News

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105th Congress                                                   Report
 2d Session              HOUSE OF REPRESENTATIVES               105-532
_______________________________________________________________________



 
        NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 1999

                               __________

                              R E P O R T

                                 OF THE

                     COMMITTEE ON NATIONAL SECURITY

                        HOUSE OF REPRESENTATIVES

                                   ON

                               H.R. 3616

                             together with

                      ADDITIONAL, DISSENTING, AND

                           SUPPLEMENTAL VIEWS

      [Including cost estimate of the Congressional Budget Office]

                                     
<GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT>

                                     

  May 12, 1998.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                            -----------

                    U.S. GOVERNMENT PRINTING OFFICE                    

48-245                     WASHINGTON : 1998





                  HOUSE COMMITTEE ON NATIONAL SECURITY

                       One Hundred Fifth Congress

               FLOYD D. SPENCE, South Carolina, Chairman

BOB STUMP, Arizona                   IKE SKELTON, Missouri
DUNCAN HUNTER, California            NORMAN SISISKY, Virginia
JOHN R. KASICH, Ohio                 JOHN M. SPRATT, Jr., South 
HERBERT H. BATEMAN, Virginia             Carolina
JAMES V. HANSEN, Utah                SOLOMON P. ORTIZ, Texas
CURT WELDON, Pennsylvania            OWEN PICKETT, Virginia
JOEL HEFLEY, Colorado                LANE EVANS, Illinois
JIM SAXTON, New Jersey               GENE TAYLOR, Mississippi
STEVE BUYER, Indiana                 NEIL ABERCROMBIE, Hawaii
TILLIE K. FOWLER, Florida            MARTIN T. MEEHAN, Massachusetts
JOHN M. McHUGH, New York             ROBERT A. UNDERWOOD, Guam
JAMES TALENT, Missouri               JANE HARMAN, California
TERRY EVERETT, Alabama               PAUL McHALE, Pennsylvania
ROSCOE G. BARTLETT, Maryland         PATRICK J. KENNEDY, Rhode Island
HOWARD ``BUCK'' McKEON, California   ROD R. BLAGOJEVICH, Illinois
RON LEWIS, Kentucky                  SILVESTRE REYES, Texas
J.C. WATTS, Jr., Oklahoma            TOM ALLEN, Maine
MAC THORNBERRY, Texas                VIC SNYDER, Arkansas
JOHN N. HOSTETTLER, Indiana          JIM TURNER, Texas
SAXBY CHAMBLISS, Georgia             F. ALLEN BOYD, Jr., Florida
VAN HILLEARY, Tennessee              ADAM SMITH, Washington
JOE SCARBOROUGH, Florida             LORETTA SANCHEZ, California
WALTER B. JONES, Jr., North          JAMES H. MALONEY, Connecticut
    Carolina                         MIKE McINTYRE, North Carolina
LINDSEY GRAHAM, South Carolina       CIRO D. RODRIGUEZ, Texas
JIM RYUN, Kansas                     CYNTHIA A. McKINNEY, Georgia
MICHAEL PAPPAS, New Jersey           (VACANCY)
BOB RILEY, Alabama
JIM GIBBONS, Nevada
BILL REDMOND, New Mexico
KAY GRANGER, Texas
                    Andrew K. Ellis, 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.................................     9
  The Strains of Shaping.........................................    10
  Preparing for an Uncertain Future..............................    11
  Responding to a Crisis.........................................    13
  Managing Risk..................................................    15
Hearings.........................................................    17

DIVISION A--DEPARTMENT OF DEFENSE AUTHORIZATION..................    19

TITLE I--PROCUREMENT.............................................    19
  OVERVIEW.......................................................    19
    Aircraft Procurement, Army...................................    22
      Overview...................................................    22
      Items of Special Interest..................................    25
        Airborne avionics........................................    25
        Airborne reconnaissance low (ARL)........................    25
        Aircraft survivability equipment (ASE)...................    25
        Army airborne command and control system (A2C2S).........    26
        Army helicopter modernization plan.......................    26
        C-12 modifications.......................................    27
        CH-47 cargo helicopter modifications.....................    27
        Endurance unmanned aerial vehicle (UAV)..................    27
        Kiowa warrior modifications..............................    28
        UH-60L blackhawk.........................................    28
    Missile Procurement, Army....................................    28
      Overview...................................................    28
      Items of Special Interest..................................    31
        Enhanced fiber optic guided missile (EFOGM)..............    31
        Javelin..................................................    31
        Multiple launch rocket system (MLRS) launcher systems....    31
    Weapons and Tracked Combat Vehicles, Army....................    31
      Overview...................................................    31
      Items of Special Interest..................................    34
        Bradley base sustainment.................................    34
        Bradley base sustainment/command and control vehicle 
          (C2V)..................................................    34
        M1 abrams tank modification..............................    34
        M-240 series machine gun.................................    35
        M4 carbine...............................................    35
    Ammunition Procurement, Army.................................    35
      Overview...................................................    35
      Items of Special Interest..................................    39
        Ammunition...............................................    39
        Arsenals.................................................    39
        Non-toxic frangible ammunition...........................    39
    Other Procurement, Army......................................    40
      Overview...................................................    40
      Items of Special Interest..................................    48
        Automated data processing equipment (ADPE)...............    48
        Close combat tactical trainer (CCTT).....................    48
        Co-site interference mitigation technology...............    48
        Family of medium tactical vehicles (FMTV)................    48
        Forward entry device (FED)...............................    49
        Ground based common sensor (GBCS)........................    49
        High mobility multipurpose wheeled vehicle (HMMWV)/HMMWV 
          extended service plan (ESP)............................    49
        Joint surveillance and target attack radar system (Joint 
          STARS) common ground station (CGS).....................    50
        Joint tactical terminal..................................    50
        Land warrior.............................................    50
        Lightweight maintenance enclosure (LME)..................    51
        Night vision devices.....................................    51
        Nonsystem training devices...............................    51
        Shortstop................................................    52
        Small pusher tug.........................................    52
    Chemical Agents and Munitions Destruction, Army..............    52
      Overview...................................................    52
      Item of Special Interest...................................    54
        Chemical agents and munitions destruction................    54
    Aircraft Procurement, Navy...................................    54
      Overview...................................................    54
      Items of Special Interest..................................    58
        AV-8B....................................................    58
        AH-1W night targeting system (NTS).......................    58
        EA-6B modifications......................................    58
        EP-3E flat panel display.................................    59
        ES-3 modifications.......................................    59
        F-14 modifications.......................................    59
        F/A-18E/F................................................    59
        Joint primary air training system (JPATS)................    60
        Lightweight environmentally sealed parachute assembly 
          (LESPA)................................................    60
        T-45TS...................................................    61
        V-22.....................................................    61
    Weapons Procurement, Navy....................................    61
      Overview...................................................    61
      Items of Special Interest..................................    66
        Close-in weapon system (CIWS) surface mode upgrade.......    66
        Standard missile.........................................    66
    Ammunition Procurement, Navy/Marine Corps....................    66
      Overview...................................................    66
      Item of Special Interest...................................    69
        Marine corps ammunition..................................    69
    Shipbuilding and Conversion, Navy............................    69
      Overview...................................................    69
      Items of Special Interest..................................    72
        Landing craft air cushion (LCAC) service life extension 
          program (SLEP).........................................    72
        LPD-17...................................................    72
        National defense features................................    72
        New attack submarine (NSSN)..............................    73
        Strategic sealift........................................    73
    Other Procurement, Navy......................................    73
      Overview...................................................    73
      Items of Special Interest..................................    82
        AN/BPS-15(H) submarine navigation radar upgrade..........    82
        AN/SQQ-89 surface anti-submarine warfare (ASW) combat 
          system.................................................    82
        AN/USC-42 mini-demand assigned multiple access (DAMA) 
          ultra-high frequency (UHF) satellite communications 
          (SATCOM) terminals.....................................    82
        Beamhit laser marksmanship training system (LMTS)........    83
        Cooperative engagement capability (CEC)..................    83
        Weapons range support....................................    83
        WSN-7 ring laser gyro (RLG) and WQN-2 doppler sonar 
          velocity log (DSVL)....................................    84
    Procurement, Marine Corps....................................    85
      Overview...................................................    85
      Items of Special Interest..................................    89
        Marine corps electronic warfare support system...........    89
        Marine corps tactical intelligence equipment.............    89
        Medium tactical vehicle replacement (MTVR)...............    89
        Unit cost growth.........................................    90
    Aircraft Procurement, Air Force..............................    90
      Overview...................................................    90
      Items of Special Interest..................................    95
        Bomber modernization.....................................    95
        C-130J...................................................    95
        CV-22....................................................    95
        E-8C joint surveillance and target attack radar system 
          (STARS)................................................    96
        F-15 modifications.......................................    96
        F-16.....................................................    97
        F-16 modifications.......................................    97
        Global hawk..............................................    97
        Joint primary aircraft training system (JPATS)...........    98
        Miscellaneous production charges.........................    98
        Navigational safety upgrades.............................    98
        Pacer coin...............................................    99
    Ammunition Procurement, Air Force............................    99
      Overview...................................................    99
    Missile Procurement, Air Force...............................   102
      Overview...................................................   102
      Items of Special Interest..................................   105
        AGM-165 maverick modifications...........................   105
        Global positioning system................................   105
        Inertial upper stage.....................................   105
        Medium launch vehicle....................................   105
        Minuteman gyro stabilized platform.......................   105
        Minuteman III modifications..............................   106
        Titan space boosters.....................................   106
    Other Procurement, Air Force.................................   106
      Overview...................................................   106
      Items of Special Interest..................................   113
        Base information infrastructure..........................   113
        Rangeless air combat training system (RACTS).............   113
        Tactical communications-electronics (CE) equipment.......   113
    Procurement, Defense-Wide....................................   114
      Overview...................................................   114
      Items of Special Interest..................................   119
        Automated document conversion system (ADCS)..............   119
        Chemical-biological defense equipment for rapid 
          assessment and initial detection teams.................   119
        Defense support program office training and exercise.....   119
        Flat panel night vision heads-up display system..........   120
        Mentor protege...........................................   120
    National Guard and Reserve Equipment.........................   120
      Overview...................................................   120
      Items of Special Interest..................................   123
        Air reserve forces.......................................   123
        Senior scout.............................................   123
    Chemical Agents and Munitions Destruction, Defense...........   124
      Overview...................................................   124
    Defense Export Loan Guarantees...............................   126
      Overview...................................................   126
  LEGISLATIVE PROVISIONS.........................................   128
    Subtitle A--Authorization of Appropriations..................   128
      Sections 101-109--Authorization of Appropriations..........   128
    Subtitle B--Army Programs....................................
      Section 111--Multiyear Procurement Authority for Longbow 
        Hellfire Missile Program.................................   128
      Section 112--M1A2 System Enhancement Program Step 1 Program   128
    Subtitle C--Navy Programs....................................   128
      Section 121--Multiyear Procurement Authority for the 
        Department of the Navy...................................   128
    Subtitle D--Other Matters....................................   128
      Section 141--Funding, Transfer and Management of the 
          Assembled Chemical Weapons Assessment Program..........   128
        Dialogue on assembled chemical weapons assessment........   129

TITLE II--RESEARCH, DEVELOPMENT, TEST, AND EVALUATION............   130
  OVERVIEW.......................................................   130
    Department of Defense Basic Research/Science and Technology 
      Program....................................................   131
    Defense Advanced Research Projects Agency....................   131
    Information Systems Technology, Superiority and Security.....   132
    Army RDT&E...................................................   134
      Overview...................................................   134
      Items Of Special Interest..................................   142
        Aerostat.................................................   142
        All source analysis system...............................   142
        Army after next combat vehicle initiative................   142
        Advanced combat vehicle and automotive technology........   142
        Digital fire control system..............................   143
        Hardened materials.......................................   143
        Industry and academia alternative vehicle propulsion 
          initiative.............................................   143
        Innovative engine technology.............................   144
        Crusader self-propelled howitzer.........................   144
        Aviation advanced technology development.................   144
        Comanche.................................................   145
        Command, control, communications technology..............   145
        Defense healthcare information assurance program.........   146
        Defense information technology test bed..................   146
        Environmental development and management programs........   146
        Environmental quality technology.........................   146
        Future direct support weapon system......................   147
        Future missile technology integration program............   147
        Helmet-mounted retinal display technology................   147
        High mobility artillery rocket system....................   147
        Improved fuel pumps and fuel controls....................   147
        Joint service small arms program.........................   148
        Joint surveillance and target attack radar system (Joint 
          STARS).................................................   148
        Lighter more lethal weapons..............................   148
        MedTeams.................................................   149
        Missile and rocket advanced technology...................   149
        Missile defense battle integration center/battle lab.....   149
        Plasma energy pyrolysis system...........................   150
        Precision guided mortar munitions........................   150
        Starstreak...............................................   150
        Stinger missile block two upgrades.......................   150
        Stinger universal launcher...............................   151
        Strategic environmental research and development program.   151
        Tactical high energy laser...............................   151
        Tactical exploitation of national capabilities...........   151
        Trajectory correctable munitions development.............   152
        Ultra lightweight camouflage net system..................   152
    Navy RDT&E...................................................   152
      Overview...................................................   152
      Items Of Special Interest..................................   160
        ADC(X) auxiliary cargo ship development..................   160
        Advanced amphibious assault vehicle......................   160
        Advanced anti-radiation guided missile...................   160
        Arctic oceanographic observation program.................   161
        Automatic target tracker.................................   161
        Autonomous underwater robotics technology................   161
        Autonomous underwater vehicle and sonar development......   162
        Aviation depot maintenance technology....................   162
        Carbon-carbon materials for reentry bodies...............   162
        Common support aircraft..................................   162
        Cooperative engagement capability........................   163
        Cooperative engagement capability frequency spectrum 
          requirements...........................................   163
        Cryogenic electronics technology.........................   164
        Distributed surveillance system..........................   164
        DD-21 land attack destroyer..............................   164
        DP-2 thrust vectoring system proof of concept 
          demonstration..........................................   165
        Environmentally safe energetic materials.................   165
        Escape system dynamic flow test facility.................   166
        Hybrid electronically scanned antenna....................   166
        Hybrid fiberoptic/wireless communications system 
          technology.............................................   166
        Inter-cooled recuperated gas turbine engine..............   167
        Link 16 improvement program..............................   167
        LPD-17 amphibious assault ship self-defense..............   168
        Man overboard indicator technology.......................   168
        Marine Corps ground combat/support system................   169
        Marine mammal research...................................   169
        Molecular design materials science.......................   169
        Multi-function self aligned gate technology..............   169
        Multipurpose processor...................................   170
        Navy land attack missile program.........................   170
        Navy theater missile defense.............................   171
        NSSN advanced technology insertion.......................   172
        Optically multiplexed wideband radar beamformer..........   172
        Parametric airborne dipping sonar........................   172
        Power electronic building blocks and power node control 
          centers................................................   173
        Project M................................................   173
        Reduction to fiscal year 1999 budget request programs....   174
        Remote minehunting system................................   174
        Shallow water influence minesweeping system..............   174
        Shipboard system component development...................   174
        Shortstop electronic protection system...................   175
        Silicon carbide semiconductor substrates.................   175
        Standoff land attack missile--expanded response (SLAM-ER)   175
        Submarine sonar domes....................................   176
        Tactical combat training systems development.............   176
        Tactical Tomahawk........................................   177
        Ultra-high thermal conductivity fibers...................   178
        Undersea warfare advanced technology.....................   178
        Vacuum electronics.......................................   178
        Vectored thrust ducted propeller compound helicopter 
          technology demonstration...............................   179
        Vectoring ESTOL control tailless operation research......   179
        Vertical gun for advanced ships..........................   180
    Air Force RDT&E..............................................   180
      Overview...................................................   180
      Items Of Special Interest..................................   189
        Advanced low observable coatings.........................   189
        Advanced military satellite communications...............   189
        Aircrew laser eye protection.............................   189
        ALR-69 radar warning receiver............................   189
        Ballistic missile technology.............................   190
        Distributed agent information warfare....................   190
        Ejection seats...........................................   190
        F-16 squadrons...........................................   191
        Flight test safely enhancements..........................   191
        Integrated high payoff rocket propulsion technology......   191
        Integrated powerhead demonstration.......................   192
        Longshot.................................................   192
        Low cost launch technology...............................   192
        Microsatellite technology................................   192
        Military spaceplane......................................   193
        More electric aircraft program...........................   193
        Panoramic night vision goggle............................   193
        Protein-based memory development.........................   193
        Rocket system launch program.............................   194
    Defense Agencies RDT&E.......................................   194
      Overview...................................................   194
      Items Of Special Interest..................................   202
        Advanced concept technology demonstration (ACTD).........   202
        Advanced synthetic aperture radar system improvement 
          program................................................   202
        Ballistic missile defense................................   202
          Advanced technology development........................   203
          Atmospheric interceptor technology.....................   203
          BMD research and development...........................   203
          Ballistic missile defense testing......................   204
          Cooperative ballistic missile defense..................   205
          Joint theater missile defense..........................   205
          National missile defense...............................   205
          Navy theater wide......................................   206
          Patriot advanced capability............................   206
          Space based laser......................................   207
          Support technology--applied research...................   207
          Technical operations...................................   208
          Theater high altitude area defense (THAAD).............   208
        Chemical-biological defense program......................   209
        Counterproliferation support.............................   209
        Defense Advanced Research Projects Agency................   209
          DARPA marine technology program........................   210
        Defense airborne reconnaissance program management.......   210
        Defense manufacturing, technology program (MANTECH)......   211
        Demilitarization of non-nuclear military explosives......   212
        Electro-optic framing technologies.......................   212
        Endurance unmanned aerial vehicle........................   212
        Facial recognition technology............................   213
        Flat panel displays......................................   213
        Global positioning system guidance package...............   214
        Humanitarian demining....................................   214
        International medical programs global satellite system...   214
        Joint signals intelligence avionics family...............   215
        Live fire testing of vulnerability to asymmetric threats.   215
        Medical free electron laser..............................   216
        National Technology Alliance.............................   216
        Next Generation Internet revolutionary applications......   216
        Polymer-cased ammunition.................................   217
        Operational field assessment program.....................   217
        Optical correlation technology for automatic target 
          recognition............................................   218
        Seismic sensor technology................................   218
        Specialty aerospace metals initiative....................   219
        Special operations intelligence systems..................   219
        Tactical unmanned aerial vehicles funding................   219
        Thermionics..............................................   220
        University research initiatives..........................   220
        Unmanned aerial vehicle systems integration laboratory...   220
        Verification technology demonstration....................   221
  LEGISLATIVE PROVISIONS.........................................   221
    Subtitle A--Authorization of Appropriations..................   221
      Section 201--Authorization Of Appropriations...............   221
      Section 202--Amount For Basic And Applied Research.........   221
    Subtitle B--Program Requirements, Restrictions, and 
      Limitations................................................   221
      Section 211--Management Responsibility for Navy Mine 
        Countermeasures Programs.................................   221
      Section 212--Future Aircraft Carrier Transition 
        Technologies.............................................   222
      Section 213--Manufacturing Technology Program..............   222
    Subtitle C--Ballistic Missile Defense........................   223
      Section 231--National Missile Defense Policy...............   223
      Section 232--Limitation on Funding for the Medium Extended 
        Air Defense System.......................................   223
      Section 233--Limitation on Funding for Cooperative 
        Ballistic Missile Defense Programs.......................   223
      Section 234--Limitation on funding for Counterproliferation 
        Support..................................................   224
      Section 235--Ballistic Missile Defense Program Elements....   224

TITLE III--OPERATION AND MAINTENANCE.............................   225
  OVERVIEW.......................................................   225
      Funding Realities..........................................   225
      Readiness Realities........................................   225
  ITEMS OF SPECIAL INTEREST......................................   254
    Budget Request Increases.....................................   254
      Critical Readiness Accounts Increases......................   254
      Mobility Enhancement Funding...............................   254
      Training Accounts..........................................   254
      United States Marine Corps Cold Weather Clothing...........   255
    Budget Request Reductions....................................   255
      Administration and Support Accounts........................   255
      Advisory and Assistance Services...........................   256
      Bulk Fuel Reductions.......................................   256
      Civilian Personnel Overstatement Reductions................   257
      Foreign Currency Reductions................................   257
    Environmental Issues.........................................   257
      Air Force Plant #3, Tulsa, Oklahoma........................   257
      Arctic Military Environmental Cooperation..................   258
      Navy Environmental Leadership Program......................   258
      Pollution Prevention Program...............................   258
      Scrapping of Naval Vessels.................................   258
    Information Technology Issues................................   259
      Overview...................................................   259
      Automatic Identification Technology........................   259
      Computer Crimes and Information Technology Security........   259
      Information Technology Management..........................   260
      Information Technology Priorities..........................   260
      Joint Information Technology Systems.......................   261
      Redundant Information Technology Programs..................   262
      Utilizing Commercial Information Technology................   262
    Intelligence Matters.........................................   263
      Integrated Architecture Plan...............................   263
      Joint Reserve Intelligence Program.........................   263
      Intelligence Congressional Justification Books.............   263
    Morale, Welfare, and Recreation Issues.......................   264
      Defense Commissary Agency Information Technology 
        Acquisition..............................................   264
      Libraries..................................................   264
      Performance Based Agreements...............................   265
      Public-Private Ventures....................................   265
      Uniform Health Benefit for Nonappropriated Fund Employees..   265
    Other Issues.................................................   266
      Appropriated Funds Used to Pay for Defense Information 
        System Agency Costs......................................   266
      Army Civilian Personnel Management.........................   267
      Automatic Document Conversion Technology...................   268
      Budget Justification Materials.............................   268
      Classified Materials Containers............................   269
      Corrosion Control Programs.................................   269
      Defense Automated Printing Service.........................   269
      Depleted Uranium Penetrators...............................   270
      Infrastructure Reduction Initiatives.......................   270
      Military Affiliate Radio System............................   271
      Prime Vendor Contracts.....................................   272
      Ship Repair Industrial Base................................   272
      Tagging System for Hydrocarbon Fuels.......................   272
  LEGISLATIVE PROVISIONS.........................................   273
    Subtitle A--Authorization Of Appropriations..................   273
      Section 301--Operation and Maintenance Funding.............   273
      Section 302--Working Capital Funds.........................   273
      Section 303--Armed Forces Retirement Home..................   273
      Section 304--Transfer From National Defense Stockpile 
        Transaction Fund.........................................   273
      Section 305--Refurbishment of M1-A1 Tanks..................   273
      Section 306--Operation of Prepositioned Fleet, National 
        Training Center, Fort Irwin, California..................   273
      Section 307--Relocation of USS Wisconsin...................   274
      Section 308--Fisher House Trust Funds......................   274
    Subtitle B--Information Technology Issues....................   274
      Section 311--Additional Information Technology 
        Responsibilities of Chief Information Officers...........   274
      Section 312--Defense-Wide Electronic Mall System for Supply 
        Purchases................................................   274
      Section 313--Protection of Funding Provided for Certain 
        Information Technology and National Security Programs....   274
      Section 314--Priority Funding to Ensure Year 2000 
        Compliance of Mission Critical Information Technology and 
        National Security Systems................................   274
      Section 315--Evaluation of Year 2000 Compliance as Part of 
        Training Exercises Programs..............................   274
    Subtitle C--Environmental Provisions.........................   275
      Section 321--Authorization to Pay Negotiated Settlement for 
        Environmental Cleanup at Former Department of Defense 
        Sites in Canada..........................................   275
      Section 322--Removal of Underground Storage Tanks..........   275
    Subtitle D--Defense Infrastructure Support Improvement.......   275
      Section 331--Reporting and Study Requirements Before Change 
        of Commercial and Industrial Type Functions to Contractor 
        Performance..............................................   275
      Section 332--Clarification of Requirement to Maintain 
        Government-Owned and Government-Operated Core Logistics 
        Capability...............................................   276
      Section 333--Oversight of Development and Implementation of 
        Automated Identification Technology......................   276
      Section 334--Conditions on Expansion of Functions Performed 
        Under Prime Vendor Contracts.............................   276
      Section 335--Clarification of Definition of Depot-Level 
        Maintenance and Repair...................................   276
      Section 336--Clarification of Commercial Item Exception to 
        Requirements Regarding Core Logistics Capabilities.......   276
      Section 337--Development of Plan for Establishment of Core 
        Logistics Capabilities for Maintenance and Repair of C-17 
        Aircraft.................................................   276
      Section 338--Contractor-Operated Civil Engineering Supply 
        Stores Program...........................................   277
      Section 339--Report on Savings and Effect of Personnel 
        Reductions in Army Materiel Command......................   277
    Subtitle E--Commissaries and Nonappropriated Fund 
      Instrumentalities..........................................   277
      Section 341--Continuation of Management and Funding of 
        Defense Commissary Agency through the Office of the 
        Secretary of Defense.....................................   277
      Section 342--Expansion of Current Eligibility of Reserves 
        for Commissary Benefits..................................   277
      Section 343--Repeal of Requirement for Air Force to Sell 
        Tobacco Products to Enlisted Personnel...................   278
      Section 344--Restrictions on Patron Access to, and 
        Purchases in, Overseas Commissaries and Exchange Stores..   278
      Section 345--Extension of Demonstration Project for Uniform 
        Funding of Morale, Welfare, and Recreation Activities....   278
      Section 346--Prohibition on Consolidation or Other 
        Organizational Changes of Department of Defense Retail 
        Systems..................................................   278
      Section 347--Authorized Use of Appropriated Funds for 
        Relocation of Navy Exchange Service Command..............   279
      Section 348--Evaluation of Merit of Selling Malt Beverages 
        and Wine in Commissary Stores as Exchange System 
        Merchandise..............................................   279
    Subtitle F--Other Matters....................................   279
      Section 361--Eligibility Requirements for Attendance at 
        Department of Defense Domestic Dependent Elementary and 
        Secondary Schools........................................   279
      Section 362--Specific Emphasis of Program to Investigate 
        Fraud, Waste, and Abuse within Department of Defense.....   280
      Section 363--Revision of Inspection Requirements Relating 
        to Armed Forces Retirement Home..........................   280
      Section 364--Assistance to Local Educational Agencies that 
        Benefit Dependents of Members of the Armed Forces and 
        Department of Defense Civilian Employees.................   280
      Section 365--Strategic Plan for Expansion of Distance 
        Learning Initiatives.....................................   281
      Section 366--Public Availability of Operating Agreements 
        Between Military Installations and Financial Institutions   281
      Section 367--Department of Defense Readiness Reporting 
        System...................................................   281
      Section 368--Travel by Reservists on Carriers under 
        Contract with General Services Administration............   285
    Subtitle G--Demonstration of Commercial-Type Practices to 
        Improve Quality of Personal Property Shipments...........   285
      Section 381--Demonstration Program Required................   285
      Section 382--Goals of Demonstration Program................   286
      Section 383--Program Participants..........................   286
      Section 384--Test Plan.....................................   286
      Section 385--Other Methods of Personal Property Shipping...   286
      Section 386--Duration of Demonstration Program.............   286
      Section 387--Evaluation of Demonstration Program...........   286

TITLE IV--MILITARY PERSONNEL AUTHORIZATIONS......................   287
  LEGISLATIVE PROVISIONS.........................................   287
    Subtitle A--Active Forces....................................   287
      Section 401--End Strengths for Active Forces...............   287
      Section 402--Revision in Permanent End Strength Levels.....   287
      Section 403--Date for Submission of Annual Manpower 
        Requirements Report......................................   288
      Section 404--Extension of Authority for Chairman of the 
        Joint Chiefs of Staff to Designate Up to 12 General and 
        Flag Officer Positions to Be Excluded from General and 
        Flag Officer Grade Limitations...........................   288
    Subtitle B--Reserve Forces...................................   288
      Section 411--End Strengths for Selected Reserve............   288
      Section 412--End Strengths for Reserves on Active Duty in 
        Support of the Reserves..................................   289
      Section 413--End Strengths for Military Technicians (Dual 
        Status)..................................................   289
      Section 414--Increase in Number of Members in Certain 
        Grades Authorized to Serve on Active Duty in Support of 
        the Reserves.............................................   290
    Subtitle C--Authorization of Appropriations..................   290
      Section 421--Authorization of Appropriations for Military 
        Personnel................................................   290

TITLE V--MILITARY PERSONNEL POLICY...............................   292
  ITEMS OF SPECIAL INTEREST......................................   292
    National Guard Youth Challenge...............................   292
    Recruiting...................................................   292
    Reserve Component Full-time Support Force....................   293
    Reserve Component Joint Professional Military Education......   294
    Sustaining Education and Teaching Excellence at the National 
      Defense University.........................................   295
  LEGISLATIVE PROVISIONS.........................................   296
    Subtitle A--Officer Personnel Policy.........................   296
      Section 501--Codification of Eligibility of Retired 
        Officers and Former Officers for Consideration by Special 
        Selection Boards.........................................   296
      Section 502--Communication to Promotion Boards by Officers 
        under Consideration......................................   296
      Section 503--Procedures for Separation of Regular Officers 
        for Substandard Performance of Duty or Certain Other 
        Reasons..................................................   296
      Section 504--Posthumous Commissions and Warrants...........   296
      Section 505--Tenure of Chief of the Air Force Nurse Corps..   296
    Subtitle B--Reserve Component Matters........................   297
      Section 511--Composition of Selective Early Retirement 
        Boards of Reserve General and Flag Officers of the Navy 
        and Marine Corps.........................................   297
      Section 512--Active Status Service Requirement for 
        Promotion Consideration for Army and Air Force Reserve 
        Component Brigadier Generals.............................   297
      Section 513--Revision to Educational Requirement for 
        Promotion of Reserve Officers............................   297
    Subtitle C--Military Education and Training..................   297
      Section 521--Requirements Relating to Recruit Basic 
        Training.................................................   297
      Section 522--After-Hours Privacy for Recruits During Basic 
        Training.................................................   298
      Section 523--Extension of Reporting Dates for Commission on 
        Military Training and Gender-Related Issues..............   298
      Section 524--Improved Oversight of Innovative Readiness 
        Training.................................................   298
    Subtitle D--Decorations, Awards and Commendations............   299
      Section 531--Study of New Decorations for Injury or Death 
        in Line of Duty..........................................   299
      Section 532--Waiver of Time Limitations for Award of 
        Certain Decorations to Specified Persons.................   299
      Section 533--Commendation of the Navy and Marine Corps 
        Personnel who Served in the United States Navy Asiatic 
        Fleet from 1910-1942.....................................   299
      Section 534--Appreciation for Service during World War I 
        and World War II by Members of the Navy Assigned on Board 
        Merchant Ships as the Naval Armed Guard Service..........   299
      Section 535--Sense of Congress Regarding the Heroism, 
        Sacrifice, and Service of the Military Forces of South 
        Vietnam and Other Nations in Connection with the United 
        States Armed Forces during the Vietnam Conflict..........   299
      Section 536--Sense of Congress Regarding the Heroism, 
        Sacrifice, and Service of Former South Vietnamese 
        Commandos in Connection with United States Armed Forces 
        during the Vietnam Conflict..............................   300
    Subtitle E--Administration of Agencies Responsible for Review 
        and Correction of Military Records.......................   300
      Sections 541-544--Corrections of Military Records..........   300
    Subtitle F--Other Matters....................................   301
      Section 551--One-Year Extension of Certain Force Drawdown 
        Transition Authorities Relating to Personnel Management 
        and Benefits.............................................   301
      Section 552--Leave Without Pay for Academy Cadets and 
        Midshipmen...............................................   301
      Section 553--Provision for Recovery, Care, and Disposition 
        of the Remains of All Medically Retired Members..........   302
      Section 554--Continued Eligibility under Voluntary 
        Separation Incentive Program for Members who 
        Involuntarily Lose Membership in a Reserve Component.....   302
      Section 555--Definition of Financial Institution for Direct 
        Deposit of Pay...........................................   302
      Section 556--Increase in Maximum Amount for College Fund 
        Program..................................................   302
      Section 557--Central Identification Laboratory, Hawaii.....   302
      Section 558--Honor Guard Details at Funerals of Veterans...   303
      Section 559--Applicability to All Persons in Chain of 
        Command of Policy Requiring Exemplary Conduct by 
        Commanding Officers and Others in Authority in the Armed 
        Forces...................................................   303
      Section 560--Report on Prisoners Transferred from United 
        States Disciplinary Barracks, Fort Leavenworth, Kansas, 
        to Federal Bureau of Prisons.............................   303
      Section 561--Report on Process for Selection of Members for 
        Service on Courts-Martial................................   304
      Section 562--Study of Revising the Term of Service of 
        Members of the United States Court of Appeals for the 
        Armed Forces.............................................   304
      Section 563--Status of Cadets at the Merchant Marine 
        Academy..................................................   304

TITLE VI--COMPENSATION AND OTHER PERSONNEL BENEFITS..............   305
  OVERVIEW.......................................................   305
  ITEMS OF SPECIAL INTEREST......................................   305
    Military Retirement..........................................   305
    Survivor Benefit Plan........................................   306
  LEGISLATIVE PROVISIONS.........................................   306
    Subtitle A--Pay and Allowances...............................   306
      Section 601--Increase in Basic Pay for Fiscal Year 1999....   306
      Section 602--Basic Allowance for Housing Outside the United 
        States...................................................   306
      Section 603--Basic Allowance for Subsistence for Reserves..   306
    Subtitle B--Bonuses and Special and Incentive Pays...........   307
      Section 611--One-Year Extension of Certain Bonuses and 
        Special Pay Authorities for Reserve Forces...............   307
      Section 612--One-Year Extension of Certain Bonuses and 
        Special Pay Authorities for Nurse Officer Candidates, 
        Registered Nurses, and Nurse Anesthetists................   307
      Section 613--One-Year Extension of Authorities Relating to 
        Payment of Other Bonuses and Special Pays................   307
      Section 614--Aviation Career Incentive Pay and Aviation 
        Officer Retention Bonus..................................   307
      Section 615--Special Pay for Diving Duty...................   307
      Section 616--Selective Reenlistment Bonus Eligibility for 
        Reserve Members Performing Active Guard and Reserve Duty.   308
      Section 617--Removal of Ten Percent Restriction on 
        Selective Reenlistment Bonuses...........................   308
      Section 618--Increase in Maximum Amount of Army Enlistment 
        Bonus....................................................   308
      Section 619--Equitable Treatment of Reserves Eligible for 
        Special Pay for Duty Subject to Hostile Fire or Imminent 
        Danger...................................................   308
    Subtitle C--Travel and Transportation Allowances.............   308
      Section 631--Exception to Maximum Weight Allowance for 
        Baggage and Household Effects............................   308
      Section 632--Travel and Transportation Allowances for 
        Travel Performed by Members in Connection with Rest and 
        Recuperative Leave from Overseas Stations................   308
      Section 633--Storage of Baggage of Certain Dependents......   308
    Subtitle D--Retired Pay, Survivor Benefits, and Related 
      Matters....................................................   309
      Section 641--Effective Date of Former Spouse Survivor 
        Benefit Coverage.........................................   309
    Subtitle E--Other Matters....................................   309
      Section 651--Deletion of Canal Zone from Definition of 
        United States Possessions for Purposes of Pay and 
        Allowances...............................................   309
      Section 652--Accounting of Advance Payments................   309
      Section 653--Reimbursement of Rental Vehicle Costs when 
        Motor Vehicle Transported at Government Expense Is Late..   309
      Section 654--Education Loan Repayment Program for Certain 
        Health Profession Officers Serving in Selected Reserve...   309

TITLE VII--HEALTH CARE PROVISIONS................................   311
  OVERVIEW.......................................................   311
  ITEMS OF SPECIAL INTEREST......................................   312
    Depleted Uranium Training and Health Surveillance............   312
    Graduate Medical Education Programs..........................   313
    Medical Readiness Learning Initiative........................   314
    TRICARE Contract Performance.................................   314
  LEGISLATIVE PROVISIONS.........................................   315
    Subtitle A--Health Care Services.............................   315
      Section 701--Expansion of Dependent Eligibility Under 
        Retiree Dental Program...................................   315
      Section 702--Plan for Provision of Health Care for Military 
        Retirees and Their Dependents Comparable to Health Care 
        Provided Under TRICARE Prime.............................   315
      Section 703--Plan for Redesign of Military Pharmacy System.   316
      Section 704--Transitional Authority to Provide Continued 
        Health Care Coverage for Certain Persons Unaware of Loss 
        of CHAMPUS Eligibility...................................   317
    Subtitle B--TRICARE Program..................................   318
      Section 711--Payment of Claims for Provision of Health Care 
        Under the TRICARE Program for which a Third Party May be 
        Liable...................................................   318
      Section 712--Procedures Regarding Enrollment in TRICARE 
        Prime....................................................   319
    Subtitle C--Other Matters....................................   319
      Section 721--Inflation Adjustment of Premium Amounts for 
        Dependents Dental Program................................   319
      Section 722--System for Tracking Data and Measuring 
        Performance in Meeting TRICARE Access Standards..........   319
      Section 723--Air Force Research, Development, Training and 
        Education on Exposure to Chemical, Biological, and 
        Radiological Hazards.....................................   320
      Section 724--Authorization to Establish a Level 1 Trauma 
        Training Center..........................................   320
      Section 725--Report on Implementation of Enrollment-based 
        Capitation for Funding for Military Medical Treatment 
        Facilities...............................................   320

TITLE VIII--ACQUISITION POLICY, ACQUISITION MANAGMENT, AND 
    RELATED MATTERS..............................................   322
  ITEM OF SPECIAL INTEREST.......................................   322
    Payments to Subtier Contractors..............................   322
  LEGISLATIVE PROVISIONS.........................................   322
      Section 801--Limitation on Procurement of Ammunition and 
        Components...............................................   322
      Section 802--Acquisition Corps Eligibility.................   322
      Section 803--Amendments Relating to Procurement from Firms 
        in Industrial Base for Production of Small Arms..........   322

TITLE IX--DEPARTMENT OF DEFENSE ORGANIZATION AND MANAGEMENT......   323
  LEGISLATIVE PROVISIONS.........................................   323
      Section 901--Further Reductions in Defense Acquisition 
        Workforce................................................   323
      Section 902--Limitation on Operation and Support Funds for 
        the Office of the Secretary of Defense...................   323
      Section 903--Revision to Defense Directive Relating to 
        Management Headquarters and Headquarters Support 
        Activities...............................................   324
      Section 904--Under Secretary of Defense for Policy to Have 
        Responsibility with Respect to Export Control Activities 
        of the Department of Defense.............................   324
      Section 905--Independent Task Force on Transformation and 
        Department of Defense Organization.......................   326
      Section 906--Improved Accounting for Defense Contract 
        Services.................................................   326
      Section 907--Repeal of Requirement Relating to Assignment 
        of Tactical Airlift Mission to Reserve Components........   327
      Section 908--Repeal of Certain Requirements Relating to 
        Inspector General Investigations of Reprisal Complaints..   328
      Section 909--Consultation with Commandant of the Marine 
        Corps Regarding Marine Corps Aviation....................   328

TITLE X--GENERAL PROVISIONS......................................   329
  Counter-Drug Activities........................................   329
    Overview.....................................................   329
    Items of Special Interest....................................   330
      Gulf states counter-drug initiative command, control, 
        communications and computer network......................   330
      Gulf states counter-drug initiative regional counter-drug 
        training academy.........................................   330
      Joint interagency task force south.........................   331
      Joint military intelligence program........................   331
      Multi-jurisdictional task force............................   331
      National guard state plans.................................   331
      Southern air forces counter-drug support...................   332
      Southwest border fence project.............................   332
      Support for counter-drug activities of Peru and Colombia...   332
    Other Matters................................................   333
      Counterterrorism and Defense Against Weapons of Mass 
        Destruction..............................................   333
      Electromagnetic Pulse (EMP)................................   335
      Intelligence Community Access to Export Control Information   335
  LEGISLATIVE PROVISIONS.........................................   336
    Subtitle A--Financial Matters................................   336
      Section 1001--Transfer Authority...........................   336
      Section 1002--Incorporation of Classified Annex............   337
      Section 1003--Outlay Limitations...........................   337
    Subtitle B--Naval Vessels and Shipyards......................   337
      Section 1011--Revision to Requirement for Continued Listing 
        of Two Iowa-Class Battleships on the Naval Register......   337
      Section 1012--Transfer of the USS New Jersey...............   337
      Section 1013--Long-Term Charter of Three Vessels in Support 
        of Submarine Rescue, Escort, and Towing..................   337
      Section 1014--Transfer of Obsolete Army Tugboat............   337
      Section 1015--Long-Term Charter Contracts for Acquisition 
        of Auxiliary Vessels for the Department of Defense.......   337
    Subtitle C--Matters Relating to Counter Drug Activities......   338
      Section 1021--Department of Defense Support for Counter-
        Drug Activities..........................................   338
      Section 1022--Support for Counter-Drug Operation Caper 
        Focus....................................................   338
    Subtitle D--Miscellaneous Report Requirements and Repeals....   340
      Section 1031--Annual Report on Resources Allocated to 
        Support and Mission Activities...........................   340
    Subtitle E--Other Matters....................................   340
      Section 1041--Clarification of Land Conveyance Authority, 
        Armed Forces Retirement Home, District of Columbia.......   340
      Section 1042--Content of Notice Required to be Provided 
        Garnishees Before Garnishment of Pay or Benefits.........   340
      Section 1043--Training of Special Operations Forces with 
        Friendly Foreign Forces..................................   341

TITLE XI--DEPARTMENT OF DEFENSE CIVILIAN PERSONNEL...............   342
    LEGISLATIVE PROVISIONS.......................................   342
      Section 1101--Authority for Release to Coast Guard of Drug 
        Test Results of Civil Service Mariners of the Military 
        Sealift Command..........................................   342
      Section 1102--Limitations on Back Pay Awards...............   342
      Section 1103--Restoration of Annual Leave Accumulated by 
        Civilian Employees at Installations in the Republic of 
        Panama to be Closed Pursuant to the Panama Canal Treaty 
        of 1977..................................................   342
      Section 1104--Repeal of Program Providing Preference for 
        Employment of Military Spouses in Military Child Care 
        Facilities...............................................   343
      Section 1105--Elimination of Retained Pay as a Basis for 
        Determining Locality Based Adjustments...................   343
      Section 1106--Observance of Certain Holidays at Duty Posts 
        Outside the United States................................   343

TITLE XII--MATTERS RELATING TO OTHER NATIONS.....................   344
  ITEMS OF SPECIAL INTEREST......................................   344
    Arms Control Implementation..................................   344
    Commission to Assess the Ballistic Missile Threat to the 
      United States..............................................   345
  LEGISLATIVE PROVISIONS.........................................   345
      Section 1201--Limitation on Funds for Peacekeeping in the 
        Republic of Bosnia and Hercegovina.......................   345
      Section 1202--Reports on the Mission of United States 
        Forces in the Republic of Bosnia and Hercegovina.........   346
      Section 1203--Report on Military Capabilities of an 
        Expanded NATO Alliance...................................   347
      Section 1204--One-Year Extension of Counterproliferation 
        Authorities for Support of United Nations Special 
        Commission on Iraq.......................................   347
      Section 1205--Repeal of Landmine Moratorium................   348

TITLE XIII--COOPERATIVE THREAT REDUCTION WITH STATES OF FORMER 
    SOVIET UNION.................................................   349
  OVERVIEW.......................................................   349
  ITEMS OF SPECIAL INTEREST......................................   349
      Arms Elimination Projects in Russia........................   349
      Arms Elimination Projects in Ukraine.......................   350
      Biological Weapons Proliferation Prevention in Russia......   350
      Chemical Weapons Destruction in Russia.....................   352
      Fissile Material Storage Facility..........................   353
      Nuclear Reactor Core Conversion............................   354
      Nuclear Warhead Dismantlement Processing in Russia.........   354
      Nuclear Weapons Storage Security in Russia.................   354
      Nuclear Weapons Transportation Security....................   355
      Other Support Programs.....................................   355
      Program Overhead...........................................   355
      Prohibition of Specified Activities........................   356
  LEGISLATIVE PROVISIONS.........................................   357
      Section 1301--Specification of Cooperative Threat Reduction 
        Programs and Funds.......................................   357
      Section 1302--Funding Allocations..........................   357
      Section 1303--Prohibition on Use of Funds for Specified 
        Purposes.................................................   357
      Section 1304--Limitation on Use of Funds for Chemical 
        Weapons Destruction Facility.............................   357
      Section 1305--Limitation on Obligation of Funds for a 
        Specified Period.........................................   357
      Section 1306--Requirement to Submit Breakdown of Amounts 
        Requested by Project Category............................   357
      Section 1307--Limitation on Use of Funds Until Completion 
        of Fiscal Year 1998 Requirements.........................   357
      Section 1308--Report on Biological Weapons Programs in 
        Russia...................................................   357
      Section 1309--Limitation on Use of Funds for Biological 
        Weapons Proliferation Prevention Activities in Russia....   358
      Section 1310--Limitation on Use of Certain Funds for 
        Strategic Arms Elimination in Russia or Ukraine..........   358
      Section 1311--Availability of Funds........................   358

DIVISION B--MILITARY CONSTRUCTION AUTHORIZATIONS.................   359
  PURPOSE........................................................   359
  MILITARY CONSTRUCTION OVERVIEW.................................   359

TITLE XXI--ARMY..................................................   378
  SUMMARY........................................................   378
  ITEMS OF SPECIAL INTEREST......................................   378
      Improvements of Military Family Housing....................   378
  LEGISLATIVE PROVISIONS.........................................   378
      Section 2101--Authorized Army Construction and Land 
        Acquisition Projects.....................................   378
      Section 2102--Family Housing...............................   378
      Section 2103--Improvements to Military Family Housing Units   378
      Section 2104--Authorization of Appropriations, Army........   378
      Section 2105--Increase in Fiscal Year 1998 Authorization 
        for Military Construction Project at Fort Drum, New York, 
        and Fort Sill, Oklahoma..................................   379

TITLE XXII--NAVY.................................................   380
  SUMMARY........................................................   380
  ITEMS OF SPECIAL INTEREST......................................   380
      Condition of Laboratory Facilities, Naval Air Warfare 
        Center, Aircraft Division, Lakehurst, New Jersey.........   380
  LEGISLATIVE PROVISIONS.........................................   380
      Section 2201--Authorized Navy Construction and Land 
        Acquisition Projects.....................................   380
      Section 2202--Family Housing...............................   380
      Section 2203--Improvements to Military Family Housing Units   381
      Section 2204--Authorization of Appropriations, Navy........   381
      Section 2205--Authorization to Accept Road Construction 
        Project, Marine Corps Base, Camp Lejeune, North Carolina.   381

TITLE XXIII--AIR FORCE...........................................   382
  SUMMARY........................................................   382
  LEGISLATIVE PROVISIONS.........................................   382
      Section 2301--Authorized Air Force Construction and Land 
        Acquisition Projects.....................................   382
      Section 2302--Family Housing...............................   382
      Section 2303--Improvements to Military Family Housing Units   382
      Section 2304--Authorization of Appropriations, Air Force...   382

TITLE XXIV--DEFENSE AGENCIES.....................................   383
  SUMMARY........................................................   383
  ITEM OF SPECIAL INTEREST.......................................   383
      Department of Defense Education Activity, Guam.............   383
  LEGISLATIVE PROVISIONS.........................................   383
      Section 2401--Authorized Defense Agencies Construction and 
        Land Acquisition Projects................................   383
      Section 2402--Improvements to Military Family Housing Units   384
      Section 2403--Energy Conservation Projects.................   384
      Section 2404--Authorization of Appropriations, Defense 
        Agencies.................................................   384
      Section 2405--Increase in Fiscal Year 1995 Authorization 
        for Military Construction Projects at Pine Bluff Arsenal, 
        Arkansas, and Umatilla Army Depot, Oregon................   384
      Section 2406--Increase in Fiscal Year 1990 Authorization 
        for Military Construction Project at Portsmouth Naval 
        Hospital, Virginia.......................................   384

TITLE XXV--NORTH ATLANTIC TREATY ORGANIZATION INFRASTRUCTURE.....   385
  SUMMARY........................................................   385
  LEGISLATIVE PROVISIONS.........................................   385
      Section 2501--Authorized NATO Construction and Land 
        Acquisition Projects.....................................   385
      Section 2502--Authorization of Appropriations, NATO........   385

TITLE XXVI--GUARD AND RESERVE FORCES FACILITIES..................   386
  SUMMARY........................................................   386
  LEGISLATIVE PROVISIONS.........................................   386
      Section 2601--Authorized Guard and Reserve Construction and 
        Land Acquisition Projects................................   386
      Section 2602--Army Reserve Construction Project, Salt Lake 
        City, Utah...............................................   386

TITLE XXVII--EXPIRATION AND EXTENSION OF AUTHORIZATIONS..........   387
  LEGISLATIVE PROVISIONS.........................................   387
      Section 2701--Expiration of Authorizations and Amounts 
        Required to be Specified by Law..........................   387
      Section 2702--Extensions of Authorizations of Certain 
        Fiscal Year 1996 Projects................................   387
      Section 2703--Extension of Authorizations of Certain Fiscal 
        Year 1995 Projects.......................................   387
      Section 2704--Effective Date...............................   387

