple sensors, databases, and anomaly detection tools into a data fusion testbed that provides persistent-situational awareness across domains and operation systems. One system under development provides wide-area surveillance, maritime domain awareness, and distributes actionable intelligence concerning potential narcotics trafficking or terrorist threats. This system operations succeeded in a test conducted by Joint Task Force-North and will be evaluated during fiscal year 2007 by the Joint Interagency Task Force-South and in Colombia.

Accordingly, the committee recommends an increase of $6.0 million for this purpose.

Southwest Border Fence

The committee is concerned that the southwest border continues to be a heavily utilized human and drug smuggling corridor allowing access into U.S. metropolitan areas from Mexico. Since 1990, construction and rehabilitation along this prolific drug smuggling corridor has resulted in 7.6 miles of double-layer fencing, 59 miles of single fencing, and 169.5 miles of road. These advances have reduced drug trafficking into the region and have eliminated the smuggling corridor.

Completing the fence construction project in San Diego, California, will allow counter-drug assets to be redeployed to other areas. The committee supports this fence and road-building activity in the southwest region. Funds authorized within this Act shall be used to complete construction of the 14-Mile Border Infrastructure System near San Diego, California; increase the height of existing border vehicle barriers to a minimum of 10 feet; and build an additional 5 miles of primary fencing east of the Otay Mesa port of entry. In addition, not less than $3.0 million shall be used to design, plan, deploy and rehabilitate fencing for 15 miles on either side of the Laredo, Texas port of entry. Finally, not less than $2.0 million shall be used to design, plan, deploy and rehabilitate fencing at the Marine Corps Air Station, Yuma, Arizona.

Accordingly, the committee recommends an increase of $10.0 million for this purpose.

U.S. Central Command operations support

The budget request contained $27.6 million for U.S. Central Command (USCENTCOM) and participating nation support for USCENTCOM operations. Reductions in support activities are planned, in light of other worldwide commitments.

Accordingly, the committee recommends a decrease of $2.0 million for this purpose.

U.S. Northern Command operations support

The budget request contained $15.5 million for U.S. Northern Command domestic operations support. Reductions in support activities are planned, in light of other worldwide commitments.

Accordingly, the committee recommends a decrease of $2.0 million for this purpose.

U.S. Pacific Command operations support

The budget request contained $27.2 million for U.S. Pacific Command (USPACOM) and participating nation support for USPACOM operations. Reductions in support activities are planned, in light of other worldwide commitments.

Accordingly, the committee recommends a decrease of $1.0 million for this purpose.

U.S. Southern Command operations support

The budget request contained $372.7 million for U.S. Southern Command (USSOUTHCOM) and participating nation support for USSOUTHCOM operations. Reductions in support activities are planned, in light of other worldwide commitments.

Accordingly, the committee recommends a decrease of $7.0 million for this purpose.

OTHER ACTIVITIES

AIRCRAFT CARRIER FORCE STRUCTURE

The committee notes that the Department of Defense's legislative proposal for fiscal year 2007, included a section that would effectively allow retirement of the conventionally-powered aircraft carrier, USS John F. Kennedy, thereby reducing the carrier force structure from 12 to 11 ships.

The committee believes that the Navy's decision to reduce the number of carriers was not based on mission requirements analysis; rather, the decision was based on fiscal constraints. Section 126 of the National Defense Authorization Act for Fiscal Year 2006 (Public Law 109-163) amended section 5062 of title 10, United States Code, to set a minimum carrier force structure of not less than 12 operational aircraft carriers. The committee believes the aircraft carrier force structure should be maintained at 12 ships in order to meet worldwide commitments.

However, the committee would like to explore options for maintaining the USS John F. Kennedy in an operational status either within or outside the U.S. Navy, to include the possibility of transferring operational control to the North Atlantic Treaty Organization (NATO). Therefore, the committee directs the Secretary of Defense to submit a report to the congressional defense committees by March 1, 2007, that examines options for maintaining the USS John F. Kennedy in an operational status both within and outside the U.S. Navy. In examining the NATO option, the Secretary shall coordinate an assessment with the NATO Secretary General. The report shall include the cost and manning required, statutory restrictions that would preclude transfer of the USS John F. Kennedy to organizations or entities outside the U.S. Navy, and a classified annex on how the Navy would meet global operational requirements with an aircraft carrier force structure of less than 12 ships.

`COMMERCIAL FIRST' MARITIME SEALIFT POLICY

The committee is aware of recent discussions between the U.S. Transportation Command (USTRANSCOM) and the operators of U.S. flag vessels concerning the longstanding policy of using commercial vessels to transport military cargo when sufficient resources are available. Under this policy, the Department of Defense is required to, at least annually, determine the number of ships it needs to own or have under charter to meet its peacetime, contingency and wartime projected requirements. Once this `fleet' is sized, ships under charter to the U.S. Government, or government-owned ships that have been activated to full operating status, shall be used to the `maximum extent practicable' when vessel schedules satisfy cargo delivery requirements. Assuring that the multiple components of sealift capacity are fully utilized is a difficult balancing act. The United States must retain its commercial capacity and simultaneously act as good stewards of the taxpayer's dollar when government-controlled carriers have been activated and are available. The Secretary of Defense has empowered USTRANSCOM to ensure that U.S. troops deployed worldwide have the assets they need, when they need them. This is a difficult task given the wide range of operational demands placed on U.S. armed forces at this point in time. This balancing act is not one that lends itself to a legislative solution, nor is one warranted. The committee is confident that satisfactory solutions are attainable through continuing dialogue.

DEPARTMENT OF DEFENSE CIVIL SUPPORT

The committee commends the men and women of the U.S. armed forces who played an invaluable role in helping the citizens of Louisiana, Alabama and Mississippi respond to the devastation of Hurricane Katrina and saved countless lives. The committee notes, however, that there are a number of areas where the Department of Defense (DOD) could have improved the execution of military support during Hurricane Katrina. The committee further notes that both the Final Report of the Select Bipartisan Committee to Investigate the Preparation for and Response to Hurricane Katrina and the White House Report on the Federal Response to Hurricane Katrina identify areas where DOD response to Hurricane Katrina was lacking, and makes recommendations for improvement.

The committee is pleased that both reports emphasize the critical support provided by the respective National Guards of Alabama, Mississippi, and Louisiana in responding to this crisis, as well as the support provided by the National Guard Bureau in mobilizing assets from guard units around the nation. The committee applauds the national guard's response to Hurricane Katrina, and believes that the command and control arrangements for national guard units during this multi-state emergency worked well and should serve as a model for future multi-state responses. In short, the governors of Louisiana and Mississippi each commanded the national guard effort in their respective states, and commanded the various national guard units from across the country who volunteered to serve under previously agreed Emergency Mutual

Assistance Compacts. Thus, the committee believes that national guard units, operating under the command and control of the governor, should not execute multi-state missions, and that regional, multi-state coordination of first response efforts remain a Department of Homeland Security mission. The committee believes, however, that the national guard will continue to be an essential element in any response to a domestic emergency that overwhelms first responders.

Therefore, the committee directs the Assistant Secretary of Defense for Homeland Defense to review the findings applicable to the Department made in the Final Report of the Select Bipartisan Committee to Investigate the Preparation for and Response to Hurricane Katrina. The committee also directs the Assistant Secretary of Defense for Homeland Defense to submit to the Senate Committee on Armed Services and the House Committee on Armed Services by April 1, 2007, a report detailing how the Department intends to address the issues raised by the Select Committee report and the White House report. In particular, the report shall clarify U.S. Northern Command's role in planning and executing support to the Department of Homeland Security and national guard units operating under title 32, United States Code, status during domestic contingencies.

DEPARTMENT OF DEFENSE INTERAGENCY COORDINATION IN THE GLOBAL WAR ON TERRORISM

The committee notes the importance of interagency coordination in all matters affecting national security, particularly in the global war on terrorism (GWOT), where success depends on the seamless application of all elements of national power. The committee is aware that the National Counterterrorism Center (NCTC) is in the process of completing the National Implementation Plan, which will provide integrated, strategic, operational plans for counterterrorism activities within and among agencies. While the committee expects that the National Implementation Plan will improve interagency coordination in the GWOT, the committee believes that the NCTC, alone, will not solve problems in interagency coordination.

The committee notes that the Department of Defense (DOD) has advocated improved interagency coordination in its National Defense Strategy, National Military Strategy and the 2006 Quadrennial Defense Review (QDR). The QDR, in particular, identifies a number of DOD initiatives aimed at improving interagency coordination.