TITLE XXVIII--GENERAL PROVISIONS.................................   388
  ITEMS OF SPECIAL INTEREST......................................   388
      Incorporation of Energy Conservation Criteria in the 
        Planning and Design of Facilities........................   388
      Military Family Housing Referral and Set-Aside Programs....   388
  LEGISLATIVE PROVISIONS.........................................   389
    Subtitle A--Military Construction Program and Military Family 
        Housing Changes..........................................   389
      Section 2801--Definition of Ancillary Supporting Facilities 
        under the Alternative Authority for Acquisition and 
        Improvement of Military Housing..........................   389
    Subtitle B--Real Property and Facilities Administration......   389
      Section 2811--Restoration of Department of Defense Lands 
        Used by Another Federal Agency...........................   389
      Section 2812--Outdoor Recreation Development on Military 
        Installations for Disabled Veterans, Military Dependents 
        with Disabilities, and Other Persons with Disabilities...   389
      Section 2813--Report on Use of Utility System Conveyance 
        Authority................................................   389
    Subtitle C--Defense Base Closure and Realignment.............   390
      Section 2821--Payment of Stipulated Penalties Assessed 
        under the Comprehensive Environmental Response, 
        Compensation and Liability Act of 1980 in Connection with 
        McClellan Air Force Base, California.....................   390
      Section 2822--Elimination of Waiver Authority Regarding 
        Prohibition Against Certain Conveyances of Property at 
        Naval Station, Long Beach, California....................   390
    Subtitle D--Land Conveyances.................................   390
      Part I--Army Conveyances...................................   390
      Section 2831--Land Conveyance, Army Reserve Center, 
        Massena, New York........................................   390
      Section 2832--Land Conveyance, Army Reserve Center, 
        Ogdensberg, New York.....................................   390
      Section 2833--Land Conveyance, Army Reserve Center, 
        Jamestown, Ohio..........................................   391
      Section 2834--Land Conveyance, Stewart Army Sub-Post, New 
        Windsor, New York........................................   391
      Section 2835--Land Conveyance, Indiana Army Ammunition 
        Plant, Charlestown, Indiana..............................   391
      Section 2836--Land Conveyance, Volunteer Army Ammunition 
        Plant, Chattanooga, Tennessee............................   391
      Section 2837--Release of Reversionary Interest of United 
        States in Former Redstone Army Arsenal Property Conveyed 
        to Alabama Space Science Exhibit Commission..............   392
      Part II--Navy Conveyances..................................   392
      Section 2841--Easement, Camp Pendleton, Marine Corps Base, 
        California...............................................   392
      Section 2842--Land Conveyance, Naval Reserve Readiness 
        Center, Portland, Maine..................................   392
      Part III--Air Force Conveyances............................   392
      Section 2851--Land Conveyance, Lake Charles Air Force 
        Station, Louisiana.......................................   392
      Section 2852--Land Conveyance, Air Force Housing Facility, 
        La Junta, Colorado.......................................   393
    Subtitle E--Other Matters....................................   393
      Section 2861--Repeal of Prohibition on Joint Use of Gray 
        Army Airfield, Fort Hood, Texas, with Civil Aviation.....   393
      Section 2862--Designation of Building Containing Navy and 
        Marine Corps Reserve Center, Augusta, Georgia............   393
      Section 2863--Expansion of Arlington National Cemetery.....   393
      Section 2864--Reporting Requirements Under Demonstration 
        Project for Purchase of Fire, Security, Police, Public 
        Works, and Utility Services from Local Government 
        Agencies.................................................   393

DIVISION C--DEPARTMENT OF ENERGY NATIONAL SECURITY AUTHORIZATION 
    AND OTHER AUTHORIZATIONS.....................................   395

TITLE XXXI--DEPARTMENT OF ENERGY NATIONAL SECURITY PROGRAMS......   395
  OVERVIEW.......................................................   395
  ITEMS OF SPECIAL INTEREST......................................   407
      Accelerated Strategic Computing Initiative.................   407
      Advanced Manufacturing, Design and Production Technologies.   407
      Comprehensive Test Ban Treaty Safeguards...................   408
      Core Stockpile Management Weapons Program..................   408
      Defense Environmental Restoration and Waste Management 
        Science and Technology...................................   408
      Defense Programs Construction Projects.....................   409
      Emergency Management.......................................   409
      Hanford Tank Safety and Remediation Projects...............   409
      Hanford Tank Waste Remediation System Privatization Phase I   410
      Hazardous Material Management and Emergency Response 
        (HAMMER) Program.........................................   410
      Heavy Water Processing.....................................   410
      Inertial Confinement Fusion................................   411
      In-Tank Precipitation Process..............................   411
      International Nuclear Safety...............................   411
      Laboratory Collaboration With the Ballistic Missile Defense 
        Organization.............................................   411
      Naval Reactors.............................................   412
      Office of Environment, Safety, and Health..................   412
      Program Direction..........................................   413
      Reactor Decontamination and Decommissioning................   413
      Rocky Flats Environmental Technology Site Closure Project..   413
      Savannah River Site Infrastructure Investment..............   413
      Stockpile Management at Y-12 Plant.........................   413
      Technology Partnerships....................................   414
      Tritium production.........................................   414
      Uncosted Obligations and Unobligated Balances..............   414
      Waste Isolation Pilot Plant (WIPP) Waste Transportation....   415
  LEGISLATIVE PROVISIONS.........................................   415
    Subtitle A--National Security Program Authorization..........   415
      Section 3101--Weapons Activities...........................   415
      Section 3102--Defense Environmental Restoration and Waste 
        Management...............................................   416
      Section 3103--Other Defense Activities.....................   416
      Section 3104--Defense Nuclear Waste Disposal...............   416
    Subtitle B--Recurring General Provisions.....................   416
      Section 3121--Reprogramming................................   416
      Section 3122--Limits on General Plant Projects.............   416
      Section 3123--Limits on Construction Projects..............   416
      Section 3124--Fund Transfer Authority......................   417
      Section 3125--Authority for Conceptual and Construction 
        Design...................................................   417
      Section 3126--Authority for Emergency Planning, Design and 
        Construction Activities..................................   417
      Section 3127--Funds Available for all National Security 
        Programs of the Department of Energy.....................   417
      Section 3128--Availability of Funds........................   417
      Section 3129--Transfers of Defense Environmental Management 
        Funds....................................................   417
    Subtitle C--Program Authorizations, Restrictions, and 
      Limitations................................................   418
      Section 3131--Prohibition on Federal Loan Guarantees for 
        Defense Environmental Management Privatization Projects..   418
      Section 3132--Extension of Funding Prohibition Relating to 
        International Cooperative Stockpile Stewardship..........   418
      Section 3133--Use of Certain Funds for Missile Defense 
        Technology Development...................................   418
      Section 3134--Selection of Technology for Tritium 
        Production...............................................   418
      Section 3135--Limitation on Use of Certain Funds at Hanford 
        Site.....................................................   419
    Subtitle D--Other Matters....................................   419
      Section 3151--Termination of Worker and Community 
        Transition Assistance....................................   419
      Section 3152--Requirement for Plan to Modify Employment 
        System Used by Department of Energy in Defense 
        Environmental Management Programs........................   419
      Section 3153--Report on Stockpile Stewardship Criteria.....   420

TITLE XXXII--DEFENSE NUCLEAR FACILITIES SAFETY BOARD.............   421
  LEGISLATIVE PROVISION..........................................   421
      Section 3201--Authorization................................   421

TITLE XXXIII--NATIONAL DEFENSE STOCKPILE.........................   422
  ITEM OF SPECIAL INTEREST.......................................   422
      Materials Research.........................................   422
  LEGISLATIVE PROVISIONS.........................................   422
      Section 3301--Definitions..................................   422
      Section 3302--Authorized Uses Of Stockpile Funds...........   422

TITLE XXXIV--NAVAL PETROLUEM RESERVES............................   423
  LEGISLATIVE PROVISIONS.........................................   423
      Section 3401--Definitions..................................   423
      Section 3402--Authorization of Appropriations..............   423
      Section 3403--Price Requirement on Sale of Certain 
        Petroleum During Fiscal Year 1999........................   423
      Section 3404--Disposal of Naval Petroleum Reserve Numbered 
        2........................................................   423
      Section 3405--Disposal of Naval Petroleum Reserve Numbered 
        3........................................................   423
      Section 3406--Disposal of Naval Oil Shale Reserve Numbered 
        2........................................................   423
      Section 3407--Administration...............................   423

TITLE XXXV--PANAMA CANAL COMMISSION..............................   424
  LEGISLATIVE PROVISIONS.........................................   424
      Section 3501--Short Title; References to Panama Canal Act 
        of 1979..................................................   424
      Section 3502--Authorization of Expenditures................   424
      Section 3503--Purchase of Vehicles.........................   424
      Section 3504--Expenditures Only in Accordance with Treaties   424
      Section 3505--Donations to the Commission..................   424
      Section 3506--Sunset of United States Overseas Benefits 
        Just Before Transfer.....................................   424
      Section 3507--Central Examining Office.....................   425
      Section 3508--Liability for Vessel Accidents...............   425
      Section 3509--Panama Canal Board of Contract Appeals.......   425
      Section 3510--Technical Amendments.........................   425

TITLE XXXVI--MARITIME ADMINISTRATION.............................   426
  ITEM OF SPECIAL INTEREST.......................................   426
      Merchant Marine Academy....................................   426
  LEGISLATIVE PROVISIONS.........................................   426
      Section 3601--Authorization of Appropriations for Fiscal 
        Year 1999................................................   426
      Section 3602--Conveyance of NDRF Vessel M/V Bayamon........   426
      Section 3603--Conveyance of NDRF Vessels Benjamin Isherwood 
        and Henry Eckford........................................   426
      Section 3604--Clearinghouse for Maritime Information.......   426
      Section 3605--Conveyance of NDRF Vessel Ex-USS Lorain 
        County...................................................   427
Departmental Data................................................   428
  Department of Defense Authorization Request....................   428
  Military Construction Authorization Request....................   429
Committee Position...............................................   429
Communications From Other Committees.............................   429
Fiscal Data......................................................   439
  Congressional Budget Office Estimate...........................   439
  Congressional Budget Office Cost Estimate......................   439
    Authorization of Appropriations..............................   440
  Committee Cost Estimate........................................   449
  Inflation-Impact Statement.....................................   450
Oversight Findings...............................................   450
Constitutional Authority Statement...............................   450
Statement of Federal Mandates....................................   450
Roll Call Votes..................................................   450
Changes in Existing Law Made by the Bill, as Reported............   459
Additional, Dissenting, and Supplemental Views:                    
          .......................................................
  Additional views of Lane Evans, Martin T. Meehan, Robert A. 
    Underwood, Jane Harman, Thomas H. Allen, Loretta Sanchez and 
    Cynthia McKinney.............................................   559
  Additional views of Robert A. Underwood........................   561
  Supplemental views of Tillie Fowler, Jane Harman, Martin T. 
    Meehan, Lane Evans, Neil Abercrombie, Loretta Sanchez, Ciro 
    D. Rodriguez, Patrick J. Kennedy, James H. Maloney and 
    Cynthia A. McKinney..........................................   562
  Additional views of Jane Harman, Patrick Kennedy, Martin 
    Meehan, Lane Evans, Loretta Sanchez, Ciro Rodriguez, James 
    Maloney, Cynthia McKinney and Tillie Fowler..................   565
  Additional views of James M. Talent............................   567
  Additional views of Patrick Kennedy............................   569
  Additional views of Roscoe G. Bartlett.........................   571
  Additional views of Tom Allen, Paul McHale, Mike Pappas, Jim 
    Saxton and Gene Taylor.......................................   573
  Additional views of Loretta Sanchez, Lane Evans, Vic Snyder, 
    Jane Harman, Adam Smith and Cynthia McKinney.................   576
  Additional views of Mr. Ryun, Mr. Hunter, Mr. Hefley, Mr. 
    Saxton, Mr. Bartlett, Mr. Lewis, Mr. Watts, Mr. Hostettler, 
    Mr. Hilleary and Mr. Pappas..................................   577
  Dissenting views of Cynthia McKinney...........................   579



105th Congress                                                   Report
 2d Session              HOUSE OF REPRESENTATIVES               105-532
_______________________________________________________________________

        NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 1999

                                _______
                                

  May 12, 1998.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______


  Mr. Spence, from the Committee on National Security, submitted the 
                               following

                              R E P O R T

                             together with

             ADDITIONAL, DISSENTING, AND SUPPLEMENTAL VIEWS

                        [To accompany H.R. 3616]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on National Security, to whom was referred 
the bill (H.R. 3616) to authorize appropriations for fiscal 
year 1999 for military activities of the Department of Defense, 
to prescribe military personnel strengths for fiscal year 1999, 
and for other purposes, 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 to the text of the bill is a complete 
substitute therefor and appears in italic type in the reported 
bill.
    The title of the bill is amended to reflect 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. 3616. 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 1999 for procurement and for research, development, test 
and evaluation (RDT&E); (2) Authorize appropriations for fiscal 
year 1999 for operation and maintenance (O&M) and for working 
capital funds; (3) Authorize for fiscal year 1999: (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 1999 for military construction 
and family housing; (6) Authorize appropriations for fiscal 
year 1999 for the Department of Energy national security 
programs; (7) Modify provisions related to the National Defense 
Stockpile; (8) Authorize appropriations for fiscal year 1999 
for the operation of the Panama Canal Commission; and (9) 
Authorize appropriations for fiscal year 1999 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 $270.9 billion 
for the national defense budget function for fiscal year 1999. 
Of this amount, the President requested $257.5 billion for the 
Department of Defense (including $7.8 billion for military 
construction and family housing) and $12.3 billion for 
Department of Energy national security programs and the Defense 
Nuclear Facilities Safety Board.
    The committee recommends an overall level of $270.4 billion 
in budget authority. This amount is consistent with the 
discretionary defense spending limitations imposed by the 
Balanced Budget Act of 1997 and it represents an increase of 
approximately $2.2 billion from the amount authorized for 
appropriation by the National Defense Authorization Act for 
Fiscal Year 1998 (Public Law 105-85). Overall, the committee's 
recommendation is largely consistent with the amounts the 
committee expects to be established in the budget resolution 
for fiscal year 1999 for the national security budget function.

                    SUMMARY TABLE OF AUTHORIZATIONS

    The following table provides a summary of the amounts 
requested and that would be authorized for appropriation in the 
bill (in the column labeled ``Budget Authority Implication of 
Committee Recommendation'') and the committee's estimate of how 
the committee's recommendations relate to the budget totals for 
the national defense function. For purposes of estimating the 
budget authority implications of committee action, the table 
reflects the numbers contained in the President's budget for 
proposals not in the committee's legislative jurisdiction.
<GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT>

                    RATIONALE FOR THE COMMITTEE BILL

    The President's fiscal year 1999 defense budget request 
fully reflects last year's Quadrennial Defense Review (QDR). 
The QDR was mandated by Congress as part of the National 
Defense Authorization Act for fiscal year 1997 (Public Law 104-
201), as a result of growing dissatisfaction with the Clinton 
Administration's 1993 Bottom-Up Review (BUR). In addition to 
being dramatically underfunded, the BUR also reflected far too 
narrow a view of America's strategic interests and military 
requirements in the post-Cold War world. In particular, the BUR 
failed to account for the increasing number and duration of 
peacekeeping, peacemaking and contingency ``operations other 
than war,'' as well as for the possibility of conflicts between 
powerful states in the future.
    The QDR's declared strategy, in the committee's judgment, 
more accurately reflects the true scope of America's post-Cold-
War defense strategy. The QDR's central strategic vision of 
shaping the international environment in ways that will protect 
and advance U.S. national security interests, preparing U.S. 
military forces for future challenges to those interests, and 
responding to current threats--is broadly shared by the 
committee. Although the QDR fails to prioritize among the three 
elements of the ``shape-prepare-respond'' approach, its 
acknowledgment of today's strategic realities represents a step 
forward from the BUR.
    Ironically, the increased clarity of the QDR's strategic 
vision only serves to highlight the disparities between 
requirements, forces and resources. The mismatches and 
shortfalls inherent in the BUR are more severe when measured by 
the QDR's standards. While the QDR retains the requirement to 
fight and win two nearly simultaneous regional theater wars, 
persuasively arguing that such a capability ``is the sine qua 
non of a superpower and is essential to the credibility of our 
overall national security strategy,'' it also requires that 
U.S. armed forces ``be prepared to conduct successfully 
multiple, concurrent [smaller-scale contingency] operations 
worldwide, in any environment, including one in which an 
adversary uses asymmetric means, such [nuclear, biological, or 
chemical] weapons.'' In addition, the QDR demands that the 
Department of Defense prepare now for an uncertain future that 
may include ``significant'' future threats from a rising China 
or a reinvigorated and aggressive Russia, and where military 
technologies, doctrine and organizations will have changed 
radically. The QDR's strategic vision for the post-Cold War 
world places much greater demands on the Department of Defense 
than did the BUR.
    Despite the QDR's expansive strategy, the Administration 
continues to recommend real decline in defense spending. The 
President's fiscal year 1999 defense budget request of $270.6 
billion in budget authority represents a real decline of 1.1 
percent from current defense spending levels, is more than 
$54.0 billion short of keeping pace even with today's record 
low inflation over the next five years, and continues a 14-year 
trend of real decline in defense spending. Overall, the request 
represents a 39 percent reduction from defense spending levels 
of the mid-1980s. Indeed, the fiscal year 1999 defense budget 
request represents the lowest real level of U.S. defense 
spending since before the Korean War. Today, the unofficial 
motto of the U.S. military is ``doing more with less'' for good 
reason: missions increase as forces and resources decline.
    In the committee's judgment, there is a dangerously 
widening gap between strategic requirements of the post-Cold 
War world and the levels of resources this nation is committing 
to its national security. As senior committee members of both 
parties recently wrote to thePresident and leaders of Congress, 
``[I]t is our collective judgment that, short of an unwise retrenchment 
and overhaul of U.S. national security strategy, fixing the nation's 
long-term defense program will require increased defense spending.'' 
Measured by any of the QDR's benchmarks--shaping, preparing, or 
responding--the current defense program is seriously underresourced.

                         The Strains of Shaping

    The QDR asserts that the Department of Defense ``has an 
essential role to play'' in shaping the international 
environment in ways beneficial to American national interests. 
Yet the review's treatment of the military capabilities 
essential to this shaping effort serves to understate the 
magnitude of the task. The current moment in history, one which 
finds the United States as the world's sole superpower, imposes 
unique responsibilities upon our armed forces. However, as 
recent trends indicate, the constant employment of military 
power quickly strains the reduced forces of today. The 
Administration's propensity to use U.S. military forces in a 
multitude of nontraditional roles around the world has merely 
added to and accelerated the strains of downsizing.
    To fully understand the challenge implicit in trying to 
shape the international environment, it is necessary to 
consider recent events in broad perspective. The collapse of 
the Soviet Union, almost a decade ago, has been one of this 
century's and perhaps history's great turning points. Even 
should a revitalized and revanchist Russia reassert itself in 
the future, the retreat of the Red Army has left in its wake a 
security vacuum stretching from Europe to Africa to Asia. 
Dozens of nations, many of them tied to U.S. national interests 
in one way or the other, now live in a state of uncertainty--
freed from Soviet tyranny but unable to guarantee their own 
independence and security.
    The result for the United States is both new opportunity 
and new challenge. In their desire for both freedom and 
security, many of these fledgling states turn to the United 
States as their best hope. Nowhere is this more in evidence 
than the desire of the newly independent nations of Central and 
Eastern Europe to join the NATO alliance.
    While the committee strongly supports the NATO alliance, 
concerns remain about the Administration's inability or 
unwillingness to explain what a fully expanded NATO alliance 
will mean in terms of function, structure, and membership. The 
United States is on the verge of assuming substantial new 
commitments to protect and shape the future security of Europe 
without a firm understanding of the political purpose or 
financial cost, let alone the military requirements or how to 
meet the requirements
    Yet for all the uncertainties and concerns raised by the 
incorporation of Poland, Hungary, the Czech Republic and 
perhaps, in time, additional Central and Eastern European 
nations into the Atlantic alliance, NATO expansion is well 
understood in comparison to challenges of shaping the 
international environment elsewhere around the globe. As 
indicated above, the demise of the Soviet Union has brought 
turmoil and uncertainty hand in hand with independence. The 
United States' interests in protecting the world's energy 
supplies and distribution network, the basis for the quasi-
permanent American military presence in the Persian Gulf, will 
be complicated as new supplies and routes are developed to 
deliver Caspian Sea and Central Asian gas and oil to market. 
Likewise, the loss of the common security goal of containment 
of the Soviet Union will continue to complicate American 
relations with China. Although China did not repeat its 1996 
missile blockade of Taiwan, in 1997 it reacquired Hong Kong and 
continued its aggressive policy of acquiring advanced military 
technologies. Moreover, the financial crisis in East Asia, 
threatening even the stability of Japan, may have unpredictable 
political consequences and could further complicate shaping of 
the international environment.
    The committee is concerned that while the QDR's requirement 
to ``shape the international environment'' is essential to the 
protection of American security interests, its full 
implications are not yet well understood. Trying to achieve the 
QDR's goal of ``promoting regional stability'' will require 
continued global military presence. From protecting against 
threats to the American homeland; to projecting power to 
Europe, the Gulf and the expanding region responsible for the 
world's energy supplies, and the Pacific Rim; to defending the 
international system from a wide variety of transnational 
threats from proliferation to information warfare, shaping the 
complex and increasingly dangerous post-Cold War international 
environment is one of the central reasons American soldiers, 
sailors, airmen and Marines are ``doing more with less.''

                   Preparing for an Uncertain Future

    Beyond shaping today's security environment, the QDR 
rightly recognizes that the security environment of the future 
will pose entirely new problems. The geopolitical uncertainties 
alone are daunting. The United States' status as the world's 
only superpower is an anomaly of history. No single nation has 
ever enjoyed such unchallenged global influence, but it would 
be folly to assume that American preeminence will last 
indefinitely.
    Much of the basis of U.S. military superiority rests upon 
the technological edge enjoyed by American soldiers, sailors, 
airmen and Marines, and the organizational and doctrinal 
advantages that this technological edge allows. The significant 
investment made in the nation's armed forces in the 1980s 
brought to the battlefield a generation of weapons systems 
without rival, as revealed so strikingly in Operation Desert 
Storm. Yet the ``procurement holiday,'' beginning in the early 
1990s and continuing still, is eroding this U.S. technological 
edge. In some areas, lack of investment has allowed 
vulnerabilities to remain unaddressed. For example, Scud 
missiles of the kind that caused significant American 
casualties in the Gulf War have become even more of a threat to 
U.S. forces and American allies today than they were in 1991. 
Despite Congressional increases in funding for theater missile 
defense programs over the past three years, this vulnerability 
remains. And it is a vulnerability that is well understood by 
our potential enemies.
    Moreover, weapons platforms and systems procured during the 
1980s, based on 1970s technology, are prematurely aging due to 
the high operational tempo associated with repeated extended 
contingency operations. The same M1A1 tanks and Apache 
helicopters, sophisticated F-15E strike fighters and carrier 
battle groups that defeated the Iraqi military are too often 
found today at checkpoints in Bosnia, flying lazy figure-8s 
enforcing no-fly zones, or steaming from ocean to ocean to 
react to the crisis of the day. Military equipment is simply 
getting older and wearing out faster than planned.
    Finally, the battlefield advantages conferred by the 
application of information technologies and similar innovations 
to military systems promise to transform warfare in the near 
future. The United States has heretofore set the pace in the 
practical application of the so-called ``Revolution in Military 
Affairs,'' during the innovation in ``smart'' and ``brilliant'' 
munitions; battlefield surveillance, reconnaissance, and 
intelligence; and the rapid dissemination ofinformation in ways 
that we now take for granted. But the U.S. military's ``innovation 
edge'' is eroding as well. Increasingly inexpensive and accessible 
technologies of computing power, communications, surveillance from 
space--indeed, the overall advance and proliferation of high 
technology, much of it commercially available--will certainly enhance 
the military capabilities of future enemies of the United States. The 
task for the United States is to retain its edge across the broad 
spectrum of military technology, through modernization and innovation.
    Faced with these realities, the QDR calls for the 
Department of Defense to pursue a ``focused modernization 
effort'' and to ``increase procurement spending now so that we 
can ensure tomorrow's forces are every bit as capable as 
today's.'' Once again, the committee generally agrees with the 
QDR's declared objectives. However, as with the costs and risks 
associated with shaping the international environment, the 
committee is concerned with the lack of adequate attention 
being paid to preparing for a strategically and technologically 
uncertain future. The gap between resources being committed to 
research, development and procurement is as great as or greater 
than the shortfalls in requirements for the shaping missions 
described above. This has been apparent from the outset of the 
QDR process. In the legislation creating the QDR, the Congress 
also created the independent National Defense Panel (NDP). The 
NDP's assessment of the QDR highlighted the ``risk in defense 
resources,'' stating that ``the Panel considers the [QDR] 
modernization plan to have more budget risk than is 
acknowledged by the QDR. The funding necessary to attain the 
procurement goal * * * rests on several key assumptions * * * 
The Panel considers each of these assumptions to be somewhat 
tenuous. Collectively, they represent a budget risk which could 
potentially undermine the entire Defense Strategy.''
    In recent years, the committee consistently has expressed 
its concerns about the continued decline in modernization 
funding. Defense procurement spending has declined by two-
thirds since fiscal year 1985, even taking into account 
Congress' significant increases of the past three years. In 
1996, the Joint Chiefs of Staff established that $60.0 billion 
in constant-dollar procurement funding was the minimum amount 
required to modernize the force, and set a goal to achieve that 
level of funding by fiscal year 1998. Unfortunately, for the 
fourth consecutive year, the President's defense budget request 
again postpones attainment of this modernization funding goal. 
At $48.7 billion, the procurement request is $2.0 billion less 
than was projected for fiscal year 1999 just last year, and is 
approximately $5.0 billion less than was projected for the two-
year period from fiscal years 1999 through fiscal year 2000. 
The shortfall is actually worse when the fact that the 
Administration's fiscal year 1999 procurement request for the 
first time includes programs not traditionally funded in 
procurement accounts, such as strategic sealift, is considered.
    Whether in modernizing today's military or in preparing for 
tomorrow's force, the committee believes the current level of 
investment is inadequate. Sustaining the technological 
advantages that give U.S. military forces an unquestioned edge 
wherever they operate is a keystone in national security 
strategy. Indeed, it is a central foundation upon which that 
strategy is built.
     The committee is concerned that the Administration is 
building a strategy for an uncertain future upon an eroding 
foundation. For what is uncertain about the future is not 
whether there will be threats to U.S. national security 
interests, but what form these threats will take. Threats may 
come from regional rogue states like Iraq or Iran, newly armed 
with more accurate ballistic missiles, weapons of mass 
destruction and advanced conventional weapons; they may come 
from other large and powerful nations like a retrenched Russia 
or an ascendant China; they may come from terrorist groups, 
drug traffickers or other ruthless and well-resourced 
international organizations; they may come from ethnic 
nationalists for whom war is itself an end as a means. Yet 
wherever these future threats originate, the committee has no 
doubt that a failure to prepare to meet them can only encourage 
America's enemies.

                         Responding to a Crisis

    In ``shaping the international environment,'' U.S. military 
forces are linked to American diplomacy, business, and culture. 
In ``preparing for an uncertain future,'' the Department of 
Defense is mortgaging its technological future by robbing long-
term investment accounts to pay short-term operational bills 
and may, even under the best of circumstances, be hard-pressed 
to keep pace with commercial enterprise. Yet some tasks are, 
will, and must remain unique to the military. The military's 
unique capability, indeed its raison d'etre, is its role in 
response to international crisis or the outbreak of war. The 
collapse of the Soviet Union has not changed this fundamental 
reality.
     As the QDR acknowledges, today's armed forces must be 
ready to respond to the full spectrum of crises, from 
deterrence, to coercion, to the conduct of an increasing number 
of ``smaller-scale contingencies'' or ``military operations 
other than war,'' and to fighting and winning the major theater 
wars that would pose the greatest threat to U.S. national 
security interests. The committee considers the crisis response 
requirement to be the essential element of the QDR's strategy, 
indeed of any proper U.S. national military strategy. As 
important as the requirements are to ``shape the international 
environment'' and to ``prepare for an uncertain future,'' the 
primary responsibility of U.S. armed forces is to defend 
America and its global interests against today's and tomorrow's 
threats.
     As the post-Soviet period has evolved, the number and 
duration of what the QDR recognized as smaller-scale 
contingencies has increased. Yet the core of U.S. national 
military strategy remains--and in the committee's view, must 
remain--the requirement to maintain the capability to fight and 
to win two nearly simultaneous major theater wars. This 
benchmark has served the United States military well during the 
post-Cold War era. Absent a well understood and precisely 
defined threat such as the Soviet military, the two-war 
standard has been the only means for preserving the kind of 
flexible and global military capability required for the vast 
array of security responsibilities that the United States 
maintains. According to the QDR, ``If the United States were to 
forego its ability to defeat aggression in more than one 
theater at a time, our standing as a global power, as the 
security partner of choice and the leader of the international 
community, would be called into question.''
    The committee continues to believe that this two-war 
benchmark is an appropriate peacetime force-sizing mechanism 
that follows clearly from an appreciation of the kinds of 
potential conventional commitments and conflicts that confront 
the United States today. Our adversaries are at all times 
acutely aware of the proximity and presence of U.S. forces. 
General Anthony Zinni, commander-in-chief of U.S. Central 
Command, recently testified before the committee that Iraqi 
leader Saddam Hussein clearly times his provocative actions to 
those occasions when U.S. military force presence in the Gulf 
is lower. Likewise, the continuing economic and humanitarian 
crisis in North Korea, combined with that regime's continuing 
investment in its military capability, could easily provide the 
spark to renewed conflict. In theseand other vital regions, the 
presence of strong U.S. forces, credited with overwhelming conventional 
combat capability, provide a convincing deterrent force, and a lethal 
fighting force.
    Unfortunately, the de facto motto of the U.S. military--
``doing more with less''--has become today's reality. American 
soldiers, sailors, airmen and marines are in fact doing much 
more than protecting the nation's interests and preparing to 
fight the nation's wars. Indeed, the burdens of peacekeeping, 
peacemaking and the variety of other operations other than war 
that increasingly occupy our military's time are preventing 
them from properly and adequately training.
    This is the unspoken reality underlying the QDR's 
recognition of smaller-scale contingencies; ``the demand for 
[smaller-scale contingency] operations is expected to remain 
high over the next 15 to 20 years.'' Yet even while 
acknowledging the burdens imposed by multiple, concurrent 
peacekeeping operations, the QDR underestimates the high 
political profile, import and even permanence they assume over 
time. The QDR's assertion that ``U.S. forces must also be able 
to withdraw from [such] operations, reconstitute, and then 
deploy to a major theater war in accordance with required 
timelines'' is, in the committee's judgment, an unrealistic, 
even naive, expectation.
    A textbook example of the complexities of meeting both 
warfighting requirements and peacekeeping missions was clearly 
illustrated several weeks ago. When the Army announced that the 
1st Cavalry Division would be deployed from Fort Hood, Texas, 
to Bosnia as the U.S. follow-on force, the conflict between 
peacekeeping and warfighting was revealed starkly. The 1st 
Cavalry Division is the most modern, best equipped and best 
trained heavy division in the entire Army, and would be among 
the first two divisions to deploy in the event of a major 
theater war. Yet the debilitating demand of constant rotation 
of forces to Bosnia-resulting from the President's commitment 
to an increasingly open-ended mission in the Balkans--has 
compelled the Army to start beating its sharpest sword into a 
plowshare. The Army has yet to explain how it will meet its 
requirement to rapidly deploy heavy forces in the event of a 
major theater war while the 1st Cavalry Division is in Bosnia. 
What is true of the Army applies equally to the other services: 
to Air Force fighter squadrons employed in no-fly zones; to 
Navy aircraft carriers transferred from the Pacific, where they 
would support a Korea contingency, to the Persian Gulf; to the 
Marine Corps which, in the recent testimony of Commandant Gen. 
Charles Krulak is ``not a two [major theater war] force.''
    In sum, the pervasive mismatch between strategic objectives 
and defense resources that undermines the QDR's vision of 
shaping the international environment and preparing for an 
uncertain future most seriously affects the ability of the U.S. 
military to respond to current crises. This is a potentially 
catastrophic mismatch, and one with very real consequences, as 
foretold in the QDR: shortfalls in warfighting capacity ``risk 
undermining both deterrence and the credibility of U.S. 
security commitments in key regions of the world. This, in 
turn, could cause allies and friends to adopt more divergent 
defense policies and postures, thereby weakening the web of 
alliances and coalitions on which we rely to protect our 
interests abroad.'' The committee agrees with this assessment. 
Indeed, in Europe, in the Gulf and in East Asia, the ability of 
America to defend its interests by responding to multiple 
crises remains an open question.

                             Managing Risk

    Caught between an international geopolitical environment 
that requires an expansive U.S. national security strategy and 
a domestic political environment bounded by the declining 
defense budgets locked in place by the Balanced Budget Act of 
1997, the committee is left to try and figure out how best to 
manage risks. No one should have any illusions about the 
growing risk: the committee finds itself in accord with the 
Joint Chiefs of Staff who, in their monthly reviews of the 
ability of U.S. forces to execute the National Military 
Strategy, have recently concluded that the level of risk is 
``moderate to high.'
    Thus the committee's actions with regard to the fiscal year 
1999 defense authorization bill are intended to protect those 
programs that will help to lower the risks to U.S. national 
security interests by protecting core readiness, enhancing 
quality of life and increasing the pace at which rapidly aging 
equipment is modernized or replaced.
    Central to these efforts are the committee's initiatives 
related to force readiness. Over recent months, the committee 
conducted a series of field hearings at military installations 
in addition to its traditional budget oversight hearings. These 
hearings confirmed the pattern, revealed in past committee 
readiness reports and reviews, of shortages of spare parts, a 
high operations tempo and continued deterioration of military 
infrastructure and facilities. For example, in response to a 
request from the committee, the service chiefs of staff 
identified approximately $10.0 billion in unfunded requirements 
in fiscal year 1999 requests alone. Tellingly, the largest 
portion of these unfunded requirements pertained to core 
readiness needs--training, spare parts and other basics. 
Indeed, almost the entire Air Force unfunded requirements list 
reflected readiness shortfalls. Therefore, the committee has 
closely scrutinized the operation and maintenance accounts in 
the President's budget request. The request includes programs 
that previously were contained in other accounts and a variety 
of programs that have little if anything to do with core force 
readiness requirements. In general, the committee's actions 
have aimed to increase spending in core readiness accounts at 
the expense of lower priority spending on administrative and 
support functions.
    Likewise, the committee believes that in addition to 
forming an essential element in the basic compact between the 
nation and those who defend it, the quality of military life is 
inextricably tied to force readiness. This is particularly true 
in today's force projection environment characterized by its 
high pace of operations and the stress it places on both 
individuals and families. Thus, the committee continues a five-
part approach to maintaining a decent quality of life for 
service members and their families: providing fair 
compensation; improving the military health care system; 
maintaining the value of retirement benefits; supporting key 
morale, welfare and recreation programs; and ensuring that 
military personnel and their families live and work in the best 
possible facilities.
    Finally, the committee has had to manage risk within the 
modernization accounts. Although the President's fiscal year 
1999 procurement budget request of $48.7 billion grows modestly 
in real terms for the first time in 13 years, it is still well 
short of the required level. The research and development 
request--the key not only to robust modernization but to 
innovation in the next century--falls even shorter of the 
requirement to prepare for an uncertain future. Over the next 
five years, defense spending for research and development 
accounts is projected to fall by at least 14 percent. The 
committee believes these levels of investment to be wholly 
inadequate.
    Thus, in comparison with the substantial addition of funds 
for modernization over the past three years, this year's bill 
reflects an effort to protect what the committee considers to 
becritical modernization projects, as it protected core 
readiness accounts. Although budget constraints have prevented the 
committee from providing the large funding increases needed in the 
modernization accounts, the committee bill does contain additional 
procurement funding above the President's request, and protects the 
$36.1 billion requested for research and development. Selected programs 
have received increases. For example, the committee has added $72.0 
million for advanced procurement of an additional two Joint STARS 
aircraft. These reconnaissance and surveillance aircraft are among the 
most sought-after assets by regional commanders-in-chief for a range of 
operations, from peacekeeping efforts in Bosnia to the regular crises 
with Iraq. Though considered ``low-density, high-demand'' assets and 
thus tightly managed by the Department of Defense, the Administration 
through the QDR chose to terminate the program at 13 aircraft, six 
short of the 19 required. The committee has concluded that the Joint 
STARS aircraft is precisely the sort of ``focused modernization'' 
effort essential to today's and tomorrow's forces.
    The committee has tried to prudently manage risks for 
tomorrow as well. In particular, the committee continues to 
believe that robust theater and national missile defenses are a 
key to future U.S. national security. Whether for the 
protection of U.S. forces deployed abroad or the ultimate 
safety of Americans at home, effective missile defenses will 
become an even more important requirement in the future. Thus, 
the committee has added $132.8 million to the President's 
request for missile defense spending.
    Yet despite its best efforts to manage risk, the committee 
remains concerned that its actions can only compel improvements 
at the margin. The magnitude of the shortfalls, as outlined 
above, is so great that it cannot be eliminated by a wiser 
allocation of resources alone. Nor can any foreseeable defense 
reform, including new rounds of base closures proposed by the 
Administration, provide sufficient savings to reapply towards 
critical shortfalls in a timely manner. In short, the committee 
has attempted to ensure, within the severe constraints of a 
declining defense budget, the most effective U.S. military 
force possible. By reprioritizing the Administration's budget 
request, the committee has provided the Department of Defense 
with some of the additional tools and resources required to 
recruit and retain the best people, train them to the highest 
standard, equip them with the most advanced military technology 
and provide them with a standard of life more commensurate with 
that of the American citizens they are sworn to protect. Having 
done so, the committee nonetheless finds itself deeply troubled 
that the world's ``sole superpower'' is running a ``moderate to 
high'' risk when it comes to its ability to promote and protect 
vital national security interests.

                                HEARINGS

    Committee consideration of the National Defense 
Authorization Act for Fiscal Year 1999 results from extensive 
hearings that began on January 29, 1998 and that were completed 
on April 1, 1998. The full committee conducted 9 sessions. In 
addition, a total of 36 sessions were conducted by five 
different subcommittees and two panels of the committee on 
various titles of the bill.
            DIVISION A--DEPARTMENT OF DEFENSE AUTHORIZATION

                          TITLE I--PROCUREMENT

                                OVERVIEW

    The fiscal year 1999 procurement budget request continues 
the Department's pattern of neglecting long-term modernization 
of aging equipment to pay for near-term readiness- and 
personnel-related shortfalls. Although the $48.7 billion 
request finally grows modestly in real terms for the first time 
in 13 years, it is nevertheless $2.0 billion less than was 
projected to be just a year ago, and the forecast for fiscal 
year 2000 is an additional $2.9 billion below last year's 
forecast. Additionally, the request has been artificially 
inflated by the inclusion of items not traditionally funded in 
procurement accounts, such as strategic sealift.
    However, the committee is pleased the Department has 
finally ``turned the corner'' on procurement spending after 
having established a pattern of promising year-after-year to do 
so, only to backtrack from its commitment each succeeding year. 
The committee has added $15.0 billion to the procurement 
accounts over the past three fiscal years and, despite the 
severe fiscal limitations, for a fourth consecutive year, it 
was able to continue its own established pattern of increasing 
these accounts. The following increases are of note:

                        [In millions of dollars]

Army:
    UH-60 blackhawk-.............................................. $66.4
    ARL-..........................................................  35.0
    Kiowa warrior safety mods-....................................  16.0
    Javelin-......................................................  20.0
    MLRS launchers-...............................................  50.0
    Bradley base sustainment-.....................................  75.0
    Ammunition-...................................................  44.6
    HMMWV-........................................................  10.0
    Shortstop-....................................................  15.0
Navy/Marine Corps:
    V-22-.........................................................  78.0
    JPATS-........................................................  12.2
    KC-130J-...................................................... 112.4
    EA-6B modifications-..........................................  39.0
    Ammunition-...................................................  25.0
    LCAC SLEP-....................................................  16.0
    CEC-..........................................................  35.0
Air Force:
    F-16-.........................................................  60.0
    Joint stars advance procurement-..............................  72.0
    Global hawk unmanned aerial vehicle-..........................  32.5
    F-15 modifications-...........................................  45.0
    TCAS/EGPWS navigation safety modifications-...................  50.0
    B-2 post production support-..................................  86.0
    Minuteman III modifications-..................................  23.0
    Theater deployable communications-............................  20.0
National Guard and Reserve:
    Various equipment items-...................................... 300.0
    WC-130J-......................................................  59.7
    EC-130J-......................................................  51.5
    C-130J-....................................................... 174.0
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                       Aircraft Procurement, Army

                                Overview

    The budget request contained $1,325.9 million for Aircraft 
Procurement, Army in fiscal year 1999. The committee recommends 
authorization of $1,420.8 million for fiscal year 1999.
    The committee recommends approval of the request except for 
those programs adjusted in the following table. Unless 
otherwise specified, adjustments are without prejudice and 
based on affordability considerations.
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                       Items of Special Interest

Airborne avionics

    The budget request contained $56.3 million for the 
procurement of various airborne avionics upgrades to Army 
aircraft, of which $20.1 million was for engineering change 
orders (ECO) for 51 improved data modems (IDM).
    The IDM is a digital data link modem, which exchanges 
targeting data between an aircraft and various ground-based 
weapons systems in support of tactical combat and forward air 
control missions. The committee notes that there is an 84 
percent increase in the amount requested for ECOs in fiscal 
year 1999 over the amount appropriated for the same number of 
IDMs in fiscal year 1998 and a 93 percent increase over the 
amount appropriated in fiscal year 1997 for 94 IDMs. Although 
the committee understands the importance of this system to the 
Army's digital battlefield effort, the committee believes this 
large increase for ECOs is unjustified and recommends $46.3 
million, a decrease of $10.0 million.

Airborne reconnaissance low (ARL)

    The budget request contained $13.1 million for fielding two 
ARL-Multifunction (M) aircraft, Commanders Tactical Terminal 
(CTT) installations and upgrades of imagery intelligence 
(IMINT) payloads with second generation forward looking 
infrared radars into three ARL-M aircraft. However, no funds 
were requested for the procurement of additional aircraft or 
for wide-area search moving target indicators (MTI) and 
synthetic aperture radars (SAR).
    The ARL supports intelligence collection requirements for 
forward deployed force projection, operations other than war, 
and mid-intensity conflicts. The committee notes that the final 
Joint Requirements Oversight Council (JROC)-validated ARL-M 
aircraft remains unfunded and that this aircraft would be U.S.-
based to support theater-level worldwide contingency 
operations.
    The ARL-M possesses an integrated IMINT, communications 
intelligence (COMINT), and MTI/SAR and offers a broader 
intelligence collection capability than the previously fielded 
specific mission type aircraft, such as the ARL-C (COMINT) and 
ARL-I (IMINT) platforms. The committee understands that the 
MTI/SAR vastly improves the capability of the aircraft to 
detect, classify and track moving targets on the ground and is 
critical to daily support of Joint Chiefs of Staff sensitive 
reconnaissance operations, United States Forces Korea 
indications and warning requirements, and various non-
Department of Defense government agencies, including the Drug 
Enforcement Administration and the Federal Emergency Management 
Agency. Therefore, the committee recommends $48.1 million, an 
increase of $30.0 million for an additional aircraft to fulfill 
the JROC requirement and $5.0 million for an additional MTI/SAR 
to upgrade a previously fielded ARL-C aircraft.

Aircraft survivability equipment (ASE)

    The budget request contained $5.1 million for nonrecurring 
engineering and engineering change orders for the Suite of 
Integrated Radio Frequency Countermeasures, but no funds were 
included for upgrades to the Aircraft Survivability Equipment 
Trainer IV (ASET IV).
    ASET IV is a ground-based, mobile aviation threat emitter 
simulation and training system, which enables aircrews to 
recognize surface-to-air-missile (SAM) and anti-aircraft 
artillery threats in order to employ the correct aircraft 
threat avoidance tactics. ASET IV systems are currently fielded 
at major training centers throughout the United States and 
Germany and require that an aircraft have a fully operational 
ASE suite of sensors on board for training.
    Congress authorized and appropriated an increase of $7.4 
million for ASET IV upgrades in fiscal year 1998. Nevertheless, 
additional validated requirements exist and several systems in 
their present configuration still lack the capability to 
locate, identify, or track aircraft at night and cannot 
simulate the most current infrared (IR) SAM threats, thereby 
limiting aircrews to daylight training against older IR SAM 
threats--a situation which is not representative of the Army's 
``train as you fight concept.''
    The committee believes that the Army should continue to 
upgrade the ASET IV system in order for aircrews to have access 
to realistic training through the incorporation of additional 
night vision cameras and up-to-date IR SAM threat emitter 
simulation capabilities at several additional training centers. 
Consistent with committee actions taken in fiscal year 1998 and 
based on the Army's requirement for forces to train in 
realistic threat environments, the committee recommends an 
increase of $7.4 million for upgrading ASET IV systems with IR 
SAM threat simulators and night vision cameras.

Army airborne command and control system (A2C2S)

    The budget request contained $24.4 million to procure 11 
A2C2Ss.
    The A2C2S is a UH-60 deployable command post, which 
provides a highly mobile data, voice, and imagery command and 
control (C2) capability in support of Corps through Brigade 
level commanders. While the committee is supportive of improved 
C2 systems, it believes that programs entering initial 
procurement under the Warfighter Rapid Acquisition Program 
(WRAP) should be procured at a more modest rate than planned 
for the A2C2S in order to validate the success of the WRAP 
research and development efforts. Therefore, the committee 
recommends $13.4 million, a decrease of $11.0 million.

Army helicopter modernization plan

    The committee notes that the recently completed 
congressionally mandated Army Helicopter Modernization Plan did 
not include a strategy for fielding the next light utility 
helicopter (LUH), arguably one of the basic aircraft for 
performing the Army's mission. The committee is concerned with 
the condition of the Vietnam war-era Army and Army National 
Guard (ARNG) UH-1 Huey helicopters--the aircraft that currently 
performs the LUH mission--and the Army's plan to maintain over 
500 of these aircraft in the fleet beyond fiscal year 2010. The 
recent worldwide grounding of all Army and ARNG UH-1 Hueys due 
to the potential for engine spur gear fractures only heightens 
this concern. The committee is aware of the ongoing development 
of a LUH operational requirements document and strongly urges 
the Secretary of the Army to complete it by the December 1998 
scheduled completion date. The committee also urges the 
Secretary to fund the LUH in the future years defense program.

C-12 modifications

    The budget request contained $2.7 million for avionics and 
cockpit upgrades to C-12 aircraft.
    The C-12 is based throughout the world and is one of the 
Army's primary passenger-carrying aircraft. This aircraft is 
expected to continue in active service for at least the next 20 
years and will be one of four types that will remain in the 
Army's fixed wing utility aircraft fleet after a major 
consolidation of the inventory is completed.
    The committee notes that the majority of the Army's C-12 
aircraft continue to operate with the same avionics and 
navigation equipment that was installed when they were 
purchased in the 1970s and 1980s. While this equipment may have 
been state-of-the-art at that time, today it is obsolete. Based 
on the need for passenger-carrying military aircraft to have 
the latest technology for safe flight operations, Congress 
authorized and appropriated an increase of $6.0 million in 
fiscal year 1998 for C-12 avionics and cockpit modifications. 
The committee believes these upgrades should continue to be 
accelerated and, therefore, recommends an increase of $7.0 
million for this purpose.

CH-47 cargo helicopter modifications

    The budget request contained $101.2 million for CH-47 cargo 
helicopter modifications, of which $87.3 million was for T55 
engine upgrades.
    The T55 engine upgrade includes engine conversion kits, 
engine fielding kits, and engine conversions. Engine conversion 
kits improve fuel, torque and rotor performance and include 
newer metal alloy parts to reduce corrosion. Engine fielding 
kits assist in torque management and engine temperature 
reduction. Engine conversions allow for cockpit 
instrumentation, associated wiring, and structural 
modifications for new engines to prevent them from ejecting 
toward crew and passengers in the event of a crash.
    While the committee is aware of the importance of these 
modifications, it notes that 87 individual engine conversion 
kits and engine conversions were included in the fiscal year 
1999 budget request, while only 70 engine fielding kits were 
requested. To adjust the procurement of these three items to 
the fiscal years 1997 and 1998 level, the committee recommends 
a decrease of $8.2 million for engine conversion kits and a 
decrease of $4.5 million for engine conversions in order to 
make them consistent with the number of engine fielding kits 
being procured.

Endurance unmanned aerial vehicle (UAV)

    The budget request did not contain funds for procurement of 
endurance UAVs for the Army.
    The committee notes that the operational performance of the 
Predator UAV in support of U.S. operations in Bosnia has been 
impressive in all respects and understands that a draft 
Operational Requirements Document indicates that the Predator 
will meet the Army's endurance UAV criteria. Since the Predator 
is the only operational endurance UAV that can support the 
Army's tactical intelligence requirements, the committee 
encourages the Army to procure this system.

Kiowa warrior modifications

    The budget request contained $40.4 million for Kiowa 
Warrior system safety enhancement program (SSEP) modifications.
    Included in the SSEP are new crashworthy crew seats; an 
inflatable air bag body and head restraint system; a new 
handheld fire extinguisher; a full authority digital electronic 
control engine upgrade; and an improved master controller 
processor unit, which will replace three existing processors 
with two state-of-the-art units providing considerable memory 
growth while reducing aircraft weight and operating and support 
costs. Similar to congressional action in fiscal year 1998, 
which authorized and appropriated an additional $15.0 million 
for these upgrades, the committee recommends an increase of 
$16.0 million for this purpose.-

UH-60L blackhawk

    The budget request contained $218.8 million for the 
procurement of 22 UH-60L Blackhawk helicopters, 10 of which are 
for the Army National Guard (ARNG).
    The UH-60 Blackhawk is the Army's primary utility 
helicopter for both the active and reserve components. As a 
result of the fiscal year 1998 congressionally mandated Army 
Modernization Plan, the Army determined that an additional 90 
Blackhawks should be fielded to the ARNG. Beginning with the 
fiscal year 1999 budget request, the Army plans to include 
funding to procure 10 aircraft per year for 5 years toward the 
additional 90 aircraft requirement. The committee notes that 40 
aircraft remain unfunded and that additional Blackhawks are one 
of the Army Chief of Staff's unfunded priorities for fiscal 
year 1999. Therefore, the committee recommends $285.2 million, 
an increase of $66.4 million, for eight additional aircraft for 
the ARNG in order to reduce the shortfall.