Therefore, the committee directs the Secretary of Defense to submit to the Senate Committee on Armed Services and the House Committee on Armed Services by March 1, 2007, a report on how the Department is implementing the 2006 QDR objective of strengthening interagency operations. The report shall address how the Department is improving and strengthening internal DOD mechanisms for GWOT interagency coordination at the strategic, operational, and tactical level; and suggest means to address any remaining gaps in the interagency planning and execution process.

DEPARTMENT OF DEFENSE PARTICIPATION IN THE COMMITTEE ON FOREIGN INVESTMENT IN THE UNITED STATES

The committee believes that the Committee on Foreign Investment in the United States (CFIUS) does not adequately scrutinize the effects on national security of mergers, acquisitions and takeovers by foreign persons, which could result in foreign control of persons engaged in interstate commerce in the United States. The committee notes that recent decisions by CFIUS, such as approving attempts by the China National Offshore Oil Corporation to acquire Unocal and Dubai Ports World to acquire operation of six U.S. ports, underscores that CFIUS is neither applying sufficient analytical rigor to its review process nor providing sufficient weight to genuine concerns about the adverse impact of such transactions on U.S. national security. The committee urges the President to reform the process to ensure that CFIUS members do not prioritize securing foreign investment in the United States ahead of protecting national security.

The committee notes that the Department of Defense is a CFIUS member and that the Department will often conduct an internal review of transactions as part of a CFIUS review. The committee is concerned that the Department may not be adequately scrutinizing and taking into consideration all of the national security implications of proposed mergers, acquisitions or takeovers under CFIUS review or voicing strongly its concerns to other CFIUS members.

Therefore, the committee directs the Secretary of Defense to submit to the Senate Committee on Armed Services and the House Committee Armed Services by April 1, 2007, a report explaining how the Department evaluates the national security implications of mergers, acquisitions or takeovers that are subject to CFIUS review. This report shall also provide examples of how the Department raised national security concerns within the CFIUS structure over the last five years, how CFIUS sought assurances to resolve such concerns and explain how the Department monitors and enforces these assurances.

HOMELAND SECURITY/DEFENSE MANAGEMENT PROGRAMS

The committee notes the efforts of civilian academia to provide important educational opportunities in the area of Homeland Security/Defense Management, and supports such efforts, especially when executed in cooperation with the Homeland Security/Defense Education Consortium and other Department of Defense educational institutions. The committee encourages the Department, as well as other federal agencies and civilian institutions, to continue to support these types of programs.

IMPROVING INTERNATIONAL PANDEMIC PREPAREDNESS THROUGH THEATER SECURITY COOPERATION PROGRAMS

The committee notes that the Department of Defense was successful in providing rapid humanitarian assistance to Southeast Asia following the December 2004, tsunami due, in part, to military to military agreements, relationships, and training established through U.S. Pacific Command's Theater Security Cooperation Program. Such pre-existing military agreements, relationships, and training could only prove beneficial during other disasters, including regional health epidemics or a global pandemic. The committee believes that during foreign military training and joint exercises with international partners, the Department should actively seek to improve the capabilities of military allies in the areas of surveillance and early warning of infectious disease outbreak and pandemic preparedness, particularly in Africa and Southeast Asia. The committee encourages the regional combatant commanders to review current efforts and make specific recommendations to the Secretary of Defense for opportunities to expand such efforts in fiscal years 2007 and 2008.

INCREASING THE AVAILABILITY OF INTELLIGENCE, SURVEILLANCE, AND RECONNAISSANCE ASSETS IN THE EVENT OF A CATASTROPHIC NATURAL OR MANMADE DISASTER

The committee is aware that the federal response to Hurricane Katrina was hampered by a lack of situational awareness of post-landfall conditions along the Gulf Coast, as noted in the final report of the Select Bipartisan Committee to Investigate the Preparation for and Response to

Hurricane Katrina. The Department of Defense possesses unparalleled assets for intelligence collection that are used worldwide to coordinate and support military operations.

Therefore, the committee directs the Secretary of Defense to increase the availability of these Intelligence, Surveillance, and Reconnaissance assets in the event of a catastrophic natural or manmade disaster for use in damage assessment and the coordination of relief efforts. The committee also directs the Secretary of Defense to provide a report to the congressional defense committees as to the status of this effort by January 31, 2007.

JOINT TRAINING AND CERTIFICATION FOR NUCLEAR, CHEMICAL, AND BIOLOGICAL DEFENSE

The 2006 Quadrennial Defense Review (QDR) envisioned the future force would be organized, trained, equipped, and resourced to deal with all aspects of the threat posed by weapons of mass destruction; but the QDR provided no insight into how the Department of Defense will achieve its nuclear, chemical, and biological defense training objective. Therefore, the committee directs the Assistant to the Secretary of Defense for Nuclear and Chemical and Biological Defense Programs, in coordination with the Secretary of the Army, Secretary of the Navy, and Secretary of the Air Force, to perform a gap analysis on nuclear, chemical, and biological (NCB) defense training, to review NCB defense doctrine across each of the military services, and to make recommendations to the Secretary of Defense, the Senate Committee on Armed Services and the House Committee on Armed Services by October 1, 2007, regarding the implementation of joint training, certification, and doctrinal alignment for NCB defense for both the active and reserve components.

NATIONAL COUNTER PROLIFERATION CENTER

The committee commends the Director of National Intelligence for formally establishing the National Counter Proliferation Center (NCPC) on November 21, 2005. As a result of testimony received during recent Terrorism, Unconventional Threats, and Capabilities Subcommittee hearings, the committee believes that it is essential that a body within the U.S. Government integrate and coordinate all elements of national power to combat weapons of mass destruction. The committee notes that the National Security Intelligence Reform Act of 2004 (Public Law 108-458) mandates that the NCPC address seven missions and objectives. The committee is concerned that the NCPC is not, and has no plans to carry out the following two missions and objectives: (1) coordinating counter proliferation plans and activities of the various departments and agencies of the U.S. Government to prevent and halt the proliferation of weapons of mass destruction, their delivery systems, and related materials and technologies and (2) conducting strategic operational counter proliferation planning for the U.S. Government to prevent and halt the proliferation of weapons of mass destruction, their delivery systems, and related materials and technologies.

Therefore, the committee directs the Director of the NCPC to submit to the Senate Committee on Armed Services and the House Committee on Armed Services, and the Senate Select Committee on Intelligence and the House Permanent Select Committee on Intelligence by February 1, 2007, a report that explains why the NCPC has not taken steps to carry out its statutorily mandated missions and objectives to coordinate U.S. Government counter proliferation plans and activities and conduct strategic operational counter proliferation planning for the U.S. Government. The report should indicate whether the NCPC expects the President to waive any of the missions and objectives assigned to the NCPC pursuant to the National Security Intelligence Reform Act of 2004 (Public Law 108-458). In the event the NCPC will not carry out any or all of the seven of the missions and objectives detailed in the National Security Intelligence Reform Act of 2004, (Public Law 108-458) and the President will not execute a national security waiver, the report should explain how the President is meeting the requirements in section 1022 of the National Security Intelligence Reform Act of 2004 (Public Law 108-458).

OVERHAUL, REPAIR, AND MAINTENANCE OF VESSELS CARRYING DEPARTMENT OF DEFENSE CARGO

In section 1017 of this act, the committee includes an interim provision to address concerns that vessels engaged in the coastwise trades, including the domestic offshore trades, are undergoing repairs and modifications in shipyards located outside the United States. In general, vessels engaged in the coastwise trades are limited to those that are U.S. built, U.S. crewed, and U.S. owned. Also, a vessel may not be `rebuilt' in a shipyard that is not located in the United States. Thus, no vessels built outside the United States can enter these trades. Part of the current discussions, center around the fact that the Coast Guard issued section 67.177 of title 46, Code of Federal Regulations that provides guidelines on when a vessel is deemed `rebuilt.' In general, this occurs when relevant work, which is defined as work performed on its hull or superstructure, constitutes a considerable part of the hull or superstructure or when a major component of the hull or superstructure, not built in the United States, is added to a vessel. With regard to the former test, percentage limitations have been established in section 67.117(b) of title 46, Code of Federal Regulations. Specifically with respect to vessels the hull and superstructure of which is constructed of steel, certain thresholds have been established. The issue is that a vessel is deemed rebuilt when the relevant work constitutes more than ten percent of the vessel's steelweight prior to the work. A vessel may be considered `rebuilt' if the relevant work constitutes more than 7.5 percent but not more than ten percent of the vessel's steelweight prior to the work. The conflict which seems to exist is the Coast Guard has one test for when a vessel is initially considered to be `built' in the United States for the purposes of engaging in the coastwise trades, and another test for when a vessel is deemed `rebuilt' outside the United States, and thus losing its right to engage in the coastwise trades.

The committee is concerned that this apparent dichotomy has resulted in a number of vessels being repaired and modified in foreign shipyards. To resolve this issue, and to be fair to proponents and opponents of the practice of repairing and overhauling coastwise eligible vessels in foreign shipyards, the committee intends to conduct a hearing or series of hearings in the near-term. The committee recognizes this is a very complicated issue with significant policy ramifications, and thus chose to address this issue through an interim legislative provision in this Act. Nevertheless, hearings will provide the opportunity for all parties to present their views. The committee believes that a more detailed and permanent solution is obtainable.

REPORT ON STRATEGIC LANGUAGE SKILLS

The committee notes that the Department of Defense has placed great emphasis on improving the strategic language posture of the United States. Accordingly, the committee directs the Secretary of Defense to identify objectives for developing capabilities in immediate investment languages and stronghold languages, as specified on the fiscal year 2006 Department of Defense Strategic Languages List, and develop a comprehensive implementation plan as to how the Secretary of Defense and the military departments will achieve those objectives. The committee expects that the plan for achieving the objectives for strategic languages will be coordinated with and will complement the Secretary's report on the need for a personnel plan for linguists in the armed forces required by section 581 of the National Defense Authorization Act for Fiscal Year 2006 (Public Law 109-163).

The committee directs the Secretary to submit these language objectives and implementation plan to the Senate Committee on Armed Services and the House Committee on Armed Services by March 31, 2007.

SPECIAL OPERATIONS COMMAND AS THE SUPPORTED COMMAND IN THE GLOBAL WAR ON TERRORISM

The committee notes that the 2004 Unified Command Plan made U.S. Special Operations Command (USSOCOM) the supported, or lead, combatant command in the global war on terrorism (GWOT). The committee further notes that annex C of the National Military Strategic Plan for the War on Terrorism, published February 1, 2006, implements USSOCOM's designation as the supported combatant command for the GWOT by charging SOCOM with planning, synchronizing, and, as directed, executing global operations against terrorist networks. The committee finds, however, that USSOCOM's roles and responsibilities as the supported combatant command for the GWOT remain ambiguous.

Therefore, the committee directs the Secretary of Defense to submit to the Senate Committee on Armed Services and the House Committee on Armed Services by February 1, 2007, a report that clarifies the roles and responsibilities of the Commander, USSOCOM in his capacity as the supported combatant commander in the GWOT. The report shall:

(1) Identify a clear chain of command affording the Commander, USSOCOM the authority to more effectively carry out his role as the lead Commander for GWOT planning and operations;

(2) Explain under what circumstances will USSOCOM be directed to exercise command and control of counterterrorism operations;

(3) Verify whether current USSOCOM acquisition, training and manning authorities are sufficient to allow Commander, USSOCOM to meet his responsibilities as the supported combatant commander for GWOT; and

(4) Clarify the command and control relationship between the geographic combatant commanders and USSOCOM in terms of GWOT planning and operations.

STATUS AND IMPLEMENTATION OF MILITARY SUPPORT FOR STABILITY, SECURITY, TRANSITION, AND RECONSTRUCTION OPERATIONS

The committee is pleased to note that the Department of Defense issued Directive 3000.05, dated November 28, 2005, on ` Military Support for Stability, Security, Transition, and Reconstruction (SSTR) Operations.' Such operations will remain common critical military tasks in the foreseeable future and the Department should be fully prepared to execute such tasks. The committee believes that the Department should integrate, to the greatest extent possible, SSTR-related requirements across its doctrine, training, logistics, organization, materiel, personnel, and facilities (DTLOM-PF).

The committee directs the Secretary of Defense to submit to the Senate Committee on Armed Services and the the House Committee on Armed Services by April 1, 2007, a report on the status and plan (including timeline) to implement the Directive across DTLOM-PFs. This report shall include, among other relevant issues, a special focus on professional military

education and training, including but not limited to revisions to Academy and War College curricula, if any; training plans at the service and joint operational levels; the possible creation of SSTR fellowships within the Agency for International Development or related organizations (including non-governmental organizations); and any reorganizations that will be required to implement the Directive.

TERRORIST USE OF THE INTERNET

The committee is concerned that terrorist organizations, such as al Qaeda, are using the internet to carry out strategic and operational objectives. The committee believes that terrorist organizations should not be permitted to exploit the internet, and that the Department of Defense should take steps to combat terrorists' use of the internet.

Therefore, the committee directs the Secretary of Defense to submit to the Senate Committee on Armed Services and the House Committee on Armed Services by May 1, 2007, a report that describes how terrorist organizations use the internet, and recommend ways the Department can counter terrorists' use of the internet. The report shall also state how the Department is currently countering terrorist recruiting, training and operations that are executed through the internet, and should identify any legal challenges the Department may face in trying to combat terrorists' use of the internet.

LEGISLATIVE PROVISIONS

SUBTITLE A--FINANCIAL MATTERS

SECTION 1001--GENERAL TRANSFER AUTHORITY

This section would provide fiscal year 2007 transfer authority to the Department of Defense for amounts up to $3.75 billion.

SECTION 1002--AUTHORIZATIONS OF SUPPLEMENTAL APPROPRIATIONS FOR FISCAL YEAR 2006

This section would authorize adjustments in the National Defense Authorization Act for Fiscal Year 2006 (Public Law 109-163) for the Department of Defense by supplemental appropriations pursuant to such authorization.

SECTION 1003--INCREASE IN FISCAL YEAR 2006 GENERAL TRANSFER AUTHORITY

This section would amend section 1001(a)(2) of the National Defense Authorization Act for Fiscal Year 2006 (Public Law 109-163) to increase the fiscal year 2006 transfer authority from $3.5 billion to $3.75 billion.

SECTION 1004--UNITED STATES CONTRIBUTION TO NATO COMMON-FUNDED BUDGETS IN FISCAL YEAR 2007

This section would authorize the United States contribution to North Atlantic Treaty Organization common-funded budgets for fiscal year 2007, including the use of unexpended balances.

SECTION 1005--REPORT ON BUDGETING FOR FLUCTUATIONS IN FUEL COST RATES

This section would require the Secretary of Defense to submit a report to the Senate Committee on Armed Services and the House Committee on Armed Services by January 15, 2007, on the fuel costs rate projection used in the annual Department of Defense budget. This section would also require the Comptroller General to review the report and submit an assessment by March 15, 2007.

SECTION 1006--REDUCTION IN AUTHORIZATIONS DUE TO SAVINGS RESULTING FROM LOWER-THAN-EXPECTED INFLATION

The Department of Defense assumed an inflation rate of 2.2 percent in its fiscal year 2007 budget submission. However, according to the House Budget Committee's report (109-402), the Congressional Budget Office's estimate of inflation is 0.4 percentage points lower than the President's request for fiscal year 2007. The savings resulting from the lower-than-expected inflation for fiscal year 2007 is $1,583 million less than the budget request.

SUBTITLE B--POLICY RELATING TO NAVAL VESSELS AND SHIPYARDS

SECTION 1011--TRANSFER OF NAVAL VESSELS TO FOREIGN NATIONS BASED UPON VESSEL CLASS

This section would allow the transfer of a specified number of ships to a particular nation without identification of the specific vessel by hull number or ship name. Section 7037 of title 10, United States Code, requires legislative approval for the transfer to other nations of specific vessels exceeding 3,000 tons or vessels that are less than 20-years-old. The legislative approval process typically begins two years or more prior to the actual decommissioning of the U.S. Navy vessel and ship transfer. Decommissioning plans frequently change as a result of changing operational commitments, material condition, and other factors. Linking a specific vessel to a specific country can result in a lost transfer opportunity if that vessel's decommissioning status changes. Additionally, it must be replaced by another vessel of the same class as a transfer candidate.