                       Missile Procurement, Army

                                Overview

    The budget request contained $1,205.8 million for Missile 
Procurement, Army in fiscal year 1999. The committee recommends 
authorization of $1,232.3 million for fiscal year 1999.
    The committee recommends approval of the request except for 
those programs adjusted in the following table. Unless 
otherwise specified, adjustments are without prejudice and 
based on affordability considerations.
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                       Items of Special Interest

Enhanced fiber optic guided missile (EFOGM)

    The budget request contained $13.7 million, of which $13.2 
million was for the procurement of 96 EFOGMs.
    Both the committee report on H.R. 1119 (H. Rept. 105-132) 
and the statement of managers accompanying the conference 
report on H.R. 1119 (H. Rept. 105-340) specifically state that 
production EFOGMs would not be procured until successful flight 
tests of prototype missiles occur. The committee notes 
elsewhere in this report that the EFOGM has been plagued with 
technical difficulties and has not demonstrated a successful 
flight to date. Therefore, the committee recommends no funding 
for EFOGM procurement.

Javelin

    The budget request contained $320.0 million for the 
procurement of 3,316 Javelin missiles for the Army.
    The Javelin is a medium range, man-portable, fire-and-
forget, anti-tank missile, which can defeat all known and 
projected armor threats and is employed by infantrymen, scouts 
and combat engineers. The committee believes that this anti-
armor system is essential for light forces to maintain 
battlefield dominance and has consistently supported 
accelerating the fielding of this missile to both the Army and 
the Marine Corps. Consistent with past actions, the committee 
recommends an increase of $20.0 million to continue accelerated 
fielding of Javelin missiles.-

Multiple launch rocket system (MLRS) launcher systems

    The budget request contained $85.4 million for the 
procurement of 24 MLRS launchers, of which $20.9 million was 
for engineering services. However, no funds were included for 
procurement of launchers for the Army National Guard (ARNG).
    The committee notes that the funding for engineering 
services in the budget request is excessive. The committee 
believes such an increase is unjustified and, therefore, 
recommends a reduction of $10.0 million.
    Although the ARNG provides nearly 70 percent of the 
artillery fire support for the total Army, the committee is 
aware that additional launchers are required to fill a 
shortfall in ARNG MLRS battalions. Therefore, the committee 
recommends $125.4 million, an increase of $50.0 million, for 
additional MLRS launchers for the ARNG.

               Weapons and Tracked Combat Vehicles, Army

                                Overview

    The budget request contained $1,433.6 million for 
procurement of Army weapons and tracked combat vehicles for 
fiscal year 1999. The committee recommends authorization of 
$1,507.6 million for fiscal year 1999.
    The committee recommends approval of the request except for 
those programs adjusted in the following table. Unless 
otherwise specified, adjustments are without prejudice and 
based on affordability considerations.
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                       Items of Special Interest

Bradley base sustainment

    The budget request contained $285.8 million for the 
procurement of 73 Bradley M2A3 fighting vehicles, but no funds 
were included for upgrading Bradley ``A0'' vehicles to the 
``A2'' Operation Desert Storm (ODS) variant.
    The Bradley A2ODS variant incorporates changes that improve 
the vehicle's lethality, survivability, and mobility, as well 
as the situational awareness of its crew. Modifications include 
installation of a laser range finder, Global Positioning System 
navigation capability, a combat identification system, a 
driver's thermal viewer and a missile countermeasure device.
    When the Army completes all of its planned modifications to 
the Bradley, the active fleet will include a mix of the most 
advanced ``A3'' variant, along with A2 and A2ODS versions. The 
Army National Guard (ARNG), however, will be left with 
unmodified, first-generation ``A0'' vehicles, which, because of 
major survivability deficiencies, were not used in the Persian 
Gulf War and will not likely be taken into future combat.
    Because the ARNG comprises an increasing percentage of the 
Army's warfighting capability as a result of active component 
force reductions and consistent with actions taken in fiscal 
year 1998, the committee recommends $360.8 million, an increase 
of $75.0 million, for modifying Bradley ``A0'' vehicles to the 
ODS variant for the ARNG.

Bradley base sustainment/command and control vehicle (C2V)

    The budget request contained $285.8 million for the 
procurement of 73 Bradley M2A3 fighting vehicles and $44.2 
million for the procurement of 10 C2V.
    The committee understands that the Army is considering the 
savings and benefits associated with a multi-program multiyear 
procurement contract for the Bradley M2A3 and the C2V. The 
committee urges the Army to consider this contracting 
opportunity beginning in fiscal year 2000 and recommends that 
the Army consider additional vehicles in the contract, such as 
the Bradley A3 Fire Support Team Vehicle, the Improved Recovery 
Vehicle and the Multiple Launch Rocket System launcher 
remanufacture program, thereby providing the Army with the 
flexibility to change the vehicle mix from year-to-year as the 
need arises.

M1 abrams tank modifications

    The budget request contained $53.3 million for 
modifications to improve the M1 Abrams tank's lethality, safety 
and survivability, of which $20.3 million was for M1A1-D 
integration kits.
    The committee notes that the Army is in the third year of a 
five-year multiyear procurement (MYP) contract to upgrade M1A1 
tanks to the M1A2 system enhancement program (SEP) variant. The 
committee fully supports this upgrade and believes that a full 
complement of M1A2 SEP tanks will provide a more lethal armor 
force in future digitized divisions compared to a mixed fleet 
of lesser capable M1A1-Ds and M1A2 SEP variants. The committee 
finds no compelling need for both the M1A1-D and M1A2 SEP 
upgrades, and, therefore, recommends no funds for the M1A1-D 
upgrade. The committee has included a provision (sec. 112) that 
directs the Secretary of the Army to obligate the $20.3 million 
requested for M1A1-D integration kits for M1A2 SEP Step One 
digital communications upgrades.
    Additionally, the committee understands that the Army 
intends to reduce the size of M1 tank battalions from 60 to 45 
tanks in the near-term and that this force structure reduction 
is possible due to the increased lethality, survivability and 
command and control capability that the M1A2 SEP tank provides. 
While the committee concurs with the National Defense Panel's 
recommendation to develop a lighter, more deployable tank for 
the Army After Next, it does not foresee technological advances 
that would warrant the fielding of a follow-on tank to the M1A2 
before 2015. Accordingly, the committee strongly urges the 
Secretary of the Army to request authorization for a three-year 
follow-on MYP contract in fiscal year 2000 with an annual 
production rate of 120 tanks per year.

M-240 series machine gun

    The budget request contained $6.5 million to procure 673 M-
240 machine guns, and the committee recommends the requested 
amount.
    The committee understands that the Army is planning to 
modernize its UH-60 and CH-47 helicopter fleets with the M-240D 
machine gun. Because it believes that this initiative will 
provide unprecedented commonality in medium machine gun 
equipage across the force, the committee encourages the Army to 
expeditiously provide the resources for its implementation.

M4 carbine

    The budget request contained $4.2 million for the 
procurement of 6,310 M4 carbines.
    The M4 carbine is a shoulder-fired 5.56 millimeter round 
weapon for light forces designed to replace all M3A1 World War 
II era .45 caliber machine guns and certain M16 rifles and M9 
pistols. The committee recommends $5.2 million, an increase of 
$1.0 million, for additional M4 carbines for light forces.

                      Ammunition Procurement, Army

                                Overview

    The budget request contained $1,008.9 million for 
Ammunition Procurement, Army in fiscal year 1999. The committee 
recommends authorization of $1,053.5 million for fiscal year 
1999.
    The committee recommends approval of the request except for 
those programs adjusted in the following table. Unless 
otherwise specified, adjustments are without prejudice and 
based on affordability considerations.
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                       Items of Special Interest

Ammunition

    The budget request contained $827.2 million for procurement 
of ammunition. The committee recommends $871.8 million, an 
increase of $44.6 million for the following types of 
ammunition:

                        [In millions of dollars]

Small/Medium Cal Ammunition:
    CTG 5.56mm All Types-.........................................  $5.6
    CTG 7.62mm All Types-.........................................   4.0
    CTG 25mm All Types-...........................................  10.0
Mortar Ammunition:
    CTG Mortar 60mm Illum M761/767-...............................   5.0
Tank Ammunition:
    CTG Tank 120mm HEAT-MP-T M830A1-..............................  10.0
Artillery Fuzes:
    M767A1 Electronic Artillery Fuze-.............................  10.0

                       Items of Special Interest

Arsenals

    The committee notes the historical importance of and unique 
contributions made by U.S. Army arsenals as part of the defense 
industrial base. Their support to the military under title 10, 
United States Code, section 4532 (The Arsenal Act), aided 
immeasurably in the demise of the Cold War and will continue 
into the 21st century. However, with the decrease in defense 
spending over the last decade, the committee is concerned over 
the dramatic decrease in workload at these government-owned, 
government-operated industrial facilities. Therefore, the 
committee urges the Secretary of the Army to identify and 
evaluate processes and economical practices that would enable 
arsenals to remain viable and critical components of the 
defense industrial base.

Non-toxic frangible ammunition

    The budget request contained no funds for the procurement 
of non-toxic frangible ammunition.
    Non-toxic frangible ammunition rounds are environmentally-
friendly, lead-free munitions for indoor or urban small arms 
training. These rounds disintegrate on impact with hard surface 
targets and reduce or eliminate lead contamination to the 
environment while providing safer and cleaner training 
scenarios than currently available. The committee notes the 
Army's recent evaluation and safety certification of certain 
commercial-off-the-shelf, non-toxic frangible 9 millimeter (mm) 
and 5.56mm ammunition under the Joint Service Small Arms 
Program (JSSAP). The committee understands, however, that the 
certifications were granted with certain limitations and 
restrictions. Nevertheless, the committee is encouraged by the 
Army's efforts under the JSSAP. Since non-toxic frangible 
ammunition is currently procured on a limited basis for 
training requirements, the committee believes that continued 
procurement is warranted for these unique requirements while 
performance deficiencies are addressed.

                        Other Procurement, Army

                                Overview

    The budget request contained $3,198.8 million for Other 
Procurement, Army in fiscal year 1999. The committee recommends 
authorization of $3,136.9 million for fiscal year 1999.
    The committee recommends approval of the request except for 
those programs adjusted in the following table. Unless other 
specified, adjustments are without prejudice and based on 
affordability considerations.
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                       Items of Special Interest

Automated data processing equipment (ADPE)

    The budget request contained $130.7 million for procurement 
of ADPE, of which $44.0 million was for the procurement of the 
Joint Computer Aided Acquisition and Logistics Support (JCALS) 
system.
    The committee notes a nearly 25 percent increase in the 
amount requested for JCALS over both the amount authorized and 
appropriated in fiscal year 1998 and the amount projected for 
fiscal year 2000. Additionally, the committee notes that the 
system recently failed approval for Milestone III low rate 
initial production for the second time. Therefore, the 
committee recommends $24.9 million, a decrease of $19.1 
million, for continued limited procurement of this system.

Close combat tactical trainer (CCTT)

     The budget request contained $113.9 million for continued 
low rate initial production (LRIP) of the CCTT system, to 
include 77 fixed site modules and 18 mobile modules.
    The CCTT is a networked system of manned simulators for the 
Abrams tank, Bradley fighting vehicle, High Mobility 
Multipurpose Wheeled Vehicle, and M113A3 carrier and will train 
both active and reserve component crews of armored and 
mechanized infantry combat units. Although the committee is 
aware of cost savings that can be achieved through simulation 
training, it is concerned with delays that have been 
experienced by this system as a result of the one-year slip in 
initial operational test and evaluation (IOT&E). Moreover, the 
committee is concerned with the 53 percent increase in the 
request over the amount authorized and appropriated in fiscal 
year 1998 prior to the system's having successfully completed 
IOT&E. Therefore, the committee recommends $84.5 million, a 
decrease of $17.0 million for modules and site equipment, $2.4 
million for commercial trainers, and $10.0 million for 
commercial image generators.

Co-site interference mitigation technology

    The budget request did not contain funds for the 
procurement of co-site interference mitigation technology.
    Co-site interference mitigation technology limits 
electronic interference created by multiple, co-located radio 
transmission antennae when radios transmit simultaneously, 
thereby producing ``bleed over'' of conversations from one 
channel to another. The committee is aware of currently 
available electronically-tuned helix antennae and interference-
canceling technologies that may provide a solution to co-site 
interference and, therefore, recommends an increase of $3.0 
million to procure these technologies for evaluation by Force 
XXI experimental units.

Family of medium tactical vehicles (FMTV)

    The budget request contained $332.0 million for the 
procurement of 2038 FMTVs.
    The committee is aware that these vehicles will be procured 
under a four-year multiyear procurement (MYP) contract, with a 
fifth one-year option, beginning in fiscal year 1998. The 
committee is also aware of the Army's plan to develop a second 
production source to achieve savings through competition. 
However, the committee is concerned that the Army may not be 
able to budget sufficient resources for medium trucks in its 
future years defense program to justify two sources and 
questions whether the Army's plan to develop a second source is 
necessary.
    Therefore, the committee expects that the Secretary of the 
Army will not enter into production qualification contracts 
with potential second source suppliers until he certifies to 
the congressional defense committees that a second source 
acquisition strategy is cost effective, that sufficient funds 
are programmed in the future years defense program to execute 
that strategy and provides analysis supporting his 
certification.

Forward entry device (FED)

    The budget request contained $25.0 million for the 
procurement of 852 FEDs. The FED is a hand-held computer used 
in heavy divisions by forward observers, field artillery 
battery commanders, and fire support teams for transmitting 
artillery fire requirements to field artillery units.
    The committee notes that the unit cost for the 852 FEDs 
requested is three thousand dollars higher than the unit cost 
for the 45 units procured in fiscal year 1998. The committee is 
aware of some enhancements incorporated into the system, which 
might explain a modest increase in unit cost. However, since 
the proliferation of information technologies (IT) in both the 
public and private sectors has greatly decreased IT costs, the 
committee believes that the unit cost increase for the 
procurement of 800 more units than were procured in fiscal year 
1998 is unwarranted and recommends a reduction of $10.0 
million.

Ground based common sensor (GBCS)

    The budget request contained $25.4 million for the GBCS-
Light (L) system, of which $1.5 million is for the Common 
Modules Electronic Intelligence Subsystem (CMES).
    The committee notes that the GBCS-L system has had numerous 
technical difficulties and experienced a significant fielding 
delay as a result of a two-year slip in initial operational 
test and evaluation (IOT&E). This delay has resulted in the 
Department's twice having used GBCS as a source of funds for 
reprogramming requests. The committee understands that the 
GBCS-L may now begin IOT&E in the fourth quarter of fiscal year 
1998, however, as a result of the sensor's past performance, it 
believes that all of the requested funding may not be 
executable because of further delays. Therefore, the committee 
recommends $14.2 million, a decrease of $9.7 million for GBCS-L 
hardware and $1.5 million due to the duplicate entries for CMES 
in the budget request.

High mobility multipurpose wheeled vehicle (HMMWV)/HMMWV extended 
        service plan (ESP)

    The budget request contained $12.1 million to procure 110 
HMMWVs, 100 of which were up-armored variants, and $24.8 
million to extend the life of 387 HMMWVs.
    The committee notes that subsequent to the submission of 
the budget request, the Army decided to only procure new HMMWVs 
rather than extend the life of older vehicles and that the new 
HMMWVs are a top unfunded priority of the Army Chief of Staff. 
Therefore, the committee recommends no funding for the HMMWV 
ESP and recommends $22.1 million, an increase of $10.0 million, 
for procurement of new up-armored HMMWVs.

Joint surveillance and target attack radar system (Joint STARS) common 
        ground station (CGS)

    The budget request contained $87.2 million for the 
procurement of 20 Joint STARS CGSs.
    The committee is aware of the lack of adequate joint Army/
Air Force air-land battlefield sensor assets to detect, locate, 
track, and classify both moving and stationary targets beyond 
the forward line of troops. The CGS improves ground commanders' 
battlefield command and control (C2) capability by integrating 
into a single station the processing of signals, imagery and 
other intelligence received through a data link from the Air 
Force's E-8 Joint STARS aircraft radar. The committee is aware 
of the proven success of the CGS in Operation Joint Endeavor in 
Bosnia, and, therefore, recommends an increase of $10.0 million 
for the procurement of 24 additional CGS workstations.

Joint tactical terminal

    The budget request contained $6.5 million in other 
procurement, Army, and $4.2 million in other procurement, Air 
Force, for the Joint Tactical Terminal intelligence broadcast 
transceivers.
    These radios are an integral part of the Integrated 
Broadcast Service that the committee fully supports. The 
committee is concerned that, because of contract protests that 
have resulted in delays in final contract award, the fielding 
of these radios has slipped, leaving operational users without 
the ability to receive tactical intelligence data broadcasts. 
In order to correct this problem, the committee recommends 
$11.5 million and $7.2 million, an increase of $5.0 million for 
the Army and $3.0 million for the Air Force, respectively, for 
accelerating the purchase and fielding of these radios.

Land warrior

    The budget request contained $51.4 million for initial 
procurement of Land Warrior dismounted combat soldier weapon 
systems, but no funds were included for all-torso body armor.
    In its report on H.R. 1119 (H. Rept. 105-132), the 
committee noted that the effectiveness of modern all-torso body 
armor was aptly demonstrated during Operation Provide Hope in 
Somalia and that subsequent Army studies and analyses indicated 
more than 50 percent of all life-threatening wounds received in 
combat could be prevented by using such body armor. The 
committee believes that the medical expenses and loss of human 
life that could be avoided by employing this type of armor far 
outweigh the costs of procuring and fielding it; therefore, the 
committee recommends $56.4 million, an increase of $5.0 
million, for the procurement of all-torso body armor.

Lightweight maintenance enclosure (LME)

    The budget request contained $545 thousand for 50 LMEs.
    The LME is a lightweight, frame-supported, mobile tent 
designed to provide rapid deployed and forward maintenance 
units a quick setup-and-takedown enclosed shelter in which to 
perform field maintenance operations on tracked and wheeled 
vehicles and other equipment in all climatic conditions. The 
committee notes that light forces will be more mobile in the 
future and must therefore be capable of rapidly repairing and 
maintaining equipment while deployed. However, because the Army 
identified a new requirement for LMEs after the budget request 
was submitted to Congress, it was not adequately funded. 
Therefore, the committee recommends an increase of $2.0 million 
for the procurement of additional LMEs.

Night vision devices

    The budget request contained $29.6 million for procurement 
of AN/PVS-7 night vision goggles, but no funds were included 
for the procurement of AN-PEQ-2A infrared aiming target 
pointers/infrared aiming lights.
    The AN-PEQ-2A infrared aiming target pointer/infrared 
aiming light is a target designator mounted either on 
individual or crew served weapons. Its eyesafe laser output is 
visible only when used with image intensifier night vision 
goggles, such as the AN/PVS-7. The committee notes that the 
``Own the Night'' initiative--the Army's concept of fighting, 
dominating and winning battles during nighttime operations--is 
one of the Army Chief of Staff's top five priorities. However, 
the committee is concerned that adequate funding for night 
vision equipment is not included in the budget request, despite 
its having proved to be a highly successful ``over match'' 
capability and ``force multiplier'' for light forces in the 
Task Force XXI Advanced Warfighting Experiments. Therefore, the 
committee recommends an increase of $9.0 million for AN-PEQ-2A 
infrared aiming target pointers/infrared aiming lights.

Nonsystem training devices

    The budget request contained $56.8 million for procurement 
of nonsystem training devices, but no funds were included for 
firefighter trainers. This training device is a computer-
controlled, natural-gas-fueled system, which provides safe, 
realistic, and environmentally-friendly training for 
firefighters at airports and training academies throughout the 
country.
    The committee understands that Army firefighter training 
sites have been or will be closed in the future because most 
are not in compliance with environmental regulations. Because 
of the site closures, the Army has established a program to 
provide regional firefighter training and has awarded a 
contract to procure 28 firefighter trainers over a five-year 
period for this purpose. However, it will have procured only 12 
of these trainers by the end of fiscal year 1998. The committee 
continues to believe that these trainers provide a safe, unique 
and fundamental fire prevention and teaching function for Army 
firefighters. Therefore, consistent with action taken in fiscal 
year 1998, the committee recommends an increase of $4.0 million 
to procure four additional firefighter trainers. The committee 
also urges the Secretary of the Army to provide funds for the 
remaining trainer requirements in the fiscal year 2000 budget 
request.

Shortstop

    The budget request contained no funds for procurement of 
the Shortstop Electronic Protection System (SEPS).
    The SEPS is a commercial electronics radio frequency 
countermeasure system that protects personnel and high value 
assets from artillery, mortar rounds and rockets by detonating 
their proximity fuzes well before they impact in the target 
area. The committee understands that initial Army testing of 
5,000 rounds fired at the SEPS resulted in a 100 percent pre-
detonation success rate and that follow-on tests with both 
artillery and rockets were also highly successful. However, for 
the third straight year, the Army has failed to include funding 
for SEPS in the budget request.
    SEPS, developed as a quick reaction capability system, was 
deployed during Operation Desert Storm and more recently in 
Operation Joint Endeavor in Bosnia. The committee authorized 
$9.0 million (of which $6.0 million was appropriated) in fiscal 
year 1998 for procurement of 30 units for forward-deployed 
forces in Korea. Similar to prior year action, the committee 
recommends an increase of $15.0 million for the procurement of 
additional SEPS in order to complete the fielding of systems to 
Korea and to begin fielding systems to Kuwait.

Small pusher tug

    The budget request contained $4.3 million for the 
procurement of one small pusher tug.
    This tug is a 60-foot, steel hull, twin propeller vessel 
designed to tow general cargo barges in harbors, inland 
waterways and along coastlines. It can also assist larger tugs 
in docking and undocking ships of all sizes, movement of 
floating cranes and machine shops, and performing line handling 
duties.
    The committee is aware of the unreliable performance of the 
Army's 40 year-old small tugs during Operations Desert Shield 
and Desert Storm and understands that the Army has a 
requirement for eight new tugs to replace these older vessels. 
The committee understands that two additional tugs can be 
procured at a cost of $4.7 million. Since the Army has only 
budgeted for six of these tugs in its future years defense 
program, the committee recommends $8.6 million, an increase of 
$4.3 million, for a total of three vessels, which would fulfill 
the Army requirement and complete the program.

            Chemical Agents and Munitions Destruction, Army

                                Overview

    The budget request contained $855.1 million for Chemical 
Agents and Munitions, Army, for fiscal year 1999. The committee 
recommends authorization of no funds for fiscal year 1999.
    The committee recommends approval of the request except for 
those programs adjusted in the following table. Unless 
otherwise specified, adjustments are without prejudice and 
based on affordability considerations.
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                        Item of Special Interest

Chemical agents and munitions destruction

    The budget request contained $855.1 million for Chemical 
Agents and Munitions Destruction, Army, including $182.8 
million for research and development, $140.7 million for 
procurement, and $531.7 million for operations and maintenance.
    Section 1412(f) of the National Defense Authorization Act 
for Fiscal Year 1986 (Public Law 99-145) requires that funds 
for the destruction of the U.S. stockpile of lethal chemical 
agents and munitions, including funds for military construction 
projects necessary to carrying out the demilitarization 
program, shall be set forth in the budget of the Department of 
Defense as a separate program and shall not be included in the 
budget accounts for any military department.
    The committee is aware of delays associated with the 
construction of the chemical demilitarization site at Pine 
Bluff Arsenal, Arkansas, that should result in a reduced level 
of expenditures at that installation during fiscal year 1999. 
The committee also notes projected increases that it does not 
consider are warranted in the research and development request 
for the destruction of stockpile and for non-stockpile agents 
and munitions.
    Accordingly, the committee recommends no funding for 
Chemical Agents and Munitions Destruction, Army, and $834.0 
million for Chemical Agents and Munitions Destruction, Defense. 
The recommendation includes a decrease of $11.9 million in 
research and development, a decrease of $6.0 million in 
procurement, and a decrease of $3.2 million in operations and 
maintenance.

                       Aircraft Procurement, Navy

                                Overview

     The budget request contained $7,466.7 million for Aircraft 
Procurement, Navy in fiscal year 1999. The committee recommends 
authorization of $7,420.8 million for fiscal year 1999.
    The committee recommends approval of the request except for 
those programs adjusted in the following table. Unless 
otherwise specified, adjustments are without prejudice and 
based on affordability considerations.
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                       Items of Special Interest

AV-8B

    The budget request contained $282.7 million to procure 12 
remanufactured AV-8B aircraft and $55.7 million for advance 
procurement of 12 remanufactured aircraft in fiscal year 2000.
    Consistent with its recommendations in fiscal years 1997 
and 1998, the committee continues to support accelerated 
mission capability and safety-related improvements to the AV-
8B. The committee notes that the Department's legislative 
proposal requests authorization for multiyear procurement of 
these aircraft and recommends a provision (sec. 121) that would 
support this request. However, the committee also notes 
unexplained growth in integrated logistics support and 
government furnished avionics compared to fiscal year 1998, and 
concludes such increase is unwarranted. Accordingly, the 
committee recommends $279.5 million, a decrease of $3.2 
million, and believes that this decrease will not affect the 
ability of the Department to proceed with a multiyear contract.
    The committee understands that an unfunded option exists in 
the proposed 72-aircraft multiyear contract that would 
remanufacture the remaining 24 aircraft in the fleet and 
encourages the Department to negotiate such an option.

AH-1W night targeting system (NTS)

    The budget request contained $22.4 million for AH-1W 
helicopter modifications, and included $9.1 million for the AH-
1W NTS. According to the budget justification documents, fiscal 
year 1999 is the final procurement year for this system.
    The NTS provides a night and adverse weather capability to 
employ the Hellfire and tube-launched, optically-tracked, wire 
guided (TOW) missiles. In addition, NTS will provide enhanced 
conventional weapons delivery by utilizing the system's laser 
ranging capability. The Commandant of the Marine Corps' 
unfunded requirements list for fiscal year 1999 identified the 
procurement of 10 additional systems among his highest 
priorities so that the Marine Corps could achieve its objective 
of 188 systems to modify training and attrition aircraft. 
Accordingly, the committee recommends an increase of $11.0 
million for 10 NTSs.

EA-6B modifications

    The budget request contained $75.7 million for EA-6B 
modifications but included no funds for the band 9/10 
transmitter/receiver upgrade.
    The committee understands that the Department faces an 
emergent requirement to counter high frequency radar techniques 
of a new family of electronic threats. The committee further 
understands that the EA-6B is not currently equipped to counter 
these threats and notes that the Joint Tactical Electronic 
Warfare Study identified a need for improving the aircraft's 
jamming capability in the high frequency (band 9/10) ranges. 
Inrecognition of this situation, the committee recommends an increase 
of $39.0 million to meet this requirement.-

EP-3E flat panel display

    The budget request contained $5.4 million for modifications 
to the EP-3E aircraft, but included no funds to procure flat 
panel displays.
    The EP-3E is a land-based, long-range aircraft with 
electronic intercept devices for detection and tracking of 
enemy radars and radios. The committee understands that, as new 
combat threats have emerged over the years, the fleet of EP-3E 
aircraft has undergone numerous equipment upgrades that have 
increased its weight. As a result, the committee also 
understands that critical operational and safety equipment has 
been removed in order to maintain the aircraft within its 
designed weight limit. The much lighter-weight flat panel 
display is a form, fit and function replacement for existing 
displays and would save nearly 600 pounds per aircraft. 
Accordingly, the committee recommends an increase of $3.0 
million to replace existing displays with the flat panel 
displays in the Navy's EP-3E fleet of 12 aircraft.

ES-3 modifications

    The budget request contained $5.2 million for ES-3 series 
modification kits. The Navy has informed the committee that it 
intends to terminate the ES-3 program in fiscal year 2000. 
Based on this decision, the committee sees no need for 
modifying these aircraft prior to their removal from the fleet. 
The committee, therefore, recommends no funding for these 
modifications.

F-14 modifications

    The budget request contained $223.7 million for F-14 
modifications, including $81.1 million for structural 
improvements.
    The committee notes excessive cost growth related to 
modifications for structural improvements and, therefore, 
recommends a decrease of $7.3 million.

F/A-18E/F

    The budget request contained $2,787.8 million for 30 F/A-
18E/F aircraft and $109.4 million for advance procurement of 36 
aircraft in fiscal year 2000.
    Based on the results of the Quadrennial Defense Review 
(QDR), the committee notes that the Department has reduced the 
total procurement objective from 1,000 to 548 aircraft and has 
also reduced procurement in the future years defense program 
(FYDP) from 248 to 224. The committee notes that the Department 
plans to request increases of six aircraft per year for each of 
the next three fiscal years until its maximum production rate 
of 48 aircraft per year is attained in fiscal year 2002. 
However, for fiscal year 1999, the requested increase from 
fiscal year 1998 is 10 aircraft.
    The committee is also aware that the Department has 
increased the number of low rate initial production (LRIP) 
aircraft in fiscal years 1997, 1998 and 1999 from 42, as 
approved in 1992 by the Defense Acquisition Board (DAB), to its 
current plan of 62 aircraft. The Department's Selected 
Acquisition Reports indicate that both its initial plan of 42 
LRIP aircraft and its current plan of 62 LRIP aircraft were 
predicated on a procurement objective of 1,000 aircraft. The 
committee notes that were the Department to comply with the 10 
percent LRIP guideline contained in section 2400 of title 10, 
United States Code, 55 LRIP aircraft should be sufficient.
    During the past year, the committee has followed the 
Department's challenges in solving an uncommanded rolling 
motion problem that occurs at altitudes and angles of attack in 
that portion of the flight envelope where the F/A-18E/F 
performs air combat maneuvers. The Department's Director of 
Operational Test and Evaluation recently testified that the 
most promising solution to this problem--a porous wing 
fairing--causes unacceptable airframe buffeting and that the 
final solution to the problem may include other combinations of 
aerodynamic alterations to the wing surface. According to the 
Director, the root cause of the problem and modifications to 
the porous wing fairing are still being investigated, and the 
wing fairing configuration flown during developmental testing 
does not incorporate the production representative wing fold 
mechanism. Additionally, the Director stated that the 
Department would not have a complete understanding of the 
impact of the design fix, including uncertainty over air flow 
effects around the weapons pylons, until the conclusion of 
operational testing in 1999. Moreover, the Director also noted 
other concerns with the aircraft such as deficiencies in the 
performance of its survivability and radar jamming systems.
    In light of the significantly higher increase in production 
proposed for fiscal year 1999, the apparent excess number of 
LRIP aircraft, and the development and testing issues yet to be 
fully resolved, the committee recommends a reduction of $213.1 
million and three aircraft. Of the total $213.1 million 
reduction, initial spares is reduced by $8.4 million. The 
committee believes that an increase of seven aircraft from the 
approved fiscal year 1998 level is appropriate and further 
believes that a total of 59 LRIP aircraft, approximately 11 
percent of the total procurement objective, will meet 
requirements for operational testing and evaluation and will 
also be sufficient to meet both initial training requirements 
and the first operational deployment scheduled for fiscal year 
2002.

Joint primary air training system (JPATS)

    The budget request contained no funds for the Navy JPATS.
    The JPATS, consisting of both the T-6A aircraft and a 
ground-based training system, will be used by the Navy and Air 
Force for primary pilot training. The T-6A will replace both 
the Navy's T-34 and Air Force's T-37B fleets, providing safer, 
more economical and more effective training for future student 
pilots. The Air Force began procurement of the T-6A in fiscal 
year 1995, and the committee understands that the Navy plans to 
begin procurement in fiscal year 2000. The committee believes 
that accelerating T-6A procurement for the Navy would not only 
reduce procurement costs for both the Navy and the Air Force 
but would reduce operations and maintenance costs forboth 
services as well. Consequently, the committee recommends an increase of 
$12.2 million for four T-6A aircraft to initiate the Navy's procurement 
of JPATS.

Lightweight environmentally sealed parachute assembly (LESPA)

    The budget request contained no funds for the LESPA.
    The committee continues to support the LESPA to replace old 
parachutes in the P-3 and E-2C aircraft. Due to its longer 
repack cycle and extended service life, the committee believes 
that the Navy will realize substantial life cycle cost savings 
by procuring LESPA compared to continued use of existing 
parachutes. Consistent with previous actions, the committee 
recommends $22.0 million to procure LESPA, including $15.0 
million for the P-3 and $7.0 million for the E-2C.

T-45TS

    The budget request contained $282.7 million for 15 T-45C 
aircraft and $60.2 million for advance procurement of 15 
aircraft in fiscal year 2000. The committee notes that fiscal 
year 1999 is the first year of a planned five-year multiyear 
procurement.
    The committee supports the Department's replacement of its 
TA-4J and T-2C training aircraft fleets due to their decreasing 
reliability and increasing maintenance costs. In fiscal year 
1998, the committee recommended additional funding for 
procurement of the T-45C from 12 to 15 aircraft in order to 
accelerate the replacement process. Consequently, the committee 
supports the Department's plan to procure this aircraft using a 
multiyear contract. However, the committee notes unexplained 
cost growth in airframe ground support and peculiar training 
equipment. Therefore, the committee recommends a decrease of 
$15.5 million for these items and understands that this 
reduction will not impact the airframe multiyear contract.

V-22

    The budget request contained $610.8 million to procure 7 V-
22 tiltrotor aircraft and $54.0 million for advance procurement 
of 10 aircraft in fiscal year 2000.
    The committee continues to support accelerated V-22 
procurement and endorses the Quadrennial Defense Review's (QDR) 
recommendation to achieve a long-term production rate of 30 
aircraft per year by 2004. Additionally, the committee notes 
that the procurement of an additional MV-22 aircraft in fiscal 
year 1999 is the Commandant of the Marine Corps' highest 
unfunded aviation acquisition priority. However, the committee 
also notes excessive cost growth for peculiar ground support 
equipment. Therefore, consistent with its prior actions, the 
recommendations of the QDR, and the Commandant of the Marine 
Corps' unfunded priorities for fiscal year 1999, the committee 
recommends an increase of $78.0 million to procure one 
additional aircraft. The committee also recommends a decrease 
of $14.0 million for peculiar ground support equipment, 
resulting in a net increase of $64.0 million.

                       Weapons Procurement, Navy

                                Overview

    The budget request contained $1,327.5 million for Weapons 
Procurement, Navy in fiscal year 1999. The committee recommends 
authorization of $1,192.2 million for fiscal year 1999.
    The committee recommends approval of the request except for 
those programs adjusted in the following table. Unless 
otherwise specified, adjustments are without prejudice and 
based on affordability considerations.
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                       Items of Special Interest

Close-in weapon system (CIWS) surface mode upgrade

    The budget request contained $2.8 million for CIWS 
modifications but included no funds for the surface mode 
upgrade for amphibious ships.
    The CIWS is a fully autonomous, radar-directed gun system 
designed for anti-ship missile defense. While the existing 
system is effective against its designed threat, the Navy's new 
focus on littoral operations requires an ability to defend 
against small, fast surface craft for which most Navy ships 
have a limited defense. The surface mode upgrade adds an 
electro-optical infra-red radar that provides this capability. 
To address this deficiency, the committee recommended an 
increase of $20.0 million in fiscal year 1998, of which 
Congress appropriated an increase of $15.0 million. Consistent 
with its prior actions, the committee recommends an increase of 
$4.0 million to procure CIWS surface mode upgrade kits for 
amphibious ships.
    The committee is concerned that continued manpower and 
budget reductions threaten the readiness and performance of the 
CIWS, which the committee understands will be maintained in the 
fleet beyond 2010. As a result, the committee has been advised 
that the Department is considering proposals that would reduce 
life-cycle costs of this system, including a single agency 
support concept. Under this concept, the Navy would contract 
with a single agency to integrate ordnance alteration kit 
production and installation with overhauls, maintenance, 
spares, warehousing, and shipping activities. The committee 
encourages the Department to conduct a fleet demonstration of 
this concept to assess its utility to the CIWS and other 
systems.

Standard missile

    The budget request contained $225.7 million for 70 Block 
III and 45 Block IV Standard missiles.
    The committee notes a 41 percent increase in support costs, 
despite the fact that the total number of missiles would only 
increase by 15 percent from fiscal year 1998 levels. 
Accordingly, the committee recommends $205.7 million, a 
decrease of $20.0 million, and believes that the Department can 
procure the requested number of missiles within this amount.

               Ammunition Procurement, Navy/Marine Corps

                                Overview

    The budget request contained $429.5 million for Ammunition 
Procurement, Navy/Marine Corps in fiscal year 1999. The 
committee recommends authorization of $452.0 million for fiscal 
year 1999.
    The committee recommends approval of the request except for 
those programs adjusted in the following table. Unless 
otherwise specified, adjustments are without prejudice and 
based on affordability considerations.
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                        Item of Special Interest

Marine corps ammunition

    The budget request contained $146.7 million for procurement 
of ammunition.
    The committee recommends $171.7 million, an increase of 
$25.0 million for the following types of ammunition:

                        [In millions of dollars]

9mm all types-....................................................  $0.8
CTG 5.56mm all types-.............................................   0.6
CTG 7.62mm all types-.............................................   0.7
CTG 25mm all types-...............................................   0.9
120mm TPCSDS-T M865-..............................................   0.5
120mm TP-T M831-..................................................   0.7
Rocket, 83mm Dual Mode PIP-.......................................  17.0
Fuze, Hand Grenade, practice-.....................................   2.5
Grenade, Hand Smoke Green-........................................   0.5
Grenade, Hand Practice Smoke TA M83-..............................   0.2
Igniter, Time Fuze Blasting-......................................   0.6

                   Shipbuilding and Conversion, Navy

                                Overview

    The budget request contained $6,252.7 million for 
Shipbuilding and Conversion,
    Navy in fiscal year 1999. The committee recommends 
authorization of $5,992.4 million for fiscal year 1999.
    The committee recommends approval of the request except for 
those programs adjusted in the following table. Unless 
otherwise specified, adjustments are without prejudice and 
based on affordability considerations.
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                       Items of Special Interest

Landing craft air cushion (LCAC) service life extension program (SLEP)

    The budget request contained no funds for LCAC SLEP.
    The LCAC is the only surface platform that can provide 
high-speed, heavy lift for Marine Corps amphibious operations 
from over-the-horizon. Despite the Department's failure to 
provide funding for an LCAC SLEP in fiscal years 1997 and 1998, 
Congress added $2.9 million in fiscal year 1997 and $19.5 
million in fiscal year 1998 to begin to correct serious 
corrosion problems on the LCACs that, if not addressed, would 
force them out of service long before they reach their planned 
twenty-year operational life. The Department plans to begin the 
LCAC SLEP in fiscal year 2000.
    The Commandant of the Marine Corps' unfunded requirements 
list for fiscal year 1999 identified acceleration of the LCAC 
SLEP as his number one shipbuilding and conversion priority. 
Therefore, the committee recommends an increase of $16.0 
million for the service life extension of two LCACs.

LPD-17

    The budget request contained $638.8 million for LPD-18, the 
second ship of 12 in the LPD-17 class of new amphibious ships.
    The committee has recently learned that the AN/SPY-1 radar 
and its associated combat system has been proposed to the Navy 
as an alternative to the currently planned combat system of the 
LPD-17 class of amphibious ships. The committee directs the 
Secretary of the Navy to provide to the congressional defense 
committees an analysis of alternatives that compares the AN/
SPY-1 radar and its associated combat system with the 
currently-planned combat system or any other combat systems 
under consideration for the LPD-17 class by March 30, 1999. 
This analysis should consider current and future requirements 
for combat systems capability, as well as schedule and life-
cycle cost impacts of the various alternatives.

National defense features

    The committee continues its strong support for the National 
Defense Features (NDF) program and believes that a robust NDF 
program will provide superior ships to support mobilization 
requirements, preserve domestic shipbuilding and supplier base 
jobs, and assist U.S. shipyards in gaining commercial market 
share. The incorporation of defense features into newly built 
commercial vehicle carriers would be a cost effective method to 
both expand surge sealift capability and recapitalize the Ready 
Reserve Fleet.
    The committee believes that entry into the commercial 
vehicle carrier market is a key element for the success of the 
NDF program. The committee reaffirms that the NDF program and, 
specifically, the entry of new U.S. built commercial vehicle 
carriers equipped with NDF into the U.S.-Japan shipping market 
are in the national interest. The committee expects the Navy to 
follow the committee's guidance and to more aggressivelyexecute 
the NDF program. Furthermore, the committee urges the Secretary of 
Defense to enlist the cooperation of the Government of Japan to 
overcome restrictions which inhibit U.S. flag carrier participation in 
the Japan trade market. Such cooperation will advance the mutual 
security interests of both nations.

New attack submarine (NSSN)

    The budget request contained $1,498.2 million for the 
second NSSN and $504.7 million for advance procurement of the 
third NSSN in fiscal year 2001.
    The committee has learned that the budget request 
underfunds the integration of the non-propulsion electronic 
systems (NPES). The NPES is composed of 24 subsystems, 
including sonar, combat control, and electronic support 
measures. The committee understands that underfunding NPES 
integration would add future cost risk to this program and, 
therefore, recommends an increase of $10.0 million to address 
the integration shortfall.

Strategic sealift

    The budget request contained $251.4 million for procurement 
of the final Large Medium Speed Roll-on/Roll-off (LMSR) vessel.
    Prior to the fiscal year 1999 budget request, procurement 
of strategic sealift vessels was budgeted, authorized and 
appropriated in the National Defense Sealift Fund (NDSF). The 
NDSF is a revolving fund that was specifically established by 
the Congress to give autonomy and visibility to the critical 
mission area of strategic sealift, in recognition of the low 
priority sealift had been previously accorded by the Navy. 
Consolidating the acquisition of sealift assets and their 
operations into a single account was intended to protect it 
from competing with other Navy priorities in the budget 
formulation and program execution processes. Accordingly, the 
committee recommends a reduction of $251.4 million to the 
Shipbuilding and Conversion, Navy request and an increase of 
$251.4 million to the NDSF request in order to reflect the 
procurement of the final LMSR in the NDSF.

                        Other Procurement, Navy

                                Overview

    The budget request contained $3,937.7 million for Other 
Procurement, Navy in fiscal year 1999. The committee recommends 
authorization of $3,969.5 million for fiscal year 1999.
    The committee recommends approval of the request except for 
those programs adjusted in the following table. Unless 
otherwise specified, adjustments are without prejudice and 
based on affordability considerations.
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                       Items of Special Interest

AN/BPS-15(H) submarine navigation radar upgrade

    The budget request contained no funds for upgrading the AN/
BPS-15(H) submarine navigation radar to make it compliant with 
the Navy's new electronic chart display information systems 
(ECDIS-N) requirement.
    ECDIS-N compliance mandates the elimination of paper 
navigation charts on submarines by upgrading their radar 
navigation systems with computer-based charts designed to 
international commercial-off-the-shelf standards. The committee 
supports the ECDIS-N requirement and recommends an increase of 
$9.0 million to provide for software and hardware upgrades to 
the AN/BPS-15(H) in order to meet it. The committee believes 
that this increase will further enhance the safety and improve 
the operational capability of the Navy's submarine fleet.

AN/SQQ-89 surface anti-submarine warfare (ASW) combat system

    The budget request contained $27.4 million for the AN/SQQ-
89 ASW combat system, including $8.7 million for upgrade of 
existing systems on DDG-51 destroyers.
    The AN/SQQ-89 detects, classifies, and localizes threat 
attack submarines, and the planned upgrade is intended to 
improve its shallow water capabilities. However, subsequent to 
the submission of the Department's budget request, the 
committee was informed that the upgrade cannot be integrated 
into the existing systems. The committee has also learned that 
a fleet evaluation demonstrated that portions of the upgrade 
may not be effective or suitable to field. Moreover, limited 
developmental testing of a related classification system showed 
that it, too, may not meet performance requirements. As a 
result of these deficiencies, the committee understands that 
the Navy is reviewing and revising its AN/SQQ-89 upgrade 
program to develop and procure a fully integrated system in 
fiscal year 2003. Accordingly, the committee recommends a 
decrease of $8.7 million for this upgrade.

AN/USC-42 mini-demand assigned multiple access (DAMA) ultra-high 
        frequency (UHF) satellite communications (SATCOM) terminals

    The budget request contained $145.2 million for SATCOM ship 
terminals, but included no funds for AN/USC-42 mini-DAMA UHF 
SATCOM terminals.
    The AN/USC-42 Mini-DAMA is a commercial-off-the-shelf 
miniaturized submarine transceiver version of the DAMA 
terminal. DAMA terminals quadruple the UHF satellite channel 
capacity through multiplexing, thus providing adequate 
satellite access to meet user requirements without requiring an 
increase in the number of satellites on orbit. The committee 
has learned that at less than one-tenth the size or weight of 
previous UHF systems, the AN/USC-42 mini-DAMA UHF SATCOM 
terminal digitizes, encrypts, transmits and receives data and 
voice transmissions at more than ten times the efficiency of 
terminals without DAMA capability. The committee understands 
fiscal year1999 is the final production year for the AN/USC-42 
terminal and that the Department has an operational requirement for 115 
AN/USC-42 terminals but has only budgeted for 72, leaving a shortfall 
of 43 terminals. Consequently, the committee recommends an increase of 
$10.0 million to procure additional mini-DAMA UHF SATCOM terminals and 
associated spare parts.

Beamhit laser marksmanship training system (LMTS)

    The budget request contained $2.2 million for training 
support equipment, but included no funds for the Beamhit LMTS.
    The committee is aware of the improved marksmanship 
qualification scores achieved by Army, Army National Guard, 
Army Reserve and Navy personnel with the Beamhit LMTS. By using 
this system, the committee understands that military personnel 
may train with their own weapons and do so under home station 
conditions thereby conserving ammunition and other resources. 
The committee has also learned that the Army Dismounted 
Battlespace Lab at Fort Benning, Georgia, determined that the 
Beamhit LMTS was so precise that it could be used to correct 
the aim of both weapons and aiming devices. Therefore, the 
committee recommends an increase of $5.0 million for this 
system and encourages the Secretary of Defense to examine its 
utility for use throughout the Department.

Cooperative engagement capability (CEC)

    The budget request contained $47.3 million for four CEC 
systems.
    CEC allows theater air and missile defense weapons to 
operate as a single system by distributing sensor data from any 
ship or aircraft in the battle group to other platforms through 
a real-time, line-of-sight, high-data-rate network. For fiscal 
year 1998, the Chief of Naval Operations identified nine CEC 
systems as one of his top three unfunded procurement 
priorities, and the Congress provided $75.0 million to procure 
the seven needed for a carrier battle group. The committee 
understands that the Navy still requires five additional CEC 
systems for training and operational requirements. 
Consequently, the committee recommends an increase of $35.0 
million to meet this requirement.

Weapons range support

    The budget request contained $8.1 million for weapons range 
support, but included no funds to procure a deployable 
rangeless air combat training system (DRACTS) or to procure 
mobile remote emitter simulator (MRES) systems for the Pacific 
Missile Range Facility (PMRF).
    The DRACTS is an air combat training system used by a 
deployed aircraft carrier battle group as a primary means of 
fleet readiness training. The committee has been advised that 
DRACTS capability can be achieved by leveraging the Navy's 
existing Large Area Tracking Range (LATR) capability through 
the addition of an off-the-shelf processor and by the 
reconfiguration of existing software. In its present 
configuration, the LATR tracks aircraft and vessels during 
large-scale battle group, mine warfare, and air combat training 
exercises. The committee notes that a future such system, the 
Joint Tactical Combat Training System (JTCTS), is under 
development and, elsewhere in this report, recommends an 
increase to accelerate this process. However, to improve the 
near-term readiness of deployed carrier battle groups, the 
committee recommends an increase of $5.0 million to procure 
additional DRACTS components.
    The MRES, which is employed with the LATR system, is a 
high-power electronic warfare simulator system capable of 
illuminating aircraft, ships and various other signal 
collection platforms. The system will also be capable of 
receiving active electronic countermeasures (ECM) transmissions 
for spectrum viewing and evaluation of ECM techniques. Existing 
threat simulators at the PMRF are low-fidelity emitters 
designed to track only ships and submarines and do not have the 
capability to track fast-moving fighter and attack aircraft. 
Accordingly, the committee recommends an increase of $10.0 
million to procure two MRES systems for the PMRF to improve 
electronic warfare training for the Pacific fleet.

WSN-7 ring laser gyro (RLG) and WQN-2 doppler sonar velocity log (DSVL)

    The budget request contained $45.3 million for other 
navigation equipment, including $22.0 million for the 
procurement of 26 WSN-7 RLGs, but included no funds for the 
WQN-2 DVSL. The WSN-7 RLG is the common RLG for both surface 
and subsurface platforms. The WQN-2 has been designated by the 
Navy as the fleet standard speed log to replace the existing 
logs which were designed in the 1950s.
    The committee understands that RLGs are less expensive, 
more reliable, more accurate, and have lower cost of ownership 
than the existing WSN-1, -3, and -5 navigators that they 
replace. The committee also understands that savings in 
maintenance costs alone will pay for replacement RLGs in three 
to four years. For these reasons, fleet commanders have 
emphasized the need to accelerate WSN-7 RLG installation. 
Consequently, the committee recommended an increase of $18.0 
million to accelerate the procurement of RLGs for fiscal year 
1998. Consistent with its previous action, the committee 
recommends an increase of $12.0 million to continue to 
accelerate the procurement and installation of the WSN-7 RLG.
    The committee notes that the Navy has not budgeted funding 
to modify the input/output boards of the WSN-7 RLG to make it 
compatible with the antiquated speed logs throughout the fleet. 
Since the WQN-2 is already compatible with these I/O boards, 
the committee recommends an increase of $6.0 million to 
initiate replacement of the existing speed logs and eliminate 
the need for unnecessary, expensive modification of existing 
speed logs. However, the committee understands that there are 
at least two versions of the WQN-2 that could be competed for 
production. Accordingly, the committee also recommends an 
increase of $2.5 million to test and evaluate a second version 
for a possible future production competition.