This section would better support the goal of affecting `hot' ship transfers. Hot ship transfers reduce the cost of decommissioning preparation and lay-up for the U.S. Navy and may support a higher selling price for the ship as an `excess defense article.' For the purchaser, a hot ship transfer is advantageous because it eliminates reactivation costs attributed to long post-decommissioning lay-up and because the ship transfer can be more quickly and economically realized.

This section would still require Congress to authorize the release of specific naval capabilities and technologies to specific countries, but it would provide flexibility to best match available decommissioned ships to customer navies' requirements. Finally, Congress would still be free to designate specific ships to specific countries where circumstances dictated.

SECTION 1012--OVERHAUL, REPAIR, AND MAINTENANCE OF VESSELS IN FOREIGN SHIPYARDS

The committee includes a provision that will clarify those commonwealths and possessions that are to be considered as part of the United States for the purposes of naval vessels to include any Military Sealift Command vessels that are owned or chartered under the

jurisdiction of the Secretary of Navy. This section also further defines the term emergency voyage repair and extends the limitations on overhaul, repair and maintenance of vessels in foreign shipyards.

SECTION 1013--REPORT ON OPTIONS FOR FUTURE LEASE ARRANGEMENT FOR GUAM SHIPYARD

This section would require the Secretary of Navy to submit a report to the Senate Committee on Armed Services and the House Committee on Armed Services by December 15, 2006, on the Guam Shipyard located in San Rita, Guam. This section would also require the Comptroller General to submit an evaluation of the Secretary of Navy's report to the Senate Committee on Armed Services and the House Committee on Armed Services by March 1, 2007.

Under the statutory authority of section 2304c(3) of title 10, United States Code, and the Federal Acquisition Regulation 6.302-3(a)(2)(i), the Navy has been awarding non-competitive contracts to Guam Shipyard located in San Rita, Guam since fiscal year 1998 to maintain the industrial base in support of national strategic objectives. In 1998, Commander, U.S. Pacific Fleet determined that maintaining a private ship repair capability in Guam is a matter of national strategic importance for future defense operations in the western Pacific.

In a report to Congress on Repair of Military Sealift Command Ships dated May 2004, the Commander, U.S. Pacific Fleet validated the importance of this shipyard. In the fiscal year 2006 Class Justification and Approval For Other Than Full and Open Competition, the Commander, U.S. Pacific Fleet again determined that maintaining a private ship repair capability as a mobilization base facility on Guam is a matter of vital strategic importance for operations in the Western Pacific Area of Responsibility. In support of that determination, the Commander U.S. Pacific Fleet submitted a letter to the Commander, Military Sealift Command on March 30, 2005, that stated:

`Guam is strategically located with respect to those Asian countries that border the Pacific-Rim and provides an excellent site for logistical support to the Navy's operating forces in that region. With the U.S. Navy's continuing focus on the Pacific Area of Responsibility, the former U.S. Naval Ship Repair Facility Guam, due to its geographically unique location and positive force protection status, is essential to our ability to respond to possible contingencies.'

Until such time as the Secretary of the Navy prepares the requested report, this section would further require the awarding of contracts under the authority of section 2304(c)(3) of title 10, United States Code and section 6.302-3(a)(2)(i) of the Federal Acquisition Regulation in an equal to the average amount awarded between Fiscal Year 1998 and Fiscal Year 2006. The committee supports the Secretary of Navy's decision to continue to designate the Guam Shipyard as critical to maintaining the industrial base in support of national strategic objectives, as certified by the Commander, U.S. Pacific Fleet, for each of the past eight fiscal years.

SECTION 1014--SHIPBUILDING INDUSTRIAL BASE IMPROVEMENT PROGRAM

This section would establish a program to provide grants and loan guarantees to U.S. shipbuilders to make capital investments in their shipbuilding processes and facilities to improve the efficiency, cost-effectiveness, and quality of U.S. ship construction and promote the international competitiveness of U.S. shipyards. This section would authorize the Secretary of the Navy to solicit and approve grant applications from shipbuilding companies to research and develop innovative technologies, processes and infrastructure to improve the efficiency and cost-effectiveness of naval vessel construction. This section would also authorize the Secretary of the Navy to provide loan guarantees to shipyards to purchase and implement a technology, a process or an infrastructure improvement that he determines will improve the productivity and cost-effectiveness of naval vessel construction. This section would also require the Secretary of the Navy to perform annual assessments of the shipbuilding industrial base to determine where and to what extent inefficiencies exist and to what extent innovative design and production technologies, processes and infrastructure can be developed to alleviate such inefficiencies. This section would also require that funding for the National Shipbuilding Research Program be separately identified and set forth in budget justification materials submitted to Congress for that fiscal year in support of that budget.

SECTION 1015--TRANSFER OF OPERATIONAL CONTROL OF CERTAIN PATROL COASTAL SHIPS TO COAST GUARD

This section would require the Secretary of the Navy to enter into an agreement with the Commandant of the Coast Guard for the transfer of operational control of not less than five 179 foot Cyclone class patrol coastal ships for a period extending at least through September 30, 2012.

SECTION 1016--LIMITATION ON LEASING OF FOREIGN-BUILT VESSELS

This section would amend section 2401 of title 10, United States Code, to prohibit the secretary of a military department from entering into a contract for lease or charter of a vessel for a term of more than 24 months, including all options to renew or extend the contract, if the hull or superstructure of that vessel was constructed in a foreign shipyard.

SECTION 1017--OVERHAUL, REPAIR, AND MAINTENANCE OF VESSELS CARRYING DEPARTMENT OF DEFENSE CARGO

This section would provide that the Secretary of Defense may not award any contract for the carriage by vessel of cargo for the Department of Defense, unless the contract includes a requirement under which the contractor shall ensure that the overhaul and repair work is done in a shipyard located in the United States or the contractor must report any repair work conducted in a shipyard located outside the Unites States.

SECTION 1018--RIDING GANG MEMBER DOCUMENTATION REQUIREMENT

This section would prohibit the Secretary of Defense from awarding a charter or a contract for carriage of defense cargo unless the charter or contract requires that each riding gang member that performs any work on the vessel during the effective period of the charter or contract holds a merchant mariner's document issued by the U.S. Coast Guard. This section also allows the Secretary of Defense to issue regulations to exempt a riding gang member from the above requirement under limited circumstances, and then only if a background check is performed.

SUBTITLE C--COUNTER-DRUG ACTIVITIES

SECTION 1021--RESTATEMENT IN TITLE 10, UNITED STATES CODE, AND REVISION OF DEPARTMENT OF DEFENSE AUTHORITY TO PROVIDE SUPPORT FOR COUNTER-DRUG ACTIVITIES OF FEDERAL, STATE, LOCAL, AND FOREIGN LAW ENFORCEMENT AGENCIES

This section would codify section 1004 of the National Defense Authorization Act for Fiscal Year 1991 (Public Law 101-510), as amended by section 1021(a) of the National Defense Authorization Act for Fiscal Year 2002 (Public Law 107-107). The current authority, which would expire at the end of fiscal year 2006, enables the Department of Defense to assist the counter-drug activities of any other department or agency of the federal government or of any State, local, or foreign law enforcement agencies. This support includes the maintenance and repair of equipment; transportation of personnel; establishment and operation of bases of operation or training facilities; counter-drug related training of law enforcement personnel; the detection, monitoring, and communication of air and sea traffic; construction of roads, fences and installation lighting, establishment of command, control, communications, and computer networks; provision of linguist and intelligence analysis services; and aerial and ground reconnaissance.

SECTION 1022--RESTATEMENT IN TITLE 10, UNITED STATES CODE, AND REVISION OF DEPARTMENT OF DEFENSE AUTHORITY TO PROVIDE SUPPORT FOR COUNTER-DRUG ACTIVITIES OF CERTAIN FOREIGN GOVERNMENTS

This section would codify and expand section 1033 of the National Defense Authorization Act for Fiscal Year 1998 (Public Law 105-85), as amended by section 1021 of the National Defense Authorization Act for Fiscal Year 2004 (Public Law 108-136). The current authority, which would expire at the end of fiscal year 2006, enables the Department of Defense (DOD) to provide counter-drug equipment in addition to that provided under section 1004 of the National Defense Authorization Act for Fiscal Year 1991 (Public Law 101-510), as amended by section 1021(a) of the National Defense Authorization Act for Fiscal Year 2002 (Public Law 107-107), to nations in South America and Central Asia, including: Colombia, Peru, Ecuador, Bolivia, Afghanistan, Pakistan, Uzbekistan, Turkmenistan and Tajikistan.

Additionally, this section would expand the authority to include countries that are located in primary narcotics-trafficking routes in Central America and Central Asia, including: Panama, Guatemala, Belize, Azerbaijan, Kazakhstan and Kyrgyzstan. During calendar year 2006, incidents against Afghan security forces by narcotics traffickers have increased. Most of these incidents involved small arms, machine guns, rocket propelled grenades, and improvised explosive devises. Afghan security forces need to be armed to effectively deal with narcotics traffickers. The Government of Afghanistan raised the issue of security forces obtaining additional arms and ammunition support at the recent United States-Afghanistan Strategic Partnership meeting held in Washington, DC in March 2006. In the Emergency Supplemental Appropriations Act for Defense, the Global War on Terror, and Tsunami Relief, 2005 (Public Law 109-13), Congress authorized providing Afghanistan crew-served weapons. Pursuant to this authority, the U.S. Government has provided the government of Afghanistan with two DShKMs heavy machine guns (.50-caliber). This section would also establish the authority to provide crew-served weapons of .50-caliber or less to Afghanistan for fiscal years 2007 and 2008. This section would also authorize that during fiscal years 2007 and 2008, $20.0 million of additional expenditures under this authority should be authorized each fiscal year, for a total of $60.0 million each fiscal year.

This section would also require the Secretary of Defense, in consultation with the Secretary of State, to prepare a counter-drug plan for the governments to which support will be provided under this section. This section would require the Department of Defense to submit the annual plans to the congressional defense committees and the Senate Committee on Foreign Affairs and the House Committee on International Relations by December 31st of each year.

SECTION 1023--EXTENSION OF AUTHORITY TO SUPPORT UNIFIED COUNTER-DRUG AND COUNTERTERRORISM CAMPAIGN IN COLOMBIA

This section would extend the continuation of authorities provided in section 1021 of the Ronald W. Reagan National Defense Authorization Act for Fiscal Year 2005, (Public Law 108-375) which allow the Department of Defense to support a unified campaign in Colombia against narcotics trafficking and terrorist organizations for fiscal years 2007 and 2008. This section would also extend the limitation on the number of U.S. military and federally funded civilian contractor personnel in the Republic of Colombia through fiscal year 2008. Section 1021 limited the number of military personnel in Colombia in fiscal years 2005 and 2006 to 800 people and the number of federally funded civilian contractors employed to support Plan Colombia to 600 people. This section would extend these authorities for an additional two years to provide support to the consolidation phase of Plan Colombia, the Government of Colombia's long-term blueprint to end the country's long-running civil war, reduce narcotics trafficking, and promote economic and social development.

SECTION 1024--CONTINUATION OF REPORTING REQUIREMENT REGARDING DEPARTMENT OF DEFENSE EXPENDITURES TO SUPPORT FOREIGN COUNTER-DRUG ACTIVITIES

This section would extend by one year the requirement for the Secretary of Defense to submit a report detailing the expenditure of funds by the Secretary during fiscal year 2006 in direct and indirect support of the counter-drug activities of foreign governments. This requirement was reinstated for fiscal year 2005. The committee notes that the Department of Defense has increased its level of counternarcotics assistance to foreign law enforcement agencies and militaries in recent years. The committee believes it should continue to monitor such expenditures closely.

SECTION 1025--REPORT ON INTERAGENCY COUNTERNARCOTICS PLAN FOR AFGHANISTAN AND SOUTH AND CENTRAL ASIAN REGIONS

This section would require the Secretary of Defense to submit a report to the congressional defense committees by February 15, 2007, updating the interagency counternarcotics implementation plan for Afghanistan and the South and Central Asian regions. The committee notes that the Secretary of Defense failed to submit a report on this matter, as directed by the committee, by December 31, 2005.

SUBTITLE D--OTHER MATTERS

SECTION 1031--REVISION TO AUTHORITIES RELATING TO COMMISSION ON THE IMPLEMENTATION OF THE NEW STRATEGIC POSTURE OF THE UNITED STATES

This section would extend the assessment horizon of the Commission of the Implementation of the New Strategic Posture of the United States, as established in section 1051 of the National Defense Authorization Act for Fiscal Year 2006 (Public Law 109-163), from 2008 to 2025. This horizon pertains particularly to the commission's assessment of the ability of the current nuclear stockpile to address the evolving strategic threat environment and the commission's recommendations on changes to nuclear stockpile and infrastructure required to preserve a nuclear capability commensurate with that threat environment.

This section would also change the commission's report date from June 30, 2007, to 18 months after commencement of commission activities and the commission's termination date from July 30, 2007, to 60 days after the report submission.

SECTION 1032--ENHANCEMENT TO AUTHORITY TO PAY REWARDS FOR ASSISTANCE IN COMBATING TERRORISM

This section would increase the flexibility and responsiveness of the counterterrorism reward program by allowing the combatant commanders to delegate approval authority for such rewards, which may amount to $50,000 each, to the commander of a command directly subordinate to that combatant commander. Such delegation of authority to a subordinate commander must have the approval of the Secretary of Defense, the Deputy Secretary of Defense, or an Under Secretary of Defense designated by the Secretary. This section would also increase reward authority, which the combatant commander may further delegate, from $2,500 to $10,000.

SECTION 1033--REPORT ON ASSESSMENT PROCESS OF CHAIRMAN OF THE JOINT CHIEFS OF STAFF RELATING TO GLOBAL WAR ON TERRORISM

This section would direct the Secretary of Defense to submit to the Senate Committee on Armed Services and the House Committee on Armed Services by March 1, 2007, a report on the findings of the semi-annual global war on terrorism (GWOT) assessment process described in the Implementation and Assessment Annex (annex R) of the National Military Strategic Plan for the War on Terrorism (NMSP-WOT).

The committee is encouraged by the Joint Chiefs of Staff effort to develop and publish a `NMSP-WOT.' The committee believes that this document effectively presents the approach the Department of Defense will take in fulfilling its role within the national strategy for combating terrorism. The committee notes with interest that the NMSP-WOT sets military priorities for the GWOT, establishes a set of metrics for evaluating progress in the global war on terrorism and implements an assessment process.

SECTION 1034--PRESIDENTIAL REPORT ON IMPROVING INTERAGENCY SUPPORT FOR UNITED STATES 21ST CENTURY NATIONAL SECURITY MISSIONS

This section would require the President to submit to Congress by February 1, 2007, a report that identifies interagency capabilities needed to achieve U.S. national security goals and objectives in the 21st century, describing how best to enhance the integration of those capabilities with those of the deployed military, and discussing the criteria and considerations used to evaluate progress in building and integration such capacity. This section would further require

the President to make recommendations for improving interagency coordination in the form of specific legislative proposals.

Since 2002, the administration has outlined broad U.S. national security goals and objectives through several strategy documents, including the March 2006 National Security Strategy, the November 2005 National Strategy for Victory in Iraq, the February 2003 National Strategy for Combating Terrorism, and the July 2002 National Strategy for Homeland Security. The Department of Defense (DOD) has complemented these documents with its own defense-specific strategies, such as the 2005 National Defense Strategy and the 2004 National Military Strategy. Most recently, the 2006 Quadrennial Defense Review (QDR) laid out DOD's perspective on ways in which to execute these various security and defense strategies. In particular, the QDR highlighted the need for improved, robust interagency capacity to complement the work done by deployed military forces in achieving U.S. national security goals.

The committee believes it is critical that the President provide his view on both the civilian and military capabilities required to address 21st century national security challenges and the extent to which such federal departments and agencies must integrate these capabilities for optimal effectiveness. Moreover, the committee seeks the President's view on the possible legislative changes that might strengthen U.S. national security. Toward this end and recognizing the complexity of the current and emerging national security challenges, the committee urges the President to incorporate the inputs of the broadest practicable group of national security players into this report, including representatives of domestic departments and agencies that must coordinate in planning and response to national and homeland security challenges.

SECTION 1035--QUARTERLY REPORTS ON 2006 QUADRENNIAL DEFENSE REVIEW REPORT IMPLEMENTATION

This section would require the Secretary of Defense to submit to the Senate Committee on Armed Services and the House Committee on Armed Services quarterly reports on the processes and procedures to examine the various recommendations of the 2006 Quadrennial Defense Review (QDR), implementation plans and strategies for each area highlighted by the QDR report, and relevant information about the status of such implementation. Because the national security environment of the 21st century is evolving rapidly, these reports would also indicate changes in the Secretary's assessment of the defense strategies or capabilities required since the publication of the 2006 Quadrennial Defense Review Report. This section would require that the Secretary submit the first report by January 31, 2007, and would terminate the reporting requiring upon publication of the next QDR report or upon notification by the Secretary to the armed services committees that implementation is complete, whichever comes first.