                       Procurement, Marine Corps

                                Overview

    The budget request contained $745.9 million for 
Procurement, Marine Corps in fiscal year 1999. The committee 
recommends authorization of $691.9 million for fiscal year 
1999.
    The committee recommends approval of the request except for 
those programs adjusted in the following table. Unless 
otherwise specified, adjustments are without prejudice and 
based on affordability considerations.
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                       Items of Special Interest

Marine corps electronic warfare support system

    The budget request contained $16.4 million for acquiring 
two Marine Corps Electronic Warfare Support Systems (MEWSS).
    Because of developmental problems and delays in the testing 
and fielding of the MEWSS, the committee directs that none of 
the funds authorized may be obligated until completion of a 
successful initial operational test and evaluation (IOT&E).
    Although the development of the MEWSS is common with that 
of the Army's Ground-Based Common Sensor (GBCS) system and that 
the IOT&E of the MEWSS is directly dependent to the testing of 
the GBCS, the committee does not see a specific need to make a 
successful IOT&E of MEWSS contingent on a successful IOT&E of 
GBCS.

Marine corps tactical intelligence equipment

    The budget requested contained no funds for purchasing and 
evaluating commercial imagery display tools or modern printer 
technologies.
    The committee is aware of the Marine Corps' highly 
successful evaluation of the Remote Replication System (RRS). 
The RRS allows the Marine Expeditionary Force (MEF) to deploy 
with automated equipment that provides the capability to 
``reach back'' to National Imagery and Mapping Agency data 
bases and ``pull forward'' data in order to construct mapping 
and imagery products. The committee believes this concept has 
the potential to reduce drastically the paper products with 
which the MEF currently deploys. However, despite the success 
of the RRS concept, the committee understands that there has 
been little attention paid to providing modern display and 
printing technologies. Therefore the committee recommends $1.0 
million for purchasing and evaluating commercial imagery 
manipulation tools, state-of-the-art display devices and high 
quality large format printers for field use.

Medium tactical vehicle replacement (MTVR)

    The budget request contained $83.7 million for procurement 
of replacement vehicles for five-ton trucks, of which $19.8 
million was for training devices in support of the replacement 
vehicles. The committee notes that the Secretary of the Navy 
has requested authorization to enter into a multiyear 
procurement contract for the MTVR program.
    The MTVR is the upgraded vehicle replacement for the 
current M809/M939 five-ton truck. Major improvements include an 
expanded 7\1/2\-ton off-road and up to 12-ton on-road cargo 
capacity, a new electronically controlled engine and 
transmission, independent suspension, central tire inflation 
system, antilock brakes, traction control, corrosion control, 
and safety and ergonomic features. While the committee supports 
the use of training and simulation devices to reduce costs of 
vehicle operations andmaintenance, it questions the procurement 
of such a large number of these devices prior to a contract being 
awarded for low rate initial production of the vehicle they support. 
Therefore, the committee recommends $73.9 million, a decrease of $9.8 
million for training devices. The committee also approves the 
Secretary's request to enter into a multiyear procurement contract for 
the MTVR program.

Unit cost growth

    The budget request contained $745.9 million for 
Procurement, Marine Corps in fiscal year 1999.
    The committee is encouraged that the budget request is 50 
percent higher than the fiscal year 1998 budget request. 
However, the committee notes that a number of programs have 
experienced unjustified unit cost growth even though for 
several programs twice as many units are planned to be procured 
in fiscal year 1999 than were procured in fiscal year 1998. The 
committee is concerned by these increases, and, therefore, 
recommends a decrease for the programs reflected in the table 
below.

                        [In millions of dollars]

Automatic Test Equipment System:
    Third Echelon Test Set-.......................................  $7.0
Communications Switching and Control Systems:
    Tactical Data Network (TDN) Gateway/Shelter-..................   6.0
    TDN Server....................................................  17.0
Environmental Control Equipment Assorted:
    Enhanced Refrigeration Unit-..................................   0.5
    Recycling Unit-...............................................   0.3
Power Equipment Assorted:
    Generator, 30 Kw/60 Hz-.......................................   0.9
    Generator, 30 Kw/60 Hz-.......................................   0.5
Garrison Mobile Engineer Equipment-...............................   0.4

                    Aircraft Procurement, Air Force

                                Overview

     The budget request contained $7,756.5 million for Aircraft 
Procurement, Air Force in fiscal year 1999. The committee 
recommends authorization of $8,219.1 million for fiscal year 
1999.
    The committee recommends approval of the request except for 
those programs adjusted in the following table. Unless 
otherwise specified, adjustments are without prejudice and 
based on affordability considerations.
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                       Items of Special Interest

Bomber modernization

    The budget request contained $189.9 million in post 
production support for the B-2 bomber and $15.7 million, $91.6 
million and $38.3 million for aircraft modifications for the B-
2, B-1, and B-52 bombers, respectively.
    The Long Range Airpower Review panel was mandated by 
section 8131 of the Department of Defense Appropriations Act, 
1998 (Public Law 105-56) to ``evaluate the adequacy of current 
planning for United States long range airpower and the 
requirement for continued low rate production of B-2 stealth 
bombers.'' The panel concluded that in order to reach the full 
potential of the current bomber fleet, consisting of B-52s, B-
1s, and B-2s, additional investments in upgrades should be 
fully supported. The committee endorses this conclusion and 
believes that upgrades to each of these aircraft, but 
especially the very small fleet of B-2 bombers, must be a 
priority. The committee received testimony from the panel that 
upgrades to the B-2 identified by the Air Force will solve a 
number of the problems concerning low observable 
maintainability, further enhance the B-2's stealthiness, as 
well as significantly improve situational awareness for B-2 
crews. The panel strongly recommended that these upgrades be 
funded, and the committee understands that funding added to the 
B-2 program by Congress in fiscal year 1998 will meet the costs 
of many, but not all, of these improvements. Consequently, the 
committee recommends $275.9 million for B-2 post production 
support, an increase of $86.0 million to continue to enhance 
the B-2's operational effectiveness.
    The panel also stated that a long-term bomber force 
structure plan, which includes consideration of additional 
bomber aircraft procurement, needs to be developed to ensure 
sustainment of the bomber force. The committee agrees with this 
assessment and, therefore, directs the Secretary of the Air 
Force to prepare such a plan and submit it to the congressional 
defense committees by March 1, 1999. The plan should identify 
upgrades required for the current bomber fleet, a funding 
profile for these upgrades, and a timeline for consideration of 
the acquisition of a follow-on bomber.

C-130J

    The budget request contained $63.8 million for one C-130J 
aircraft. No funds were requested for any C-130J variant--the 
EC-130J, the WC-130J, and the KC-130J.
    The committee recommends an increase of $397.6 million for 
seven additional aircraft. Two of these are to be configured as 
KC-130J tankers for the Marine Corps, one is to be configured 
as a special operations variant for the Air National Guard, and 
one is to be configured as a weather reconnaissance variant for 
the Air Force Reserve.

CV-22

    The budget request contained $22.3 million for advance 
procurement of a CV-22 weapons system trainer.
    The CV-22 is a Special Operations Forces variant of the V-
22 tiltrotor aircraft. The Air Force plans to procure and field 
50 CV-22 aircraft and associate support equipment for the 
United States Special Operations Command (USSOCOM). The Air 
Force also plans to fund 85 percent of the procurement costs 
for CV-22 training systems with USSOCOM funding the remaining 
15 percent.
    According to the budget justification material for the CV-
22 weapons system trainer, it requires a three-year lead time 
for delivery, requiring procurement funding to begin in fiscal 
year 1999 in order to support a ready-for-training date of 
September 2002. The committee is unaware of any previous 
weapons system trainer of such complexity as to necessitate 
advance procurement funds two years prior to the request for 
full funding of the weapons system it supports. Consequently, 
the committee believes these funds can be deferred until fiscal 
year 2000 and recommends no authorization for this purpose. 
Likewise, the committee recommends no funds for CV-22 
modifications in the Defense-wide Procurement account, a 
decrease of $4.0 million.

E-8C joint surveillance and target attack radar system (STARS)

    The budget request contained $463.1 million to procure two 
E-8C Joint STARS aircraft, but included no advance procurement 
funding to continue production of this aircraft.
    The Quadrennial Defense Review (QDR) recommended reducing 
the procurement objective of the Joint STARS from 19 to 13 
aircraft, based on the assumption that the North Atlantic 
Treaty Organization (NATO) would select Joint STARS as its 
Alliance Ground Surveillance (AGS) aircraft and purchase 6 of 
them. Despite NATO's having rejected the Joint STARS as its AGS 
choice before the budget request was finalized, the Department 
failed to change the QDR recommendation. The committee is 
disturbed that the Department chose not to continue Joint STARS 
production, despite the Air Combat Command's requirement for 19 
of these ``low-density, high-demand'' aircraft. Accordingly, 
the committee recommends $72.0 million for advance procurement 
of two additional E-8Cs in fiscal year 2000.

F-15 modifications

    The budget request contained $196.6 million for F-15 
modifications, including $17.8 million for upgrading 12 F100 
engines to the 220E configuration. The request contained no 
funds for procurement of the ALQ-135 internal countermeasures 
set Band 1.5 upgrade.
    The committee understands that the so-called ``E-Kit'' 
upgrade will provide increased safety, reliability, and 
performance at a fraction of the cost of a new production 220 
engine. Since the F-15C will remain the Air Force's primary air 
superiority fighter until the F-22 enters the inventory in the 
mid-2000s, the committee believes that the ``E-Kit'' 
modification is critical to ensuring that this aircraft 
continues to perform safely and at peak efficiency. 
Accordingly, the committee recommends an increase of $20.0 
million to accelerate this upgrade.
    The committee also understands that the ALQ-135 Band 1.5 
program, which is currently in the Engineering and 
Manufacturing Development phase, is scheduled to complete 
initial operational test and evaluation in May 1999. The 
committee notes the Band 1.5 shares a high degree of 
commonality with the currently fielded Band 3, which completes 
production in late 1998. Because the Air Force did not request 
procurement funds to begin production of Band 1.5, the 
committee is concerned about the impact of a production break 
and with the delay in getting this important upgrade fielded. 
Accordingly, the committee recommends $25.0 million to upgrade 
approximately one squadron of F-15Es with the modified ALQ-135 
Band 1.5 in order to ensure this aircraft will have full 
frequency protection.
    In total, the committee recommends $231.4 million for F-15 
modifications, an increase of $34.8 million. In addition to the 
increases described above, the committee recommends a decrease 
of $10.2 million for various modifications which either show 
excessive cost growth or were poorly justified.

F-16

    The budget request contained no funds for procurement of 
the F-16C multirole aircraft.
    The committee notes that the Congress has funded 15 
additional F-16Cs in the last three fiscal years--six each in 
fiscal years 1996 and 1997 and three in fiscal year 1998--to 
reduce the attrition reserve shortfall of 40 aircraft the Air 
Force has projected through 2010. The committee believes that 
it is prudent to continue to reduce this shortfall, especially 
in the most capable Block 40 and Block 50 versions, and, 
therefore, recommends $60.0 million to acquire two additional 
F-16C aircraft for this purpose.

F-16 modifications

    The budget request contained $229.3 million for F-16 
modifications but included no funding for the Digital Terrain 
System (DTS) upgrade.
    The DTS, which provides both a precise navigation and a 
ground collision avoidance capability, is designed to reduce 
controlled flight into terrain mishaps. The committee strongly 
supports the DTS upgrade as indicated by its addition of $20.0 
million (of which $12.0 million was appropriated) to the fiscal 
year 1998 budget request for this purpose. Although the Air 
Force states that DTS is a firm requirement for the F-16 and it 
is in the process of modifying the F-16's operational flight 
program to accommodate DTS integration, it has not budgeted 
funds to continue this upgrade until fiscal year 2001. The 
committee finds this situation unacceptable and recommends 
$12.0 million to continue to accelerate the incorporation of 
DTS technology into the F-16 fleet. The committee also 
recommends a decrease of $6.9 million for various poorly 
justified modifications.

Global hawk

    The budget request contained $90.1 million in research and 
development funds to complete fabrication and integration of 
the final three demonstration aerial vehicles, which will be 
used for military utility and user demonstration testing. 
However, the budget request contained no procurement funds to 
begin production of the vehicle. Global Hawk is a conventional, 
high altitude, endurance unmanned aerial vehicle (UAV), which 
will provide all-weather, day/night, reconnaissance and 
surveillance in direct support of Joint Forces Commanders.
    The committee understands that the Air Force will assume 
management of the Global Hawk from the Defense Airborne 
Reconnaissance Office on October 1, 1998 and that planning is 
underway to transition this UAV from an Advanced Concept 
Technology Demonstration platform to a production program. 
However, the committee notes that even if production funds are 
requested in fiscal year 2000, there will be a gap of two years 
between delivery of the last demonstration vehicle and the 
first production vehicle. In order to efficiently transition 
this program to production, the committee recommends an 
increase of $32.5 million for advance procurement of three 
Global Hawk UAVs.

Joint primary aircraft training system (JPATS)

    The budget request contained $107.1 million for JPATS, 
including $36.2 million for the Ground Based Training System 
(GBTS).
    The committee notes that more research and development 
funding for the GBTS is included in the budget request--$34.2 
million--than was appropriated in fiscal years 1997 and 1998 
combined. The committee further notes that this amount is only 
slightly less than the procurement request--indicating the GBTS 
program is highly concurrent. Although the committee strongly 
supports the JPATS program, it believes that GBTS procurement 
funding is premature in view of the pre-production research and 
development activities remaining. Therefore, the committee 
recommends a decrease of $36.2 million and defers initial GBTS 
procurement. However, the committee also recommends an increase 
of $9.1 million for three additional T6-A aircraft in order to 
allow the Air Force to obtain the upper limit in its JPATS 
variations-in-quantity contract. In total, the committee 
recommends a decrease of $27.1 million for JPATS.

Miscellaneous production charges

    The budget request contained $221.5 million for 
miscellaneous production charges, including $10.1 million for 
High Speed Anti-Radiation Missile targeting pod modifications.
    The committee notes that $6.1 million was requested for the 
same purpose in the ``Other aircraft modifications'' funding 
line. Therefore, the committee recommends a decrease of $10.1 
million.

Navigational safety upgrades

    The budget request contained $49.5 million for Traffic 
Alert and Collision Avoidance System (TCAS) equipment and $51.1 
million for Enhanced Ground ProximityWarning System (EGPWS) 
equipment. The committee is aware there is also funding for both TCAS 
and EGPWS in other larger modification projects where itemized cost 
breakouts are not exact.
    TCAS provides a flight crew predictive collision avoidance 
information regarding its aircraft's position relative to 
another aircraft. It operates without air traffic control from 
ground-based systems. EGPWS provides an aircrew with knowledge 
of impending collision with the ground.
    The committee is very supportive of providing these 
navigational safety upgrades to the Air Force's fleet of 
passenger- and cargo-carrying aircraft as expeditiously as 
possible. The committee understands that the majority of these 
upgrades for passenger-carrying aircraft have been funded in 
prior years and believes that appropriate attention should now 
be given to cargo-carrying aircraft. Accordingly, the committee 
recommends an increase of $25.0 million for TCAS equipment and 
$25.0 million for EGPWS equipment.

Pacer coin

    The budget request contained $2.4 million in aircraft 
spares and repair parts for the transfer of mission equipment 
from retiring Pacer Coin aircraft to the non-dedicated, follow-
on C-130 reconnaissance aircraft. The committee notes that a 
fiscal year 1998 reprogramming action stated that all funds for 
the C-130 follow-on program were included in that request. 
Furthermore, the committee does not agree that $2.4 million of 
procurement funding is required to transfer equipment from one 
aircraft to another. Therefore, the committee recommends no 
funding for this purpose.

                   Ammunition Procurement, Air Force

                                Overview

     The budget request contained $384.2 million for Ammunition 
Procurement, Air Force in fiscal year 1999. The committee 
recommends authorization of $383.6 million for fiscal year 
1999.
    The committee recommends approval of the request except for 
those programs adjusted in the following table. Unless 
otherwise specified, adjustments are without prejudice and 
based on affordability considerations.
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                     Missile Procurement, Air Force

                                Overview

    The budget request contained $2,359.8 million for Missile 
Procurement, Air Force in fiscal year 1999. The committee 
recommends authorization of $2,234.7 million for fiscal year 
1999.
    The committee recommends approval of the request except for 
those programs adjusted in the following table. Unless 
otherwise specified, adjustments are without prejudice and 
based on affordability considerations.
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                       Items of Special Interest

AGM-165 Maverick Modifications

    The budget request contained no funds for Maverick 
modifications.
    The committee recommended $11.0 million in fiscal year 1998 
to initiate a much-needed, low-cost, service life extension 
program to the Maverick missile. Unfortunately, only $8.0 
million was appropriated for this purpose. Consequently, the 
committee recommends an increase of $3.0 million to provide the 
necessary funds to ensure a smooth transition from development 
to production. The committee expects the Air Force to include 
continued funding for this upgrade in the future years defense 
program.

Global positioning system

    The budget request contained $77.4 million for advance 
procurement of Global Positioning System (GPS) satellites.
    The committee understands that $28.4 million of the advance 
procurement funds would be used to acquire the first three 
Block IIF satellites and the remaining $49.0 million would 
support a multiyear procurement of an additional 12 satellites. 
While the committee continues to support the GPS program, it 
believes that a commitment to a multiyear procurement for these 
satellites is premature. GPS satellites continue to remain on 
orbit much longer than their expected design lives. Although 
the uncertainty inherent in satellite life span requires that a 
certain number be constructed for contingencies, the committee 
believes that the planned multiyear procurement would result in 
an inventory well in excess of future requirements. Moreover, 
the Department's fiscal year 1999 legislative proposal included 
several requests for multiyear procurement approval, but it did 
not include such a request for GPS. Therefore, the committee 
recommends deferral of a GPS multiyear procurement and a 
decrease of $49.0 million.

Inertial upper stage

    The budget request contained $48.0 million for the inertial 
upper stage (IUS) program.
    The committee notes that the Department has withheld 
approximately $2.0 million that was authorized and appropriated 
for the IUS in fiscal year 1998 and understands these funds are 
excess to program needs. Accordingly, the committee recommends 
$46.0 million for the IUS and directs the Department to apply 
the funds being withheld to fiscal year 1999 requirements.

Medium launch vehicle

    The budget request contained $188.4 million for the medium 
launch vehicle program. The committee recommends $177.4 
million, a reduction of $11.0 million,based on changes in the 
launch schedule of Global Positioning System satellites that will 
reduce medium launch vehicle operations costs.

Minuteman gyro stabilized platform

    The budget request contained no funding for advanced 
inertial measurement units (IMU) or gyro stabilized platforms 
(GSP).
    The committee notes that, although the Air Force has two 
validated mission need statements for improved missile guidance 
systems, Air Force Space Command has not completed a GSP 
operational requirements document (ORD). The committee 
understands that maintenance problems with the current IMU on 
the Minuteman III intercontinental ballistic missile (ICBM) are 
increasing and believes that its replacement with an advanced 
IMU would result in increased alert force reliability and 
flexibility, as well as lower life cycle costs and improved 
accuracy.
    The committee therefore urges Air Force Space Command to 
complete the GSP ORD in time to support the fiscal year 2000 
budget request and directs the Secretary of the Air Force to 
provide the congressional defense committees a report on IMU 
options for the Minuteman III by January 15, 1999. The report 
should include an analysis of options currently under 
consideration, estimated cost of these options, and potential 
benefits of any option involving a new GSP.

Minuteman III modifications

    The budget request contained $90.6 million for Minuteman 
III intercontinental ballistic missile (ICBM) modifications, of 
which $83.7 million was for the guidance replacement program 
(GRP).
    The committee notes that the Department reduced the fiscal 
year 1999 GRP request from the level anticipated when the 
fiscal year 1998 budget was submitted to Congress. The 
committee understands that this reduction would delay the 
program by up to two years and require continued use of 
increasingly unreliable guidance packages. The committee also 
believes that this delay could potentially undermine the ICBM 
industrial base. As a consequence, the committee is concerned 
that the proposed GRP funding level would increase risk to the 
sustainability of the ICBM force and increase overall program 
costs. Therefore, in order to mitigate such problems, the 
committee recommends $113.6 million, an increase of $23.0 
million, for GRP procurement.

Titan space boosters

    The budget request contained $578.5 million for Titan space 
boosters. The committee understands that excess program funds 
have been identified in fiscal year 1998 and believes that the 
fiscal year 1999 request also contains excess funds. Therefore, 
the committee recommends $550.5 million, a reduction of $28.0 
million. Of this reduction, $12.0 million is from excess funds 
in fiscal year 1998, which the committee directs be applied to 
fiscal year 1999 program requirements.

                      Other Procurement, Air Force

                                Overview

    The budget request contained $6,974.4 million for Other 
Procurement, Air Force in fiscal year 1998. The committee 
recommends authorization of $7,046.4 million for fiscal year 
1998.
    The committee recommends approval of the request except for 
those programs adjusted in the following table. Unless 
otherwise specified, adjustments are without prejudice and 
based on affordability considerations.
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                       Items of Special Interest

Base information infrastructure

    The budget request contained $159.4 million for base 
information infrastructure, of which $72.7 million is for the 
voice switching system (VSS) product area.
    The committee notes that the request for the VSS product 
area exceeds the amount appropriated in fiscal year 1998 by 
almost $67.0 million. This increase is attributed to the ``Year 
2000'' problem, yet no justification has been provided to the 
committee that explains how these funds will be used. Although 
the committee is acutely aware of the ``Year 2000'' problem, it 
believes that an increase of this magnitude is unwarranted 
absent a detailed explanation for its intended use. 
Accordingly, the committee recommends a decrease of $30.0 
million.

Rangeless air combat training system (RACTS)

    The budget request contained $13.2 million for combat 
training ranges, but included no funds for the RACTS.
    The RACTS, which can be used at either home station or in a 
deployed location, provides realistic air combat training over 
land or sea without dependence upon ground-installed 
instrumentation. The committee notes that a RACTS was delivered 
to Kadena Air Base, Japan, in August 1997, and the committee 
understands that since its delivery, Air Force and Navy pilots 
have successfully used this system on more than 3,000 sorties. 
The committee also notes that a similar system is scheduled for 
installation at Alpena Air National Guard Base, Michigan, 
during fiscal year 1998. Since the committee has been informed 
that the United States Air Forces Europe (USAFE) has a 
requirement for a RACTS but has not budgeted funds to meet this 
requirement, it recommends an increase of $5.0 million for this 
purpose.

Tactical communications-electronics (CE) equipment

    The budget request contained $31.1 million for tactical CE 
equipment, of which $27.3 million is for theater deployable 
communications (TDC) sets. TDC is a compact, high bandwidth, 
commercially available communications system used by forward-
deployed forces. It is much more capable than the aging 
equipment it replaces and requires significantly reduced 
airlift support.
    In April 1997, the Air Force created a command and control 
(C2) task force and directed it to establish an air and space 
C2 policy for the 21st century. One key finding of that task 
force was the determination that the Air Force should 
accelerate procurement of TDC sets and complete the buyout of 
this equipment by fiscal year 2001. The committee endorsed this 
finding and added $25.0 million ($18.0 million of which was 
appropriated) for this purpose to the fiscal year 1998 budget 
request. To continue acceleration of TDC equipment and 
consistent with its fiscal year 1998 action, the committee 
recommends anincrease of $20.0 million for TDC equipment.

                       Procurement, Defense-Wide

                                Overview

    The budget request contained $2,041.7 million for 
Procurement, Defense-Wide in fiscal year 1998. The committee 
recommends authorization of $1,962.9 million for fiscal year 
1998.
    The committee recommends approval of the request except for 
those programs adjusted in the following table. Unless 
otherwise specified, adjustments are without prejudice and 
based on affordability considerations.
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                       Items of Special Interest

Automated document conversion system (ADCS)

    The budget request contained no funds for ADCS.
    The committee understands that the ADCS program is 
performing a critical role in the attainment of the 
Department's goal to digitize all engineering drawings and 
technical data by fiscal year 2002. The committee continues to 
strongly support this program and recommends $32.0 million for 
the purchase of ADCS hardware and software.

Chemical-biological defense equipment for rapid assessment and initial 
        detection teams

    The budget request contained a total of $620.3 million for 
the chemical-biological defense program, including $283.9 
million for procurement of chemical and biological defense 
equipment for the military services and $336.4 million for 
research, development, test and evaluation.
    The committee is aware that the budget request includes 
$6.9 million for initial procurement of contamination avoidance 
equipment for the National Guard Rapid Assessment and Initial 
Detection (RAID) teams that the DOD has proposed be established 
to provide immediate response and assistance to state and local 
authorities in response to a domestic emergency involving the 
use of weapons of mass destruction, or other chemical or 
biological accident or incident. As discussed elsewhere in this 
report, the committee is concerned that the Department's 
efforts and initiatives have not been closely coordinated with 
other agencies within the government who share responsibility 
for responding to such incidents, and by the apparent lack of 
an effectively coordinated effort on the part of these 
agencies. Accordingly, the committee has deferred action on the 
Department's recommendations for legislation which would 
provide authority to establish the RAID teams in the National 
Guard and on related matters, pending a report from the 
Secretary of Defense on the Department's overall plan for 
addressing these issues. Furthermore, the committee recommends 
no authorization for procurement of equipment for the RAID 
teams and recommends a decrease of $6.9 million for procurement 
of chemical and biological defense contamination avoidance 
equipment for the military services.

Defense support program office training and exercise

    The budget request contained $7.8 million for Defense 
Support Program Office (DSPO) training and exercise support.
    The Secretary of Defense has informed the committee that 
the DSPO is being abolished and its functions consolidated 
within the National Reconnaissance Office (NRO). The committee 
understands that the National Military and Operations Support 
Office within the NRO is also charged with, and funded for, 
training and exercise support. Therefore, the committee 
believes the DSPO training and exercise support funding is no 
longer required and recommends no funds for this purpose.

Flat panel night vision heads-up display system

    The budget request contained $47.0 million for rotary wing 
upgrades and sustainment, but included no funds for upgrading 
the HH-60G, MC-130P, C-141B, and MC-130E with a flat panel 
night vision heads-up display (HUD) system.
    A night vision HUD system allows pilots to fly at night by 
using outside visual references instead of using only aircraft 
instruments. Since the early 1980s, Air Force special 
operations aircrews have had such a system, but it was recently 
removed from their aircraft because of safety issues related to 
high cockpit voltages. As a result, these aircrews face 
increased danger and mission degradation due to the lack of 
night vision capability. The committee understands that the 
newer-technology flat panel night vision HUD system is safer, 
more effective, and more reliable than its predecessor. The 
committee also understands that the flat panel night vision HUD 
is a non-developmental item and can therefore meet the near-
term needs of Air Force special operations crews. Accordingly, 
the committee recommends an increase of $6.5 million to procure 
and install the flat panel night vision HUD system into HH-60G, 
MC-130P, C-141B, and MC-130E aircraft in order to improve the 
safety and survivability of special operations aircrews.

Mentor protege

    The budget request contained $17.8 million for the Mentor 
Protege program. This program provides funds to major 
Department of Defense prime contractors for the purpose of 
developing the technical capabilities of Small Disadvantaged 
Businesses to perform as subcontractors.
    The committee notes that the legal authority for this pilot 
program expires at the end of fiscal year 1998. Therefore, the 
committee recommends no funds for the Mentor Protege program.

                  National Guard and Reserve Equipment

                                Overview

    The budget request contained no funds for National Guard 
and Reserve Equipment for fiscal year 1999. The committee 
recommends authorization of $300.0 million for fiscal year 
1999.
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                       Items of Special Interest

Air reserve forces

    The United States has dramatically decreased its defense 
force structure over the last several years. To compensate for 
this smaller force structure will require the active Air Force 
to continue to rely on Air Force Reserve and Air National Guard 
units to project and sustain power around the globe. The 
committee notes that Air Force Reserve and Air National Guard 
units have been seamlessly integrated into the total Air Force 
for many years and have performed their missions superbly. In 
order to adequately maintain a strong total Air Force, the 
committee believes it is important that weapons systems 
assigned to the air reserve forces and the active components be 
comparably equipped. Therefore, the committee expects the Air 
Force, and the other services as well, to ensure their 
operational plans and budget submissions reflect this guidance.

Senior scout---------

    The budget request contained $14.3 million in operations 
and maintenance, Air National Guard, partially for the 
continued operation of the Senior Scout tactical reconnaissance 
system.
    Senior Scout is a C-130-employed, roll-on/roll-off, 
reconnaissance system operated by the Air National Guard. It 
provides an airborne reconnaissance collection system that is 
complementary to other airborne collection systems operated by 
the active component.
    The committee perceives a lack of direction and support for 
Senior Scout, noting that on several occasions the Air Force 
has nearly terminated the program, that the system has not been 
well supported in terms of upgrades or sensor improvements, and 
that it has certainly not maintained technological pace with 
the RC-135 Rivet Joint aircraft or other similar reconnaissance 
platforms. Consequently, the committee does not believe 
continuing Senior Scout to be either cost or mission effective.
    However, the committee believes the Air National Guard 
linguists currently operating the Senior Scout are vital to the 
overall national reconnaissance effort and sees a critical need 
both to retain and train them on more modern equipment.
    In fiscal year 1997, the Congress authorized and 
appropriated funding for two additional RC-135 Rivet Joint 
aircraft. The committee has learned that the Air Force is 
having difficulty fully manning these aircraft. Since the Guard 
personnel are currently called on to supplement active 
component RC-135 operations, the committee believes providing 
at least one of these aircraft on a rotational basis to the Air 
National Guard would both resolve the manpower problem and take 
greater advantage of an available resource.
    Therefore, the committee expects the Secretary of the Air 
Force to provide the congressional defense and intelligence 
committees no later than October 1, 1999, a plan for phasing 
out the Senior Scout reconnaissance system and replacing it 
with an RC-135alternative or a plan for upgrading and 
maintaining the Senior Scout system commensurate with Rivet Joint 
capabilities.

           Chemical Agents and Munitions Destruction, Defense

                                Overview

    The budget request contained no funds for Chemical Agents 
and Munitions, Defense, for fiscal year 1999. The committee 
recommends authorization of $834.0 million for fiscal year 
1999.
    The committee recommends approval of the request except for 
those programs adjusted in the following table. Unless 
otherwise specified, adjustments are without prejudice and 
based on affordability considerations.
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                     Defense Export Loan Guarantees

                                Overview

    The budget request contained $1.3 million for Defense 
Export Loan Guarantees, Defense for fiscal year 1999. The 
committee recommends authorization of $1.3 million for fiscal 
year 1999.
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                         LEGISLATIVE PROVISIONS

              Subtitle A--Authorization of Appropriations

           Sections 101-109--Authorization of Appropriations

    These sections would authorize the recommended fiscal year 
1999 funding levels for all procurement accounts.

                       Subtitle B--Army Programs

   Section 111--Multiyear Procurement Authority for Longbow Hellfire 
                            Missile Program

    This section would authorize the Secretary of the Army to 
enter into a multiyear procurement contract for the Longbow 
Hellfire missile.

      Section 112--M1A2 System Enhancement Program Step 1 Program

    This section would require the Army to use the $20.3 
requested in the budget for M1A1-D upgrade kits to instead 
procure M1A2 System Enhancement Program Step 1 communications 
upgrades.

                       Subtitle C--Navy Programs

Section 121--Multiyear Procurement Authority for the Department of the 
                                  Navy

    This section would authorize the Secretary of the Navy to 
enter into a multiyear procurement contract for the Navy AV-8B, 
T-45TS, and E-2C aircraft programs and for the Marine Corps 
Medium Tactical Vehicle Replacement.

                       Subtitle D--Other Matters

Section 141--Funding, Transfer and Management of the Assembled Chemical 
                       Weapons Assessment Program

    This section would authorize funding for identification and 
demonstration of technologies alternative to the baseline 
incineration process for destruction of assembled chemical 
munitions that are a part of the U.S. chemical munitions 
stockpile. The provision would also direct the transfer of 
management oversight responsibility for the program from the 
Under Secretary of Defense for Acquisition and Technology 
(USD(A&T)) to the Secretary of the Army.
    The Assembled Chemical Weapons Assessment program was 
established under section 8065, Omnibus Consolidated 
Appropriations Act for Fiscal Year 1998 (Public Law 104-208) as 
the Department of Defense (DOD) program for assessment of the 
feasibility of alternative technologies for the 
demilitarization of assembled chemical munitions. Such 
technologies could provide an alternative to the baseline 
program, which uses incineration of chemical agents and 
munitions as the means for demilitarization of the chemical 
munitions stockpile. The assessment is to be completed with a 
final report to the Congress in December 1998.
    Responsibility for the chemical agents and munitions 
destruction program will be transferred from the Office of the 
Secretary of Defense to the Secretary of the Army as a part of 
the Defense Reform Initiative (DRI). The committee believes 
that transfer of the responsibility for the assembled chemical 
weapons assessment (ACWA) program to the Army is also 
appropriate and consistent with the DRI recommendations. In 
making the transfer, the USD(A&T) and the Secretary of the Army 
must insure the independence of the ACWA program from the 
baseline incineration program, in order to maintain public 
acceptance of, interaction with, and confidence in the ACWA 
program management. The committee notes that the consultation 
among ACWA program management and interested individuals from 
the chemical weapons stockpile communities; federal, tribal, 
and state environmental regulators; and national activist 
organization representatives that regularly work on chemical 
weapons issues has been a key factor in winning public 
acceptance of the program. The committee strongly encourages 
the Secretary of the Army to continue that consultation as an 
integral part of the ACWA program.

Dialogue on assembled chemical weapons assessment

    The DOD has committed to meaningful public involvement in 
the assessment program, and has stated that such involvement is 
critical to its success. In response to this commitment, a 
public interest group, known as the Dialogue on Assembled 
Chemical Weapons Assessment (``the Dialogue'') has sought to 
consult with the DOD to discuss issues relating to the 
assessment program. The Dialogue consists of a diverse group of 
interested individuals from the chemical weapons stockpile 
communities; federal, tribal, and state environmental 
regulators; and national activist organization representatives 
that regularly work on chemical weapons issues.
    During the committee's consideration of the National 
Defense Authorization Bill for Fiscal Year 1999 (H.R. 3616), a 
concern was raised that the Federal Advisory Committee Act 
(Public Law 92-462; 5 U.S.C. App.) (FACA) might apply to the 
Dialogue in its consultative relationship with the DOD on the 
assessment program. The program's near-term deadline would make 
it unlikely that a formal charter process for the Dialogue, 
which would be required under FACA, could be completed in 
sufficient time to meet the deadline for the assessment 
program's final report to Congress and, concurrently, 
incorporate public involvement. In response to this concern, 
the committee consulted with the House Committee on Government 
Reform and Oversight, the committee of jurisdiction on issues 
related to FACA. In the opinion of that committee, FACA does 
not apply to the Dialogue in its relationship with the DOD on 
the assessment program.

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

                                OVERVIEW

    The budget request contained $36,078.5 million for 
research, development, test, and evaluation (RDT&E), 
representing a $144.1 million increase from the amount 
authorized for fiscal year 1998.
    The committee recommends authorization of $36,228.0 
million, an increase of $149.5 million from the budget request.
    The committee notes that the budget request proposes to 
implement portions of the Quadrennial Defense Review (QDR) 
recommendations including increases in new procurement and 
major upgrades to current military equipment programs. However, 
the committee is concerned that while procurement accounts are 
projected to continue increasing by as much as 29 percent over 
the Future Years Defense Plan (FYDP), the Department projects a 
decline in research and development accounts of at least 14 
percent during that same time period. The Department has 
publicly placed great emphasis on QDR recommendations that 
stress preparing for future conflicts, maximizing capabilities 
of smaller force structures, and implementing leap-ahead 
technologies, with only minimal investment in legacy 
modernization programs. However, the committee notes that the 
Department's plan to continue decreasing already underfunded 
research and development accounts, the cornerstone investment 
needed to support each service's future requirements, appears 
in direct contradiction with QDR recommendations.
    The committee is also concerned with the continuing trend 
of placing higher priority on a number of Department level 
initiatives such as the Defense Advanced Research Projects 
Agency (DARPA) and Advanced Concepts Technology Demonstrations 
(ACTDs) at the expense of already seriously constrained service 
research and development budgets. The committee notes, in 
particular, that while the Army, Air Force, and defense-wide 
research and development requests all decreased from fiscal 
year 1998 levels, the service requests also include shifts over 
$300.0 million from defense-wide programs to the services. This 
shift results in actual increases to remaining defense-wide 
programs while masking an even greater decline in service 
programs.
    For these reasons and others stated elsewhere in this 
report, the committee is seriously concerned that Department 
statements asserting the health and growing improvement of the 
defense budget are not evident in the research and development 
budget request. While the Secretary of Defense has described 
the fiscal year 1999 request as one that is carefully balanced 
to address both present and future requirements, the committee 
notes a very visible sacrifice on the part of high priority 
service requirements to achieve that balance, and yet, no 
similar level of sacrifice within the defense-wide programs. 
The committee believes that the Department should provide a 
more succinct explanation of how DARPA, ACTDs, and other large 
defense-wide research and development programs are more 
appropriate investments for addressing future requirements than 
the focused service research and development accounts.

  Department of Defense Basic Research/Science and Technology Program

    The committee strongly supports the request for the 
Department of Defense basic research and science and technology 
programs, and recommends a total of $1,130.7 million for basic 
research and a total of $7,280.4 million for the Defense 
science and technology program (including basic research). 
However, to address the committee's concerns with respect to 
critical shortcomings in the service requests and perceived 
imbalances between defense-wide and service research and 
development programs, the committee recommends shifts of 
funding, outlined elsewhere in this report, from the defense 
agencies' science and technology accounts to those of the 
services.
    The committee believes that the Department's basic research 
program has long played a crucial role in the development of 
technology and in the education and training of scientific 
personnel required to support the continuing technical advances 
critical to maintaining superior military capabilities. The 
ability of today's U.S. military forces to deploy anywhere in 
the world, sustain a forward presence, and win decisively on 
the battlefield results from past investments in research and 
technology. For more than 50 years, these investments have 
enabled the Department of Defense to advance the frontiers of 
knowledge and develop the technologies necessary to gain and 
maintain operational and technical superiority. The committee 
believes that the Department must continue to provide the 
necessary investments in research and technologies that ensure 
a strong, stable, and robust science and technology program for 
our armed forces.
    The committee notes with concern that the research budget 
request is at a 19 year low and that funding for Defense 
science and technology is at an equally disturbing 13 year low. 
While the committee is pleased that this year's request brings 
an end to the disturbing decline in overall research funding 
levels and proposes a period of projected growth of 
approximately 5 percent over the period through fiscal year 
2003, the committee expresses concern over the apparent 
conflict between the Department's projection for growth in the 
research budget in light of the current forecast for a 14 
percent decline in overall research and development during the 
same period.

               Defense Advanced Research Projects Agency

    The committee is concerned by the Department's continued 
commitment to a very large budget for the Defense Advanced 
Research Projects Agency (DARPA) in comparison to the science 
and technology budgets of the military departments, and by the 
trend this represents in the overall Department of Defense 
science and technology program. The committee commends the 
agency and its outstanding contribution over its 40 year 
history to the development of advanced technology and military 
systems for our armed forces, and believes that DARPA will 
continue to play a key role in the development of advanced 
capabilities for our future armed forces.
    The committee notes, however, that the budget request for 
DARPA, although reduced from the peak level attained in 1994, 
remains at a higher level (when measured in constant fiscal 
year 1997 dollars) than at any time since 1960, two years after 
the agency was formed. The committee also notes that, despite 
the elimination of over $200.0 million in fiscal year 1998 
programs from the DARPA budget by transfer to the military 
departments or by cancellation, there is no commensurate 
reduction in fiscal year 1999budget request. The committee 
notes that a number of DARPA programs have grown significantly from the 
fiscal year 1999 projection that was included with the fiscal year 1998 
budget request. The committee believes that in this time of great 
financial constraint, all expenditures must be considered carefully and 
continued only where they make a clear contribution to critical service 
requirements.

        Information Systems Technology, Superiority and Security

    The budget request contained a total of $705.7 million for 
information technology research, development, test, and 
evaluation. The budget request also included a total of $191.8 
million for the Department of Defense (DOD) information systems 
security program.
    The committee report on H.R. 1119 (H. Rept. 105-132) and 
the statement of managers accompanying the conference report on 
H.R. 1119 (H. Rept. 105-340) directed the Secretary of Defense 
to submit to the Congressional defense committees an assessment 
of the DOD information systems security program that addresses 
the current status of the program, specific actions being taken 
on the recommendations of the 1996 Defense Science Board Task 
Force on Information Warfare-Defense, and additional actions 
that should be taken to assure the increased security and 
integrity of the defense information infrastructure. The report 
is to also address measures necessary to assure the integrity 
of those elements of the national information infrastructure 
and critical national infrastructure on which the defense 
information infrastructure depends, and identify any additional 
resources and legislative authority which may be required.
    The Secretary's report has not yet been received by the 
committee. However, assuming that the report will have been 
received by the Congressional defense committees prior to the 
House-Senate Conference on H.R. 3616 and that there will have 
been sufficient time for congressional review of the issues and 
recommendations contained in the report, the committee intends 
to address appropriate issues and recommendations from its 
review of Secretary's report during the conference.
    The committee recommendations for the fiscal year 1999 
RDT&E program are identified in the table below. Major issues 
are discussed following the table.
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                               Army RDT&E

                                Overview

    The budget request contained $4,780.5 million for Army 
RDT&E. The committee recommends authorization of $4,793.0 
million, an increase of $12.5 million.
    The committee recommendations for the fiscal year 1999 Army 
RDT&E 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

Aerostat

    The budget request contained for $103.9 million for the 
Joint Land Attack Cruise Missile Defense Elevated Netted Sensor 
System (JLENS), formerly referred to as Aerostat, in PE 12419A.
    The committee is aware that JLENS is duplicative of more 
promising missile defense efforts and believes funding should 
be reduced to support strengthening other more essential Army 
programs. Therefore, the committee recommends a decrease of 
$73.9 million in PE 12419A.

All source analysis system

    The budget request contained $28.1 million in PE 64321A for 
the All Source Analysis System (ASAS).
    The committee recommends $30.1 million, an increase of $2.0 
million in PE 64321A to continue the development of situation 
display fusion algorithms, for migrating these algorithms to 
the other service intelligence support systems, and to achieve 
ASAS Block II interoperability with the Defense Intelligence 
Agency's Modernized Integrated Data Base.

Army after next combat vehicle initiative

    The committee is aware of the Army's commitment to ensure 
that priority modernization efforts are fully compatible with 
the Army's vision of required capabilities for the Army After 
Next (AAN). While a significant number of important Army 
modernization programs are being refocused or restructured to 
incorporate new technologies needed for the AAN, the committee 
notes with interest numerous criticisms, including recent Army 
statements and the recommendations of the National Defense 
Panel, that question the viability of the current combat 
vehicle technology for the lighter, faster, more mobile AAN. 
The committee also notes, however, that the Army is already 
addressing these criticisms by conducting promising new 
research on lighter, more capable vehicle systems, lighter-
weight and more fuel-efficient hybrid power systems and other 
innovations to meet the emerging combat vehicle requirements of 
the AAN.
    The committee is encouraged by these developments and finds 
the associated longer range planning/development horizon 
especially noteworthy for guiding investment of increasingly 
scarce research and development funds. The committee believes 
that longer planning horizons are required to develop the 
reaching systems necessary to ensure technical viability and 
longer useful service lives for AAN combat systems.
    Accordingly, the committee recommends:
            Advanced combat vehicle and automotive technology
    The budget request contained $4.8 million in PE 63005A for 
advanced materials and components for advanced combat vehicle 
technology.
    The committee notes that new composite materials have the 
potential of reducing future combat vehicle weight and 
operating costs, as well as for improving vehicle mobility and 
transportability. Therefore, the committee recommends an 
increase of $10.0 million in PE 63005A for advanced composite 
materials.
            Digital fire control system
    The budget request contained $0.1 million for artillery 
system engineering and development. No funds were included for 
the Army and Marine Corps joint Light Weight 155mm Towed 
Howitzer program and its digital fire control system.
    The committee notes the Army's continued efforts to develop 
digital fire control technology that will yield significant 
increases in howitzer system capability while reducing weight 
and size of current 155mm howitzer fire control systems. The 
committee believes that, given sufficient funding, this area of 
technology offers the potential for significant contributions 
to all 155mm howitzer systems, including Crusader.
    Therefore, the committee recommends an increase of $8.0 
million in PE 64854A for further development of digital fire 
control technology.
            Hardened materials
    The budget request contained $10.1 million for materials 
technology in PE 62105A. The request did not include funds for 
continuation of the hardened materials project.
    The committee notes that this project is directed toward 
developing materials technology that will make heavy forces 
lighter and more deployable while improving their 
survivability. The committee recommends $15.1 million in PE 
62105A, an increase of $5.0 million for advanced hardened 
materials.
            Industry and academia alternative vehicle propulsion 
                    initiative
    The budget request contained $40.1 million in PE 62601A for 
combat vehicle and automotive technology, but did not include 
funds for the ongoing industry and academia alternative vehicle 
propulsion initiative.
    The committee notes that one of the Army's most significant 
challenges for future vehicles is lighter, more efficient power 
systems that comply with future environmental regulations. The 
committee is aware that the Fuel-Efficient AAN Task Group 
concluded that the AAN is conceived to be a highly mobile, 
high-speed insertion force and stated that decrease in the fuel 
logistics burden is a prerequisite to achieving this goal. The 
task group determined that a significant fuel decrease is a 
practical possibility that can be realized by two primary 
approaches: (1) by doubling propulsion efficiency, and (2) by 
decrease in vehicle weight.
    The committee believes that combining the efforts of the 
private sector, academic research, and Army technical experts 
offers a means of infusing both new ideas and technologies into 
future Army vehicles. The committee recommends $50.1 million, 
an increase of $10.0 million for the innovative industry and 
academia alternative vehicle propulsion initiative.
            Innovative engine technology
    The budget request contained $54.4 million in PE 63005A for 
advanced combat vehicle and automotive technology. No funding 
was included for completion of the combined diesel/turbine 
engine program.
    The committee is aware that the combined diesel/turbine 
engine offers the potential for an improved power plant for 
next generation vehicles. The committee recommends an increase 
of $7.0 million in PE 63005A for completion and testing of the 
combined diesel/turbine engine and other hybrid engine 
developments.
            Crusader self-propelled howitzer
    The budget request contained $313.2 million in PE 63854A 
for the Crusader self-propelled howitzer.
    The Crusader is an evolutionary development of a self-
propelled howitzer (SPH) intended to replace the current 
Paladin 155mm SPH. It promises improved mobility, higher rate-
of-fire, and greater survivability than the Paladin. The 
committee notes that the Crusader no longer incorporates some 
of the key technologies, specifically liquid propellant gun 
technology and common heavy vehicle chassis, that were original 
cornerstones of the program when first introduced. 
Nevertheless, the committee is aware of the Army's stated need 
to modernize its tactical ground fire support forces and 
remains very concerned that technology currently incorporated 
in Crusader is not sufficiently advanced to ensure Crusader's 
viability in the AAN. At a minimum, Crusader's weight, speed, 
agility and fuel efficiency would be so dissimilar, to other 
combat vehicles planned for the AAN, as to be operationally 
limiting. Given the current and projected fiscal environment, 
the committee does not believe that the Army should continue 
making such large investments in new weapon systems such as 
Crusader in order to maintain a proposed fielding schedule, 
unless that system is fully compatible with AAN requirements. 
Rather, the committee believes the Army should be developing 
the first of the next generation combat systems instead of 
developing and fielding the last of the current generation that 
the Crusader program now represents.
    Accordingly, the committee directs the Secretary of the 
Army to evaluate the restructuring of the Crusader program to 
ensure incorporation of applicable state-of-the-art 
technologies such as weight saving composite technology for 
armor and structural uses, advanced lighter, more efficient 
propulsion technologies to meet AAN fuel economy goals, and 
innovative weapons technologies to increase lethality and 
reduce the logistics tail. The committee believes that such 
restructuring of Crusader development will provide for 
maturation and integration of these promising technologies to 
support alighter, more mobile, more lethal SPH that would be 
more compatible with AAN combat vehicle requirements.
    Therefore, the committee recommends a decrease of $59.6 
million in PE 63854A.

Aviation advanced technology development

    The budget request contained $30.0 million in PE 63003A for 
aviation advanced technology.
    The committee notes that the Army is seeking new propulsion 
technologies to reduce the size and cost of future missiles 
while increasing lethality and further notes the potential 
benefits of scramjet propulsion technology for future missiles 
and interceptors. The committee recommends an increase of $8.0 
million in PE 63003A for scramjet technology.

Comanche

    The budget request contained $367.8 million for Comanche in 
PE 64223A.
    Comanche is a vital system for the 21st century Army, as 
well as the Army After Next (AAN), and is planned to replace 
several aging helicopters that cannot be upgraded to meet AAN 
requirements. The Comanche schedule has steadily slipped beyond 
its first envisioned operational capability in 1996 as a result 
of numerous funding decreases which have collectively slowed 
initial operational capability until late 2006. The Army's 
decision to reduce prototype aircraft from eight to two has 
delayed development still further and increased program risk. 
Comanche development is presently proceeding with a single 
prototype after funding was again reduced, reinforcing the 
perception that the Army's Comanche program appears fated to 
proceed at only a minimal level for the foreseeable future.
    The committee is aware that increased funding is required 
to enable Comanche to fully participate in upcoming Army 
warfighting experiments such as Division 00 and Digitized Corps 
04. Additional funding will also reduce the unwarranted program 
risk inherent in undertaking a major aviation development 
effort with a single flying prototype. Specifically, additional 
funding would support the Army Advanced Warfighting Experiments 
(AWE), accelerate mission electronics package development and 
weapons system integration, and integrate and test the proven 
Apache Longbow radar, as well as lower outyear procurement 
costs.
    The committee recommends $429.8 million, an increase of 
$62.0 million in PE 64223A to accelerate fielding and equipping 
the second Comanche prototype and provide a more robust testing 
program in fiscal year 1999. The committee is aware that this 
increase, coupled with additional funding throughout the future 
year defense program, would enable the Comanche schedule to be 
accelerated to coincide with establishment of the first 
digitized Army division in 2004.