The committee recognizes that the latest QDR Report describes the complex security challenges facing armed forces in the 21st century, clearly indicating that the document reflects a `snapshot in time' regarding the Department of Defense's (DOD) strategy and the capabilities required to execute that strategy, and notes that the Department is in the process of transformation. The Department devoted significant analytical resources to ensure that the QDR process identified various scenarios and described the types of capabilities, ranging from weapons platforms to cultural and language skills to combat support and combat service support elements, that are required to prevail in these scenarios and shape the international security environment.

The QDR also reflects the reality that the U.S. Government must develop, procure, and employ such capabilities through a long-term strategy. The committee understands that the Department has developed several working groups to examine various areas that may impact future authorities and funding requests by the Department.

For example, the committee notes that in the post-September 11th world, irregular warfare--or conflicts in which enemy combatants are not regular military forces of nation-states--has emerged as a primary form of warfare confronting the United States and that developing irregular warfare capability is critical to military success in the global war on terrorism. The QDR report stipulates that while sustaining capabilities to address conventional combat operations, the Department must develop and enhance capabilities to carry out long-duration operations, unconventional warfare, foreign internal defense, counterterrorism, counterinsurgency and stabilization, and reconstruction operations. In particular, the QDR report identifies irregular warfare as an area that will need continuous reassessment and improvement in the coming years and requires the development of a `roadmap' by a working group to address such issues.

Because implementing the QDR recommendations in irregular warfare and other areas will require strong commitment and emphasis from not only the Secretary of Defense and leaders from other federal departments and agencies but also from Congress, it is critical that the Secretary of Defense maintain robust, timely information flow to the armed services committees, particularly on the work of these QDR-related groups.

SECTION 1036-INCREASED HUNTING AND FISHING OPPORTUNITIES FOR MEMBERS OF THE ARMED FORCES, RETIRED MEMBERS, AND DISABLED VETERANS

This section would require the Secretary of Defense to ensure that service members, military retirees, disabled veterans, and persons assisting disabled veterans are able to utilize Department of Defense (DOD) lands that are available for hunting and fishing. This section would also require the Secretary to report to Congress within 180 days of enactment of this Act on actions necessary to increase the availability of DOD lands to such persons for hunting and fishing activities.

Finally, this section would require the Secretary of the Interior to cease plans to exterminate deer and elk on Santa Rosa Island, California by helicopter and would prohibit the Secretary from exterminating or nearly exterminating the deer and elk on the island. Under current plans, all deer and elk will be eliminated from the island by 2012.

SECTION 1037--TECHNICAL AND CLERICAL AMENDMENTS

This section would make a number of technical and clerical amendments to existing law of a non-substantive nature.

SECTION 1038--DATABASE OF EMERGENCY RESPONSE CAPABILITIES

This section would direct the Secretary of Defense to ensure that the Department of Defense maintains a database of emergency response capabilities for domestic disasters. The committee believes that a single entity in the Department should be responsible for tracking the full range of military disaster response capabilities that exist domestically. The committee acknowledges U.S. Northern Command's role in domestic disaster preparedness and response, and recommends that it be involved in this effort.

SECTION 1039--INFORMATION ON CERTAIN CRIMINAL INVESTIGATIONS AND PROSECUTIONS

This section would expand the annual reporting requirement in section 1093 of the Ronald W. Reagan National Defense Authorization Act for Fiscal Year 2005 (Public Law 108-375) to include a detailed and comprehensive description of any investigation or prosecution, and any resulting judicial or non-judicial punishment or other disciplinary action, for any violation of international obligations or laws of the United States regarding the treatment of individuals detained by the U.S. armed forces or by a person providing services to the Department of Defense on a contractual basis, if such information would not compromise any ongoing criminal or administrative investigation or prosecution.

This section would also include additional information on investigations and prosecutions for any officer nominated for command, or nominated for promotion or appointment to a position requiring the advice and consent of the Senate, which should be clearly designated as such. The information in connection with nominations shall be submitted to the House Committee on Armed Services and the Senate Committee on Armed Services on a regular, timely basis in advance of any nomination.

SECTION 1040--DATE FOR FINAL REPORT OF EMP COMMISSION

This section would direct the Electromagnetic Pulse (EMP) Attack Commission, established by title 14 of the Floyd D. Spence National Defense Authorization Act for Fiscal Year 2001 (Public Law 106-398), and reestablished by section 1042 of the National Defense Authorization Act for Fiscal Year 2006 (Public Law 109-163) to move its final report date from June 30, 2007, to 18 months after commencement of commission activities.

TITLE XI--CIVILIAN PERSONNEL MATTERS

ITEM OF SPECIAL INTEREST

PERFORMANCE PERIODS ESTABLISHED IN CONNECTION WITH PUBLIC-PRIVATE COMPETITIONS

The committee notes that civilian in-house workforces and contractor workforces who win A-76 competitions are treated differently with respect to recompetitions at the end of their performance periods. The committee also notes that OMB Circular A-76 (revised May 29, 2003), while technically allowing an in-house workforce to receive an extension to the performance period, in effect, rarely results in an extension. The committee further notes that in contrast, the regulations in the Federal Acquisition Regulations regarding contractor performance periods appear to result in frequent extensions to contractor performance periods. The committee believes that this apparent disparity may prejudice civilian in-house employees.

The committee directs the Secretary of Defense, in coordination with the Office of Management and Budget, to examine this apparent inequity and report to the congressional defense committees by March 1, 2007. The report its findings shall include an analysis and comparison of recompetitions conducted since January 1, 2001 through the date of the enactment of this Act to determine the frequency of in-house extensions and contractor extensions. The

report shall also examine the existing regulations governing recompetitions to identify areas of possible disparity between in-house and contractor workforces. The committee further directs the Secretary to provide recommendations regarding any inequities between the in-house and contractor workforces disclosed in this examination.

LEGISLATIVE PROVISIONS

SECTION 1101--INCREASE IN AUTHORIZED NUMBER OF DEFENSE INTELLIGENCE SENIOR EXECUTIVE SERVICE EMPLOYEES

This section would increase the authorization for the number of Defense Intelligence Senior Executive Service employees by 50 in fiscal year 2007.

SECTION 1102--AUTHORITY FOR DEPARTMENT OF DEFENSE TO PAY FULL REPLACEMENT VALUE FOR PERSONAL PROPERTY CLAIMS OF CIVILIANS

This section would amend section 2636a(a) of title 10, United States Code, to authorize full replacement value coverage for household goods of civilian employees of the Department of Defense damaged or lost during transportation at government expense. Currently, only members of the armed forces may receive full replacement coverage. This section would resolve an area of disparate treatment for civilian employees compared to military personnel.

SECTION 1103--ACCRUAL OF ANNUAL LEAVE FOR MEMBERS OF THE UNIFORMED SERVICES PERFORMING DUAL EMPLOYMENT

This section would amend section 5534a of title 5, United States Code, to provide that servicemembers hired by the U.S. Government for a civilian position while on terminal leave from the military would accrue annual leave in the manner specified in section 6303(a) of title 5, United States Code. Currently, a servicemember on terminal leave hired for a federal civilian position receives civil service leave and military leave at the same time. This section would limit leave accrual of such individuals to that of a military retiree.

SECTION 1104--DEATH GRATUITY AUTHORIZED FOR FEDERAL EMPLOYEES

This section would add a new section in chapter 81 of title 10, United States Code, to provide a death gratuity of $0.1 million to civilian employees of the U.S. Government in the case of a death resulting from wounds, injuries, or illnesses that are incurred in the performance of duty in a contingency operation. The gratuity would be payable retroactively for deaths after October 7, 2001, in the theater of operations of Operation Enduring Freedom and Operation Iraqi Freedom. During this period of time eight civilian employees of the Department of Defense have lost their lives as a direct result of their assignments to Afghanistan and Iraq. This section would provide covered civilians with a death gratuity similar to the $.1 million authorized for service members under section 664 of the National Defense Authorization Act for Fiscal Year 2006 (Public Law 109-163).