Command, control, communications technology

    The budget request contained $19.7 million in PE 62782A for 
command, control and communications technology, including $12.9 
million for communications.
    The committee notes that rapid dissemination of multimedia 
information is critical to total integration of forces on the 
future battlefield. The committee is aware of successful 
demonstrations of the Army Multimedia Communications Device 
which addresses warfighter requirements to conduct two-way 
communication wherever they may be deployed.
    The committee supports efforts to improve communications 
and provide better man-machine interfaces and recommends $22.5 
million, an increase of $2.8 million in PE 62782A for further 
development of the Army multimedia communications device.

Defense healthcare information assurance program

    The budget request contained $7.4 million in PE 33140A for 
the Army information systems security program.
    Congress provided $2.5 million for fiscal year 1998 to 
initiate a demonstration program for military healthcare 
information protection that would be consistent with national 
healthcare and information protection initiatives. The 
committee report on H.R. 1119 (H. Rept. 103-132) directed the 
Secretary of the Army to report to the Congressional defense 
committees on the program's development, demonstration, 
evaluation plan and funding requirements.
    The committee recommends $12.4 million, an increase of $5.0 
million to continue the demonstration program for military 
healthcare information protection. The committee directs the 
Secretary of the Army to provide to the Congressional defense 
committees an update to the program plan and funding required 
to complete the demonstration program with the submission of 
the fiscal year 2000 Defense budget request.

Defense information technology test bed

    The budget request contained no funding in PE 323751A for 
the defense information technology test bed (DITT).
    The committee is aware that information dominance is vital 
to success on the future battlefield and supports the Army's 
ongoing joint DITT effort at the Center for Army Lessons 
Learned at Ft. Leavenworth, Kansas to establish a fully 
electronic virtual intelligence archive for use by battlefield 
commanders. The committee recommends $6.6 million in PE 
323751A, an increase of $6.6 million to make DITT operational.

Environmental development and management programs

    The budget request contained $13.8 million in PE 62720A for 
environmental quality technology. The committee notes that no 
funding is specifically provided to continue the facility 
environmental management and monitoring system and the computer 
based land management efforts. The committee recommends an 
increase of $4.0 million for facility environmental management 
and monitoring system and $4.0 million forcomputer based land 
management, noting that these increases will complete these 
developments.

Environmental quality technology

    The budget request contained $13.8 million for 
environmental quality technology within PE 62720A.
    The committee supports continuation of the joint effort of 
the U.S. Army Environmental Center and the U.S. Department of 
Agriculture to demonstrate the efficacy and cost effectiveness 
of agriculturally based bioremediation to restore contaminated 
military and civilian sites in geographically isolated Pacific 
island ecosystems. The committee supports demonstration of 
phytoremediation, composting, wetlands, and other 
agriculturally based technologies to restore lands and related 
resources and recommends an increase of $5.0 million in PE 
62720A to continue agriculturally based bioremediation efforts.

Future direct support weapon system

    The budget request contained $24.6 million in PE 63004A for 
weapons and munitions advanced technology.
    The committee is aware that the Army After Next (AAN) will 
require lighter, more transportable, and more mobile weapons 
systems, and supports the Army's efforts to develop enabling 
technologies such as soft recoil, advanced propellant 
technology, and improved digital fire control that can provide 
such systems. The committee supports development of lighter, 
more agile AAN weapons and recommends an increase of $5.0 
million for the future direct support weapon system.

Future missile technology integration program

    The budget request contained $86.1 million in PE 63313A for 
missile and rocket advanced technology, which included $1.5 
million for future missile technology integration.
    The committee notes the importance of lighter more 
affordable missiles and supports composite technology 
development for that purpose. The committee recommends an 
increase of $6.0 million for composite missile technology.

Helmet-mounted retinal display technology

    The budget request contained $7.5 million in PE 63801A for 
aviation advanced development, including $2.5 million for 
aircrew integrated systems.
    The committee notes the aircrew integrated common helmet 
(AICH) incorporates reaching technology including miniature 
retinal display technology that greatly improves aircrew 
performance. The committee recommends $12.5 million, an 
increase of $5.0 million in PE 63801A for retinal display 
technology.

High mobility artillery rocket system

    The budget request contained $20.2 million in PE 63778A for 
the multiple launch rocket system (MLRS) improvement program.
    The committee notes the high mobility artillery rocket 
system (HIMARS) is being developed as an early entry capability 
for light forces and is scheduled to participate in the Army's 
rapid force projection initiative. The committee strongly 
supports development of this mobile, high lethality weapons 
system for early entry and light forces and notes that this 
effort represents an excellent example of leveraging the proven 
capabilities of the MLRS system to address a specifically 
defined force projection requirement. The committee recommends 
$26.2 million, an increase of $6.0 million in PE 63778A for 
HIMARS.

Improved fuel pumps and fuel controls

    The budget request contained $2.9 million in PE 23752A for 
the aircraft engine component improvement program.
    Improved fuel pumps and engine controls are necessary 
elements of all fielded helicopters, as well as new helicopter 
development programs such as Longbow Apache and Comanche. The 
committee supports these critical improvements and recommends 
$11.9 million in PE 23752A, an increase of $4.0 million for 
improved fuel pumps and $5.0 million for the full authority 
digital engine control.

Joint service small arms program

    The budget request contained $5.2 million for the joint 
service small arms program in PE 63607A.
    The objective of this program is to demonstrate key 
technologies leading to more effective small arms and munitions 
for all services, including such technology as the objective 
individual combat weapon.
    The committee recommends an increase of $3.5 million for 
the joint service small arms program.

Joint surveillance and target attack radar system (Joint STARS)

    The budget request contained $5.5 million for engineering, 
manufacturing and development system improvements to the Joint 
STARS in PE 64770A. The committee notes the proven success of 
the Joint STARS system in both Operation Desert Storm and 
Operation Joint Endeavor in Bosnia. A key feature of Joint 
STARS is the secure, encrypted, anti-jam Surveillance Control 
Data Link (SCDL). The SCDL links the Air Force's E-8 Joint 
STARS aircraft to the Army's ground support modules and common 
ground stations, enabling real-time data transfer of command 
and control information between the aircraft and ground 
stations. The committee is aware that the ongoing SCDL System 
Improvement Program (SIP), which eliminates obsolete parts and 
updates older digital circuit boards with state-of-the-art, 
software-based array boards, willincrease the data transfer 
rate while reducing component cost, size, weight, and power 
requirements by as much as 50 percent. Based on the increased 
reliability and improved performance benefits of this SIP, the 
committee recommends $21.5 million, an increase of $16.0 million in PE 
64770A for its completion.

Lighter more lethal weapons

    The budget request contained $26.5 million in PE 63639A for 
the armament enhancement initiative.
    No funds were included for the ongoing tank extended range 
munitions-kinetic energy (TERM-KE) program. The committee notes 
that the TERM-KE is a 120mm tank munition that uses a rocket 
boosted standard kinetic energy penetrator and fire-and-forget 
guidance to provide greater lethality at extended ranges. The 
committee is aware that lighter, more lethal, fire and forget 
weapons are needed for the Army After Next and supports such 
efforts. The committee recommends an increase of $10.0 million 
in PE 63639A for continued development of TERM-KE technology as 
an integral part of efforts to meet the broad range of future 
requirements for lighter, longer range, more lethal weapons.
    The committee is also aware of continued Army/Marine Corps 
joint development of the lightweight 155mm howitzer and that 
additional funding is needed for testing, evaluation of a 
breech mounted laser ignition system, and modifications to 
accommodate the Army's new propelling charge system. A 
significant part of this effort is the Army's digital fire 
control system. The committee recommends an increase of $5.0 
million for the lightweight 155mm howitzer and fire control 
system in PE 64854A.

MedTeams

    The budget request contained $13.4 million in PE 62716A for 
human factors engineering technology, including, $0.5 million 
for the Emergency Team Coordination program (MedTeams) in PE 
62716A.
    The committee notes that the Army MedTeams research under 
the extended team performance efforts has improved shock trauma 
care to reduce medical and casualty risks. The committee 
recommends $18.2 million, an increase of $4.8 million in PE 
62716A for MedTeams, with the clear understanding that this 
increase will complete this program.

Missile and rocket advanced technology

    The budget request contained $86.1 million in PE 63313A to 
support development of advanced missile technologies.
    The committee notes recent statements by the Army Chief of 
Staff expressing concern over the inability of future budgets 
to sustain the current number of Army modernization programs. 
While the Army is currently pursuing a significant number of 
anti-armor missile programs, the committee remains concerned 
over continuing poor performance of the Enhanced Fiber Optic 
Guided Missile (E-FOGM) missile system, and questions whether 
this program is an appropriate use of the Army's extremely 
limited modernization funds.
    Last year, the committee expressed great concern over the 
Army's plan to procure over 300 of these missiles during the 
Advanced Concepts Technology Demonstration (ACTD) based on only 
two actual missile flights, both of which were failures. 
However, $31.4 million was authorized in the National Defense 
Authorization Act for fiscal year 1998 to complete the planned 
14 missile ACTD testing with the direction that no additional 
missiles be procured for other than test purposes. A full year 
later, still with no successful missile flights during the 
ACTD, the fiscal year 1999 request includes funds to continue 
ACTD testing and procure an additional 192 missiles, including 
96 production missiles. The committee remains concerned over 
the lack of successful missile flight tests and recent problems 
with rising missile costs projections. Furthermore, the 
committee has seen no indication that the Army intends to 
pursue fielding this system beyond those capabilities obtained 
during the planned scope of the ACTD.
    Based on the disappointing results of this program to date 
and the assessment that fiscal year 1998 funds should be more 
than sufficient to complete the remaining 12 missile flight 
tests, the committee believes that the time has come to 
terminate this effort and redirect limited resources to more 
viable programs. Therefore, the committee recommends a decrease 
of $35.7 million in PE 63313A allocated for evaluation of the 
E-FOGM missile system.

Missile defense battle integration center/battle lab

    The budget request contained $12.2 million in PE 63308A for 
Army missile defense system integration.
    The Army is developing the missile defense battle 
integration center (MDBIC), a flexible distributed interactive 
simulation-based architecture for training, exercises, and 
military operations. The committee notes that while missile 
defense is a stated high priority for the Army, the MDBIC 
program is inadequately funded. The committee recommends an 
increase of $10.0 million in PE 63308A to continue development 
of the integrated battle lab.

Plasma energy pyrolysis system

    The budget request contained no funds in PE 62720A for 
completion of the plasma energy pyrolysis system (PEPS) 
development.
    The committee notes that PEPS technology has been validated 
through testing to safely destroy hazardous waste streams into 
inert gasses. The committee supports efforts to keep the 
environment clean and recommends an increase of $3.0 million in 
PE 62720A, to complete development, construction and delivery 
of a transportable and a mobile PEPS system to the Army for 
testing. The committee notes that this funding will complete 
PEPS development, and any future PEPS procurement must be based 
on military requirements and priorities.

Precision guided mortar munitions

    The budget request contained $24.6 million in PE 63004A, 
including $1.9 million for precision guided mortar munitions 
(PGMM).
    The committee notes that PGMM doubles the weapon range and 
provides a precision kill capability against tanks and bunkers. 
The committee recommends an increase of $6.0 million in PE 
63004A for PGMM.

Starstreak

    The budget request contained $30.0 million for aviation 
advanced technology in PE 63003A. No funds were included for 
Starstreak (ATASK)-Stinger missile side-by-side testing for the 
Apache helicopter.
    The committee is aware that the Apache helicopter does not 
have a defensive air-to-air missile capability, even though 
other helicopters are being so equipped, and that Starstreak 
and Stinger are being evaluated and compared using simulation. 
The committee supports comparative test of Starstreak and 
Stinger, as appropriate, in live side-by-side firings, and 
recommends an increase of $3.0 million in PE 63003A for this 
purpose.

Stinger missile block two upgrades

    The budget request contained $11.3 million in PE 23801A for 
missile/air defense product improvement, which included $2.0 
million for Stinger product improvement.
    The committee notes efforts to develop block II 
modifications to the Stinger missile to provide enhanced 
performance. The committee supports continuation of this 
initiative and recommends an increase of $12.0 million in PE 
23801A to support these efforts.

Stinger universal launcher

    The budget request contained $30.0 million for aviation 
advanced technology in PE 63003A.
    The budget request contained no funds for the Stinger 
universal launcher, which is under development, and required to 
support side-by side testing. The committee notes that this 
launcher has broad applicability to a number of platforms, 
including Apache aircraft. The committee supports this 
development including necessary weapons system interfaces and 
recommends an increase of $2.0 million in PE 63003A for this 
purpose.

Strategic environmental research and development program

    The budget request contained $54.4 million for the 
Strategic Environmental Research and Development Program 
(SERDP)/Environmental Security Technology in a new Army program 
element (PE 63780A).
    SERDP was established in 1990 to address Department of 
Defense and Department of Energy environmental concerns. 
SERDP's stated objective is to improve DOD's mission readiness. 
This program was transferred from the Office of the Secretary 
of Defense (OSD) to the Army with the fiscal year 1999 request. 
The Army's budget request already contains ongoing 
environmental programs including: Environmental Quality 
Technology (PE 62720A), Environmental Conservation (PE 65853A), 
Pollution prevention (PE 65854A), and Environmental Compliance 
(PE 65856A) totaling $75.8 million. The committee believes that 
the mission essential Army environmental protection needs can 
be met within existing Army programs and, therefore, recommends 
no funding for SERDP.

Tactical high energy laser

    The budget request contained $12.2 million in PE 63308A, 
but included no funding for the tactical high energy laser 
(THEL) program.
    The committee understands that the Army now has an 
identified mission need for a directed energy air defense 
system. The committee believes that the Army's continued 
technical involvement in the THEL program represents an 
effectively leveraged path to meeting its requirements.
    While the early prototypes of THEL will not have sufficient 
mobility to meet Army needs, the committee understands that the 
planned evolution of the THEL program will lead to a mobile, 
sustainable battlefield system. Key elements of this effort 
include development of materials for crystals and manufacturing 
technology in support of solid state laser technology and 
integration of a lightweight acquisition and tracking system 
with a lightweight beam director. The committee recommends an 
increase of $10.0 million in PE 63308A for THEL.

Tactical exploitation of national capabilities

    The budget request contained $44.7 million in PE 64766A for 
Army tactical exploitation of national capabilities (TENCAP).
    The committee notes that the amount requested represents 
nearly a $26.0 million increase from the level approved for 
fiscal year 1998. The committee is concerned that the Army may 
be using the TENCAP program as a means for bypassing the 
``normal'' acquisition process allowing it to procure and 
operate combat systems associated with space sensors. The 
committee is supportive of TENCAP efforts for short-term, high-
pay off concepts and initiatives that improve the use of 
national space sensors and systems. However, the committee will 
not support TENCAP funded development and production of entire 
weapons systems. Therefore, the committee directs that future 
TENCAP requests be limited to space exploitation initiatives 
and projects that are of short-duration and high payoff.
    The committee recommends $40.1 million for the Army's 
TENCAP program in fiscal year 1999, a reduction of 4.6 million 
in PE 64766A.

Trajectory correctable munitions development

    The budget request contained $24.6 million weapons and 
munitions advanced technology in PE 63004A. No funds were 
provided for the Trajectory Correctable Munitions (TCM) 
program.
    The committee is aware that the TCM will provide the Army 
with a versatile projectile with unprecedented range and 
accuracy and will significantly extend the range and accuracy 
of both current and developmental 155mm artillery platforms. 
The committee supports TCM development and recommends an 
increase of $6.0 million in PE 63004A for TCM development.

Ultra lightweight camouflage net system

    The budget request contained $26.0 million for Logistics 
and Engineer Equipment in PE 64804A, including $0.8 million for 
camouflage systems (ULCANS).
    The committee notes that the ultra lightweight camouflage 
net system is intended to increase force survivability in 
arctic, desert and urban environments. The committee recommends 
$28.0 million, and increase of $2.0 million for expedited 
production qualification and testing of ULCANS.

                               Navy RDT&E

                                Overview

    The budget request contained $8,108.9 million for Navy 
RDT&E. The committee recommends authorization of $8,403.6 
million, an increase of $294.6 million.
    The committee recommendations for the fiscal year 1999 Navy 
RDT&E 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

ADC(X) auxiliary cargo ship development

    The budget request contained $133.6 million in PE 64567N 
for the Navy's program for ship contract design and live fire 
test and evaluation design, including $5.9 million for the 
ADC(X) Dry Auxiliary Cargo Ship program.
    The committee is aware that research and development 
funding for the ADC(X) should be shifted from PE 64567N, Ship 
Contract Design, to PE 63564N, Ship Preliminary Design and 
Feasibility Studies, to support the Build and Charter and 
program for auxiliary ships that is recommended elsewhere in 
this report. Accordingly, the committee recommends a decrease 
of $5.9 million in PE 64567N and an increase of $5.9 million in 
PE 63564N.

Advanced amphibious assault vehicle

    The budget request contained $104.8 million in PE 63611M 
for the advanced amphibious assault vehicle (AAAV).
    The AAAV is a self-deploying, high water speed, fully 
tracked, nuclear biological and chemical warfare protected 
armored amphibious personnel carrier. The committee is aware 
that additional funding will permit accelerated development of 
alternative propulsion system and suspension components which 
are critical to the AAAV system. The committee recommends an 
increase of $4.0 million in PE 63611M to support these efforts.

Advanced anti-radiation guided missile

    The budget request contained $18.9 million in PE 25601N for 
the Homing Anti-Radiation Missile (HARM) improvement program, 
including $10.5 million for continued development of the 
advanced anti-radiation guided missile (AARGM). AARGM is a 
Phase III Small Business Innovative Research (SBIR) program for 
demonstration of an integrated anti-radiation homing seeker, 
active millimeter wave terminal seeker, and precision mid-
course navigation suite within the size constraints of an 
existing HARM missile. The program is designed to demonstrate 
that a dual-mode seeker of this type can effectively engage and 
destroy advanced air defenses even in the presence of system 
shutdown or other anti-radiation missile countermeasures.
    The committee report on H.R. 1119 (H. Rept. 105-132) 
directed the Secretary of the Navy to conduct an independent 
assessment of the AARGM program, including the program plan and 
schedule, program execution, technical performance, and program 
risk. The Secretary's report, dated April 3, 1998, stated that 
the Navy had initiated and completed a revised program baseline 
which significantly reduces program risk, and concluded that 
the AARGM program is fundamentally sound, is executable with 
the currently budget resources, and will provide a technology 
demonstration which will determine technical feasibility and 
military utility of the AARGM technology. The AARGM 
demonstration program, if successful, will demonstrate system 
level capabilitieswhich exceed current Navy tactical missile 
capabilities. The program schedule includes completion of guided flight 
tests and the demonstration program by fiscal year 2001. The report 
states that funding budgeted for the rebaselined program is sufficient 
to accomplish the technology demonstration, however, the report also 
states that the current program does not address a number of issues 
that would be required for a Milestone II development decision.
    The committee recommends a total of $25.5 million in PE 
25601N for the AARGM program, an increase of $15.0 million to 
address risk reduction and other issues necessary to support a 
development decision following completion of the demonstration 
program.

Arctic oceanographic observation program

    The budget request contained $56.7 million in PE 62435N for 
applied research in oceanographic and atmospheric technologies. 
No funds were requested for continuation of the program for 
Arctic Climate Observations Using Underwater Sound (ACOUS).
    ACOUS is a cooperative program for the utilization of 
underwater acoustic techniques to determine ocean climate and 
acoustic characteristics in a large ocean basin. The program 
provides the capability for understanding the large temperature 
changes occurring in the Arctic Ocean, the potential impact of 
these changes on the Arctic, and their implications for global 
climate. As a bilateral program with Russia, ACOUS furthers 
U.S. national security interests through improved scientific 
relations and the transfer of Russian defense technology and 
scientific experience to peaceful uses. The committee 
encourages the Navy to reprogram funds to continue the ACOUS 
program in fiscal year 1999 and to include funds for completion 
of the program in the fiscal year 2000 budget request.

Automatic target tracker

    The budget request contained $14.7 million in PE 26623M for 
Marine Corps ground combat/support systems but included no 
funding for an automatic target tracker for the M1A1 tank.
    The committee notes that an automatic target tracker has 
been successfully tested on National Guard M1A1 tanks. The 
committee is aware that automatic target tracking could 
increase the Marine Corps warfighting capability and recommends 
$3.0 million to evaluate this available capability for Marine 
Corps use.

Autonomous underwater robotics technology

    The budget request contained $347.9 million in PE 61153N 
for the Navy's defense research sciences program.
    Recent research, including software simulations and 
hardware tests in the water, indicate that the application of 
autonomous underwater robotic systems has the potential for 
significant improvements in surveillance, tactical 
oceanography, and shallow water mine countermeasures. The 
committee believes that partnerships established among 
academia, industry, and the Navy's research and development and 
operational communities would be beneficial in the development 
and evaluation of the technology and operational concepts for 
these systems. Such partnerships could develop and evaluate 
tactics and capabilities, as well as demonstrate the 
operational utility of these systems in at-sea tests. Of the 
funds provided in PE 61153N, the committee recommends $4.0 
million for continued basic research and development in 
autonomous underwater robotic systems for surveillance, 
tactical oceanography, and shallow water mine countermeasures.

Autonomous underwater vehicle and sonar development

    The budget request contained $56.7 million in PE 62435N for 
oceanographic and atmospheric technology, including $20.3 
million for applied research in environmental influences on 
mine countermeasures systems and littoral oceanography.
    The committee recommends $66.7 million, an increase of 
$10.0 million to continue applied research and exploratory 
development in technologies for advanced sensors and unmanned 
underwater vehicles applicable to mine countermeasures and 
other littoral operations.

Aviation depot maintenance technology

    The budget request contained $59.4 million in PE 63721N for 
environmental protection demonstration and validation, 
including $3.5 million for Naval aviation pollution prevention.
    The committee recommends $62.1 million, an increase of $2.7 
million for the development and demonstration of aviation depot 
maintenance technologies that will significantly reduce 
maintenance and repair costs, and reduce or eliminate hazardous 
waste and pollution products.

Carbon-carbon materials for reentry bodies

    The budget request contained $77.6 million in PE 62234N for 
applied research in materials, electronics, and computer 
technology.
    The committee encourages the Navy to continue a robust 
program for the development of carbon-carbon heatshield and 
insulation materials to address future Navy reentry body 
requirements to survive long atmospheric flight trajectories 
while maintaining a precision strike capability. The committee 
recommends an increase of $3.0 million in PE 62234N for the 
development of carbon-carbon materials.

Common support aircraft

    The budget request contained $27.1 million in PE 64217N for 
the Common Support Aircraft (CSA), a fiscal year 1999 major new 
start program to develop the replacement for the Navy's S-3B, 
ES-3A, E-2C, and C-2 aircraft. The common support airframe 
would also be a primary candidate for the Navy's organic tanker 
aircraft mission.The CSA program plan calls for a Milestone 0 
decision in fiscal year 1999 to initiate the concept formulation phase 
and achievement of CSA initial operating capability in 2013.
    The committee supports the need for a replacement for the 
Navy's E-2/C-2 and S-3/ES-3 aircraft which represent 1960s and 
1970s aviation technology, respectively, and will begin 
reaching the end of their service lives in the 2010 time-frame. 
However, based on the projected in-service date for the CSA, 
the committee believes that the start of the CSA program should 
be delayed until fiscal year 2000. Accordingly, the committee 
recommends no funding for the CSA program for fiscal year 1999. 
The committee expects that the program will be included in the 
fiscal year 2000 defense budget request, and directs the 
establishment of a separate concept exploration/product 
definition and risk reduction program element for the program.

Cooperative engagement capability

    The budget request contained $131.6 million in PE 63658N 
for cooperative engagement capability (CEC) demonstration and 
validation.
    The committee is aware of additional funding requirements 
for the CEC program that developed too late to be included in 
the fiscal year 1999 defense budget request. These requirements 
include correction of deficiencies discovered during the 
initial operational test and evaluation of the system, and 
support of follow-on testing in preparation for the 
interoperability test that will involve two carrier battle 
groups. The committee is also aware of the increasing role that 
the Navy's CEC system will play in air defense and tactical 
ballistic missile defense for the fleet and for joint forces. 
Development and evaluation of these capabilities will require 
an integrated test and evaluation system that links together 
major military test and training ranges. Such a system should 
capitalize on a number of existing government-sponsored high 
performance computing and high-speed network programs. The 
committee recommends $157.6 million for the CEC program, an 
increase of $20.0 million to address funding shortfalls in the 
program as outlined above, and $6.0 million for continued 
development of the CEC test and evaluation system and linking 
that system to the military test and training ranges 
infrastructure.

Cooperative engagement capability frequency spectrum requirements

    The committee report on H.R. 1119 (H. Rept. 105-132) 
required the Secretary of Defense to review the impact of the 
loss of portions of the frequency spectrum, previously assigned 
to the CEC program, due to frequency spectrum sales under title 
VI of the Omnibus Reconciliation Act of 1993, and to report on 
the measures being taken to compensate for any operational 
degradation that might result from such loss. The DOD report to 
Congress on spectrum requirements, dated March 1998, states 
that in addition to the loss of capability resulting from the 
transfer of 50 megahertz (MHz) from the radio frequency 
operating band of the CEC, the reallocated spectrum also has 
the potential for making a substantial portion of the remaining 
CEC spectrum unusable. The report also states that there is an 
existing radio frequency interference problem between the CEC 
and the Light Airborne Multi-purpose System (LAMPS) that 
impacts the use of the CEC. This interference problem could be 
accommodated by movement of the LAMPS Mark III data link from 
C-band to Ku-band at a potential cost of $115.0 million.
    Of the funds provided in PE 63658N for the CEC program, the 
committee recommends $5.0 million to continue development 
activities necessary for the transfer of the LAMPS Mark III 
data link from C-band to Ku band. The committee directs the 
Secretary of the Navy to conduct a detailed assessment of the 
measures required to compensate for the loss of the CEC 
frequency spectrum and for the CEC/LAMPS Mark III data link 
interference problem. The Secretary shall report the plan and 
program required to maintain the CEC operational capability to 
the Congressional defense committees with the submission of the 
fiscal year 2000 budget request.

Cryogenic electronics technology

    The budget request contained $77.6 million in PE 62234N for 
applied research in materials, electronics, and computer 
technology.
    The committee is aware that the Defense Advanced Research 
Projects Agency and the Office of Naval Research are 
demonstrating notable performance gains through the use of 
cryogenic electronics and high temperature superconductivity 
technology in analog and digital electronic components, and 
that such applications may offer the potential for achieving 
significant improvements in the ability of future radar systems 
to detect and track low-flying targets in clutter. The 
committee also understands that these technologies may permit 
the development of advanced RF receiver/exciter subsystems that 
could be common to a wide range of radar applications and could 
result in significant reductions in the cost of future radar 
systems. Accordingly, the committee recommends an increase of 
$3.0 million to continue the development of superconducting 
waveform generator and analog-to-digital converter technology, 
leading to the demonstration of an advanced ``cryo-radar'' with 
increased performance and clutter rejection and reduced size, 
power, and weight.

Distributed surveillance system

    The budget request contained $42.0 million in PE 64784N for 
advanced deployable system (ADS) engineering and manufacturing 
development.
    The committee recommends $48.7 million, including an 
increase of $6.7 million to continue the planned introduction 
of automation and data fusion capability for the ADS 
demonstration system.

DD-21 land attack destroyer

    The budget request contained $133.6 million in PE 64567N 
for ship contract design and live fire test and evaluation 
design, including a total of $84.9 million for the Navy's DD-21 
land attack destroyer program.
    The committee report on H.R. 1119 (H. Rept. 105-132) 
directed the Secretary of the Navy to review the acquisition 
strategy for the Navy's next-generation surface combatant (SC-
21), determine if a prototyping strategy is appropriate for the 
program,and report the results of the review to the Congress. 
The Secretary's report, dated April 1998, describes a phased 
acquisition process that would culminate in the selection of a single 
contractor to complete system design, construction, test, delivery, and 
support of the lead ship for the DD-21 class land attack destroyer. The 
three-phased program would emphasize active competition among competing 
contractors during the concept design and initial systems design 
phases, and identification of a ``second ship builder'' prior to 
completing the system design in the detailed design and construction 
phase. The report also identified the following: early contractor 
involvement, the use of state of the art engineering tools to enable 
``virtual prototyping'' and analysis of alternatives prior to beginning 
construction, and the use of ``cost as an independent variable'' 
criteria in meeting the affordability goals for the program. 
Additionally, a risk management process that includes the use of 
process teams, extensive modeling and simulation, networked land-based 
engineering sites, lessons-learned from the Maritime Fire Support 
Demonstrator program, and at-sea testing of DD-21 components and sub-
systems would be established.
    The committee supports the need for a competitive 
acquisition strategy for the DD-21 and believes that such a 
strategy is critical to achieve the advanced surface combatant 
that will meet or exceed the aggressive cost and performance 
goals established for the DD-21. The committee believes that it 
is imperative that the Navy and industry make every effort to 
ensure a competitive environment, even if a brief delay in 
initiation of the concept phase of the program is necessary. 
The committee notes that such a delay would affect the Navy's 
ability to obligate fiscal year 1998 funds, which have been 
provided for the concept phase, and reduce the requirement for 
fiscal year 1999 funding for the DD-21 program.
    Accordingly, the committee recommends a decrease of $25.0 
million in PE 64567N for the DD-21 land attack destroyer. The 
committee directs the Secretary of the Navy to report to the 
congressional defense committee within 30 days of the enactment 
of this Act, the measures that will be taken to maintain 
competitiveness in the DD-21 program.

DP-2 thrust vectoring system proof of concept demonstration

    The budget request contained $48.1 million in PE 63217N for 
advanced development of air systems and weapons advanced 
technology. No funds were requested for continuation of the DP-
2 thrust vectoring system (DP-2) proof of concept 
demonstration.
    DP-2 is a proof of concept program to demonstrate in a one-
quarter scale flight test vehicle the technology for a short 
take off/vertical landing (STOVL) aircraft of advanced 
composite construction using thrust vector control. Following 
the ground test demonstration of an all-composite, divert 
thruster system that was supported by the Defense Advanced 
Research Projects Agency, the program and $10.0 million in 
fiscal year 1997 funds were transferred from DARPA to the 
Department of the Navy for an 18-month, proof of concept 
demonstration phase. Roll-out of the one-quarter scale flight 
test vehicle is scheduled in February 1999 and the first flight 
test in June 1999. Should the proof of concept demonstration 
prove successful, the contractor has proposed the construction 
and test of a full scale aircraft, which would demonstrate an 
affordable, high performance, vertical take off transport 
aircraft for ship to shore operation and for ship and shore 
based reconnaissance.
    The committee recommends an increase of $5.0 million in PE 
63217N for completion of the DP-2 proof of concept 
demonstration. Completion of a successful proof of concept 
demonstration could provide the basis for the Department of the 
Navy to proceed with a full-scale aircraft development program.

Environmentally safe energetic materials

    The budget request contained $39.8 million in PE 63609N for 
conventional munitions demonstration and validation.
    The committee has supported the elimination of toxic 
materials and solvents from explosives and other energetic 
material and the development of new insensitive explosives and 
other materials that are able to meet increasingly stringent 
environmental compliance regulations. Such developments could 
lead to propellants and explosives that could result in higher 
weapon systems performance and significant savings in overall 
life cycle costs. The committee recommends an increase of $3.0 
million in PE 63609N to accelerate the program for the 
development of propellants and explosives that utilize 
environmentally compliant energetic materials for undersea, 
surface, and other weapons systems.

Escape system dynamic flow test facility

    The budget request contained $8.2 million in PE 63216N for 
the aviation survivability demonstration/validation program.
    The committee believes that there is a need for 
improvements in the ability to test the performance of aircraft 
ejection seats in a realistic environment and to evaluate the 
interaction between the ejection seat, aircrew equipment, and 
aircraft cockpit as the seat leaves the aircraft. In recent 
years, added aircrew equipment and the smaller stature of 
female crewmembers have raised concerns about the safety of the 
crew during ejection from an aircraft. The committee recommends 
an increase of $3.0 million in PE 63216N for improvements in 
ejection seat test capabilities.

Hybrid electronically scanned antenna

    The budget request contained $65.0 million in PE 62232N for 
the Navy's command, control, communications, intelligence 
surveillance and reconnaissance technology program, including 
$20.8 million for applied research in radar technology.
    The committee is aware of work at the Naval Research 
Laboratory leading to a hybrid electronically scanned antenna 
for potential use with the Evolved Sea Sparrow Missile (ESSM). 
If successful, this antenna development could replace the 
existing ESSM mechanically scanned illuminator radar dish 
antenna with a two-dimensional X-band array, and provide a 
multiple target engagement capability for the ESSM and 
significant reduction in ship radar cross section at an 
affordable cost. The committee encourages theSecretary of the 
Navy to consider reprogramming of fiscal year 1999 funds to accelerate 
the development and an advanced technology demonstration of the new 
antenna technology.

Hybrid fiberoptic/wireless communications system technology

    The budget request contained $65.0 million in PE 62232N for 
applied research in command, control, and communications 
technology.
    The committee is aware that command and control functions 
require a high degree of mobility and security and that current 
shipboard communication systems cannot simultaneously provide 
both maximum security and mobility. Wireless systems offer a 
high degree of mobility, but are susceptible to intercept, and 
fiberoptic systems offer increased security, but are limited to 
fixed point-to-point communications. The committee is aware of 
efforts to develop a shipboard communications system which 
would combine distributed wireless base stations and fiberoptic 
networks to achieve increased mobility and security, while 
reducing the effects of frequency interference. The committee 
believes that this technology may have the potential for 
enhanced, secure shipboard command and control systems. 
Accordingly, the committee recommends $66.0 million, an 
increase of $1.0 million for development and demonstration of 
the technology for hybrid fiberoptic/wireless communications 
systems.

Inter-cooled recuperated gas turbine engine

    The budget request contained $58.4 million in PE 63573N for 
the Navy's advanced service machinery program (ASMP), including 
$23.5 million for continued development of the inter-cooled 
recuperated (ICR) gas turbine engine.
    The ICR engine program is a cooperative development program 
between the United States, the United Kingdom and France to 
develop and demonstrate an advanced fuel efficient gas turbine 
engine that could be the prime power plant for future ship 
applications.
    The statement of managers accompanying the conference 
report on H.R. 1110 (H. Rept. 105-304) required the Secretary 
of the Navy to conduct an assessment of the progress in the ICR 
engine program, future plans for engine testing and 
qualifications, and the status of agreements on program conduct 
and funding with the United Kingdom and other participating 
countries, and budget estimates of the cost to complete the 
program. The Secretary's report, dated February 1998, and an 
earlier report to the Senate Committee on Armed Services, 
responds to these issues and states that testing requirements 
were under discussion with the United Kingdom and France and 
that an estimated $95.5 million in U.S. funding would be 
required to complete the program. The committee is also aware 
that engine testing to date has demonstrated the ability to 
achieve 21 percent fuel savings and that 27 percent savings are 
believed achievable.
    The committee supports continued development of the ICR 
engine because of the potential the engine holds for increased 
performance and improvements in fuel economy for future Navy 
ships. The committee recognizes that the technical, 
programmatic, and funding issues must be resolved in order to 
insure a stable development program which will meet U.S. and 
allied requirements for an advanced naval prime power plant.
    The committee recommends the budget request. The committee 
directs the Secretary of the Navy to provide an updated report, 
which addresses the issues cited above, to the Congressional 
defense committees with the submission of the fiscal year 2000 
defense budget request. The committee also directs 
consideration of the ICR gas turbine engine among the 
alternatives for the prime power plant for the future DD-21 
land attack destroyer.

Link 16 improvement program

    The budget request contained $49.8 million in PE 25604N for 
the Navy's tactical data link program, including $4.4 million 
for Link 16 improvements.
    The committee strongly supports the program that was 
initiated in fiscal year 1998 for integration of Link 16 into 
the Joint Maritime Command and Control System (JMCIS) and the 
Global Command and Control System (GCCS). The committee is 
aware that Link 16 integration into GCCS will satisfy many DOD 
data dissemination requirements, including those from the Joint 
Surveillance Tactical Reconnaissance System (JSTARS). Within 
the funds provided in PE 25604N, the committee recommends a 
total of $7.4 million for Link 16 improvements, an increase of 
$3.0 million for that program.

LPD-17 amphibious assault ship self-defense

    The committee is aware that the Navy is evaluating combat 
system alternatives for the LPD-17 Class Amphibious Assault 
Ships. The committee reiterates the need for the LPD-17 to meet 
the Navy's own ``Capstone'' requirement for ship self-defense 
and previous congressional direction that the LPD-17 should 
have no less self-defense capability than other Navy ships. The 
committee also believes that to do otherwise could 
unnecessarily place at risk the combat elements which may be 
deployed on this class ship. In view of the fact that these 
ships are projected to be in the fleet for 40 years, the 
committee believes that the Navy should consider combat system 
commonality and compatibility with other elements of the fleet, 
life cycle support costs, and growth in combat system 
capability required to keep pace with future threats. The 
committee directs the Secretary of the Navy to report the 
results of the evaluation to the Congressional defense 
committees before proceeding with procurement of a combat 
system for the LPD-17.

Man overboard indicator technology

    The budget request contained $6.2 million in PE 64516N for 
Navy ship survivability program engineering and manufacturing 
development.
    The committee has followed closely the Navy's efforts to 
develop and introduce into the fleet a computer-based, total 
ship damage control information management system that would 
enable rapid/coordinated response to wartime and 
peacetimecasualties, reduce crew manpower requirements, and improve 
manpower utilization. The committee is aware that the Navy currently 
has no method other than visual detection for detecting man overboard 
incidents. The committee is also aware of a commercially available, 
water-activated man overboard indicator, and believes that integration 
into such an indicator of a human factors monitor and location-
monitoring device could significantly enhance crew safety and 
survivability and also provide the personnel monitoring capabilities 
sought in the damage control information management system. The 
committee urges the Navy to investigate the utility of such a man 
overboard indicator for fleet use and the feasibility of integrating a 
human factors monitor and location-monitoring capability into the 
indicator as outlined above. The committee requests that the Secretary 
of the Navy report the results of these investigations to the 
Congressional defense committees with the submission of the fiscal year 
2000 budget request. The committee recommends the budget request for 
fiscal year 1999.

Marine Corps ground combat/support system

    The budget request contained $37.1 million in PE 63635M, 
including funds for continued development of the joint Army/
Marine Corps lightweight 155mm howitzer.
    The lightweight 155mm towed howitzer will be the Marine 
Corps sole artillery weapon for all forces and missions, 
replacing the aging and operationally deficient M198 Howitzer. 
The program is a third of the way through a three year 
engineering and manufacturing development (EMD). The committee 
is aware that additional funding is needed for EMD testing and 
program support, evaluation of a breech mounted laser ignition 
system, modification to accommodate the Army's new propelling 
charge system, and perform live fire testing of weapons crew 
ballistic protection. The committee recommends $39.6 million, 
an increase $2.5 million for the lightweight 155mm howitzer in 
PE 63635M.

Marine mammal research

    The budget request contained $347.9 million in PE 61153N 
for the Navy's defense research sciences program.
    Of the funds provided in PE 61153N, the committee 
recommends $500,000 for continuation of the Navy's cooperative 
marine mammal research program.

Molecular design materials science

    The committee report on H.R. 1119 (H. Rept. 105-132) 
required the Secretary of the Navy to submit an assessment of 
the Department of the Navy's materials science program, which 
was initiated in May 1995 at the Lawrence Berkeley National 
Laboratory and at the Georgia Institute of Technology. The 
Secretary's report, dated February 1998, indicates that first 
phase of the program, in little more than two years and with an 
initial investment of less than $10.0 million, has clearly 
impacted materials science at the national and international 
levels. The program has also contributed to faculty, graduate 
student, and curriculum development and, through patents, 
licensing, and technology transfer, has catalyzed industrial 
activity and state partnerships. The committee notes that the 
report stated that the funding provided by the Congress for 
fiscal year 1998 is sufficient to support the next three years 
of the program, consolidate discoveries made in the first 
phase, and support other discoveries now in their early stages. 
At the end of this second phase, a significant part of the 
science and technology developed in the program will have 
transitioned to private industry, and the remaining program 
will be sufficiently well established to be funded by the 
regular Navy budget process.

Multi-function self aligned gate technology

    The budget request contained $32.1 million in PE 35204D8Z 
for continued development of the unmanned aerial vehicle (UAV) 
tactical control system (TCS).
    The committee notes that the TCS will provide 
interoperability and commonality for mission planning, command 
and control, communications, and data dissemination for the 
current and future family of tactical and medium altitude 
endurance UAVS. The multi-function self aligned gate (MSAG) 
technology developed as part of the TCS development has been 
successfully demonstrated and is now ready for larger scale 
testing. The committee acknowledges the Departments' plan to 
transfer funding for this program to the Navy, as lead service 
for this effort, and recommends an increase of $4.0 million in 
PE 35204N for fabrication and testing of prototype MSAG active 
array antennae for TCS UAVS.

Multipurpose processor

    The budget request contained $50.3 million in PE 64503N for 
submarine system equipment development, including $37.2 million 
for engineering and manufacturing development of submarine 
sonar improvements.
    The committee notes the Navy's selection of the 
multipurpose processor (MPP) as the cornerstone of sonar 
upgrades for existing SSN-688, 688I, and TRIDENT submarines and 
the improvement in sonar systems capability that has resulted 
from the application of MPP acoustic signal processing 
technology. The committee also believes that similar 
improvements in the capability of airborne and surface sonar 
systems and of undersea surveillance systems would be realized 
through the use of MPP technology. Therefore, the committee 
recommends $65.3 million in PE 64503N, an increase of $15.0 
million, to continue the research and development necessary for 
the introduction of MPP technology in submarine and other naval 
sonar systems.

Navy land attack missile program

    The budget request contained $110.1 million in PE 63795N 
for land attack technology, including $11.3 million for 
continued evaluation of the Army Tactical Missile System 
(ATACMS) for adaptation for naval surface ship and submarine 
use. No funds are included in budget request for the Land 
Attack Standard Missile (LASM).
    During fiscal year 1999 budget review briefings, the 
committee was informed that the Navy's surface warfare 
community and the Navy's submarine warfare communitywere 
considering different approaches to fulfilling the requirement for a 
land attack missile system for naval surface fire support. The former 
favored selection of the LASM, while the latter favored selection of 
the Navy Tactical Missile System (NTACMS), a naval variant of ATACMS. 
The committee was also informed that the Navy surface warfare community 
intends to move to a Milestone II decision in mid-1999 for the 
selection of LASM as the land attack missile.
    The statement of managers accompanying the conference 
report on H.R. 1119 (H. Rept. 105-340) expressed the view that 
a number of mature systems, sub-systems and components appear 
to be capable of fulfilling surface fire support requirements 
and that the Navy needs to conduct the basic analysis required 
to narrow the field of candidates analytically and to take 
maximum advantage of developed systems. The committee report on 
H.R. 1119 (H. Rept. 105-132) cautioned that a thorough, 
objective, and independent cost and operational effectiveness 
analysis of competing system alternatives would be required 
before the Navy proceeds with any development milestone 
decision for a land attack missile. The committee is unaware 
that any such analysis has been completed.
    The committee strongly believes that the selection of a 
land attack missile system must reflect the operational 
requirements of the entire Navy, should capitalize on mature 
systems, and should also capitalize on future system 
capabilities. The committee believes that selection of a land 
attack missile system will be a major defense acquisition 
decision that will set the direction for future Navy fire 
support systems capabilities and, as such, should be subject to 
the rigorous analysis and review associated with such 
decisions. Accordingly, the committee directs the Secretary of 
Defense to ensure that an appropriate analysis of alternatives 
(AOA) be conducted to support acquisition of a Navy land attack 
missile program, and that the Navy may not proceed to a 
Milestone I decision until this AOA and other requirements 
appropriate to a major acquisition milestone decision have been 
satisfied. The committee recommends $11.3 million for the Navy 
Tactical Missile System as contained in the budget request.

Navy theater missile defense

    The budget request contained $190.4 million in PE 63868C 
for the Navy Theater Wide (NTW) defense system.
    The committee recognizes the value of leveraging the large 
investment in the Aegis fleet as the cornerstone of NTW 
development and continues to support this important effort. The 
committee notes that in a number of instances, ballistic 
missile defense development costs are shared between the 
Ballistic Missile Defense Organization (BMDO) and the executing 
service. Examples include the Air Force Space Based Laser, Navy 
Area Defense, and the Army Patriot Advanced Capability-
Configuration 3 (PAC-3) programs. The committee believes cost 
sharing is justified if the resulting system serves multiple 
missions, or if major elements of the resulting system meet 
other service-unique requirements.
    The committee understands that while the projected NTW 
Block I will continue to rely on the existing Aegis SPY-1 
radar, the operating frequency of this radar is not adequate to 
acquire ballistic missile targets without cueing from other 
sources or to discriminate the threat warhead from other 
clutter. Further evolution of the Aegis radar will be needed to 
achieve the capabilities required by the objective NTW Block II 
system. At the same time, the committee notes that these radar 
improvements required for missile defense will help meet wider 
Navy requirements for fleet defense against cruise missile and 
air attack and that the Navy is pursuing other initiatives to 
improve current Aegis radar capabilities.
    The committee believes that the Navy has unique expertise 
in developing radar capabilities to meet fleet defense 
requirements, that these requirements overlap with those 
derived from the ballistic missile defense mission, and the 
resulting radar system will be inherently multi-mission in 
nature. Consequently, the committee recommends $50.0 million 
for a new Navy program element, PE 636XXN, to develop SPY-1 
radar upgrades critical to development of the NTW Block II 
system and to integrate that development with continuing Navy 
efforts to improve radar capabilities required for fleet 
defense. In doing so, the committee believes that overall 
control of the ballistic missile defense architecture must 
remain with BMDO, and that Navy radar development must remain 
closely coordinated with BMDO.

NSSN advanced technology insertion

    The budget request contained $218.8 million in PE 64558N 
for the New Attack Submarine (NSSN) program, including $146.4 
million for NSSN hull, mechanical, and electrical systems 
development, and $72.5 million for NSSN combat systems 
development.
    The committee continues to strongly support the development 
of advanced submarine technologies for the NSSN and the 
insertion of these technologies into its design at the earliest 
possible opportunity. The committee has reviewed the Navy's 
plan for technology insertion in the first four submarines of 
the NSSN class and notes that the plan falls short in funding 
for several technologies. Inclusion of these technologies in 
the NSSN design would result in significant improvements in the 
capabilities of the NSSN class. Accordingly, the committee 
recommends an increase of $10.0 million for the development of 
high priority submarine technologies that are currently 
unfunded and the insertion of these technologies into the NSSN 
program. The committee is aware that insertion of the 
technologies will also require a limited amount of procurement 
funding across the first four submarines (less than $5.0 
million) and encourages the Navy to reprogram from within 
available funds the procurement funding necessary to complete 
the technology insertion in the appropriate NSSN hulls.

Optically multiplexed wideband radar beamformer

    The budget request contained $347.9 million in PE 61153N 
for the Navy's defense research sciences program.
    In shipboard radar surveillance systems, high instantaneous 
bandwidth is need to achieve the necessary resolution for 
theater ballistic missile defense, ship self-defense, and non-
cooperative target identification. The committee is aware that 
the use of optical wavelength-division multiplexing (WDM) 
technology, now being developed in thecommercial sector, may 
provide the capability for wideband beamforming that could result in 
the demonstration of a wideband electronically-steered active radar 
antenna with high instantaneous bandwidth and the resolution necessary 
for theater ballistic missile defense requirements. Use of optical WDM 
technology to reduce hardware complexity would permit reductions in 
system cost and achieve system performance levels that are needed for 
ship-self defense in a littoral environment. The committee recommends 
an increase of $4.5 million in PE 61153N to initiate a cooperative 
program for research, development, and demonstration of a prototype 
optically multiplexed, wideband, radar beamforming array using optical 
WDM technology.

Parametric airborne dipping sonar

    The budget request contained $231.1 million in PE 64212N 
for anti-submarine warfare (ASW) and other helicopter 
development, including $215.5 million for the Light Airborne 
Multi-purpose System (LAMPS) ASW helicopter. No funds were 
requested for the parametric airborne dipping sonar (PADS).
    The PADS project was initiated as a small business 
innovative research program (SBIR) proposal in 1990 for an 
advanced acoustic source for helicopter dipping sonar. 
Following successful demonstration of a parametric projector 
(acoustic source) beam-forming capability approximating 
theoretical estimates, funding was added in the National 
Defense Authorization Act for Fiscal Year 1997 (Public Law 104-
201) to initiate a limited PADS onboard helicopter 
demonstration and at-sea helicopter PADS system test. The test 
will be conducted in 1999 using funds added in the National 
Defense Authorization Act for Fiscal Year 1998 (Public Law 105-
85). Following completion of the at-sea test in 1999, the Navy 
plans to review the test results, assess the viability of 
integrating PADS technology into current or future weapons 
systems for enhanced shallow water ASW and mine detection 
capabilities, and report the results of its review and 
assessment to the Congress.
    The committee is aware of recommendations for insertion of 
the PADS technology into the LAMPS ASW helicopter and 
establishment of an engineering and manufacturing development 
program for PADS during fiscal year 1999. In view of the time 
required to complete the PADS testing and follow-on assessment 
during 1999, the committee believes that this recommendation 
should be addressed as a part of the fiscal year 2000 defense 
budget request. Accordingly, the committee recommends no 
increase in funding for PADS.