TITLE XII--MATTERS RELATING TO FOREIGN NATIONS

ITEMS OF SPECIAL INTEREST

ADDRESSING THE THREAT POSED BY THE ISLAMIC REPUBLIC OF IRAN

The committee notes that the Islamic Republic of Iran currently poses a serious threat to the security of the United States, as well as to the peace and stability of the international community by continuing dangerous nuclear activities, including development of uranium enrichment capabilities; violating the human rights of the Iranian people; supporting terrorists; calling for the destruction of the State of Israel; creating instability in Iraq; and undermining the spread of freedom and democracy in the Middle East.

Given these circumstances, the committee directs the Secretary of Defense to provide to the Senate Committee on Armed Services and the House Committee on Armed Services, by January 31, 2007, a classified report encompassing the present period through 2016, which describes the Department of Defense's (DOD) strategy for addressing current and foreseeable Iranian threats to U.S. security and international security. The report shall describe the range of U.S. military options, including possible scenarios in which the use of U.S. military force may be appropriate and any limits or obstacles to using such force. The report shall also specifically address Iran's nuclear activities; support for terrorists; influence in the Middle East region, particularly Iraq; and any broader destabilizing ambitions of the Iranian regime.

To supplement this report, the committee directs the Secretary of Defense to provide regular, timely briefings to the Senate Committee on Armed Services and the House Committee on Armed Services which include detailed political-military assessments of existing and emerging threats posed by Iran to the security of the United States and the peace and stability of the international community, and DOD plans to address such threats. The briefings shall include, as appropriate, coordination of the Department with the Department of State or other relevant government agencies; alternative intelligence analyses from these agencies; the status of negotiations with Iran regarding its nuclear activities and involvement in Iraq; and the impact of Iran's nuclear activities, support for terrorists, and influence in Iraq and the Middle East, on the security of the United States and the peace and stability of the international community.

Finally, in the event the U.S. participates in direct talks with Iran on the subject of Iraq, the committee urges the appropriate U.S. officials to address in any such talks the need for Iran to stop the flow of any Iranian-supplied explosives to Iraq, withdraw any presence of the Iranian Revolutionary Guard Corps in Iraq, and end Iranian financial support to insurgent groups in Iraq.

INTERNATIONAL MILITARY EDUCATION AND TRAINING PROGRAMS

The committee notes that it has received testimony before the full committee from the commander of the U.S. Southern Command on March 16, 2006 on the value of the U.S. Government's International Military Education and Training (IMET) programs and the unintended consequences of IMET restrictions under the American Servicemembers' Protection Act of 2002 (ASPA) (title II of Public Law 107-206). The committee also notes that it had previously received testimony before the full committee of the value of IMET programs by the commanders of U.S. Southern and European Command on March 9, 2005 and by the commander of the U.S. Central Command on March 2, 2005.

Specifically, the committee perceives that IMET programs create opportunities for military-to-military engagement between U.S. armed forces and the militaries of developing nations. Such interactions are critical to advancing the understanding of, and respect for, civil-military relations; enhancing the understanding of U.S. military principles and values; bridging cultural differences; and developing important long-term relationships with future military and civilian leaders. Generally, such engagement has positively affected U.S. armed forces' global access and influence and has proved helpful in the global war on terrorism.

The committee notes that ASPA-related restrictions on IMET programs have reduced U.S. engagements with countries in ways that create opportunities for third-party governments and actors, which may not share the democratic principles and values of the United States, to exert undue influence in countries subject to IMET restrictions in ways that undermine the U.S. national security and broader interests.

The committee notes that ASPA provides the President with the authority to waive IMET restrictions, but the President has not yet chosen to exercise this authority. The committee urges the President to use, where appropriate, the waiver authority granted to him under ASPA to impede undue influence on U.S. partner nations and improve U.S. strategic relationships. Additionally, the committee requests that the President provide the committee with legislative proposals for the strengthening of key military-to-military relationships without undermining the importance of article 98 agreements under ASPA.

The committee emphasizes that it supports all aspects of ASPA that do not involve IMET restrictions, including the restrictions on foreign military financing. The committee supports article 98 agreements, which protect U.S. citizens against prosecution under the International Criminal Court. The committee does not believe that selectively waiving IMET restrictions under ASPA will undermine the effectiveness of ASPA or diplomatic efforts to secure article 98 agreements and does not intend such result.

REPORT ON CERTAIN COOPERATIVE ACTIVITIES INVOLVING THE UNITED STATES AND INDIA

The committee emphasizes its support for a robust U.S.-India strategic partnership and commends India for its recent efforts to bring its national export controls for dual-use and other sensitive materials and technologies in line with international standards.

Given the President's proposed deepening of U.S.-India nuclear cooperation and its possible effect on safeguards that prevent theft or other illicit transfer of nuclear materials and technologies, the committee directs the Secretary of Energy to submit, by February 1, 2007, a report to the Committees on Armed Services and Foreign Relations of the Senate and the Committees on Armed Services and International Relations of the House of Representatives on the Department's current and planned cooperative activities to enhance India's export control system and nuclear safeguards and to prevent such theft or transfer. The report should also describe how the Department of Energy coordinates these activities with similar efforts of the Departments of Defense and State; provide an assessment of the limits and vulnerabilities in India's current export control system and other safeguards as they relate to nuclear materials; and identify possible areas for expanded U.S.-India export control- or nuclear-related cooperative activities.

The Secretary of Energy should coordinate this report with the Secretary of Defense and the Secretary of State. To the maximum extent possible, the report shall be unclassified, with a classified annex if necessary.

REPORT ON DEPARTMENT OF DEFENSE ACTIVITIES IN SUPPORT OF MULTINATIONAL PEACEKEEPING OPERATIONS IN SUDAN

Noting with concern the ongoing crisis in the Darfur region of Sudan, the committee directs the Secretary of Defense to submit to the Senate Committee on Armed Services, the House Committee on Armed Services, the Senate Committee on Foreign Relations, and the House Committee on International Relations by April 1, 2007, a report describing any current or planned Department of Defense activities, including those activities involving U.S. military forces, in support of peacekeeping missions of United Nations or North Atlantic Treaty Organization forces in Sudan.

LEGISLATIVE PROVISIONS

SUBTITLE A--ASSISTANCE AND TRAINING

SECTION 1201--LOGISTIC SUPPORT FOR ALLIED FORCES PARTICIPATING IN COMBINED OPERATIONS

This section would allow the Secretary of Defense, with the concurrence of the Secretary of State, to use up to $100.0 million of funds available to the Department of Defense for operation and maintenance in any given fiscal year to provide logistics support, supplies, and services to foreign military forces. To receive such support, the foreign military forces must be participating in an operation, such as active hostilities, a contingency, or a non-combat operation, with U.S. armed forces. Also, the Secretary of Defense must determine that the support is essential to the success of the combined operation and that without such support, the foreign military forces would be unable to participate in the combined operation. Finally, the support provided must be allowable under existing export control laws and regulations.

SECTION 1202--TEMPORARY AUTHORITY TO USE ACQUISITION AND CROSS-SERVICING AGREEMENTS TO LEND CERTAIN MILITARY EQUIPMENT TO FOREIGN FORCES IN IRAQ AND AFGHANISTAN FOR PERSONNEL PROTECTION AND SURVIVABILITY

This section would provide the Secretary of Defense with the authority to lend certain military equipment, using acquisition and cross-servicing agreements, to the military forces of nations participating in combined operations with the U.S. armed forces in Iraq and Afghanistan. This section would limit this authority to fiscal years 2007 and 2008, limit such equipment to those items marked as `significant military equipment' in categories I, II, III, and VII on the U.S. Munitions List, allow the provision of such equipment for up to one year and only if the U.S. forces participating in that combined operation have no unfilled requirements for that equipment, and require the Secretary of Defense to submit to the Senate Committee on Armed Services and the House Committee on Armed Services detailed reports on the exercise of such authority.

SECTION 1203--RECODIFICATION AND REVISION TO LAW RELATING TO DEPARTMENT OF DEFENSE HUMANITARIAN DEMINING ASSISTANCE

This section would recodify in a section of title 10, United States Code, the provisions relating to the humanitarian mine action (HMA) program. This section would amend the authorities for HMA missions so secretaries of the military departments may base their decisions on whether the mission offers training value to participating U.S. military units or promotes the strategic interests of the United States. The committee notes that restrictions on actual physical detection, lifting, or destruction of landmines by U.S. military personnel do not change and there is no restriction on servicemembers visiting the physical site of demining activities.