Power electronic building blocks and power node control centers

    The budget request contained $39.3 million in PE 63508N for 
surface ship and submarine hull, mechanical, and electrical 
advanced technology. The request included funding to continue 
the development and demonstration of power electronic building 
blocks and power node control centers for shipboard electrical 
power systems. The committee recommends an increase of $6.0 
million in PE 63508N to continue the program to accelerate the 
development of power electronic building block technology and 
the use of virtual prototyping and a virtual test bed to 
demonstrate and evaluate advanced shipboard electrical power 
system concepts. The committee also recommends an increase of 
$2.0 million in PE 63508N to continue the development of power 
node control centers for advanced electrical distribution 
system fault detection, switching, reconfiguration, and control 
of shipboard electrical systems.

Project M

    The committee has followed the progress of Project M--an 
active approach for noise and vibration cancellation. The 
results to date have shown that the active machinery raft may 
provide unprecedented quieting for submarines.
    Congress appropriated $5.0 million in fiscal year 1998 to 
be used for only active control of machinery rafts, and the 
committee notes that Project M is to be tested on a submarine 
large scale vehicle. However, the committee understands that no 
funds have been budgeted to develop a prototype system for 
surface ships. Accordingly, the committee directs the Secretary 
of the Navy to program funds to develop a prototype system for 
surface ships in fiscal year 2000.

Reduction to fiscal year 1999 budget request programs

    The committee has reviewed the Navy's budget request for 
fiscal year 1999 and, in a number of program elements, 
identified program growth over fiscal year 1998 projected 
funding for fiscal year 1999 funding for those programs to the 
actual requested levels in fiscal year 1999. The committee 
believes that these increases are not sufficiently justified in 
comparison to higher priority Navy programs and recommends 
reductions totaling $9.8 million and listed by program element 
in the following table.

65152N--Studies And Analysis Support--Navy....................     $-1.0
65853N--Management, Technical & International Support.........      -1.0
65863N--RDT&E Ship And Aircraft Support.......................      -2.0
65864N--Test And Evaluation Support...........................      -5.8
                    --------------------------------------------------------------
                    ____________________________________________________

      Total Reduction.........................................     $-9.8

Remote minehunting system

    The budget request contained $73.5 million in PE 63502N for 
surface and shallow water mine countermeasures demonstration 
and validation including $11.0 million for the Remote 
Minehunting System (RMS). The RMS is a remotely operated system 
that is being developed to detect and classify mines. This 
system is the primary element of the Navy's program to provide 
an organic mine countermeasures means for surface combatants.
    The committee recommends an increase of $7.0 million in PE 
63502N to continue the program for accelerated development and 
fielding of the RMS. This increase, and an increase recommended 
for the shallow water influence minesweep system 
(SWIMS)elsewhere in this report, reflect the high priority that the 
committee places on the mine countermeasures program and on the 
introduction of an organic mine countermeasures capability into the 
Navy's battle groups and amphibious ready groups.

Shallow water influence minesweeping system

    The budget request contained $56.8 million in PE 63747N for 
the Navy's undersea warfare advanced technology program.
    The committee strongly endorses the need for development 
and deployment of improved mine countermeasures and believes 
that systems are needed that have high speed minesweeping 
capabilities, provide significantly improved area coverage, are 
effective in all environments, and meet the requirements of the 
Navy's mine warfare plan for littoral operations. The committee 
recommends $64.8 million in PE 63747N, an increase of $8.0 
million to continue the development and demonstration of 
advanced magnetic and acoustical minesweeping system 
technology.

Shipboard system component development

    The budget request contained $27.7 million in PE 63513N for 
shipboard system component development demonstration and 
validation.
    The committee is aware that the U.S. manufacturer of the 
110-kilowatt static frequency converter for Navy combatant 
ships has been selected by two foreign navies to develop a new 
150-killowatt static frequency converter. The 110-kilowatt 
unit, which uses 25-year old technology, is both difficult and 
expensive to maintain. The committee believes that replacement 
of the older 110-kilowatt unit with the new 150-kilowatt unit 
in new construction of U.S. Navy ships, such as the LPD-17, 
could result in significant cost savings. The committee 
recommends that the Secretary of the Navy assess the 
feasibility of using the new 150-kilowatt unit in new naval 
ship construction programs, and, if such use is judged feasible 
and cost-effective, conduct the necessary U.S. qualification 
and environmental tests for the new converter. The committee 
recommends $28.7 million in PE 63513N, an increase of $1.0 
million for the qualification and testing program.

Shortstop electronic protection system

    The budget request contained $14.7 million for Marine Corps 
ground combat/supporting arms but included no funding for 
additional development of the shortstop electronic protection 
system (SEPS). The committee notes recent completion of 
successful testing of SEPS, which provides detection and early 
detonation of incoming artillery, mortar and rocket rounds to 
protect ground forces. However, SEPS requires upgrading to 
protect forces from newer weapons. Therefore, the committee 
recommends an increase of $5.0 million in PE 26623M, and an 
increase of $5.0 million in PE 64270A, a total increase of 
$10.0 million for this purpose.

Silicon carbide semiconductor substrates

    The budget request contained $77.6 million in PE 62234N for 
applied research in materials, electronics, and computer 
technology.
    Silicon carbide (SiC) is a wide band-gap semiconductor 
material with unique physical and electrical properties that 
will make possible the fabrication of the next-generation of 
microelectronic devices. These devices will be capable of 
operation in radiation environments and at high temperatures, 
high voltages, high power levels, and high frequencies in the 
microwave regime. These capabilities will enable a wide range 
of applications in military and commercial systems, such as 
high voltage/high power systems, advanced radar, nuclear, 
instruments, satellite communications, and advanced sensors. 
The committee recommends an increase of $3.5 million in PE 
62234N to accelerate the development of SiC semiconductor 
materials and to advance high electrical power control and 
other applications for next generation military platforms.

Standoff land attack missile--expanded response (SLAM-ER)

    The budget request contained $5.2 million in PE 64603N for 
the Navy's SLAM-ER program.
    The committee report on H.R. 1119 (H. Rept. 105-132) 
required the Secretary of the Navy to provide an assessment of 
the SLAM-ER program. The report, dated January 23, 1998, states 
that SLAM-ER is the missile system that will meet the Navy's 
requirement for an advanced air-launched, standoff land attack 
system, that the Navy acquisition objective for SLAM-ER is 
approximately 700 missiles, and that no further capability is 
currently anticipated. Accordingly, the committee agrees with 
the Navy's decision and recommends $5.2 million for SLAM-ER as 
contained in the budget request.

Submarine sonar domes

    The budget request contained $218.8 million in PE 64558N 
for the New Design SSN (NSSN) program.
    The committee is aware of a Navy risk reduction program in 
which a new structural acoustic sandwich material system 
composed of glass-reinforced plastic and rubber has been used 
to fabricate a quarter-scale sonar dome. Although this advanced 
material system was initially developed for surface ship sonar 
domes and windows, at-sea testing of the quarter-scale sonar 
dome indicated potentially significant advantages for the NSSN, 
including major improvements in sonar performance, enhanced 
sonar dome durability, and reduced manufacturing and life-cycle 
costs. The committee recommends an increase of $7.0 million in 
PE 64558N to complete fabrication of a full-scale sonar dome 
using this acoustic sandwich material system for further 
evaluation and testing.

Tactical combat training systems development

    The budget request contained $28.4 million in PE 24571N for 
the consolidated training system development program, including 
$6.9 million for continued development of the Joint Tactical 
Combat Training System (JTCTS).
    The committee report on H.R. 1119 (H. Rept. 105-132) 
directed the Secretary of the Navy, in coordination with the 
Secretary of the Air Force, to conduct an assessment of the 
requirement for the JTCTS and execution of the JTCTS program. 
The Secretary's report, dated February 19, 1998, stated that 
the joint instrumented range requirement remains valid, that 
JTCTS meets the requirements of both the Navy and the Air 
Force, and that the program had been restructured to allow the 
Services to field a prototype JTCTS mobile, rangeless air 
combat training capability in 1999, one year sooner than 
originally scheduled. The report also stated that service 
priorities have driven the first procurement of JTCTS with an 
emphasis on replacing existing, less capable and aging air 
combat range instrumentation systems. However, the report also 
noted that JTCTS capabilities for joint simulation system 
integration, ground interoperability, and shipboard weapons 
system integration had been deferred to later in the program 
with the full system capability becoming available in fiscal 
year 2003.
    The committee notes the existing Navy large area tracking 
ranges (LATR) and the Air Force's AN/ASQ-34 air combat training 
system. In view of the projected delay in fielding of the full 
JTCTS capability, the committee believes that the Navy and the 
Air Force need to develop an overall strategy for transition 
from these legacy systems to the full JTCTS capability. The 
committee believes that such a transition strategy should 
include potential improvements in the legacy systems, 
requirements for interoperability with JTCTS as it is fielded, 
and ultimate replacement of the legacy systems by JTCTS. The 
committee directs that the Secretary of the Navy, in 
coordination with the Secretary of the Air Force, conduct a 
further assessment of the feasibility and desirability of such 
a transition strategy and report the results of that assessment 
to the Congressional defense committees with the submission of 
the fiscal year 2000 budget request. To accelerate the 
development of the full capability of JTCTS and to address the 
recommendations that may result from the assessment, the 
committee recommends $33.4 million in PE 24571N, an increase of 
$ 5.0 million and a total of $11.9 million for the JTCTS 
program.

Tactical Tomahawk

    The budget request contained $66.7 million in PE 24229N for 
Tomahawk operational system development; $132.9 million in 
Weapons Procurement, Navy for the Tomahawk Block Improvement 
Program (TBIP); $94.2 million in Other Procurement, Navy for 
TBIP; and $117.1 million in Operation and Maintenance, Navy for 
TBIP.
    In September 1997, during the House-Senate conference on 
H.R. 1119, the Department of the Navy and the Department of 
Defense (DOD) advised the conferees of a proposal to upgrade 
the capability and reduce the production unit cost of the 
Tomahawk cruise missile. The upgraded missile, ``Tactical 
Tomahawk,'' would include several enhancements to improve the 
tactical responsiveness of the Tomahawk missile.
    In the statement of managers accompanying the conference 
report on H.R. 1119 (H. Rept. 103-340), the conferees supported 
the concept of the Tactical Tomahawk missile system, but raised 
several issues regarding the acquisition strategy and funding 
for the system that would need to be addressed before 
initiation of the Tactical Tomahawk program.
    In February 1998, following submission of the President's 
budget request for fiscal year 1999, the committee received a 
reprogramming proposal from the DOD which would transfer fiscal 
year 1998 funds provided for TBIP missile procurement to 
research and development for the Tactical Tomahawk. Following 
review of the supporting rationale for the reprogramming, the 
committee approved the proposal in April, 1998.
    The committee is generally satisfied with the rationale 
that the Navy and the DOD have provided to support the 
reprogramming request. The committee is concerned, however, 
about the Navy's ability to establish a competitive environment 
for future Tactical Tomahawk procurement. The committee is 
particularly interested in the measures that will be taken by 
the Navy to insure a Tactical Tomahawk program that includes 
the potential for a second source for missile system production 
and also provides for a qualified second source engine for the 
production phase of the program. The committee directs the 
Secretary of the Navy to report to the Congressional defense 
committees by September 30, 1998, the Navy's plan for ensuring 
competitiveness in the production phase of the Tactical 
Tomahawk program.
    To provide the fiscal year 1999 funding required to 
complete the reprogramming for Tactical Tomahawk, the committee 
recommends $165.3 million in PE 24229N for Tomahawk operational 
systems development, an increase of $98.6 million; an increase 
of $2.8 million in Other Procurement, Navy for TBIP; and 
reductions of $96.5 million in Weapons Procurement, Navy, and 
$4.9 million in Operations and Maintenance, Navy, for TBIP.

Ultra-high thermal conductivity fibers

    The budget request contained $77.6 million in PE 62234N for 
applied research in materials, electronics, and computer 
technology.
    The committee is aware that over the last three years the 
Navy has engaged in a program to significantly advance the use 
of ultra-high thermal conductivity fibers in high-performance, 
high-density electronic modules. Through this research, the 
Navy has concluded that ultra-high thermal conductivity fibers 
could allow for the expanded use of commercial-off-the-shelf 
(COTS) electronic components in military applications, such as 
avionics, in which the high thermal output of such components 
has constrained their use. The committee believes that the 
potential exists for substantial savings if greater use could 
be made of COTS components in aircraft and avionics systems. 
The committee recommends an increase of $2.5 million to 
determine the feasibility of application of the Navy's recently 
completed research in ultra-high thermal conductivity fibers.

Undersea warfare advanced technology

    The budget request contained $34.9 million in PE 62633N for 
applied research in undersea warfare weaponry technology.
    The committee recommends $36.9 million, an increase of $2.0 
million to continue the development and application of micro 
electromechanical systems (MEMS) technology to Navy undersea 
weapons systems.

Vacuum electronics

    The budget request contained $77.6 million in PE 62234N for 
the Navy's materials, electronics and computer technology 
program, including $10.0 million for applied research in vacuum 
electronics.
    The January 1997 Report to the Congress on the Tri-Service 
Microwave Power Module Project by the Director, Defense, 
Research, and Engineering, and the April 1997 Industrial 
Assessment of the Microwave Power Tube Industry by the Deputy 
Under Secretary of Defense (Industrial Affairs and 
Installations) underscore the importance of vacuum electronics 
to the Department of Defense (DOD). The assessment cites the 
requirement for a focused DOD research and development 
investment strategy to advance the technology and improve 
manufacturability of vacuum electronics to meet future DOD 
system performance improvement and cost reduction requirements. 
The assessment also notes that additional development funding 
may be necessary to adapt emerging product technologies to meet 
service-specific requirements. The committee supports 
continuation of a robust vacuum electronics research and 
development program, and expects the Navy as DOD executive 
agent for the program to insure a coordinated vacuum 
electronics research and development program among the military 
services and defense agencies, and among the DOD and other U.S. 
Government agencies, which will meet DOD requirements for 
advanced vacuum electronics technology. The committee 
recommends the budget request of $10.0 million for the vacuum 
electronics program.

Vectored thrust ducted propeller compound helicopter technology 
        demonstration

    The budget request contained $23.2 million in PE 62122N for 
aircraft technology applied research. No funds were requested 
for the Vectored Thrust Ducted Propeller (VTDP) compound 
helicopter technology demonstration program.
    The VTDP program is intended to demonstrate the technology 
for a vectored thrust, ducted propeller in a compound 
helicopter, which could meet requirements for improvements in 
future rotor craft performance, survivability and 
affordability. The funded program includes design, fabrication 
and ground testing of full-scale VTDP components, control 
system simulation, and system design focused on the H-60 
helicopter as a demonstration platform. If successful, the 
ground test program would provide a basis for a potential 
follow-on flight demonstration program. The committee is aware 
that the Navy expects to address the VTDP technology potential 
for naval rotary wing aircraft before final preparation of the 
fiscal year 2000 budget.
    The committee recommends the budget request. Should the 
Navy make a decision to begin a flight demonstration phase for 
the VTDP program in fiscal year 2000, the committee also 
recommends that the Secretary of the Navy consider 
reprogramming the fiscal year 1999 funds necessary to 
transition the program from the ground test phase to the flight 
test phase.

Vectoring ESTOL control tailless operation research

    The budget request contained $48.3 million in PE 63217N for 
advanced development in air systems and advanced technology, 
including $7.0 million for the Vectoring Extremely Short Take-
off and Landing Control Tailless Operation Research (VECTOR) 
project, and $11.0 million in PE 63790N, NATO Research and 
Development, including $5.0 million for the VECTOR project.
    The committee notes that VECTOR is a new start, 
international flight demonstration effort that would utilize 
the X-31 experiment aircraft to demonstrate the feasibility of 
tailless fighter designs to perform carrier and amphibious 
ship/land-based strike fighter mission, and also demonstrate 
extremely short take-off and landing (ESTOL) using thrust 
vectoring directional control.
    The committee strongly supports the development of advanced 
aviation technology, but notes that the VECTOR project 
represents a new start program that was not included in the 
fiscal year 1998 defense budget request and that was initiated 
with a below threshold reprogramming of $3.0 million. 
Notwithstanding the technical merit of the VECTOR project, the 
committee believes that many of the operational capabilities 
sought in the project duplicate those being pursued in the 
Joint Strike Fighter program. The committee believes that 
priority should be given to the development of advanced 
aviation technology in the JSF program and that funding for the 
VECTOR program should be deferred to fiscal year 2000, 
following completion of JSF technology maturation 
demonstrations and assessments. Accordingly, the committee 
recommends a decrease of $7.0 million in PE 63217N for VECTOR; 
and a decrease of $5.0 million in PE 63790N for VECTOR.

Vertical gun for advanced ships

    The budget request contained $110.1 million in PE 63795N 
for project definition and risk reduction in land attack 
technology, including $25.2 million for the Vertical Guns for 
Advanced Ships (VGAS) program.
    The committee strongly supports the accelerated development 
and fielding of advanced fire support system capabilities for 
naval surface fire support and believes that an advanced gun 
system for the next generation of Naval Surface Combatants (SC-
21) surface combatants will be an integral part of the future 
system. However, the committee does not believe that the Navy 
has given sufficient consideration to, nor completed the 
rigorous analysis of alternative gun system concepts that would 
justify selection of the VGAS concept as the preferred 
alternative for the advanced naval gun system for SC-21. Nor, 
in the committee's opinion, has the Navy given sufficient 
consideration to the relative technical requirements and 
operational roles of gun and missile systems. Until such an 
analysis of alternatives is completed, the committee believes 
that the Navy is not prepared to proceed to a Milestone I 
decision for an advanced gun system as described in the fiscal 
year 1999 budget request. Accordingly, the committee recommends 
a decrease of $20.0 million for the VGAS project.

                            Air Force RDT&E

                                Overview

    The budget request contained $13,598.1 million for Air 
Force RDT&E. The committee recommends authorization of 
$13,577.2 million, a decrease of $20.9 million.
    The committee recommendations for the fiscal year 1999 Air 
Force RDT&E program are identified in the table below. Major 
changes to the Air Force request are discussed following the 
table and in the classified annex to this report.
<GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT>

                       Items of Special Interest

Advanced low observable coatings

    The budget request contained $21.0 million in PE 63112F for 
advanced materials for weapon systems.
    The committee is aware of the constantly evolving threats 
to U.S. aircraft and notes numerous Department of Defense 
initiatives pursuing survivability enhancements to address 
these evolving threats. One technology approach which has 
proven both adaptable and cost effective is that of low 
observable coatings applied to aircraft and other high value 
platforms which mask them from evolving battlefield sensors.
    The committee supports these efforts and recommends $30.0 
million, an increase of $9.0 million for continued exploration 
of advanced low observable coatings.

Advanced military satellite communications

    The budget request contained $54.4 million for the advanced 
military satellite communications (MILSATCOM) program in PE 
63430F.
    Advanced MILSATCOM is the planned Air Force replacement for 
the MILSTAR extra high frequency (EHF) communications 
satellite. The committee notes that the commercial satellite 
communications industry is taking a strong interest in EHF 
communications and in greatly increasing the on-board 
processing capacity of communications satellites. The committee 
believes that the overlap between these trends and advanced 
MILSATCOM requirements offers an opportunity for the Air Force 
to leverage commercially developed technology
    Therefore, the committee recommends $30.0 million, a 
decrease of $24.4 million. The authorized funding would support 
research and development for Air Force-unique requirements in 
EHF communications, including radiation hardened electronics, 
compatibility of a new system with the existing EHF 
communications infrastructure, and interoperability with ground 
terminals.

Aircrew laser eye protection

    The budget request contained $16.6 million in PE 63231F for 
crew systems and personnel protection technology. No funds were 
requested to support development of the aircrew laser eye 
protection program.
    The committee supports the Department of Defense's 
continued efforts to enhance aircraft crew member protection 
systems and yet notes, with concern, recent incidences of 
injuries sustained by crew members due to exposure to lasers. 
The committee is aware of ongoing efforts to develop dye based 
aircrew visors and urges the Air Force to continue funding 
these efforts.
    The committee recommends an increase of $5.5 million for 
aircrew laser eye protection.

ALR-69 radar warning receiver

    The budget request contained $25.6 million in PE 63270F for 
electronic combat technology. No funds were requested to 
support development of the ALR-69 radar warning receiver.
    The committee is aware of continuing efforts by the 
services to improve situational awareness of the radar threat 
environment. While modernization of radar warning equipment has 
progressed for the active forces, the committee remains 
concerned that modernization of National Guard, Reserve, and 
Special Forces aviation assets has not kept pace with available 
technology to address this critical area of vulnerability. The 
committee is aware of the potential of the ALR-69 radar warning 
receiver to offer protection to these forces and recommends 
$34.6 million, an increase of $9.0 million for integration of 
the ALR-69 radar warning receiver into priority National Guard, 
Reserve, and Special Forces aviation assets.

Ballistic missile technology

    The budget request contained $1.3 million for the ballistic 
missile technology (BMT) program in PE 63401F and no funding 
for a conventional ballistic missile demonstration in PE 
63851F.
    Prior year ballistic missile technology funding has 
supported several demonstrations of guidance technology, deep 
earth penetrating warheads, and Global Positioning System (GPS) 
range safety. This technology has in turn supported a 
demonstration of a conventional ICBM that could be used for 
long range precision strike of deeply buried or very hardened 
targets. Many such targets, which include facilities for 
command and control and weapons of mass destruction, are 
currently immune from attack by anything but nuclear weapons. 
The committee believes that this demonstration should be 
pursued as part of the wider effort to develop effective non-
nuclear means to attack this target set.
    Last year, the BMT program was funded separately in PE 
63311F. The committee believes that funding BMT in PE 63401F, a 
program element for advanced spacecraft development is 
inappropriate. The committee recommends $17.3 million, an 
increase of $16.0 million, for advanced ballistic missile 
technology and the conventional ballistic missile 
demonstration. The committee recommends this funding for PE 
63311F and believes that combining these efforts in one PE will 
result in better program coordination.

Distributed agent information warfare

    The budget request contained $8.4 million in PE 33140F for 
the information systems security program.
    The committee notes that the Department of Defense is 
engaged in several development initiatives to mature 
information security technologies for military purposes. One 
such effort, the Distributed Agent Information Warfare 
Framework (DAIWF) has been successfully demonstrated in a small 
business innovative research program under Air Force 
supervision.
    The committee supports this development effort and 
recommends $10.4 million for continued DAIWF development, an 
increase of $2.0 million.

Ejection seats

    The budget request contained $16.6 million in PE 63231F for 
crew systems and personnel protection and $8.2 million in PE 
63216N for aviation survivability.
    Last year, the committee supported an increase in funding 
to continue improvements in aircrew ejection seats and to 
explore alternative technologies leading to injury-free 
ejection seat designs that can accommodate both male and female 
pilots.
    The committee remains supportive of these efforts and 
recommends an increase of $3.0 million in PE 63231F, and an 
increase of $3.0 million in PE 63216N.
    The committee is also aware that the Navy has completed the 
second phase of a small business innovative research program 
(SBIR) for stabilizers for Navy fighter ejection seats, which 
may produce an extraordinary reduction in injuries as well as a 
dramatic increase in aircrew ability to survive ejection from 
the aircraft. Based on the results of the feasibility 
demonstration, the committee encourages the Navy and the Air 
Force to consider establishing a phase III SBIR or a 
demonstration/validation program to continue development of 
this promising stabilization technology.

F-16 squadrons

    The budget request contained $125.1 million in PE 27133F 
for continued operational system development support for the F-
16 fleet.
    The committee notes that the budget request reflects an 
increase of $24.6 million over the level forecast as necessary 
to support fiscal year 1999 requirements in the fiscal year 
1998 budget request. Further, the committee believes that some 
of the proposed fleet support modifications are not expected to 
be carried out until the fourth quarter of fiscal year 1999 and 
should be considered for incorporation into the fiscal year 
2000 program.
    The committee recommends $100.5 million to continue F-16 
fleet support at the level previously forecast for fiscal year 
1999, a decrease of $24.6 million in PE 27133F.

Flight test safely enhancements

    The budget request contained $370.2 million in PE 65807F 
for test and evaluation support.
    The committee is aware of Air Force efforts to improve the 
safety of high performance aircraft flight test operations at 
the Air Force Flight Test Center. The committee notes that 
upgrades to air traffic control systems and on-board aircraft 
equipment offer significant improvements in safety of flight 
test operations and recommends $376.2 million, an increase of 
$6.0 million to continue these efforts.

Integrated high payoff rocket propulsion technology

    The budget request contained $19.0 million in PE 63302F for 
the integrated high payoff rocket propulsion technology 
(IHPRPT).
    The IHPRPT program is developing technologies and 
components for insertion into existing launch vehicles, with 
the goal of improving launch vehicle performance in a variety 
of areas and lowering costs of space launch substantially. The 
committee understands the importance of testing these new 
technologies to demonstrate their performance. The committee 
recommends $23.0 million for IHPRPT in PE 63302F, an increase 
of $4.0 million, to support a Phase I Solid Boost and Orbit 
Transfer demonstration.

Integrated powerhead demonstration

    The budget request contained $21.1 million in PE 63302F for 
space and missile rocket propulsion.
    The committee notes that the Air Force is maximizing 
efforts to integrate advanced propulsion technologies into its 
highest priority space related programs. Of particular 
interest, the committee believes that the Integrated Powerhead 
Demonstration included in this year's request offers potential 
for significant advances in capability and cost reduction for 
the Air Force and other service space programs.
    The committee strongly urges the Air Force to continue this 
effort and supports the request for space and missile rocket 
propulsion.

Longshot

    The budget request contained $17.6 million in PE 27590F for 
the SEEK EAGLE weapons integration flight test program. No 
funds were requested to support continued testing of the 
Longshot guided munition adaption kit.
    The committee notes that the Longshot kit offers the 
potential for a highly cost effective, precision stand-off 
adaption kit that could provide a long range glide capability 
combined with an inexpensive guidance system for increased 
accuracy, and could be strapped on existing inventory bombs and 
submunition delivery systems without modification.
    The committee notes that the system has only received 
limited testing to date and recommends $19.6 million, an 
increase of $2.0 million to continue testing of Longshot.

Low cost launch technology

    The budget request contained no funding for low cost launch 
technology development. Fiscal year 1998 funding was 
appropriated in PE 63173C and PE 63401F.
    Congress added funding for low cost launch technology 
development in both fiscal year 1997 and 1998. The committee 
continues to believe that these technologies, as embodied in 
programs such as Scorpius and Excalibur, show considerable 
promise and deserve additional support. The committee 
encourages the Department to identify and program funds for 
these efforts in the future years defense plan.

Microsatellite technology

    The budget request contained no funding for microsatellite 
technology. Fiscal year 1998 funding for microsatellite 
technology was appropriated in PE 63401F in the Clementine II 
program.
    In congressional testimony, the commander-in-chief of U.S. 
Space Command, identified the development of microsatellite 
technology as a high priority. The committee notes that the 
nation relies heavily on space-based assets for both commercial 
and military purposes, and that reducing the size and weight 
and increasing the agility of satellites and space vehicles has 
the potential to lower costs and improve sustainability. The 
committee understands that $4.0 million would allow the 
microsatellite technology development program to fly a 
satellite inspection mission. The committee recommends an 
increase of $4.0 million to PE 63401F for this purpose.

Military spaceplane

    The budget request contained no funding for the military 
spaceplane in PE 63401F and $3.0 million for the space 
maneuvering vehicle in the space test program, PE 65864F.
    The committee notes that U.S. military forces are 
increasingly reliant on space-based capabilities and the Air 
Force has identified requirements that are best met by a 
military spaceplane and an associated family of vehicles. The 
committee understands that any military spaceplane effort 
should focus on militarily unique requirements and leverage 
NASA investment in the reusable launch vehicle program. These 
unique requirements are reflected in development efforts for a 
space maneuvering vehicle (SMV) that would provide all-orbit 
access and extended on-orbit dwell time, a low cost expendable 
upper stage to deploy payloads to all orbits, and a common aero 
vehicle (CAV) that would serve as a maneuvering reentry vehicle 
capable of delivering various payloads anywhere on earth within 
an hour of launch.
    The committee believes that a military spaceplane and its 
related elements have the potential to contribute significantly 
to U.S. military capability. The committee recommends an 
addition of $15.0 million to PE 63401F to support further SMV 
and CAV development.

More electric aircraft program

    The budget request contained $69.1 million in PE 62203F for 
aerospace propulsion, including $17.9 million for More Electric 
Aircraft (MEA).
    The committee is encouraged with Air Force efforts to 
develop advanced electric power technology through the MEA 
program and urges the Air Force to accelerate this program in 
future budget requests. The committee recommends the $69.1 
million requested.

Panoramic night vision goggle

    The budget request contained $16.6 million in PE 63231F for 
crew systems and personnel protection technology.
    The committee notes the Air Force progress in development 
of night vision technology for application to existing fighter 
and tactical aircraft. Of particular note is the panoramic 
night vision goggle (PNVG) program which significantly broadens 
the field of view for pilots.
    The committee supports this effort and recommends an 
increase of $4.5 million in PE 63231F to continue development 
of PNVG.

Protein-based memory development

    The budget request contained $65.2 million in PE 62702F for 
command, control and communications research.
    The committee notes the encouraging results of Air Force 
research in protein-based ultra-high density memory storage. Of 
particular interest is the progress made in the past year 
confirming the potential for significant increases in memory 
storage capacity. The committee urges the Air Force to continue 
this research and recommends $68.2 million, an increase of $3.0 
million.

Rocket system launch program

    The budget request contained $7.9 million for the rocket 
system launch program (RSLP) in PE 65860F.
    The committee notes that the Air Force has a requirement 
for improved high performance missile technology. The committee 
understands that Advanced Solid Axial Stage (ASAS) technology 
is potentially valuable for ballistic missile defense 
interceptors and other future missiles, and that RSLP plays an 
important role in ASAS development. The committee recommends 
$18.9 million, an increase of $11.0 million in PE 65860F, for 
ASAS development and activities related to current and future 
RSLP flights.

                         Defense Agencies RDT&E

                                Overview

    The budget request contained $9,591.0 million for Defense 
Agencies RDT&E. The committee recommends authorization of 
$9,454.3 million, a decrease of $136.7 million.
    The committee recommendations for the fiscal year 1999 
Defense Agencies RDT&E program are identified in the table 
below. Major changes to the Defense Agencies request are 
discussed following the table.
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                       Items of Special Interest

Advanced concept technology demonstration (ACTD)

    The budget request contained $116.3 million for advanced 
concept technology demonstrations in PE 63750D8Z, an increase 
of $38.8 million over fiscal year 1998.
    Although the management of the ACTD initiatives appears to 
have improved, the committee remains concerned that the 
Department's selection criteria for ACTD candidates lacks 
specificity and believes such a large increase is not 
warranted. The committee recommends a decrease of $12.0 million 
in PE 63750D8Z.

Advanced synthetic aperture radar system improvement program

    The budget request contained $5.0 million in PE 35207D8Z 
for the Advanced Synthetic Aperture Radar System (ASARS) 
Improvement Program (AIP) for the U-2 aircraft.
    As a result of the termination of the Defense Airborne 
Reconnaissance Office, the Deputy Secretary of Defense for 
Acquisition and Technology sent a letter to the Congress 
recommending specific redistribution of Defense Airborne 
Reconnaissance Program funding in fiscal year 1999. Included in 
this recommendation was an additional $2.5 million for AIP 
research and development.
    The AIP program will dramatically increase the U-2's radar 
system with significantly improved synthetic aperture radar 
imagery, a highly capable moving target indicator tracking 
capability, and integral onboard processing functions. 
Unfortunately, the AIP has suffered cost growth and has a 
fiscal year 1999 shortfall of over $18.0 million. Some of this 
growth is due to contractor overruns and schedule slips caused 
by late deliveries of commercial processors. Some of this 
growth is due to a decision to postpone certain Global Hawk 
High Altitude Unmanned Aerial Vehicle radar developments that 
were cost sharing with AIP. This growth has forced the Air 
Force to make decisions to slip the AIP, thereby further 
increasing costs. In order to deliver the AIP when required, 
the Air Force has stated a need to reprogram funding from 
procurement to research and development in fiscal year 1999. 
However, such a step would have a significant procurement 
funding impact in fiscal year 2000.
    The committee recommends an authorization of $13.0 million, 
an increase of $8.0 million for AIP development.

Ballistic missile defense

    The budget request contained $3.6 billion for ballistic 
missile defense (BMD). The committee recommends $3.8 billion, 
an increase of $132.8 million.
    The committee believes that the budget request represents a 
reasonable effort to fund BMD priorities more adequately than 
the budget requests of the past several years. The committee 
notes specifically that the National Missile Defense (NMD) 
program request is consistent with the revised estimate of 
program requirements put forward by the Department last year. 
The committee also believes that the Theater High Altitude Area 
Defense (THAAD) program request reflects an effort to restore 
funding reduced last year as a result of program delays.
    While the committee is gratified with this commitment of 
funds, it is concerned that the Administration's commitment to 
robust research and development and timely deployment in the 
longer term is still lacking. According to Ballistic Missile 
Defense Organization (BMDO) budget documents, BMD funding would 
decline rapidly in the future years defense plan (FYDP), from 
$3.6 billion requested in fiscal year 1999 to $2.6 billion in 
both fiscal years 2002 and 2003. This decline would leave the 
BMDO with an annual budget shortfall of over $1.0 billion and 
unable to meet clearly identified and understood BMD 
requirements. These documents acknowledge that the shortfall is 
even greater than appears, because several high priority 
programs are unfunded or underfunded throughout the FYDP, 
including innovative research and development to support next 
generation BMD systems, the medium extended air defense system 
(MEADS), the Navy theater wide defense system, and NMD, should 
a decision be made to deploy within the FYDP. This projected 
shortfall would inevitably result in delayed development and 
deployment schedules for virtually all BMD programs.
    The committee notes that missile defense remains a very 
high priority with commanders in the field and that missile 
threats to the U.S. homeland, deployed troops, and allies 
continue to grow. The committee believes that the planned 
reduction of the BMDO budget baseline is completely unjustified 
and urges in the strongest terms that the Department identify 
funds in the future year defense plans to meet legitimate 
missile defense needs.
            Advanced technology development
    The budget request contained $166.7 million for Advanced 
Technology Development in PE 63173C, of which $30.2 million is 
for Operational Support (project 4000).
    The committee notes that the $30.2 million request for 
Operational Support (project 4000) represents an eleven percent 
increase over the fiscal year 1997 request. The committee 
recommends a decrease of $2.0 million for Operational Support.
            Atmospheric interceptor technology
    The budget request contained $24.5 million for the 
atmospheric interceptor technology (AIT) program in PE 63173C.
    The AIT program has been restructured to develop advanced 
components for a variety of hit-to-kill vehicles, including 
advanced high performance divert and attitude control systems, 
seekers, energy sources, and avionics. The committee notes that 
BMDO is now pursuing five hit-to-kill missile defense systems 
which will remain in U.S. inventories for many years. The 
committee believes that the AIT effort can provide beneficial 
technology to all of these programs. The committee recommends 
$46.5 million, an increase of $22.0 million.
            BMD research and development
    The committee notes with considerable concern that, 
according to budget documents provided by the Ballistic Missile 
Defense Organization (BMDO), by fiscal year 2002, BMDO research 
and development accounts will fall to their lowest levels since 
fiscal year 1985. This situation would result from the 
precipitous decline in funding projected by the BMDO budget and 
from the fact that several programs are transitioning from 
development to acquisition.
    The committee believes that this projected level of 
investment in next generation missile defense technologies is 
inadequate. The committee directs the Secretary of Defense to 
provide a report to the Congressional defense committees by 
March 1, 1999, on the appropriate level of research and 
development investment in next generation ballistic missile 
defense technologies, the BMD budget level required to sustain 
both acquisition of critical BMD systems and robust R&D, and 
how the Department of Defense intends to manage the BMDO 
transition from an R&D organization to one that must manage 
both R&D and acquisition programs.
            Ballistic missile defense testing
    The committee has long expressed frustration with the lack 
of a robust test program in a number of BMD programs, including 
the theater high altitude area defense (THAAD), national 
missile defense (NMD), and navy area defense systems. In its 
recent report, the Panel on Reducing Risk in Ballistic Missile 
Defense Flight Test Programs criticized BMD flight test 
programs for accepting excessive risk, in part because of the 
perceived urgency of speeding BMD capabilities into the field. 
The panel also argued that BMD flight test programs have 
incorrectly viewed flight tests as significant advances in 
technology rather than validations of technical advances and 
carefully planned efforts to prove technology that cannot be 
tested on the ground. The report recommended that BMD program 
schedules be slowed, and that ground testing, modeling and 
simulation be substantially increased.
    The committee finds considerable merit in the report, and 
notes that many of its recommendations had already been 
incorporated into the THAAD and NMD test programs prior to the 
report's release. Due in part to funding added to by Congress, 
the number of integrated ground tests planned in the NMD 
program has doubled. Nevertheless, the committee believes that 
the report's implication that the urgency of the need to deploy 
TMD systems is merely ``perceived'' is seriously mistaken. Both 
the Commander-in-Chief of U.S. Central Command, and the 
commander of U.S. and United Nations forces in Korea testified 
this year that theater missile defense is their top priority. 
This priority is reflected in House passage of H.R. 2786, the 
Theater Missile Defense Improvement Act of 1998, that would 
provide additional test and development funds for a number of 
systems to more effectively and more rapidly address emerging 
theater missile threats. The committee continues to believe 
that the earliest possible deployment of theater missile 
defense capabilities remains a very high priority.
    The committee believes the report of the panel would have 
been more valuable had it focused more directly on testing 
practices that would allow BMDO to minimize development risks 
while sustaining aggressive schedules, and believes that such a 
focus would have benefited not only BMD programs and the 
warfighters, but the test and evaluation community as well. 
Therefore, the committee directs the Secretary of Defense to 
report to the Congressional defense committees by March 1, 
1999, on innovative testing concepts, processes, and procedures 
that have the potential to advance BMD technologies rapidly 
with minimum risk.
            Cooperative ballistic missile defense
    The budget request contained $37.9 million for the Israeli-
American Arrow theater missile defense program and $12.8 
million for the Russian-American Observation Satellites (RAMOS) 
program in PE 63875C.
    The committee continues to endorse cooperative BMD efforts 
as a means of leveraging U.S. BMD investments, and recommends 
the requested amount for the Arrow program. The committee 
understands that the rapid emergence of an Iranian ballistic 
missile threat capable of threatening Israel requires an 
effective and timely response. The committee notes that the 
Israeli government has expressed strong interest in deploying a 
third Arrow battery to mitigate this emerging threat and that 
the Administration has recently endorsed U.S. assistance toward 
that end. The committee urges the Administration to proceed 
rapidly in determining appropriate funding sources and 
finalizing appropriate agreements with the government of Israel 
that would allow such aid to be provided expeditiously.
    The committee recognizes that the Iranian ballistic missile 
program has advanced so rapidly in large part due to 
substantial assistance from Russian sources. The committee 
recommends $12.8 million for RAMOS, and recommends a 
legislative provision (sec. 233) that would prohibit obligation 
or expenditure of $5.0 million until the Secretary of Defense 
certifies to Congress that the Department has acquired detailed 
information concerning the nature, extent, and military 
implications of ballistic missile technology transfer from 
Russian sources to Iran.
            Joint theater missile defense
    The budget request contained $176.8 million for Joint TMD 
in PE 63872C.
    The committee notes unjustified increases in the cost of 
various TMD exercises, and recommends $174.8 million, a 
decrease of $2.0 million in User Interface, project 3265.
            National missile defense
    The budget request contained $950.5 million in PE 63871C 
for the national missile defense (NMD) program.
    The committee recommends the budget request. The committee 
is encouraged by the Administration decision to fully fund the 
NMD program and by the selection of the lead system integrator 
(LSI). The committee believes that the LSI concept is sound and 
will provide the necessary management expertise to move the 
program forward expeditiously.
    The committee continues to support efforts to develop an 
NMD system capable of defending all 50 states. The committee 
believes that the threat of ballistic missile attack on the 
U.S. homeland continues to grow, and understands that nations 
hostile to U.S. interests are developing or seeking to acquire 
long range ballistic missile technologies. Therefore, the 
committee recommends a legislative provision (sec. 231) that 
expresses the sense of Congress that any deployed national 
missile defense should defend all fifty states and that U.S. 
territories should be protected from ballistic missile attack.
    The committee is aware that defense of all 50 states by an 
NMD system could require changes to the Anti-Ballistic Missile 
(ABM) Treaty. The committee believes that the United States and 
Russia should pursue approaches to the ABM Treaty responsive to 
new strategic requirements that would permit an effective 
limited defense of U.S. national territory and enhance the 
security of both Russia and the United States. U.S.-Russian 
discussions to explore these issues were pursued in the early 
1990s but were discontinued in 1993. The committee does not 
believe that such exchanges should or would restrict the right 
to deploy an effective limited national missile defense when 
U.S. interests require such a deployment. The committee 
recognizes that the Treaty expressly provides for the right of 
withdrawal, a right that could be exercised if a demarche with 
Russia fails to produce the necessary agreement concerning the 
intent or content of the Treaty.
            Navy theater wide
    The budget request contained $190.4 million in PE 63868C 
for the navy theater wide (NTW) defense system.
    The committee continues to support this important theater 
missile defense program. The Assistant Secretary of the Navy 
for Research, Development, and Acquisition recently testified 
that the NTW system could achieve Block I capabilities by 
fiscal year 2002 if provided with sufficient additional funding 
above the Administration's request. The committee notes recent 
analysis performed by BMDO and the Navy indicating that this 
date would entail very high program risk, very high near term 
costs, and does not appear reasonably executable. The committee 
further notes that BMDO and the Navy now support deployment of 
a Block I capability by fiscal year 2005 as a fiscally 
plausible and technically achievable goal. However, additional 
funding in fiscal year 1999 and throughout the future year 
defense plan will be necessary to achieve this objective. To 
this end, the committee recommends $260.4 million, an increase 
of $70.0 million for continued risk reduction, additional 
testing of the Lightweight Exoatmospheric Interceptor (LEAP) 
program and Aegis-LEAP integration. The committee urges the 
Department to identify and support adequate funding in the 
future years defense plan to sustain Block I NTW deployment.
    The committee is concerned that the technical evolution of 
NTW Block I to Block II has not been adequately considered. As 
a consequence, BMDO has not yet been able to provide assurance 
to the committee that Block I development efforts are on a path 
to support the evolution to Block II. The committee believes 
that the long term success of NTW requires that Block II 
technology requirements and architecture be well defined to 
ensure that accelerated Block I development can proceed along 
that critical path.
            Patriot advanced capability
    The budget request contained $343.2 million in procurement 
and $137.3 million in PE 64865C for the Patriot Advanced 
Capability-Configuration 3 (PAC-3) program.
    The committee understands that the PAC-3 development 
program has experienced cost increases. The committee supports 
the Department's request to use $40.0 million requested for 
PAC-3 procurement in fiscal year 1999 to meet this development 
shortfall and to ensure that the PAC-3 test program is 
completed.
    The committee understands that this reduction to 
procurement will reduce the number of low rate initial 
production missiles that will be acquired in fiscal year 1999. 
The committee believes that increasing the initial production 
rate is an important goal as a means of addressing the threat 
posed by potential deployment of Iranian theater ballistic 
missiles to U.S forces, friends and allies in the Persian Gulf 
and Middle East. The committee understands that an additional 
$16.0 million would support increasing low rate initial 
production to six a month. Consequently, the committee 
recommends $303.2 million for PAC-3 procurement, a reduction of 
$40.0 million, and $193.3 million for engineering and 
manufacturing development, an increase of $56.0 million which 
includes the $40.0 million transfer from procurement and an 
increase of $16.0 million in PE 64865C.
            Space based laser
    The budget request contained a total of $93.8 million for 
the Space Based Laser (SBL) program, of which $58.8 million is 
in PE 63173C and $35.0 million is in 63876F.
    The committee understands that SBL technology has matured 
to the point where a readiness demonstrator (SBLRD) is a 
logical next step. However, the committee is concerned that a 
program leading to an SBLRD launch in 2005 may be too costly 
and would unnecessarily restrict the technical options open to 
the program. The committee believes that innovative technical 
ideas can reduce the cost of the SBLRD, advance the 
technologies that might be used if a decision were taken to 
develop and deploy an operational system, and provide valuable 
proof of concept demonstrations. The committee believes that 
these goals can be accomplished without an inordinate delay in 
the launch date.
    However, the committee does not believe that the best path 
to achieve these goals has been adequately laid out in the 
currently proposed SBLRD program. Until the Department proposes 
a technically achievable program plan and funding in the future 
years defense plan has been identified, the committee believes 
that a commitment to higher funding levels is premature. 
Consequently, the committee recommends a reduction of $10.0 
million in PE 63173C and a reduction of $10.0 million in PE 
63876F. The committee further recommends that BMDO establish a 
separate SBL program element in its fiscal year 2000 budget 
submission.
            Support technology--applied research
    The budget request contained $86.9 million in PE 62173C for 
ballistic missile defense support technologies.
    The committee is concerned with the deep reduction in 
innovative science and technology for BMD in project 1651, from 
$60.5 million in fiscal year 1998 to a request of $24.0 
million. The committee understands that BMDO seeks to support 
only those areas of applied research relevant to BMD without 
duplicating other efforts, but is also aware that a number of 
such technology efforts are not sufficiently funded. The 
committee recommends an increase of $15.0 million in project 
1651, including $5.0 million for wide bandgap semiconductor 
research.
    Furthermore, while the committee is aware and appreciative 
of the value of involving small business in BMD research, the 
committee is not convinced that a 35 percent increase in Small 
Business Innovative Research and Small Business Technology 
Transfer in project 1660 is justified. Therefore, the committee 
recommends $50.0 million, a reduction of $12.2 million in 
project 1660.
    The committee recommends $89.7 million for PE 62173C, an 
increase of $2.8 million.
            Technical operations
    The budget request contained $190.1 million for BMD 
technical operations in PE 63874C. The committee notes a 
significant increase in fiscal year 1999 funding in project 
3153, System Architecture and Engineering compared to 
projections made in fiscal year 1998, and, therefore, 
recommends $186.1 million, a reduction of $4.0 million.
            Theater high altitude area defense (THAAD)
    The budget request contained $497.8 million in PE 63861C 
for THAAD demonstration and validation, and $323.9 million in 
PE 64861C for THAAD engineering and manufacturing development.
    The committee continues its strong support for the THAAD 
program and recommends authorization of the request. The hiatus 
in THAAD flight testing has been used for extensive quality 
control and risk reduction efforts, and has put the program on 
a firmer technical footing. While THAAD missile development 
remains an area of risk, the THAAD battle management/command, 
control, and communications (BMIC3) system and ground based 
radar have achieved significant progress. The committee 
strongly encourages the Director of BMDO to proceed with EMD on 
the elements of the program mature enough to do so, while the 
THAAD missile continues to evolve. The committee believes that 
starting EMD for the THAAD radar and BM/C3 will result in more 
a capable system earlier than if those systems are held back.
    The committee notes that early deployment of a contingency 
capability remains a high priority of the Ballistic Missile 
Defense Organization to address longer range threat missiles, 
such as those currently deployed in North Korea and under 
development in Iran. The committee is aware of concern that a 
decision to proceed to production of 40 User Operational 
Evaluation System (UOES) missiles after one successful 
intercept may be premature. The committee notes that the 
decision to proceed is based not only on one intercept but 
three subsequent ``in progress reviews.'' Further funding for 
THAAD UOES acquisition can be suspended after any of these 
reviews if problems or difficulties that warrant such an action 
are discovered. The committee also understands that delaying 
the commitment to UOES correspondingly delays delivery of a 
contingency capability to the warfighters, and believes that 
such a delay would unnecessarily deny them a valuable defensive 
and deterrent capability.

Chemical-biological defense program

    The budget request contained a total of $620.3 million for 
the Department of Defense chemical-biological defense program, 
including $283.9 million for procurement of chemical and 
biological defense equipment for the military services and 
$336.4 million for research, development, test and evaluation 
(RDTE). The budget request also included $88.0 million in PE 
62383E for the Defense Advanced Research Projects Agency's 
component of the biological warfare defense program.
    The committee has repeatedly expressed its concerns about 
the need for a strong chemical-biological defense program to 
meet the potential threat posed by the proliferation of 
chemical and biological weapons in the post-Cold War world. The 
committee has strongly supported and insisted upon a 
coordinated and integrated chemical-biological defense program 
and the need for joint coordination and oversight of the 
program. The committee notes ongoing research and development 
activities by the Department of Energy (DOE) national 
laboratories that are addressed elsewhere in this report, 
including $17.0 million for the DOE Deterrence and Detection 
Technologies Program and $56.5 million for the DOE 
Proliferation Detection Program.
    The committee believes that increased and continuing 
emphasis should be given to the development of advanced stand-
off detectors that employ a range of potential sensing 
technologies capable of detecting nuclear, chemical, and 
biological weapon proliferation effluents and agents. The 
committee also believes that the chemical-biological defense 
program must incorporate the best efforts of the military 
services' research and development establishment, defense 
agencies, national laboratories, federally funded research and 
development centers, and industry. The committee directs that 
the Secretary of Defense address this issue, including plans 
for developing a more fully integrated program with the DOE, as 
a specific item of interest in the next annual report to 
Congress on the Department of Defense Nuclear/Biological/
Chemical (NBC) Defense Program.