SECTION 1204--ENHANCEMENTS TO REGIONAL DEFENSE COMBATING TERRORISM FELLOWSHIP PROGRAM

This section would amend section 2249c of title 10, United States Code, to describe the nature of the Counterterrorism Fellowship Program (CTFP) more clearly by changing the program title to the Combating Terrorism Fellowship Program and further explaining the authorities associated with the program, to allow the Department of Defense to manage the program more effectively and efficiently, and to increase the total amount of funds that may be used under this authority in any fiscal year from $20.0 million to $25.0 million.

The committee notes that the CTFP successfully engages potential partners in the global war on terrorism by educating and training foreign military officers, ministry of defense officials, and security officials with combating terrorism responsibilities. The committee is aware that before accepting CTFP candidates into the program the Department requires that each candidate enters a thorough human rights verification background vetting process. The committee expects that this policy will remain unchanged. Additionally, where it is not already part of the CTFP, the committee encourages the Department to develop and include curricula that promote human rights values and respect for democratic principles.

SECTION 1205--CAPSTONE OVERSEAS FIELD STUDIES TRIPS TO PEOPLE'S REPUBLIC OF CHINA AND REPUBLIC OF CHINA ON TAIWAN

This section would require the Secretary of Defense to conduct field studies trips to the People's Republic of China and the Republic of China on Taiwan during the overseas section of the CAPSTONE course for newly-selected flag and general officers. Overseas CAPSTONE trips provide a unique opportunity for the next generation of senior military leadership to familiarize themselves with areas of strategic importance. Therefore, this section would require that the Secretary provide one trip per year to China and one trip per year to Taiwan.

SECTION 1206--MILITARY EDUCATIONAL EXCHANGES BETWEEN SENIOR OFFICERS AND OFFICIALS OF THE UNITED STATES AND TAIWAN

This section would require the Secretary of Defense to establish and conduct exchanges of senior defense officials and officers with the Republic of China on Taiwan at the level of Deputy Assistant Secretary and flag-rank officers or above. The committee notes that the United States currently conducts reciprocal visits with senior defense officials and military officers from the People's Republic of China. The committee believes that similar programs with Taiwan are appropriate. More importantly, the committee believes that maintaining a balance of power across the Taiwan Strait is critical to ensuring deterrence and preserving peace, security, and stability in Asia. China's National People's Congress adopted an anti-secession law that essentially authorizes China's Central Military Commission to use non-peaceful means against Taiwan if the latter declares independence. The committee is concerned that this law, in conjunction with an excessive military build-up by China, may signal a weakening of deterrence

across the Taiwan Strait. The committee believes that the exchange program, by helping to strengthen Taiwan's defenses, would help preserve and strengthen deterrence, thereby encouraging China and Taiwan to resolve their differences peacefully.

SUBTITLE B--NONPROLIFERATION MATTERS AND COUNTRIES OF CONCERN

SEC 1211--PROCUREMENT RESTRICTIONS AGAINST FOREIGN PERSONS THAT TRANSFER CERTAIN DEFENSE ARTICLES AND SERVICES TO THE PEOPLE'S REPUBLIC OF CHINA

This section would prohibit the Secretary of Defense from purchasing goods or services from any entity that knowingly transfers an item that is on the United States Munitions List to the People's Republic of China. The committee notes that China's military modernization has proceeded apace with roughly double-digit increases in its defense budget almost every year for the last decade and a half. The committee is concerned that China's military modernization now exceeds its legitimate security needs, is undermining the balance of power that has maintained peace and security in the Western Pacific for decades, may be undermining deterrence in the region, and may be contributing to the increasingly bellicose nature of Chinese foreign policy. This section would create disincentives for potential arms exports to China by denying sellers access to Department of Defense procurement opportunities and would provide incentives for foreign persons to choose not to export arms to China in order to maintain their ability to sell goods and services to the Department of Defense.

SUBTITLE C--OTHER MATTERS

SECTION 1221--EXECUTION OF THE PRESIDENT'S POLICY TO MAKE AVAILABLE TO TAIWAN DIESEL ELECTRIC SUBMARINES

This section would establish that it is the policy of the United States to make available to Taiwan plans and options for design work and construction work on future diesel electric submarines under the U.S. foreign military sales process. The availability of such work would be consistent with U.S. national disclosure policy and subject to U.S. export control laws.

The section would also require the Secretary of Defense to submit to the congressional defense committees, not later than 30 days after enactment of this Act, a report on the Department of the Navy's efforts to execute the President's policy to sell diesel electric submarines to Taiwan, including ongoing and planned activities to make Taiwanese officials aware of foreign military sales options.

TITLE XIII--COOPERATIVE THREAT REDUCTION WITH STATES OF THE FORMER SOVIET UNION

OVERVIEW

The budget request for Cooperative Threat Reduction contained $372.1 million for fiscal year 2007, representing a decrease of $43.4 million from the amount authorized for fiscal year 2006, exclusive of any supplemental funds authorized for fiscal year 2006. This request included increases for strategic offensive arms elimination, nuclear weapons storage security, and nuclear weapons transportation security in Russia, as well as biological threat reduction efforts in states of the former Soviet Union. The request also included a decrease for weapons of mass destruction proliferation prevention in the states of the former Soviet Union and a $65.8 million decrease for chemical weapons destruction in Russia, reflecting the upcoming completion of the construction of a chemical weapons destruction facility.

LEGISLATIVE PROVISIONS

SECTION 1301--SPECIFICATION OF COOPERATIVE THREAT REDUCTION PROGRAMS AND FUNDS

This section would define the programs and funds that are Cooperative Threat Reduction programs and funds as those authorized to be appropriated in section 301 of this Act and specify that Cooperative Threat Reduction funds shall remain available for obligation for three fiscal years.

SECTION 1302--FUNDING ALLOCATIONS

This section would authorize $372.1 million for the Cooperative Threat Reduction program. This section would authorize specific amounts for each Cooperative Threat Reduction program element and would require notification to Congress 30 days before the Secretary of Defense obligates and expends fiscal year 2007 funds for purposes other than those specifically authorized. This section would also provide limited authority to obligate amounts for a Cooperative Threat Reduction program element in excess of the amount specifically authorized for that purpose.

SECTION 1303--TEMPORARY AUTHORITY TO WAIVE LIMITATION ON FUNDING FOR CHEMICAL WEAPONS DESTRUCTION FACILITY IN RUSSIA

This section would extend, until the completion of the facility, the President's authority to waive restrictions established in section 1305 of the National Defense Authorization Act for Fiscal Year 2000 (Public Law 106-65) for continuing the construction of a chemical weapons destruction facility at Shchuch'ye, Russia. The President's current authority expires at the end of calendar year 2006. This section would also require the Secretary of Defense to submit to Congress a notification that specifies the date of completion of the facility, not later than 30 days after completion.

SECTION 1304--NATIONAL ACADEMY OF SCIENCES STUDY

This section would authorize a study by the National Academy of Sciences to analyze lessons learned, past and present challenges, and possible options in effectively managing and facilitating threat reduction and nonproliferation projects under the Department of Defense Cooperative Threat Reduction Program.

This section would also require the Secretary of Defense to submit, by December 31, 2007, a report on this study to the Senate Committee on Armed Services and the House Committee on Armed Services. The report would review and evaluate project management, interagency interaction, public outreach and community involvement, cooperation of Russia and other states of the former Soviet Union, legal frameworks, transparency, adequacy of funding from the United States and any Cooperative Threat Reduction program partner, and interaction with threat reduction and nonproliferation projects of Global Partnership countries.

TITLE XIV--HOMELAND DEFENSE TECHNOLOGY TRANSFER

LEGISLATIVE PROVISIONS

SECTIONS 1401-1403--HOMELAND DEFENSE TECHNOLOGY TRANSFER

These sections would authorize the Secretary of Defense to create a Homeland Defense Technology Transfer Consortium to improve the effectiveness of the Department of Defense (DOD) processes for identifying and deploying relevant DOD technology to federal, State, and local first responders. The consortium would assist the Secretary in fulfilling the Department's technology transfer responsibilities required by section 1401 of the Bob Stump National Defense Authorization Act for Fiscal Year 2003 (Public Law 107-314).

TITLE XV--AUTHORIZATION FOR INCREASED COSTS DUE TO OPERATION IRAQI FREEDOM AND OPERATION ENDURING FREEDOM