Counterproliferation support

    The budget request contained $70.6 million for 
counterproliferation support in PE 63160BR. The committee notes 
that the requested funding is significantly above last year's 
projection for fiscal year 1999. The committee believes that 
maintaining level funding is appropriate and recommends $57.6 
million, a decrease of $13.0 million.
    The committee also recommends a provision (sec. 234) that 
would prohibit obligation or expenditure of the funds 
authorized and appropriated in PE 63160BR until the report on 
the threat posed to the United States by weapons of mass 
destruction andcruise and ballistic missiles is submitted to 
Congress as required in section 234 of the National Defense 
Authorization Act for Fiscal Year 1998 (Public Law 105-85).

Defense Advanced Research Projects Agency

    The budget request contained $2,040 million for Defense 
Advanced Research Projects Agency programs.
    The committee is concerned, as detailed elsewhere in this 
report, by the increased emphasis given to defense-wide 
research, science, and technology programs at the apparent 
expense of those programs within the military departments.
    Accordingly, the committee recommends the following 
adjustments in selected DARPA programs and transfer of the 
funds to the accounts of the military departments: a reduction 
of $37.0 million in PE 62702E for applied research in tactical 
technology; a reduction of $27.5 million in PE 63760E for 
command, control, and communications systems advanced 
development; a reduction of $13.1 million in PE 63762E for 
advanced development of sensor and guidance technology; and a 
reduction of $11.6 million in PE 63764E for land warfare 
technology advanced development.
            DARPA marine technology program
    The committee is also concerned by the overall reduction in 
funding for the DARPA marine technology program, for which 
$24.8 million in PE 63763E was requested. The objective of the 
program is to identify and mature critical enabling 
technologies for maritime systems, and to develop and 
demonstrate advanced systems concepts to counter the threat 
created by the worldwide proliferation of increasingly 
sophisticated naval technology. The growing threat of quiet 
diesel/electric submarines, the continuing worldwide 
proliferation of advanced submarine and weapons capabilities, 
and the easy availability of modern underwater mines all 
necessitate the development of solutions for enhancing the 
operating capabilities and the survivability of U.S. naval 
forces in the littoral. With the cancellation of the Arsenal 
Ship program at the beginning of fiscal year 1998 and other 
adjustments in the marine technology program, the DARPA fiscal 
year 1999 budget request for marine technology was reduced by 
$64.0 million and estimated funding for the remainder of the 
Future Years Defense Program (FYDP) reduced by $135.2 million. 
The committee believes that such reductions result in an 
advanced marine technology program which is not adequate to 
address the future requirements of U.S. naval forces. The 
committee directs the Under Secretary of Defense for 
Acquisition and Technology and the Secretary of the Navy to 
conduct an assessment of the DARPA marine technology program 
from the standpoint of these requirements and report to the 
Congressional defense committees with the submission of the 
fiscal year 2000 defense budget request the results of the 
assessment and recommendations for adjustments to budget 
projections for the FYDP period.

Defense airborne reconnaissance program management

    The budget request contained $15.7 million for defense 
airborne reconnaissance program (DARP) integration and support 
in PE 35209D8Z, and $35.0 million in PE 35208D8Z for 
distributed common ground systems.
    The committee notes that, subsequent to development of this 
year's budget request, the Defense Airborne Reconnaissance 
Office (DARO) has been eliminated and its functions absorbed 
within the reorganized office of the Office of the Assistant 
Secretary of Defense for Command, Control, Communications, and 
Intelligence (OASD (C3I)) and within the military services. The 
committee supports actions which adhere to the Department's 
stated objective of maintaining very small cadre oversight 
organizations within OSD, focused on policy level guidance to 
ensure reconnaissance system interoperability and architectural 
compliance. The Department provided a report to the 
Congressional defense committees which included plans to 
request reprogramming authority to shift DARO funding for DARP 
integration and support from PE 35209D8Z to program elements 
within the Air Force and other DOD agencies, as well as to 
defense-wide operations and maintenance accounts.
    The committee supports this transfer of funding and, 
therefore, recommends $7.0 million in Operations and 
Maintenance, defense-wide for OASD (C3I), $2.5 million in PE 
35208F, $2.5 million in PE 35208BQ, $2.5 million in PE 35208G, 
and $2.0 million in PE 35208L, for a total transfer of $11.0 
million, a decrease of $4.7 million in PE 35209D8Z and $5.6 
million in PE 35208D8Z.

Defense manufacturing, technology program (MANTECH)

    The budget request contained $14.5 million in PE 78045A, 
$59.1 million in PE 78011N, $51.0 million in PE 78011F, and 
$26.2 million in PE 78011S, for the Department of Defense 
manufacturing technology (ManTech) program.
    Section 211 of the National Defense Authorization Act for 
Fiscal Year 1998 (Public Law 105-85) requires the Secretary of 
Defense to prepare a five-year plan for the manufacturing 
technology program and to submit the plan annually to the 
Congress with the President's budget request. The committee has 
received the first such plan which establishes the goals, 
milestones, priorities, and investment strategy for the 
manufacturing technology program through fiscal year 2003. The 
committee commends the Secretary for preparing a comprehensive 
plan and is encouraged by the positive trends in the five-year 
budget projection for the ManTech program.
    However, the committee believes that the budget projections 
are still inadequate to accomplish the stated goals for the 
program. In the statement of managers accompanying the 
conference report on H.R. 1119 (H. Rept. 105-340), the 
conferees recommended an annual manufacturing technology 
funding target for each of the military departments and defense 
agencies of at least 0.25 percent of the total amount budgeted 
in each service for demonstration and validation, engineering 
and manufacturing development, operational system development, 
and procurement programs. The fiscal year 1999 budget request 
falls short of this recommended minimum funding level.
    The committee is aware of a number of promising candidate 
ManTech programs, including electronic circuit board 
manufacturing development, battery technology, rotary wing 
sustainment, the Instrumented Factory for Gears, fiber optics, 
advanced composites,synchronized drive trains, smart production 
product model, and simulation based design and operational evaluation. 
The committee believes that each program should compete for funding 
within the overall priorities of the service ManTech programs.
    The Army is the single service manager for the defense 
ammunition program. The committee believes that insufficient 
attention has been paid to the development of manufacturing 
technology for this critical commodity and recommends increased 
funding for munitions manufacturing technology in the Army 
ManTech program. The committee recommends that munitions 
manufacturing technology be reflected as an integral part of 
the ManTech program in the future and directs that this aspect 
of the program be addressed as a specific item of interest in 
the annual plan update.
    Accordingly, to bring the total ManTech program to the 
level that has been recommended by the Congress, the committee 
recommends a total of $41.7 million in PE 78045A for the Army 
ManTech program (including $15.0 million for munitions 
manufacturing technology), an increase of $27.2 million; $67.7 
million in PE 78011N, an increase of $8.6 million; $58.4 
million in PE 78011F, an increase of $7.4 million; and $26.2 
million in PE 78011S.
    Elsewhere in this report, the committee recommends a 
legislative provision that addresses ManTech program cost 
sharing.

Demilitarization of non-nuclear military explosives

    The budget request contained $11.6 million in PE 63104D8Z 
for the development of explosives demilitarization technology, 
including $7.4 million for continuation of the tunnel 
demonstration program.
    The committee notes that funding for the conventional 
munitions demilitarization program has decreased from the 
original goals that were set when the program was established. 
The committee also notes the need for increased emphasis on the 
development of environmentally safe procedures and processes 
for the disposal of non-nuclear military explosives. 
Accordingly, the committee recommends $13.6 million in PE 
63104D8Z, an increase of $2.0 million to allow continued 
aggressive development of environmentally safe procedures to 
safely dispose of military explosives.

Electro-optic framing technologies

    The budget request contained $5.4 million in PE 35207D8Z 
for electro-optic (EO) framing technology.
    The committee continues to strongly support the state-of-
the-art EO framing with on chip forward motion compensation 
(FMC). This technology is proving itself in operationally 
deployed systems.
    The committee recommends $13.4 million, an increase of $8.0 
million in PE 35207D8Z for the purposes of furthering the EO 
with on-chip FMC technologies. Specifically, these additional 
funds are to be used for continued development of the ultra-
high resolution focal plane array and conformance with JPEG 
2000 compression standards. These developments should produce 
form/fit operational insertions into currently deployed CA-260 
framing cameras. Further, these funds are to be used to develop 
infra-red EO framing technologies and image intensified EO 
framing sensors with FMC for operational insertion into 
existing Air National Guard tactical reconnaissance aircraft 
and other aircraft as appropriate.

Endurance unmanned aerial vehicle

    The budget request contained $178.7 million in PE 35205D8Z 
for endurance unmanned aerial vehicles, and included $40.6 
million for the DarkStar stealth high altitude endurance (HAE) 
unmanned aerial vehicle (UAV), $90.1 million for Global Hawk 
HAE UAV, and $48.0 million for the common ground segment.
    The committee is aware that there has been a tendency to 
describe existing advanced concept technology demonstration 
(ACTD) aircraft, such as DarkStar and Global Hawk, as systems 
that may, in part, replace manned reconnaissance aircraft. The 
committee notes that Global Hawk has recently completed its 
first test flight. The committee is also aware that continuing 
problems with the DarkStar development have prevented any 
flight test since the previous crash during the attempted 
second flight test of air vehicle #1. The committee is 
concerned by continuing delays in the DarkStar flight test 
schedule and is aware that the DarkStar, as well as other 
similar ACTD aircraft, require significant redesign and 
modification before user evaluation can be performed. Such 
demonstration aircraft are not, nor were they designed to be, 
operational aircraft. Predator, the first ACTD UAV to 
transition to production has demonstrated the difficulties 
inherent to this process. The committee reaffirms its direction 
that the ACTD program is not to be used to circumvent 
established acquisition procedures.
    The committee strongly supports continued development of 
HAE UAVs as potential replacements for manned reconnaissance 
aircraft, and recommends $178.7 million in PE 35205F only for 
HAE UAV and common ground segment development.

Facial recognition technology

    The budget request contained $35.8 million for the DOD 
counter-terror technical support (CTTS) program in PE 63122D8Z.
    The CTTS is an interagency program for development and 
demonstration of surveillance, physical security, and 
infrastructure protection technology. The committee continues 
to support use of advanced technology to control access to 
critical facilities and recommends an increase of $4.0 million 
in PE 63122D8Z for the development and demonstration of 
biometric access control technology, including the use of 
authentication software and the principal component method of 
facial recognition.

Flat panel displays

    The budget request contained $34.0 million in PE 62708E for 
the Defense Advanced Research Projects Agency's integrated 
command and control technology applied research program.
    In 1994, the President and the Department of Defense 
announced a five-year, National Flat Panel Display Initiative 
(NFPDI) to establish a viable domestic industrialcapability for 
the manufacture of high definition displays that could develop and 
produce advanced technology flat panel displays for use by the military 
services. The Under Secretary of Defense for Acquisition and Technology 
(USD(A&T)) recently provided a report, dated March 1988, to the 
Congressional defense committees that states that the objective of the 
NFPDI remains valid, that considerable progress has been made in the 
development of a domestic industrial capability for commercial and 
military applications of flat panel displays, but the objective of the 
initiative has not yet been fully achieved. According to the report, 
the issue facing DOD today is how to allocate its resources most 
effectively to obtain assured, affordable access to advanced flat panel 
display technology. The report also cites the need for improved 
coordination of issues that cut across programs, such as assured 
sources of supply, commonality, and upgrade and replacement of flat 
panel display systems over the life cycle of weapon systems.
    The committee recommends $40.0 million in PE 62708E, an 
increase of $6.0 million to continue the development of 
advanced technology for flat panel displays. The committee 
directs the USD(A&T) to report to the Congressional defense 
committees with submission of the fiscal year 2000 budget 
request the actions taken on the recommendations contained in 
the USD(A&T) report.

Global positioning system guidance package

    The budget request contained $213.2 million in PE 63762E 
for advanced development of sensor and guidance technology, 
including $4.5 million for continued development, integration 
and test of the global positioning system (GPS) guidance 
package.
    The GPS guidance package (GGP) is a fiber-optic-gyro-based 
inertial navigation system which has the potential to lower 
substantially the cost, size, and weight of military inertial 
navigation systems. If the objectives of the program are met, 
the reduced cost of the system would make precise inertial 
navigation and positioning available for use in a significantly 
larger number of Army, Navy, and Air Force airborne and ground 
vehicle systems. Of the funds authorized in PE 63762E, the 
committee recommends $6.5 million for completion of the GGP 
program, an increase of $2.0 million to the budget request for 
that program.

Humanitarian demining

    The budget request contained $17.2 million for humanitarian 
demining in PE 63920D8Z.
    The committee does not believe that humanitarian demining 
is the sole responsibility of the Department of Defense, but 
rather an initiative that should be conducted in close 
coordination and shared funding with other agencies and 
organizations. The committee notes that many of the tasks with 
the humanitarian demining effort are assessed by the Department 
as having low to medium utility to the military. Therefore, the 
committee recommends $12.2 million in PE 63920D8Z, a decrease 
of $5.0 million.

International medical programs global satellite system

    The budget request contained $2.0 million in PE 11017D8Z 
for Partnership For Peace activities.
    The committee notes that the Peace Information Management 
System (PIMS) is a NATO program to enable efficient, reliable 
information exchange between partnership countries and NATO 
members. The committee recognizes that the International 
Medical Programs Global Satellite System (IMPGSS) is an 
important part of the PIMS effort and recommends $6.0 million, 
an increase of $4.0 million to initiate the IMPGSS in PE 
11017D8Z.
    While supportive of this effort, the committee is concerned 
about continuing loss of radio frequency spectrum allocated to 
the Department of Defense (DOD) and believes that precautions 
must be taken to ensure that the radio frequency authorization 
for IMPGSS does not interfere with or result in the loss of 
radio frequency spectrum to DOD users. Accordingly, the 
committee directs that the Secretary of Defense shall not 
obligate any funds provided for the IMPGSS program prior to 
submitting a report to the Congressional defense committees 
detailing the impact of the IMPGSS on the DOD radio frequency 
spectrum.

Joint signals intelligence avionics family

    The budget request contained $80.4 million in PE 35206D8Z 
for the joint signals intelligence avionics family (JSAF).
    The committee continues to be concerned by problems with 
JSAF development. While the committee is encouraged by progress 
in design of the low band subsystem (LBSS), it is concerned by 
schedule delays and cost increases that have forced reduction 
of system performance to remain within budget. Further, the 
committee remains doubtful that the high band subsystem (HBSS) 
development can successfully meet its cost and performance 
goals.
    The committee's concerns are heightened by the fact that 
the JSAF development is the only planned upgrade for future 
airborne signals intelligence (SIGINT) reconnaissance. If JSAF 
fails to provide the needed capabilities, users ranging from 
theater tactical forces to national policy makers will be 
severely impacted.
    Executive Order 12333 charges the Director of the National 
Security Agency (NSA) to conduct ``research and development to 
meet the needs of the United States for signals intelligence. . 
. .'' To ensure proper joint oversight of JSAF development, the 
committee recommends the budget request be authorized in PE 
35885G, the Defense Cryptologic Program. The committee believes 
this action will allow the Air Force, as the executive agent 
for JSAF, to continue to execute the program, while providing 
joint oversight by NSA.

Live fire testing of vulnerability to asymmetric threats

    The budget request contained $9.9 million in PE 65131D8Z 
for the live fire testing program under the Director of 
Operational Test and Evaluation.
    The Department of Defense live fire testing program is 
focused primarily upon assessing the vulnerability of U.S. 
military systems to the effects of conventional threats, such 
as projectiles and explosives. The committee is concerned by 
the potential threat posed to U.S. weapons and supporting 
defense systems by emerging threats such as those posed by low, 
medium, and high energy lasers, high power microwave radio 
frequency weapons, or by weapons capable of generating a high-
power electromagnetic pulse. Such weapons might be used by an 
adversary to exploit a specific area of vulnerability, such as 
communications, information warfare, or other selected areas, 
to attack U.S. forces more effectively and efficiently, and 
thereby achieve an asymmetric advantage. The committee believes 
that increased attention should be given to the potential 
threat posed by such weapons and to assessing their potential 
threat to U.S. military systems.
    The committee recommends $13.9 million for the live fire 
testing program, an increase of $4.0 million to expand threat 
vulnerability testing and evaluation to include the threat of 
radio frequency weapons. The committee directs the Secretary of 
Defense to conduct an assessment of the requirements for 
testing of the vulnerability of U.S. military systems to 
asymmetric threats and to submit the results of the assessment 
to the Congressional defense committees with the fiscal year 
2000 budget request.

Medical free electron laser

    The budget request contained $9.7 million for the medical 
free electron laser program (MFEL) in PE 62227D8Z.
    The committee is aware that the MFEL has undergone rigorous 
peer review and is now enabling new methods for treating burns 
and other minimally invasive techniques. The committee supports 
MFEL and recommends $14.7 million in PE 62227D8Z, an increase 
of $5.0 million for MFEL.

National technology alliance

    The committee is aware that the National Technology 
Alliance (NTA) program has demonstrated its worth in over a 
decade of productive, cooperative efforts with government, 
industry and academia which have measurably benefited users of 
information technology. Originated by the intelligence 
community, the NTA program has focused on advanced technology 
solutions to address the expanding needs for information of 
operational users.
    The committee notes that the program's unique user support 
activities conducted by the National Media Laboratory, the 
National Information Display Laboratory, and the new National 
Center for Applied Technology have saved hundreds of millions 
of dollars, and have been successful in providing dual-use 
solutions for the Intelligence Community, Department of Defense 
and civil agencies, due largely to the organization's ability 
to work across agency and departmental boundaries on common 
technological problems and technical standards.
    The committee believes that the NTA program should expand 
its efforts to address intelligence and information needs 
within the Department of Defense. Therefore, the committee 
recommends that the Secretary of Defense investigate means to 
expand the NTA program to focus on cross-agency needs in 
technology areas such as visualization, video technologies, 
compression, digital libraries, displays, data storage and 
operational user support, leveraging on the existing NTA 
effort.

Next Generation Internet revolutionary applications

    The budget request contained $40.0 million in PE 62110E for 
applied research in the Defense Advanced Research Project 
Agency (DARPA) component of the Next Generation Internet (NGI) 
program.
    NGI is a major national initiative involving DARPA, the 
National Science Foundation (NSF), Department of Energy (DOE), 
National Institute of Science and Technology (NIST), and 
National Aeronautics and Space Administration (NASA) in a 
three-year, $100.0 million per year program to development and 
demonstrate the technologies, protocols, and standards for a 
very high speed, broad bandwidth NGI that will offer reliable, 
affordable, secure information delivery. The program has three 
primary goals: (1) develop the next generation network and 
connect universities and Federal research institutions with 
high speed networks that are 100 to 1,000 times faster than 
today's Internet; (2) promote experimentation with the next 
generation of networking technologies; and (3) demonstrate new 
applications that meet important national goals and missions.
    The committee fully supports the NGI initiative and the 
concept of working with the applications communities--Federal 
agencies, the public sector, academia, and private companies--
to incorporate new and existing networking technologies and 
capabilities developed under the NGI into applications of 
importance to each community. The committee further supports 
the formation of cooperative ventures with regional consortia 
established for this purpose among federal agencies, local 
governmental authorities, industry, and academic institutions. 
The committee expects that such initiatives would leverage the 
application specific funding, knowledge, skills, and methods 
brought to the venture by the members of the regional 
consortium. The committee recommends $53.0 million, an increase 
of $13.0 million for the NGI program. The committee directs 
that competitive procedures shall be used for awarding all 
partnership grants and entering into all partnership contracts, 
cooperative agreements, and other transactions under the 
program, and encourages the establishment of cost-shared 
relationships where feasible.

Polymer-cased ammunition

    The budget request contained no funding for polymer-cased 
ammunition in PE 116404BB.
    The committee notes that polymer-cased ammunition offers 
potential cost and weight savings compared to existing 
munitions. The committee recommends $109.2 million in PE 
116404BB, an increase of $3.0 million for polymer-cased 
ammunition.

Operational field assessment program

    The budget request contained $15.3 million in PE 65118D8Z 
for the Defense Operational Test and Evaluation program. No 
funding was requested for the operational field assessment 
(OFA) program.
    Section 212 of the National Defense Authorization Act for 
Fiscal Year 1998 (Public Law 105-85) directed the Secretary of 
Defense to submit to the Congressional defense committees a 
report on the conduct and management of the OFA program. In the 
statement of managers which accompanied the conference report 
on H.R. 2266, The National Defense Appropriations Bill for 
Fiscal Year 1998, (H. Rept. 105-265), the conferees agreed to 
provide $4.0 million for the operational field assessments 
program, but expressed concern about the widely differing views 
within the Department of Defense on this issue and directed the 
Joint Staff Director for Force Structure, Resources and 
Assessment (J-8) to conduct a thorough review of all aspects of 
operational field assessments.
    The committee has reviewed the Secretary of Defense report 
on the OFA program, dated April 3, 1998, which was prepared by 
the DOT&E, and the letter from the Vice Chairman, Joint Chiefs 
of Staff, dated March 30, 1998, which transmits the J-8's 
findings and recommendations.
    Based upon the committee's review of these reports, it is 
clear there is continuing disagreement within the Office of the 
Secretary of Defense (OSD), and between OSD, the Joint Staff, 
and the military departments, regarding the conduct and 
management of, and funding for, the OFA program. The committee 
believes that the Secretary of Defense needs to codify the role 
of the DOT&E and the OFA process in the conduct of operational 
field experiments, if that role and the OFA process are 
warranted. Until the OFA process has been codified in DOD 
instructions, the committee recommends no authorization of 
funds for the OFA program.

Optical correlation technology for automatic target recognition

    The budget request contained $5.1 million in PE 63232D8Z 
for the development and demonstration of automatic target 
recognition technology, $67.2 million in PE 62787A for the 
Army's medical technology program, and $39.8 million in PE 
63609N for the Navy's conventional munitions program.
    The committee continues to be encouraged by the progress 
being made in the use of automatic target recognition (ATR) 
technologies to support missiles, precision-guided weapons and 
target cueing for surveillance systems. The committee 
encourages the Director of Defense Research and Engineering 
(DDR&E) to provide assistance to the Navy and other services 
initiatives pursuing ATR technologies in their development of 
optical correlators for potential use on the Navy's Standard 
Missile and for other applications, such as medical diagnosis. 
The committee expects the military services to capitalize on 
current programs for the development of optical correlator 
technology in the DDR&E's ATR program and to coordinate their 
activities with the ATR program. The committee recommends $8.1 
million in PE 63232D8Z, an increase of $3.0 million for the 
DDR&E ATR program. The committee also recommends an increase of 
$5.0 million in PE 63609N for development and demonstration of 
a miniature, rugged optical correlator for automatic target 
recognition and improved aimpoint selection for the Standard 
Missile. The committee also recommends an increase of $2.0 
million in PE 62787A for applied research in the use of low 
cost optical correlator technology in medical diagnosis. The 
committee directs the Undersecretary of Defense (Acquisition 
and Technology) to report to the Congressional defense 
committees with the submission of the fiscal year 2000 Defense 
budget request, the Department's overall plan and program for 
the development and demonstration of optical correlator 
technology for automatic target recognition.

Seismic sensor technology

    The budget request contained $213.2 million in PE 63762E 
for sensor and guidance technology.
    The committee notes that seismic technology is critical to 
detection, verification and evaluation of both natural and 
weapon related phenomena important to national security. The 
committee recommends an increase of $10.0 million in PE 63762E 
for seismic sensor technology.

Specialty aerospace metals initiative

    The budget request contained $244.4 million in PE 62712E 
for the Defense Advanced Research Projects Agency (DARPA) 
materials and electronics technology program, including $145.4 
million for applied research in materials processing 
technology.
    The committee notes the progress made by DARPA in the 
development of low-cost manufacturing of specialty aerospace 
metals such as beryllium-aluminum, nickel-based, and titanium 
alloys through the use of government-industrial partnerships. 
The committee also notes actions that have been taken by the 
military services to capitalize on the development of these 
advanced technologies. Several have already successfully 
transitioned into military systems such as aircraft engines, 
guidance systems, and electronic components. The committee 
understands that the Air Force Research Laboratory has created 
a government-industrial consortium to further address 
affordability and availability issues with regard to such 
metals.
    Of the funds provided in PE 62712E for materials and 
electronics technology, the committee recommends $10.0 million 
to continue the DARPA program for development of manufacturing 
technologies for specialty aerospace metals and the transition 
of these technologies to the military departments. These funds 
should be used in conjunction with other service funds to 
establish cooperative government-industry programs for the 
development of manufacturing technology and industrial 
applications for these specialty metals.

Special operations intelligence systems

    The budget request contained $1.8 million in PE 1160405BB 
for the special operations systems development.
    The committee notes that the special operations forces 
intelligence vehicle (SOF IV) is an evolutionary ongoing effort 
that requires additional funding to complete development. The 
committee recommends $6.8 million, an increase of $5.0 million 
for SOF IV in PE 1160405BB.

Tactical unmanned aerial vehicles funding

    The budget request contained $75.6 million in PE 35204A and 
$37.2 million in PE 35204D8Z for tactical unmanned aerial 
vehicles (UAV).
    The committee notes that the Under Secretary of Defense for 
Acquisition and Technology recently provided the Congressional 
defense committees with the Department's plan to implement 
legislative direction included in the National Defense 
Authorization Act for Fiscal Year 1998 (Public Law 105-85) for 
reorganization of the Defense Airborne Reconnaissance Office 
(DARO) and commends the Department for its prompt response.
    The National Defense Authorization Act for Fiscal Year 1998 
(Public Law 105-85) contained further direction that the 
Department of Defense review commercial solutions for the 
various UAV requirements. The committee notes that the Navy is 
now conducting a three-phase competitive demonstration of 
vertical takeoff or landing (VTOL) UAVs to meet the Navy and 
Marine Corps VTOL UAV requirement. The committee continues to 
support this approach and urges the Navy to continue this 
multiple-participant competitive demonstration through the 
shipboard phase prior to final selection using the funds 
provided.
    The committee notes the proposed plan for transfer of DARO 
funding in the budget request to the appropriate service 
accounts and recommends the following transfers of funds: a 
decrease of $26.0 million in PE 35204A for the Tactical UAV 
program, an increase of $18.0 million in PE 35204N for VTOL 
UAV, and $8.0 million in PE 35204M for the Marine Corps close 
range tactical UAV. In addition, the committee recommends 
transfer of $37.2 million from PE 35204D8Z to PE 35204N for 
ongoing common tactical control system development previously 
managed by the Joint Program Office.

Thermionics

    The budget request contained $203.6 million in PE 62715BR 
for weapons of mass destruction related technologies, but no 
funding for thermionics.
    The committee recognizes the increasing importance of space 
to commercial and military users and believes that high 
performance, high reliability power and propulsion sources will 
be critical to the effective exploitation of space assets. The 
committee believes that advanced thermionic converters could 
provide compact electrical generations systems. The committee 
directs that of the funds provided in PE 62715BR, $5.0 million 
shall be available to continue thermionics technology 
development.

University research initiatives

    The budget request contained $216.3 million in PE 61103D8Z 
for the university research initiatives (URI), including $10.0 
million for the defense experimental program to stimulate 
competitive research (DEPSCoR). The committee supports 
continuation of the DEPSCoR program to strengthen the 
infrastructure, enhance research, and develop human resources 
to assist the DEPSCoR states to become more competitive for 
regular research and training grants. Therefore, the committee 
recommends $231.3 million, an increase of $15.0 million for 
DEPSCoR.

Unmanned aerial vehicle systems integration laboratory

    The budget request contained $5.0 million in PE 35204D8Z 
for the U.S. Army's Unmanned Aerial Vehicle (UAV) Systems 
Integration Laboratory (SIL), and included $3.0 million for 
continued development of the Multiple UAV Simulation 
Environment (MUSE).
    The committee supports the SIL's joint UAV developmental 
work and it is concerned that the reorganization of Defense 
Airborne Reconnaissance Program will leave the SIL without a 
sponsor, thereby possibly losing a valuable joint UAV 
integration organization and jeopardizing continued evolution 
and improvement of the MUSE tool. While SIL is clearly a 
service organization, it provides joint support that may well 
be overseen directly by the new Deputy Assistant Secretary of 
Defense (DASD) for Command, Control, Communications, and 
Intelligence, Surveillance and Reconnaissance. Therefore, the 
committee directs the Assistant Secretary of Defense for 
Command, Control, Communications and Intelligence to provide 
the Congressional defense and intelligence committees a plan, 
which includes a funding profile, for the continued operation 
of the SIL, by no later than March 31, 1999.

Verification technology demonstration

    The budget request contained $63.0 million in PE 63711BR.
    This request has increased by $12.8 million over the 
funding level for fiscal year 1999 projected last year and 
includes approximately $25.0 million for efforts other than 
research and development, such as sustained systems operations, 
equipment procurement and seismic detection. Of these areas, 
seismic detection within the continental United States is the 
specific responsibility of the U.S. Geological Survey. The 
committee recommends a decrease of $25.0 million in PE 63711BR.

                         LEGISLATIVE PROVISIONS

              Subtitle A--Authorization of Appropriations

              Section 201--Authorization of Appropriations

    This section would authorize Research, Development, Testing 
and Evaluation (RDT&E) funding for fiscal year 1999.

           Section 202--Amount for Basic and Applied Research

    This section would specify the amount authorized for fiscal 
year 1998 for technology base programs.

    Subtitle B--Program Requirements, Restrictions, and Limitations

 Section 211--Management Responsibility for Navy Mine Countermeasures 
                                Programs

    This section would amend section 216(a) of the National 
Defense Authorization Act for Fiscal Years 1992 and 1993 
(Public Law 102-190, as amended), and would extend the 
implementation of the provision through fiscal year 2003.
    Since the completion of the Gulf War, the Congress has 
repeatedly emphasized the need for improvements in the Navy's 
mine countermeasures capabilities (MCM). In response to this 
emphasis, the Navy has developed three successive mine warfare 
plans, increased funding for MCM research and development, 
focused on improving the readiness and sustainability of it's 
dedicated MCM ships, and accelerated the development of a 
Remote Mine hunting System. A limited contingency shallow water 
mine hunting capability using laser mine detection has been 
established in one Navy Reserve helicopter squadron. Since 
1992, the Navy has spent about $1.2 billion and plans to spend 
an additional $1.3 billion for MCM research and development 
over the next six years.
    In 1996, a General Accounting Office (GAO) report (NSIAD-
96-104, Navy Mine Warfare--Budget Realignment Can Help Improve 
Countermine Capabilities, March 1996) recommended that a long 
range plan be developed to identify gaps and limitations in the 
Navy's MCM capabilities, establish priorities, and fund the 
most critical programs. The Office of the Secretary of Defense 
responded that such a process was ongoing and would provide an 
architecture within which the needs and shortfalls in MCM 
capabilities could be identified and prioritized. The Navy has 
changed its MCM strategy from a focus on dedicated MCM forces 
to deploying organic MCM capabilities within the fleet and 
developing rapid in-stride mine avoidance and clearing 
capabilities. However, in a follow-up report (NSIAD-98-135, 
Navy Mine Countermeasures--Plans to Improve Countermeasures 
Capabilities Unclear, March 1998), the GAO observed that the 
investment in MCM research and development had not produced any 
systems that are ready to transition to production. Delaying 
factors cited by the GAO included funding instability, changing 
requirements, cost growth, unanticipated technical problems, 
and inadequate contractor performance.
    The committee believes that the annual certification 
process has served to increase the visibility of MCM 
requirements within the DOD and the Navy and has had positive 
results. However, as currently conducted, the annual 
certification process has not been able to address the adequacy 
of resources for the MCM mission because it addresses only the 
adequacy of funding for the budget year and does not include 
the out years. Nor does the certification contain any objective 
measures against which the Navy's progress in enhancing its MCM 
capabilities can be evaluated. In recommending an extension of 
the requirement for certification through fiscal year 2003, the 
committee directs the Secretary of Defense and the Chairman of 
the Joint Chiefs of staff to include such criteria in their 
annual certification.

      Section 212--Future Aircraft Carrier Transition Technologies

    This section would make $50.0 million of the funds 
authorized for development of technologies for the CV(X) next-
generation aircraft carrier available for research, 
development, test, evaluation, and insertion of technologies 
into the CVN-77 nuclear aircraft carrier program. The committee 
understands that the U.S. Navy's plan to transition to the next 
generation aircraft carrier--the CV(X)--is to use the CVN-77 as 
a transition ship by incorporating new technology and process 
design changes. This could have the double benefit of 
dramatically enhancing the operating efficiency and capability 
of the CVN-77, while also delivering proven aircraft carrier 
enhancements to the CV(X) design and minimizing both risk and 
cost for the new platform. This transition plan could also 
provide technologies that would contribute to reduction of life 
cycle costs when inserted into other aircraft carriers that are 
already in the fleet.

             Section 213--Manufacturing Technology Program

    This section would amend section 2525 of title 10, United 
States Code, to establish goals for cost sharing in the 
manufacturing technology program and procedures by which the 
requirement for cost sharing, that is now contained in current 
law, could be waived. Section 211 of the National Defense 
Authorization Act for Fiscal Year 1998 (Public Law 105-85) 
requires the Secretary of Defense to prepare a five-year plan 
for the manufacturing technology program and to submit the plan 
annually to the Congress with the Presidents budget request. 
Both the Secretary's plan, submitted to the Congress in 
February 1999, and the Department of Defense Inspector 
General's Audit Report ``Defense Manufacturing Technology 
Program'', dated February 25, 1998, cite problems created by 
the cost-sharing requirement in executing the manufacturing 
technology problem, and the need for revisions in the cost-
sharing requirement and waiver procedures.

                 Subtitle C--Ballistic Missile Defense

              Section 231--National Missile Defense Policy

    This section would establish congressional findings 
pertaining to the threat posed to U.S. national territory by 
weapons of mass destruction and long range ballistic missiles. 
It would also establish the sense of Congress that any deployed 
national missile defense should defend all fifty states and 
that the territories of the United States should be protected 
from ballistic missile defense.

Section 232--Limitation on Funding for the Medium Extended Air Defense 
                                 System

    The budget request contained $43.0 million in PE 63869C for 
Medium Extended Air Defense System (MEADS). The committee 
understands the requirement for the MEADS, strongly supports 
the program, and recommends authorization of the requested 
amount. The budget request again fails to include funding for 
MEADS in the future years defense plan. Last year, the 
committee expressed reluctance to continue its support of MEADS 
in the absence of a clear commitment to the program from DOD.
    This section would prohibit the Secretary of Defense from 
obligating or expending funds authorized and appropriated for 
MEADS until the Secretary certifies to Congress that funding 
has been designated for MEADS in the future years defense plan.
    The funds so identified must be sufficient to meet the 
MEADS program goal of proceeding to low rate initial production 
by fiscal year 2003 and first unit equipped by fiscal year 
2007. The provision would require that if such certification is 
not received by January 1, 1999, the funds authorized for MEADS 
would thereafter be authorized only for the purpose of research 
and development to adapt the Patriot Advanced Capability 3-
Configuration 3 (PAC-3) to meet the Army requirement for a 
mobile theater missile defense system.

 Section 233--Limitation on Funding for Cooperative Ballistic Missile 
                            Defense Programs

    This section would prohibit obligation or expenditure of 
$5.0 million authorized to be appropriated for the Russian-
American Observational Satellite (RAMOS) program until the 
Secretary of Defense certifies to Congress that the Department 
of Defense has received detailed information concerning the 
nature, extent, and military implications of ballistic missile 
technology transfer from Russian sources to Iran.

  Section 234--Limitation on Funding for Counterproliferation Support

    This section would prohibit obligation or expenditure of 
the requested funds for counterproliferation support in PE 
63160BR, until the report on the threat posed to the United 
States by weapons of mass destruction and cruise and ballistic 
missiles is submitted to Congress as required in section 234 of 
the National Defense Authorization Act of 1998 (Public Law 105-
85).

        Section 235--Ballistic Missile Defense Program Elements

    This section would realign program elements for the 
Ballistic Missile Defense Organization and require each program 
element to include funding for management and support necessary 
for the activities within that program element.

                  TITLE III--OPERATION AND MAINTENANCE

                                OVERVIEW

                           Funding Realities

    The fiscal year 1999 budget request for operation and 
maintenance represents an $828.0 million increase from the 
level authorized and appropriated by Congress for fiscal year 
1998. The senior leadership of the Department of Defense has 
stated on numerous occasions that the budget request contains 
an increase of over one billion dollars. To date, the committee 
has been unable to identify these increases, other than the 
proposed transfer of $982.0 million from the Defense Working 
Capital Fund account into the military services operation and 
maintenance accounts for commissary store operations. Prior to 
this year, the funding of the commissaries was not included in 
the operation and maintenance accounts. This proposed 
accounting transfer will do nothing to improve readiness. In 
addition, the committee notes that many of the accounts having 
little to do with readiness that are contained within the 
operation and maintenance accounts contain budget increases. 
These include accounts such as Cooperative Threat Reduction, 
Overseas Humanitarian, Disaster and Civic Aid, among others. 
Neither the movement into the operation and maintenance 
accounts of commissary funding, or budget growth in non-
readiness operation and maintenance accounts should be 
misconstrued as increased readiness spending.
    The committee remains deeply concerned with the continued 
under-funding of critical readiness accounts and the impact 
this practice is having on military forces in the field. In 
fact, the problems seem to be getting worse. Despite the 
addition by Congress of approximately $350.0 million in fiscal 
year 1998 to arrest the backlog of depot maintenance and 
repair, the backlog will grow by $120.4 million in fiscal year 
1999. After the addition by Congress of $600.0 million in the 
real property maintenance and repair accounts in fiscal year 
1998, the backlog will grow by $1.6 billion. And after Congress 
added $562.0 million to the Navy and Air Force flying hour/
spare parts accounts in fiscal year 1998, there is a projected 
shortfall, in fiscal year 1999, of approximately $250.0 million 
in these accounts. The five year shortfall in the readiness 
related accounts, according to the military Service Chiefs, is 
$18.1 billion. The effect of growing shortfalls in key 
readiness accounts is readily evident in mounting readiness 
problems in the field.

                          Readiness Realities

    Contradictions between reports on military unit readiness 
provided by the senior leadership of the Department of Defense 
(DOD) and observations made by military personnel in the field 
continue to grow. Where official reports and testimony before 
the committee portray the overall readiness of U.S. armed 
forces as high, soldiers, sailors, airmen and marines 
increasingly admit that their units continue to slip below past 
readiness standards.
    In its continuing effort to assess force readiness, the 
committee once again conducted a series of field hearings at 
various military installations throughout the United States to 
hear the views of operational unit commanders and senior non-
commissioned officers from all of the military services. The 
overwhelming impression left with the committee was of a force 
working harder, longer, and with fewer personnel then ever 
before. Funding and forces continue to shrink while the demands 
of the job increase. For example, the Army, which conducted 10 
``operational events'' outside of normal training and alliance 
commitments during the 31 year period of 1960-1991, has 
conducted 26 ``operational events'' just in the seven years 
since 1991. The Marine Corps, which undertook 15 ``contingency 
operations'' from 1982 to 1989, has conducted 62 since the fall 
of the Berlin Wall. These increases in operational tempo are 
occurring at the same time that the Army has been reduced from 
18 to 10 Division, the Navy has reduced its ships almost by 
one-half, and the Air Force has reduced from 24 to 12 fighter 
wings.
    Among the disturbing problems raised in the committee's 
hearings and investigations were indications of a growing 
shortage of spare parts and the related increase in the 
cannibalization of equipment; combat aircraft and vehicles are 
being operated at a pace that requires longer and more 
extensive repairs at the maintenance depot; and the 
deterioration of base facilities where personnel live and work 
are below acceptable standards. These are indicators of broader 
trends throughout the force that are raising doubts about 
present, and future readiness.
    None of this is new. Indeed, these readiness problems are 
consistent with those enumerated in past committee hearings and 
reports. The persistence of these problems leaves the committee 
concerned by the lack of progress the Department of Defense has 
made in developing a more comprehensive readiness measurement 
system that better reflects today's operational realities. As 
defense resources and force size have declined, and the number, 
frequency and duration of contingency operations has increased, 
the ability of U.S. armed forces to train for their primary 
warfighting missions is being compromised.
    In addition to improving its readiness reporting systems, 
discussed elsewhere in this report, the committee believes that 
DOD should also take further steps to aggressively reduce costs 
in areas that do not directly contribute to readiness. After a 
review of the fiscal year 1999 budget request, the committee 
notes repeated examples where funding for support activities, 
such as headquarters and other support activities has 
inexplicably increased over current spending. Accordingly, the 
committee has identified administrative and support accounts 
that do not directly contribute to readiness and re-prioritized 
much of these spending increases to areas that will immediately 
improve readiness, such as depot maintenance, real property 
maintenance and aircraft spare parts.
    As the reprioritization of operation and maintenance 
funding clearly demonstrates, and consistent with the testimony 
of the Service Chiefs, the committee remains committed to 
address the service readiness shortfalls even within a 
declining defense budget.
<GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT>

                       ITEMS OF SPECIAL INTEREST

                        Budget Request Increases

                 Critical Readiness Accounts Increases

    The committee remains committed to addressing critical 
readiness problems and has, therefore, recommended an increase 
of $610.7 million in a number of underfunded readiness 
accounts. Although the committee has increased funding in key 
readiness accounts over the President's budget by more than 
$4.6 billion over the past three years, force readiness 
continues to decline. The committee has carefully reprioritized 
the Administration's request in an effort to once again provide 
increases to key readiness accounts, many of which reflect the 
priorities expressed by the Service Chiefs in their testimony 
before the committee. Examples include:

                        [In millions of dollars]

Depot Maintenance--Army-..........................................  50.0
Depot Maintenance--Navy/Air-......................................  75.0
Depot Maintenance--Navy Sea-......................................  90.0
Depot Maintenance--Marine Corps-..................................  20.7
Aircraft Spare Parts--Navy-.......................................  50.0
Aircraft Spare Parts--Air Force-.................................. 150.0
Real Property Maintenance--Army-..................................  50.0
Real Property Maintenance--Navy-..................................  50.0
Real Property Maintenance--Marine Corps-..........................  25.0
Real Property Maintenance--Air Force-.............................  50.0

                      Mobility Enhancement Funding

    The committee recommends an increase of $25.0 million to 
improve deployment and mobility of military forces and supplies 
through investment in en-route infrastructure. These funds are 
provided for the United States Transportation Command Mobility 
Enhancement Fund (MEF). The committee is aware that the MEF was 
established to address strategic mobility shortcomings that 
revealed themselves during Operation Desert Shield/Desert 
Storm. The committee believes that this additional funding will 
improve the ability of the military services to respond to 
future contingencies.

                           Training Accounts

    The budget request once again proposes to require funding 
for Army unit rotations at the National Training Center, (NTC) 
Fort Irwin, California to pay for the use of the pre-positioned 
equipment out of the funds provided for home station training. 
In the National Defense Authorization Act for Fiscal Year 1998 
(Public Law 108-85), the committee added $60.2 million to the 
Army's Operation and Maintenance account to continue central 
funding of the equipment necessary to maintain the equipment at 
theNTC, and urged the Army to continue funding the NTC 
centrally. Unfortunately, the budget request does not support central 
funding of equipment for the NTC.
    The NTC is the only U.S.-based training facility where Army 
maneuver units can train against a dedicated opposing force in 
an environment which most closely approximates high intensity 
combat. The committee continues to believe that the Army policy 
of requiring rotational units to fund training at the NTC 
diminishes home station training and will adversely impact 
training at the NTC.
    The committee is also concerned by inadequate funding for 
the other military training centers. As an example, the 
committee is aware of funding shortfalls for aggressor training 
equipment at the Navy and Air Force air warfare centers, which 
has severely reduced the frequency and level of training for 
aircraft fighter crews. In addition, the training equipment at 
the Joint Readiness Training Center, Fort Polk, Louisiana and 
the Marine Corps Air Ground Combat Training Center, Twenty Nine 
Palms, California is in urgent need of repair and upgrade. Due 
to increasing restrictions on the availability of local station 
training ranges and other environmental concerns, the committee 
reiterates that the military service training centers are 
national assets that require additional attention and funding.
    Therefore, the committee recommends increases as follows:

                        [In millions of dollars]

National Training Center, Fort Irwin, California-.................  60.3
Naval Strike Air Warfare Center, Fallon Naval Air Station, Nevada-  20.0
Air Warfare Center, Nellis Air Force Base, Nevada-................  20.0
Joint Readiness Training Center, Fort Polk, Louisiana-............  20.0
Marine Air Ground Combat Center, Twenty Nine Palms, California-...   5.0
                        -----------------------------------------------------------------
                        ________________________________________________
      Total....................................................... 125.3

            United States Marine Corps Cold Weather Clothing

    The committee is aware that the Marine Corps is in need of 
additional funding for the Extended Cold Weather Clothing 
System (ECWCS), which is designed to provide protection during 
cold and wet weather. The committee believes the ECWCS is a 
significant contributor to the combat readiness of the 
individual marine and would significantly improve quality of 
life. Therefore, the committee recommends an increase of $12.6 
million for ECWCS.

                       Budget Request Reductions

                  Administration and Support Accounts

    The committee notes that at the same time the budget 
request contains underfunded readiness and operational 
accounts, many at levels even below current fiscal year 1998 
spending, it proposes spending increases in a number of 
administrative and support accounts with no direct impact on 
service readiness. The committee disagrees with the budget's 
priorities in this regard and, therefore, recommends decreases 
in many of the military services' and defense agencies' non-
readiness accounts. These decreases reflect reductions in 
spending growth over current fiscal year 1998 level:

                        [In millions of dollars]

Army Administration...............................................  27.5
Air Force Administration-.........................................  14.9
Joint Chiefs of Staff-............................................  24.4
Defense Logistics Agency-.........................................  35.0
Defense Finance and Accounting Service-...........................  35.0
Defense Information Systems Agency................................  30.0

    The committee fails to understand the justification for 
budget growth in support accounts at a time when the services 
face critical readiness shortfalls. For example, the Defense 
Reform Initiative (DRI) proposed management reductions of 33 
percent in the Office of the Secretary of Defense by the end of 
fiscal year 1998, yet the budget request reflects no such 
reduction. Therefore, the committee recommends a reduction of 
$15.9 million in this account to bring the budget request in 
line with the recommendations of the DRI.
    The committee also notes questionable funding requests in 
the support accounts. As an example, the Defense Finance and 
Accounting Service, a working capital fund agency, request 
contains nearly $35.0 million for executive and professional 
training. The committee believes that funding for the training 
of working capital funded employees should be charged against 
the appropriate working capital fund and managed accordingly.
    As expressed in more detail elsewhere in this report, the 
committee is disappointed that the department of Defense has 
not fully complied with section 911 of the National Defense 
Authorization Act for Fiscal Year 1998 (Public Law 105-85) 
which required a five percent reduction in all headquarters and 
headquarters support activities personnel by October 1, 1998. 
Except for the Department of the Army, the budget request fails 
to account for these reductions and in some cases, these 
accounts reflect budget growth. Therefore, the committee 
recommends the following reductions consistent with section 911 
of the National Defense Authorization Act for Fiscal Year 1998 
(Public Law 105-85):

                        [In millions of dollars]

Navy-.............................................................  23.9
Air Force-........................................................  60.3
Defense Information Systems Agency-...............................   1.8
Defense Contract Audit Agency-....................................   1.6
Joint Chiefs of Staff-............................................   2.4
Special Operations Command-.......................................   3.4

                    Advisory and Assistance Services

    The committee recommends the following reductions for 
Advisory and Assistance Services:

                        [In millions of dollars]

Army..............................................................  40.0
Navy..............................................................  40.0
Air Force.........................................................  40.0
Defense Agencies..................................................  40.0

    A more detailed discussion on Advisory and Assistance 
Services can be found elsewhere in this report.

                          Bulk Fuel Reductions

    The General Accounting Office (GAO) has estimated that fuel 
purchases by the services have been executed at levels below 
those assumed in the budget request since fiscal year 1996. The 
overestimates of fuel costs ranged from $440.0 million in 
fiscal year 1996 to $201.0 million in fiscal year 1998. The 
committee notes that the budget estimates used by the 
Department of Defense (DOD) for fuel purchases for fiscal year 
1999 exceed the latest DOD estimates by approximately $2 per 
barrel. Consistent with the revised pricing date, the committee 
recommends the following reductions:

                        [In millions of dollars]

Army..............................................................  29.9
Navy..............................................................  90.5
Air Force......................................................... 110.5
Defense Agencies..................................................   9.0

              Civilian Personnel Overstatement Reductions

    To determine civilian personnel requirements for the budget 
request, the Department of Defense (DOD) applied the actual 
fiscal year 1997 personnel levels and the estimated personnel 
levels the Department would have on hand at the end of fiscal 
year 1998, to forecast civilian personnel levels in fiscal year 
1999. Because the DOD was unable to accurately estimate the 
fiscal year 1998 end strengths prior to the submission of the 
budget request, the General Accounting Office (GAO) has 
determined that DOD will employ fewer civilian personnel at the 
beginning of fiscal year 1999 than it assumed and budgeted for 
in the request.
    Therefore, to bring the request in line with GAO's 
estimated civilian end strength levels for fiscal year 1999, 
the committee recommends reductions in funding as follows:

                        [In millions of dollars]

Army.............................................................. 518.0
Navy..............................................................  15.0
Defense Agencies..................................................   5.3

                      Foreign Currency Reductions

    Since the submission of the Department of Defense fiscal 
year 1999 budget request, the U.S. dollar has increased in 
value compared to various foreign currencies. As a result, the 
committee believes that the fiscal year 1999 budget request is 
overstated. In addition, the committee understands that the 
Defense Foreign Currency Fluctuation account already contains a 
balance of over $300.0 million to be used in the event that 
unfavorable currency fluctuations develop. The committee 
believes the requested amount is, therefore, in excess of the 
needs of the Department and recommends the following 
reductions:

                        [In millions of dollars]

Army..............................................................  78.2
Navy..............................................................   6.7
Air Force.........................................................  16.1
Defense Agencies..................................................   7.1

                          Environmental Issues

                  Air Force Plant #3, Tulsa, Oklahoma

    The committee commends the Department of the Air Force for 
the expeditious response to the committee's concerns regarding 
the cleanup of ground contamination at Air Force Plant #3 in 
Tulsa, Oklahoma. However, despite this attention the committee 
is aware that other environmental problems remain at the 
facility, particularly in the above-ground structures. The 
committee directs the Air Force to investigate these hazards 
and provide a report on these risks along with a revised 
obligation and cleanup schedule for the facility by December 
31, 1998.

               Arctic Military Environmental Cooperation

    The committee is aware that the Department of Defense has 
established the Arctic Military Environmental Cooperation 
(AMEC) program to cooperatively address the military impact on 
the arctic environment. The committee urges the Secretary of 
Defense, out of the $5.5 million available for AMEC, to use 
$1.0 million to support the establishment of a Joint United 
States-Russia Nuclear Materials Commission. The members of this 
commission may include legislators, agency and ministry 
leaders, and environmental experts, representing the 
international environmental community, to provide 
recommendations on establishing more effective tracking and 
verification systems for nuclear nonproliferation and 
contamination containment programs, consistent with the 
objectives of AMEC. This commission may also support an 
international summit on Russian nuclear waste to initiate this 
cooperative effort.

                 Navy Environmental Leadership Program

    The committee continues to support the Chief of Naval 
Operation's Navy Environmental Leadership Program (NELP), with 
two designated sites-one on the east and the west coast of the 
United States. The primary mission of each site is to identify 
and demonstrate new technologies that improve the environmental 
compliance, cleanup, conservation and pollution prevention 
efforts within the Navy. The committee recommends an increase 
of $4.0 million for the Navy Environmental Leadership Program. 
The committee believes these additional funds are needed to aid 
the east coast site in developing technologies to separate 
aqueous fire-fighting foam and other contaminants in oily water 
and wastewater, reduce waste generated by the de-painting/
painting process, and reduce emissions from fire-fighting 
training facilities.

                      Pollution Prevention Program

    The committee notes recent Department of Defense (DOD) 
testimony indicating a strategy of improving environmental 
compliance by increasing priority and funding for pollution 
prevention. According to this testimony, pollution prevention 
is designed to lower overall compliance costs. The committee is 
concerned that between fiscal years 1997 and 1999, DOD will 
spend $776.0 million on pollution prevention, but compliance 
costs are estimated to drop only $30.0 million during the same 
period--roughly a four percent return on the pollution 
prevention investment. In an effort to better understand why 
the rate of return is only four percent, the committee directs 
that the Secretary of Defense provide to the Senate Committee 
on Armed Services and the House Committee on National Security, 
by December 31, 1998, a report on DOD's pollution prevention 
metrics, strategic plans, and how pollution prevention outcomes 
relate to environmental compliance and cleanup outcomes.

                       Scrapping of Naval Vessels

    The committee is encouraged that the Department of Defense 
(DOD) has established a task force to review the scrapping of 
naval vessels and has provided a report to Congress on this 
issue recently. However, the committee believes the DOD 
continues to have a lack of a credible domestic scrapping 
program, and that additional innovative options should be 
considered. One such option that should be considered is, 
through competition, providing surplus ships for the purpose of 
creating artificial reefs. The committee believes that such an 
arrangement would allow qualified companies to seek 
arrangements with states on cost sharing and appropriate 
environmental clearances.
    The committee directs the Secretary of Defense to provide, 
by December 31, 1998, a report that reviews all options, both 
domestic and foreign, for the scrapping of naval vessels. The 
report shall also include a review of and recommendations for 
the option to competitively sell surplus ships to create 
artificial reefs.

                     Information Technology Issues

                                Overview

    The committee is concerned by the current status of the 
Department of Defense (DOD) information technology programs. In 
the last several years, the committee has taken several steps, 
including requiring annual performance plans and the enactment 
of the Information Technology Management Reform Act of 1996 
(Public Law 104-106), to improve DOD's information technology 
(IT) systems and programs. Despite these efforts, the committee 
remains unconvinced that the Department has made the necessary 
improvements in managing its $26 billion Command, Control, 
Communications, and Computers (C4) program. This is 
particularly disturbing, given the increasing role of 
information technology in the battlefield of today and 
tomorrow. As a result, the committee's recommendation focuses 
on improving management of IT programs, supporting joint and 
interoperable systems, eliminating funding due to program 
redundancies, and shifting IT funding to higher priority areas.

                  Automatic Identification Technology

    The committee is aware that the Joint Task Force for 
Automated Identification Technology (AIT) will pilot test AIT 
systems for air, sea, ammunition, and personnel movement this 
summer. Each AIT system under review is designed to support 
joint operations and be interoperable with the Global Combat 
Supply System (GCSS). Dependent on the outcome of these pilot 
studies, the committee directs that the implementation costs of 
each proven AIT systems shall be provided out of each of the 
individual military departments fiscal year 1999 funding for 
GCSS.

          Computer Crimes and Information Technology Security

    Section 907 of the National Defense Authorization Act for 
Fiscal Year 1998 (Public Law 105-85) required that all of the 
military services criminal investigation agencies utilize the 
joint computer security training center and forensics 
laboratory. The committee understands that the Department of 
the Army has not complied with section 907. Therefore, the 
committee directs the Secretary of the Army to join the other 
Defense criminal investigation agencies in using the joint 
computer security training center and forensics laboratory. The 
committee also directs that the joint computer security 
training center and forensics laboratory be budgeted in the 
Operations and Maintenance, Defense-Wide account. Further, the 
Air Force Criminal Investigative Organization is directed to 
serve as the executive agent for this joint program.

                   Information Technology Management

    The committee is concerned with the general management of 
the Department of Defense's (DOD) information technology (IT) 
systems. Recent analysis by the General Accounting Office (GAO) 
identified poor management controls and implementation in such 
areas as interoperability testing and certification, migration 
strategy of legacy systems, and compliance with Year 2000 
requirements. In an effort to refocus the management of IT 
programs in DOD, the committee recommends two provisions 
(sections 311 and 333) that would clarify and expand the roles 
of the DOD and militarydepartment's Chief Information Officers 
and the Smartcard Technology Office. In addition, the committee directs 
the Secretary of Defense, by December 1, 1998, to provide the committee 
with a review of the department's efforts to improve its management of 
information technology. This review shall include:
          (1) DOD's overall Information Technology Management 
        strategic plan (ITM) (including any service and agency 
        subsets);
          (2) Performance measures and plan for implementing 
        the performance measures;
          (3) Barriers to achieving the goals in the ITM 
        strategic plan and performance measures;
          (4) Directives and policies addressing the 
        implementation of reforms required by the Information 
        Technology Management Reform Act of 1996;
          (5) Actions taken to integrate the requirements of 
        the Information Technology Management Reform Act of 
        1996 into DOD's Program, Planning, and Budget System 
        (PPBS);
          (6) Actions taken on the GAO recommendations (AIMD-
        98-5) to improve the Department's management control 
        over the technology investments in its national 
        security systems and its combat support 
        (administrative) systems; and
          (7) DOD's plans to perform vulnerability assessment 
        and operational testing for Year 2000 compliance or 
        contingency plans, particularly for mission critical 
        systems.
    The committee requests that GAO provide an analysis of this 
report to the committee by February 15, 1999.

                   Information Technology Priorities

    The committee is concerned that the Department has not 
provided the appropriate level of attention to the information 
technology (IT) priorities of Year 2000 compliance and IT 
infrastructure developments. As a result, the committee 
recommends a provision (section 313) that would protect the 
development and implementation of IT infrastructure programs 
from internal transfers or reductions during execution of 
fiscal years 1999, 2000, and 2001. In addition, the committee 
recommends a provision (section 314) that would increase the 
priority of Year 2000 compliance for mission critical systems 
within the fiscal year 1999 information technology program. The 
committee also recommends a provision (section 315) that the 
Department utilize its military exercises to simulate the year 
2000 in operational scenarios and to provide the committee with 
a plan for incorporating such tests during fiscal year 1999 
exercises.
    Furthermore, the committee recommends reallocating funds in 
the budget request from lower priority IT systems and IT 
systems that will be executed after the year 2000, to provide 
for a $1.0 billion increase in funding for Year 2000 
compliance. For example, the committee recommends a $33.2 
million decrease to the Army's Joint Computer-Aided Acquisition 
and Logistics Support (JCALS) system due to continued program 
slippage and fielding after fiscal year 2000. Similarly, since 
the Defense Civilian Personnel Data System (DCPDS) milestones 
have slipped another six months, the committee recommends a 
reduction of $6.0 million. The Army Recruiting System 
(previously known as the Joint Recruiting Information Support 
System) is a new system that duplicates existing systems in the 
other military department. Therefore, the committee recommends 
a reduction of $3.8 million for this program and directs the 
Army to use an existing military department IT system.

                  Joint Information Technology Systems

    The committee is concerned that the Department is labeling 
systems ``joint'' and ``global'' that are not single, standard, 
or interoperable systems for use throughout the department. As 
an example, the Global Combat Supply System (GCSS), which is 
intended to provide an integrated view of combat support 
functions, at a cost of approximately $370.0 million, will not 
be a single system but at least four systems: GCSS-Army, GCSS-
Air Force, GCSS-Navy, and GCSS-JCS. The committee does not 
believe that there is a justifiable requirement for developing 
unique systems for each military department, instead of a 
single, joint system integrating all logistics, medical, 
transportation, finance, and personnel systems. The committee 
is convinced that there should be joint, interoperable systems 
in all areas of DOD, from electronic malls (E-malls) to 
Automated Identification Technology and computer security 
training centers.
    As a further example, the Department of the Navy and the 
Defense Logistics Agency are developing a joint E-mall system. 
However, the Departments of the Army and the Air Force are each 
developing separate, service-specific E-mall systems. 
Therefore, the committee recommends a provision (section 312) 
that would create a Department-wide joint E-mall system and 
recommends a decrease of $1.0 million from each of the 
operation and maintenance accounts of the Army and the Air 
Force. The committee believes this reduction is justified based 
on a reduction in the staff and overhead costs that will not be 
needed after incorporation into a joint E-mall system.
    The committee also recommends a reduction of $6.0 million 
in the Army's operation and maintenance account consistent with 
the requirement for the Army to eliminate their service-unique 
computer security and forensics center and laboratory in 
compliance with section 907 of the National Defense 
Authorization Act for Fiscal Year 1998 (Public Law 105-85).

               Redundant Information Technology Programs

    The committee is concerned that the Department is not 
implementing plans to eliminate redundant information 
technology (IT) systems and old IT systems that have been 
replaced by newer systems. The result is duplicative funding of 
outdated and unused IT systems. For example, although the 
decision was made to move all the military departments and 
defense agencies onto a single system for program, budgeting, 
and accounting (PBAS), the Air Force has refused to move to the 
new system. In fact, the Air Force has began development of the 
Financial Information Resources System (FIRST) that duplicates 
PBAS and will utilize the Global Combat Supply System-Air Force 
(GCSS-AF) contract to develop this program. The committee 
believes that this not only represents an unnecessary 
duplication of systems and funding, but is work outside of the 
scope of the GCCS-AF contract. Therefore, the committee 
recommends no funds forFIRST, and encourages the Department of 
the Defense to upgrade the interoperability of PBAS.
    The Department has provided a report to Congress which 
identifies all of the current IT systems that will be replaced 
by newer IT systems. However, when this report is matched 
against the current budget request, many of the IT systems 
scheduled for elimination are still receiving funding even 
though they have been replaced by newer systems. Based on the 
information provided by DOD, the committee believes there is 
$298.1 million in redundant IT systems that should be 
eliminated and recommends the appropriate reductions in these 
accounts.

              Utilizing Commercial Information Technology

    The committee is concerned with the trend by the DOD to 
develop information technology systems in-house instead of 
utilizing today's commercial-of-the-shelf (COTS) technology for 
joint, interoperable warfare systems reliant on an information 
technology infrastructure. For example, the Global Command and 
Control System (GCCS) is being developed as the single Command, 
Control, Communications, Computer and Intelligence system (C4I) 
supporting the warfighter from the foxhole to the command post. 
GCCS is scheduled for implementation around 2003, however, most 
of the technology under development for GCCS is available today 
in COTS packages, at a fraction of the current DOD estimate of 
$1.7 billion. In fact, most national news networks employing 
existing commercial capabilities have significantly superior 
battlefield mapping and imagery capabilities than our 
warfighters take to the battlefield. The committee believes 
that in many instances, providing the warfighters with superior 
information technology need not wait until 2010, if DOD would 
better capitalize on existing commercial technologies.

                          Intelligence Matters

                      Integrated Architecture Plan

    The budget request contained $6.1 million for the Command, 
Control, Communications, Computers, Intelligence, Surveillance, 
and Reconnaissance (C4ISR) Integrated Architecture Plan (CIAP).
    CIAP has been strongly endorsed by the Assistant Secretary 
of Defense for Command, Control, Communications, and 
Intelligence as well as the commanders-in-chief of the nine 
unified commands. The CIAP developments have included the 
highly successful C4ISR Architecture Framework for the 
Department of Defense, the Command C4ISR Architectures for the 
regional Commanders-in-Chief, and the initiation of the C4ISR 
Architectures for the Warfighter (CAW) effort at selected 
unified commands. The committee believes this later effort 
should be extended to all nine unified commands.
    The committee believes these architectural developments 
will provide a cohesive and more cost-effective strategy for 
developing and procuring the proper intelligence support 
systems for the users. Therefore, the committee recommends $9.1 
million for the continuation of these efforts and extension of 
the CAW to all unified commands.

                   Joint Reserve Intelligence Program

    The budget request contained $9.4 million in operations and 
maintenance, defense-wide, for continued reserve component man 
days for the conduct of the Joint Reserve Intelligence Program 
(JRIP).
    The committee is favorably impressed by the intelligence 
production mission load the JRIP has been able to accommodate 
in support of the active forces. This has been particularly 
true of the JRIP support to the European Joint Analysis Center 
(JAC) from the Fort Sheridan, Illinois, Joint Reserve 
Intelligence Center. This world-wide support has included 
direct personnel support via temporary duty assignments as well 
as support from the continental United States via virtual 
connectivity whereby reservists can drill with their gaining 
units without having to leave their home area. Further, this 
support, in excess of 34,000 man days, has provided the active 
components with critical intelligence augmentation to conduct 
collection operations, process backlogs, and produce targeting 
materials, final reports and studies--all without having to use 
the presidential selected reserve call-up authority.
    The committee believes this program should be expanded and 
its benefits maximized to the extent possible. The committee 
recommends $12.6 million, an increase of $3.0 million for these 
purposes.

             Intelligence Congressional Justification Books

    In the committee report on H.R. 1119 (H. Rept. 105-132), 
the committee directed that the Congressional Justification 
Books and the Congressional Budget Justification Books 
accompanying the intelligence budget request must contain all 
direct costs of a program, including the costs of operating and 
maintaining the systems or project. The committee notes that 
the materials received with this year's budget request are 
incomplete in this respect. For example, the operations and 
maintenance costs of some intelligence aircraft systems show 
the direct operating costs, but do not provide the direct depot 
maintenance costs. Several service systems show procurement 
costs, but do not reflect the operations costs for fielded 
systems nor the personnel required to man them. At best, this 
practice makes understanding the total costs of a program 
difficult; at worst, this practice is suggestive of an attempt 
to hide these costs.
    The committee directs that, beginning with the fiscal year 
2000 budget request, the Secretary of Defense and the Director 
of Central Intelligence must include all associated costs of an 
intelligence program or project within the justification 
materials. Further, the committee directs that the intelligence 
justification books contain a signed formal statement by the 
Secretary of Defense and the Director of Central Intelligence 
that, to the best of their knowledge, all such associated costs 
are included in each of the justification publications.

                 Morale, Welfare, and Recreation Issues

      Defense Commissary Agency Information Technology Acquisition

    The committee is aware that the Defense Commissary Agency 
(DeCA) has had substantial difficulty in fielding the Defense 
Commissary Information System (DCIS). The committee understands 
that the development of this system has cost significantly more 
than originally expected, and has taken considerably longer to 
develop than planned. The committee understands that costs have 
increased by over $20 million, and that the time to field the 
system has increased from 18 to 40 months. Since the new system 
is funded through the commissary surcharge account, commissary 
patrons are bearing the cost of these overruns. The committee 
notes that DCIS was intended to be a quick modification of a 
commercial grocery chain's information technology system, and 
notes that DeCA's inability to quickly adapt the system has 
caused delay in meeting critical year 2000 software 
adjustments. The committee is concerned about DeCA management 
of this program and the effect of the cost overruns on the 
patron funded surcharge account, and directs the Department of 
Defense Inspector General to audit the award and execution of 
the DCIS contract, and report her findings to the Senate 
Committee on Armed Services and the House Committee on National 
Security by January 31, 1999.

                               Libraries

    The committee has learned that the Army and the Navy have 
closed libraries at active installations. The committee regards 
libraries as essential category A morale, welfare, and 
recreation activities that should be present on every military 
installation, as well as on vessels afloat. Libraries are 
important elements to any American community, and are 
especially important in our education oriented military. School 
children of military families living on base, as well as 
soldiers seeking wholesome diversion, lessons in military 
history, or Internet access for civilian job searches, deserve 
quality libraries. Accordingly, the committee directs the 
Secretary of Defense to suspend further library closings, 
except at those installations being closed under BRAC, and 
report to the Senate Committee on Armed Services and the House 
Committee on National Security by December 31, 1998, each 
library closed by a military service since January 1, 1996, 
list installations that have libraries open fewer than four 
days a week, and explain why library service was either 
terminated or established at fewer than four days a week for 
each installation reported. The Secretary will further report 
on plans to reestablish service at installations that have no 
library service.

                      Performance Based Agreements

    The committee is aware that the Defense Commissary Agency 
(DeCA) has negotiated performance based agreements as 
authorized by section 374 of the National Defense Authorization 
Act for Fiscal Year 1998 (Public Law 105-85) as a way to 
improve category management. The committee is concerned about 
the adequacy and effectiveness of internal controls relating to 
these agreements and about the possible negative impact on 
customer selection and commissary sales. The committee directs 
the Secretary of Defense to report to the Senate Committee on 
Armed Services and the House Committee on National Security by 
January 31, 1999 on the policy and procedures used to negotiate 
and approve these agreements, the amount of annual revenue 
expected, how that revenue is accounted for, and the 
Department's plans for continuance of this program.

                        Public-Private Ventures

    The committee notes that the report required by section 376 
of the National Defense Authorization Act for Fiscal Year 1998 
(Public Law 105-85) has not been received. Despite this 
failure, the Department continues to submit proposals for 
public-private ventures of various kinds to the committee's 
Special Oversight Panel on Morale, Welfare, and Recreation for 
its approval. Further, these requests do not contain the 
information required by law. The committee directs that the 
Secretary of Defense submit public-private venture requests 
annually, in the same manner that commissary surcharge and 
nonappropriated fund major construction requests are submitted. 
Exceptions may be submitted out of cycle for compelling 
reasons. All requests must describe the impact that the 
proposal will have on local businesses which provide the same 
goods and services, and include local business comments on the 
proposal.

       Uniform Health Benefit for Nonappropriated Fund Employees

    The committee notes that the Department still has not 
implemented section 349 of the National Defense Authorization 
Act for Fiscal Year 1995 (Public Law 103-337), which required 
the Department of Defense to take such steps as necessary to 
provide a uniform health benefits program for its 
nonappropriated fund employees. In addition, the committee 
report on H.R. 1119 (H. Rept. 105-132) required that the 
contract for a uniform plan be subject to the competitive 
bidding process. The committee is concerned that the 
competitive bid process has still not been initiated, and that 
there is still no uniform benefit. The committee understands 
that there is some disagreement among the affected 
nonappropriated fund entities about the cost of the proposed 
plan. While the committee expects that the plan would address a 
certain minimum level of benefit at reasonable cost and provide 
for portability of the benefit among nonappropriated fund 
entities, the committee reminds the Department that the 
implementing law did not require that the Department's plan be 
the most costly available. The committee directs the Secretary 
of Defense to report to the Senate Committee on Armed Services 
and the House Committee on National Security by December 31, 
1998, on the features of the Department's final plan, and the 
ways in which the final plan incorporates the objectives of 
uniformity, competitive bidding, portability, and reasonable 
cost.

                              Other Issues

                    Advanced Self-Protection Jammer

    The committee notes that the AN/ALQ-165, the Advanced Self-
Protection Jammer (ASPJ), is one of the most advanced tactical 
aircraft electronic countermeasures systems in production. Over 
530 F/A-18C/D and 50 F-14D aircraft in the Navy and theMarine 
Corps inventory have been equipped for ASPJ installation, and it is the 
only electronic countermeasures system installed on these aircraft that 
can effectively counter the more modern threats encountered worldwide 
today. However, the committee also notes that out of 131 ASPJ units 
that have been procured thus far, only 82 systems are currently 
available for use by the Navy and the Marine Corps. As there is no 
organic depot capability to maintain the ASPJ systems, all failed 
systems must be returned to the manufacturer for repairs resulting in 
the Navy being only able to support approximately four fleet squadrons, 
or around 48 to 50 aircraft. The committee is also concerned that the 
lack of a sufficient ASPJ inventory requires that squadrons deploying 
with the ASPJ must have them installed just prior to deployment or 
while en route to the deployment areas. This situation precludes 
sufficient time for either pilot or maintenance personnel to properly 
train on the ASPJ system to ensure maximum operational proficiency.
    The committee urges the Secretary of the Navy to fully 
review all options for improving the availability of the ASPJ 
system, including the consideration of establishing a logistics 
support system for ASPJ maintenance and repair. Elsewhere in 
this report, the committee recommends an increase of $75.0 
million to address unfunded aviation depot maintenance 
requirements.

 Appropriated Funds Used to Pay for Defense Information System Agency 
                                 Costs

    The committee notes that the Defense Information System 
Agency (DISA) is using direct appropriations to offset the cost 
of Working Capital Fund (WCF) services. According to the 
General Accounting Office, these costs could reach as high as 
$285.0 million in fiscal year 1998. For example, approximately 
$46.0 million in appropriated funds were used to support the 
Defense Satellite Communication System, thereby artificially 
deflating average telecommunications prices by four cents a 
minute. These findings were also supported by a recent 
independent telecommunications study, commissioned by DISA. As 
a result, DISA charges to its customers may not represent the 
true cost of the services provided.
    Therefore, the committee recommends reallocating $221.6 
million from the DISA budget request, that should be part of 
the WCF pricing structure, to the military department operation 
and maintenance accounts to offset increased DISA WCF rates in 
fiscal year 1999. Further, the committee directs the Secretary 
of Defense, beginning with the fiscal year 2000 budget request, 
to more appropriately reflect and justify the DISA non-WCF 
budget request.

                   Army Civilian Personnel Management

    The Department of the Army has been making substantial 
progress in developing the Army Workload and Performance System 
(AWPS), which allows it to manage civilian personnel according 
to workload and prioritized requirements. The committee notes, 
however, that two recent General Accounting Office (GAO) 
studies point out several areas that need to be improved if 
AWPS is to accurately determine civilian personnel 
requirements. In a study that is nearing completion, GAO found 
that the Army cannot achieve the most cost-effective system 
without evaluating maintenance requirements for the total Army. 
GAO has also reported that a number of active and reserve 
component installations are developing depot-like facilities 
without the Army assessing the impact of these activities on 
its total maintenance program.
    The committee believes that it is critical for the Army to 
assess its total maintenance program, including ad hoc programs 
that are being developed at the local installations level and 
any funding from procurement and foreign military sales. The 
Army must determine the appropriate mix of the various types of 
equipment maintenance that will ensure efficiency at public 
depots, arsenals, and ammunition depots so that staffing levels 
are adequate and costs are lowered not only in the public 
depots, but also in the private sector or at the installation 
level. Therefore, the committee directs the Secretary of the 
Army to conduct a study and report to the committee not later 
than February 1, 1999, on the following issues:
          (1) The proliferation of depot maintenance type 
        activities throughout the Army;
          (2) The total number of personnel involved in these 
        activities;
          (3) Recommendations concerning the consolidation of 
        any fragmented activities to the public depots;
          (4) A long-range master plan to implement AWPS;
          (5) Future applications for AWPS; and
          (6) The total funding for the implementation of AWPS.
    The committee requests that the GAO review the above 
requested study and provide comments as to the adequacy and 
completeness of the study, including any other relevant 
information, to the committee not later than March 31, 1999.
    The committee is also concerned that the AWPS corporate-
level system requirements have not yet been defined and a 
decision has not been made on whether to develop and install 
the Decision Support System, which would provide roll-up data 
from all installations and allow commands to identify areas 
where performance could be improved through reengineering as 
well as allowing the setting of performance goals. Since these 
corporate-level systems are critical to enable the Army to 
measure performance and identify areas for improvement, the 
committee directs that the Secretary of the Army move forward 
with the development of these modules as quickly as possible.
    Finally, the committee directs that none of the working 
capital funds of the Department of the Army may be used for the 
completion of the AWPS studies or any implementation of AWPS.

                Automatic Document Conversion Technology

    The committee believes that there is the potential for 
significant savings from automatic document conversion software 
for use in weapons systems engineering drawing digitization, 
and that the Department of Defense (DOD) should increase its 
efforts to digitize all weapons engineering drawings by the 
year 2000. Therefore, the committee recommends the addition of 
$15.0 million for engineering drawings and document storage and 
retrieval to be directly managed by the Defense Logistics 
Agency. The committee strongly urges the DOD to include funding 
for document conversion technology in future budget requests.

                     Budget Justification Materials

    The committee is frustrated by the Department of Defense's 
persistent tardiness in providing all of the budget 
justification materials needed by Congress to fulfill its 
oversight responsibilities and provide for effective decision-
making in the budget review process. The justification 
materials, particularly for the operation and maintenance 
accounts, continue to be provided to Congress late in the 
committee's review process, often precluding the ability to 
conduct thorough and in-depth analysis of the President's 
budget request. Although an extensive amount of material is 
eventually provided, much of it remains in formats that 
contradict information from the individual services, making it 
difficult to assess trends in similar functions. The complexity 
of the multiple displays of budget information also makes 
locating information on a specific subject difficult and time 
consuming. In particular, details on efficiency savings 
generated by outsourcing and business reforms are either not 
provided or scattered throughout several tables.
    Because of these persistent difficulties, in the committee 
report on H.R. 1119 (H. Rept. 105-132) the committee directed 
the Secretary of Defense to convene a working group, consisting 
of representatives of the military departments and the 
appropriate defense agencies, to develop a single DOD-wide 
standard formulation for the display of budget justification 
materials provided to Congress. The committee urged this 
working group to consider eliminating repetitive and redundant 
budget displays, and further directed that budget justification 
materials provided to support the fiscal year 1999 budget 
request conform, to the maximum extent practicable, with a new 
department-wide standardized format. To the committee's 
knowledge, none of these actions have been taken.
    The committee again directs the Secretary of Defense to 
expeditiously reform and standardize the format and 
presentation of the budged justification materials, with 
particular emphasis on the operations and maintenance and 
environmental materials. The committee notes that if DOD 
continues to ignore repeated requests to improve the timing and 
content of the budget justification materials required by 
Congress, a legislative remedy may be required.

                    Classified Materials Containers

    The committee supports the Department of Defense plan to 
retrofit existing classified material containers with security 
locks that conform to the Federal Specification FF-L-2740A, and 
the Department's other efforts to provide secure protection of 
sensitive classified materials. In addition, the committee 
encourages the Department to include in these efforts a review 
of the protection of sensitive classified materials in the 
possession of defense contractors and provide appropriate 
recommendations to the committee, if any.

                       Corrosion Control Programs

    The committee believes that the ability to establish an 
effective corrosion control program is an important component 
of maintaining military readiness. This critical maintenance 
activity increases the life of multi-million dollar weapons 
systems and ensures their availability during times of crisis. 
The capability to perform remote location corrosion control 
must also be considered where wash facilities do not exist. At 
the same time, environmental concerns mandate military 
equipment/system washing on approved wash racks and disposal of 
effluents in compliance with Environmental Protection Agency 
standards. However, the committee further believes that 
military readiness needs must be balanced with environmental 
concerns and that both objectives must be achieved for the 
security of the United States and the preservation of the 
environment.

                   Defense Automated Printing Service

    The committee supports the Department's efforts to improve 
the management of the Defense Automated Printing Service 
(DAPS). However, the committee is concerned that DAPS has not 
incorporated best business practices of the private sector and 
is passing the costs of this inefficiency onto its customers. 
The committee directs the Secretary of Defense to complete a 
review of DAPS, utilizing a private sector source, and provide 
a report by March 31, 1999. The Secretary shall ensure that the 
contractor providing the review has experience in content and 
network management, along with offset, gravure, digital 
printing and print related services. The report shall include:
          (1) A description of the management structure of 
        DAPS, including the location of all DAPS sites;
          (2) The total number of personnel employed by DAPS 
        and their location;
          (3) A description of the functions performed by DAPS 
        and the number of DAPS employees performing each of the 
        DAPS functions;
          (4) A list of each inherently governmental and non-
        inherently governmental function performed by DAPS;
          (5) A site assessment of the type of equipment at 
        each DAPS site;
          (6) The type and explanation of the networking and 
        technology integration linking all DAPS sites;
          (7) Identify current and future customer 
        requirements;
          (8) Assess the effectiveness of DAPS current 
        structure in supporting current and future customer 
        needs and plans to address any shortcomings;
          (9) Identify and discuss best business practices that 
        are utilized by DAPS, and such practices that could be 
        utilized by DAPS; and
          (10) Provide options on maximizing the DAPS structure 
        and services to provide the most cost effective service 
        to its customers.

                      Depleted Uranium Penetrators

    The committee is aware of the Department of the Army's 
efforts to reduce from two to one the number of producers of 
tank depleted uranium penetrators as part of an effort to 
downsize and make more cost-effective the ammunition production 
base.However, the committee is concerned that the Army has 
apparently not identified any requirement for the removal of government 
furnished equipment from the facility that will no longer produce the 
depleted uranium penetrators. The committee directs the Secretary of 
the Army to review this removal process and to report back to the 
congressional defense committees on the Army's plans to remove 
government furnished equipment from the facility in question and to 
identify any necessary funding in future budget requests for this 
purpose.

                  Infrastructure Reduction Initiatives

    The committee is concerned that the Department of Defense's 
(DOD) current reform and infrastructure reduction initiatives 
are not supported by executable programs. The Quadrennial 
Defense Review states that one of the primary sources of 
instability in future defense plans is the migration of funds 
to cover shortfalls in savings estimates when competitive 
outsourcing or business process reengineering initiatives fail 
to achieve expectations.
    The committee remembers the Defense Management Review 
Directives, initiated in 1989 by DOD to generate significant 
savings and apply these savings against future years budgets. 
The committee also remembers that many of these initiatives 
failed to generate the anticipated savings and further 
remembers the budgeting difficulties resulting from this 
exercise. The committee generally supports the concept of 
outsourcing and encourages the department to continue pursuing 
improved business practices when they are cost effective and do 
not affect the readiness of the military services. However, 
savings estimates must be based on proven program results and 
not incorporated into future budgets until determined to be 
achievable.
    The committee directs the Comptroller General to report, by 
March 1, 1999, on the fiscal year 1999 and Five Year Defense 
Plan (FYDP), supporting the fiscal year 1999 budget, savings 
and personnel reductions for each military department and the 
Defense Agencies due to outsourcing, for non-depot maintenance 
and repair functions, or other Defense Reform Initiative 
efforts. The report shall:
          (1) Determine whether or not the estimated savings 
        and personnel reductions in the fiscal year 1999 budget 
        or FYDP were based on the results of outsourcing 
        studies completed during fiscal year 1999 or after 
        fiscal year 1999, using either section 2462 of title 
        10, United States Code or the Office of Management and 
        Budget Circular A-76;
          (2) Identify those savings and personnel reductions 
        in the fiscal year 1999 budget or FYDP that are linked 
        to current outsourcing studies or planned outsourcing 
        studies where the function to be outsourced has been 
        identified;
          (3) Calculate the outsourcing savings identified as a 
        percentage of the current cost of the function;
          (4) Identify those savings and personnel reductions 
        in the fiscal year 1999 budget or the FYDP that are the 
        result of DRI and other efforts unrelated to 
        outsourcing; and
          (5) Determine the extent to which the military 
        departments and Defense Agencies appear to be engaged 
        in outsourcing activities that include inherently 
        governmental functions, do not allowing civilian 
        employees to compete, or do not providing the study and 
        notification requirements of section 2461 of title 10, 
        United States Code.

                    Military Affiliate Radio System

    The committee is encouraged by the Department's expression 
of support for the Military Affiliate Radio System (MARS), an 
inexpensive DOD-sponsored program that relies on volunteer 
radio communications personnel to provide the Department and 
the armed forces with an auxiliary and emergency communications 
capability as an adjunct to normal communications. 
Specifically, the committee agrees with the conclusion of the 
Secretary of Defense, in a report submitted to the committee on 
December 31, 1997, that ``the broadly stated mission of MARS 
continues to be valid.'' The committee also notes the 
Department's estimate that use of the MARS system, in lieu of 
commercial or DOD resources, results in annual savings to DOD 
of between $11.1 million and $27.5 million, and encourages the 
Department to proceed with plans to restructure the MARS 
program in order to realize manpower savings, eliminate 
duplicative efforts, improve coordination, and modernize the 
program through technology improvements.
    The committee notes that although MARS is also used to 
relay morale communications traffic for the armed forces, the 
Department has relied on other means to fulfill this function, 
which often result in out-of-pocket costs to U.S. military 
personnel. For example, the Department has acknowledged that 
the cost of commercial telephone calls for troops deployed in 
Bosnia has been a morale issue. Notwithstanding the recent 
agreement with AT&T to reduce commercial telephone rates for 
U.S. troops participating in the Bosnia peacekeeping operation, 
the committee believes that restoring a MARS capability within 
Bosnia will provide a useful alternative and encourages the 
Department to give serious consideration to this option.

                         Prime Vendor Contracts

    The committee supports prime vendor delivery of materiel, 
since this program not only improves delivery response times 
and product availability but lowers inventory costs. In 
addition, the prime vendor program lowers the recovery rate 
charged by the Defense Logistics Agency (DLA). The prime vendor 
contracts rates are around 15 percent of the cost of the sales 
compared to DLA's current rate of 20 to 30 percent. The 
committee is concerned that the disparity between rates 
illustrates that DLA has made little effort to adjust its 
administrative structure to respond to a new business 
environment. Further, the committee encourages the Department 
to require the military departments to utilize an existing 
prime vendor contract for similar items, instead of generating 
another contract for the same materiel.

                      Ship Repair Industrial Base

    The committee is concerned the Department of the Navy is 
not providing sufficient ship repair and overhaul funding to 
sustain a viable private sector industrialbase. In recognition 
of continual under-funding in the overall ship depot maintenance 
account, Congress has added significant additional funding during the 
past three years to correct this deficiency. The committee notes that 
the majority, if not all, of this additional funding has been applied 
to the public shipyards. The committee further notes that if the 
distribution of ship overhaul and repair funds are not more equitably 
provided to private ship repair industry, the capabilities of this 
critical defense industry will severely impacted. Therefore, the 
committee directs the Secretary of the Navy to apply no less than 50 
percent of any additional funding above the budget request to the 
private sector.

                  Tagging System for Hydrocarbon Fuels

    The committee has learned of commercial technologies for 
tagging and identifying hydrocarbon fuels. These commercial 
technologies would allow the Department of Defense (DOD) to 
track and identify its fuels, provide a deterrence to fuel 
theft, aid in investigation of fuel theft and environmental 
pollution, and improve internal accounting. The committee 
directs the Secretary of Defense to provide a report by 
February 1, 1999 to the House Committee on National Security on 
the feasibility of using commercial technologies to tag DOD 
fuels particularly for:
          (1) Quantitative analysis and identification of DOD 
        fuels;
          (2) Deterrence of theft and misuse of DOD fuels; and
          (3) Determining the source of surface and underground 
        pollution.

                         LEGISLATIVE PROVISIONS

              Subtitle A--Authorization of Appropriations


             Section 301--Operation and Maintenance Funding

    This section would authorize $92.5 billion in operations 
and maintenance funding for the Armed Forces and other 
activities and agencies of the Department of Defense.

                   Section 302--Working Capital Funds

    This section would authorize $1.7 billion for Working 
Capital Funds of the Department of Defense.

               Section 303--Armed Forces Retirement Home

    This section would authorize $70.745 million from the Armed 
Forces Retirement Trust Fund for the operation of the Armed 
Forces Retirement Home, including the U.S. Soldiers' and 
Airmen's Home and the Naval Home.

 Section 304--Transfer From National Defense Stockpile Transaction Fund

    This section would authorize the Secretary of Defense to 
transfer not more than $150.0 million from the amounts received 
from sales in the National Defense Stockpile Transaction Fund 
to the operation and maintenance accounts of the military 
services.

               Section 305--Refurbishment of M1-A1 Tanks

    This section would require that out of the total 
authorization of operation and maintenance appropriations for 
the Department of the Army, $49.3 million may be used only for 
the refurbishment of up to 70 M1-A1 tanks under the AIM-XXI 
maintenance and repair program.

   Section 306--Operation of Prepositioned Fleet, National Training 
                     Center, Fort Irwin, California

    This section would authorize $60.2 million in additional 
funding for the operation of the preposition vehicle fleet by 
units of the armed forces during training rotations at the 
Army's National Training Center (NTC).
    The committee believes that the reduced proficiency levels 
of units arriving at the NTC is, in large part, due to the lack 
of home station training funds available to prepare for the 
rotation. This section, similar to section 307 of the National 
Defense Authorization Act for Fiscal Year 1998 (Public Law 105-
85), would authorize the funds for the Army to pay for the 
operation of the preposition fleet for all units rotating 
throughthe NTC. In the future, the committee expects the 
Secretary of the Army to take the necessary steps to ensure sufficient 
funding is made available to pay NTC preposition fleet operational 
costs out of a central fund.

                Section 307--Relocation of USS Wisconsin

    This section would authorize the Secretary of the Navy to 
utilize up to $6.0 million for the relocation of the USS 
Wisconsin which is currently berthed in reserve status at 
Norfolk Naval Shipyard, Virginia.

                 Section 308--Fisher House Trust Funds

    This section would authorize appropriations from the Fisher 
House Trust Funds for use in the operation and maintenance of 
the Fisher Houses of the Army, Navy, and Air Force.

               Subtitle B--Information Technology Issues

  Section 311--Additional Information Technology Responsibilities of 
                       Chief Information Officers

    This section would expand the responsibilities of the Chief 
Information Officers within the Department of Defense.

 Section 312--Defense-Wide Electronic Mall System for Supply Purchases

    This section would require the development of a single, 
joint, defense-wide electronic mall system.

  Section 313--Protection of Funding Provided for Certain Information 
               Technology and National Security Programs

    This section would require the Department of Defense to 
notify Congress prior to changing authorized funding level for 
high priority information technology programs.

Section 314--Priority Funding to Ensure Year 2000 Compliance of Mission 
     Critical Information Technology and National Security Systems

    This section would shift the priorities within the 
Department of Defense's Command, Control, Communication, and 
Computer budget request to ensure that mission critical systems 
are Year 2000 compliant.

  Section 315--Evaluation of Year 2000 Compliance as Part of Training 
                           Exercises Programs

    This section would require the Secretary of Defense to 
provide Congress with a plan on utilizing training exercises in 
the military departments and Joint Chiefs of Staff to test Year 
2000 compliance of information technology systems to transmit 
information from the point of origin to the point of 
termination simulating the year 2000.

                  Subtitle C--Environmental Provisions

      Section 321--Authorization to Pay Negotiated Settlement for 
 Environmental Cleanup at Former Department of Defense Sites in Canada

    This section would authorize the Secretary of Defense to 
pay the Government of Canada up to $100.0 million in annual 
payments over a ten year period. These payments would be 
pursuant to a bilateral agreement between the United States and 
Canada in which the United States agreed to pay cleanup costs 
associated with the operations by the United States of various 
military installations in Canada. Any future arrangements 
relating to environmental damage by the Department of Defense 
at overseas locations would be subject to treaty negotiations 
and ratification by the United States Senate.

           Section 322--Removal of Underground Storage Tanks

    This section would enable the Department of Defense to use 
authorized funds for removal of ten Army Corps of Engineers' 
underground storage tanks.

         Subtitle D--Defense Infrastructure Support Improvement

    Section 331--Reporting and Study Requirements Before Change of 
   Commercial and Industrial Type Functions to Contractor Performance

    This section would clarify the mandated reporting 
requirements prior to the study and conversion of any defense 
activities for possible performance by the private sector. The 
Defense Reform Initiative (DRI) states that between fiscal 
years 1999 and 2003 the Department of Defense will conduct 
Office of Management and Budget Circular A-76 competitions for 
150,000 federal positions. The committee has learned, however, 
that at least two of these competitions have not used the A-76 
guidance or complied with the current reporting requirements of 
section 2461 of title 10, United States Code. Specifically, DOD 
failed to notify Congress of its efforts to restructure over 
1,700 positions at the Air Force's 38th Engineering and 
Installation Wing (USAF 38th EIW) in Oklahoma, and its 
intention to compete 664 positions at the Army's Logistics 
Systems Support Command (USA-LSSC), St. Louis, Missouri.
    In addition to the legislative changes recommended by this 
section, the committee clarifies that the title 10 reporting 
requirements are not limited to competitions using the Office 
of Management and Budget Circular A-76. Regardless of whether 
such activities are called outsourcing, privatization, 
divestiture, re-engineering or restructuring, section 2461 of 
title 10 clearly states that Congress must be notified of a 
decision to study any current defense activities for possible 
performance by a private contractor.
    Furthermore, the committee directs the Secretary of Defense 
to provide to the committee, prior to any further activity 
regarding the USAF 38th EIW or USA-LSSC ``competitions,'' all 
the information required by law including the documentation 
supporting each certification under sections 2461(a)(3) and (4) 
of title 10. The committee also directs the General Accounting 
Office to analyze and determine whether information provided by 
the Army and Air Force on this matter supports the proposed 
action.

Section 332--Clarification of Requirement to Maintain Government-Owned 
           and Government-Operated Core Logistics Capability

    This section would clarify section 2464 of title 10, United 
States Code, to provided a specific definition of work 
performed by defense contractors in government-owned and 
government-operated maintenance facilities as it would apply to 
the requirements to maintain a core logistics capability.

 Section 333--Oversight of Development and Implementation of Automated 
                       Identification Technology

    This section would extend the responsibilities of the 
Smartcard Technology Office within the Defense Human Resources 
Field Activity.

Section 334--Conditions on Expansion of Functions Performed Under Prime 
                            Vendor Contracts

    This section would require the Secretary of Defense, or the 
secretary of a military department, to provide a report to 
Congress 60 days prior to entering into a prime vendor contract 
that would give a defense contractor the responsibility to 
manage, store, and distribute inventory, manage and provide 
services, or manage and perform research on behalf of the 
Department of Defense or a military service. The section would 
also require that the report include a description of the 
competitive procedures to be used in the proposed prime vendor 
contract, and a cost benefit analysis that demonstrates that 
the use of the prime vendor contract will result in savings to 
the government over the life of the contract.

Section 335--Clarification of Definition of Depot-Level Maintenance and 
                                 Repair

    This section would clarify section 2460(a) of title 10, 
United States Code, to include the location at which depot-
level maintenance is performed.

Section 336--Clarification of Commercial Item Exception to Requirements 
                 Regarding Core Logistics Capabilities

    This section would clarify section 2464(a)(5) of title 10, 
United States Code, to establish specific requirements for the 
determination of a commercial item exception for depot-level 
repair and maintenance of equipment.

 Section 337--Development of Plan for Establishment of Core Logistics 
        Capabilities for Maintenance and Repair of C-17 Aircraft

    This section would require the Secretary of the Air Force 
to provide to Congress, by March 1, 1999, a plan for the 
establishment of a core logistics capability for the C-17 
aircraft that would be consistent with section 2464 of title 
10, United States Code. The section would also prohibit the 
extension of the interim contract support agreement for the C-
17 aircraft until 60 days after the receipt of the plan by 
Congress.

   Section 338--Contractor-Operated Civil Engineering Supply Stores 
                                Program

    This section would require the Secretary of Defense to 
provide additional information on competitions that combine a 
Contractor-Operated Civil Engineering Supply Store with other 
functions.

 Section 339--Report on Savings and Effect of Personnel Reductions in 
                         Army Materiel Command

    This section would require the Comptroller General to 
submit a report to Congress concerning the effect that the 
proposed personnel reductions in the Army Material Command will 
have on workload and readiness, and a report on any anticipated 
cost savings from these proposed reductions. The section would 
also preclude some personnel reductions in the Army Material 
Command until receipt of the report or March 31, 1993.

  Subtitle E--Commissaries and Nonappropriated Fund Instrumentalities

    Section 341--Continuation of Management and Funding of Defense 
    Commissary Agency through the Office of the Secretary of Defense

    This section would require that the Defense Commissary 
Agency (DeCA) continue to be managed and funded by the Office 
of the Secretary of Defense. The budget request proposed to 
return the funding and management of DeCA to the military 
services. The committee is concerned that the Department's plan 
would negate the benefits gained from consolidating the former 
service commissary agencies into DeCA, and put further strain 
upon the operating and maintenance accounts of the military 
services.

     Section 342--Expansion of Current Eligibility of Reserves for 
                          Commissary Benefits

    This section would increase the number of days that certain 
ready reserve members and reserve retirees under the age of 60 
are eligible to use commissary stores from 12 days each 
calendar year to 24 days each calendar year. This section would 
also extend commissary eligibility to members of the national 
guard who are activated duringfederally declared disasters. 
This committee recognizes the increased reliance the nation has placed 
upon the reserve components in recent years. The committee notes that 
this change is not expected to result in any measurable increase in 
commissary sales, and expects that no requests for new commissary store 
construction would be requested or approved as a result of this 
increased benefit.

   Section 343--Repeal of Requirement for Air Force to Sell Tobacco 
                     Products to Enlisted Personnel

    This section would repeal a provision of law that is 
ambiguous and an apparent anachronism. The provision that would 
be repealed, section 9623 of title 10, United States Code, 
requires the Air Force to sell not more than 16 ounces of 
tobacco a month to an enlisted member who requests it. There 
are no similar provisions of law that apply to the other 
military services.

   Section 344--Restrictions on Patron Access to, and Purchases in, 
               Overseas Commissaries and Exchange Stores

    This section would authorize the Secretary of Defense to 
continue to restrict the sale of certain items in overseas 
exchanges and commissaries, but would require that the 
secretary ensure that such restrictions are consistent with the 
primary purpose of providing U.S. made goods to authorized 
patrons. The committee firmly believes that access to these 
products is an important morale boost to those serving in 
remote locations, and that restrictions should only be imposed 
for the best of reasons. The committee is concerned that 
overseas commanders have exercised unfettered reign in this 
area, have taken the view that patron convenience is a 
secondary concern, and have been free from departmental 
oversight. The committee expects the Department to begin 
exercising effective supervision of these programs, and expects 
that necessary controls will be consistent with the goal of 
minimizing infringement on the right of authorized patrons to 
purchase U.S. made products.

Section 345--Extension of Demonstration Project for Uniform Funding of 
               Morale, Welfare, and Recreation Activities

    This section would amend section 335(c) of the National 
Defense Authorization Act for Fiscal Year 1996 (Public Law 104-
106) to extend for one year the authority of the Department of 
Defense to conduct a demonstration project for the uniform 
funding of morale, welfare, and recreation activities at 
certain military installations. The committee understands that 
the demonstration project appears to be working well. The 
committee will consider the Department's views on the merits of 
expanding the program throughout the Department after the 
Department submits the report required by the authorizing test 
legislation. The extension of authority provided by this 
section would permit the test installations to maintain the 
test funding procedures and avoid the disruption of reversion 
to the traditional method of funding while the report is being 
prepared and considered by the Congress.

   Section 346--Prohibition on Consolidation or Other Organizational 
            Changes of Department of Defense Retail Systems

    This section would prohibit the Department of Defense from 
consolidating military exchange and commissary operations and 
from conducting further study of consolidation, unless 
specifically authorized by law. The committee is aware of an 
Office of Management and Budget (OMB) directed study within the 
Department of Defense regarding the creation of a DOD Resale 
Agency. The committee is concerned that OMB's direction of the 
resale study may be indicative of a shift in policy on the part 
of the Administration away from one of ensuring that commissary 
and exchange services are properly supportive of the needs of 
military families and retirees and toward one of allowing 
economic efficiencies to be the principal driver that 
determines these essential benefits. The committee notes that 
the recent proliferation of suggestions to change the military 
resale system has caused concern among service members, their 
families, and retirees about the health of the resale benefit. 
The committee firmly asserts its support for the commissary and 
exchange benefit, and strongly believes that no further changes 
should be made to the resale system without specific 
Congressional approval. The committee notes that the Department 
recently contracted for a due diligence study regarding 
exchange integration issues. The committee intends for that 
study to continue, but expects that implementation of any study 
recommendations would await Congressional approval.

  Section 347--Authorized Use of Appropriated Funds for Relocation of 
                     Navy Exchange Service Command

    This section would provide that the Navy Exchange Service 
Command (NEXCOM) shall not be required to reimburse the United 
States for appropriated funds allotted to NEXCOM during fiscal 
years 1994, 1995, and 1996 for costs incurred in connection 
with the relocation of NEXCOM headquarters to Virginia Beach, 
Virginia, and for the lease of headquarters space.

Section 348--Evaluation of Merit of Selling Malt Beverages and Wine in 
            Commissary Stores as Exchange System Merchandise

    This section would require the Secretary of Defense to 
survey eligible commissary store patrons to determine their 
interest in commissary stores selling beer and wine. The 
provision would also authorize the secretary to conduct a 
demonstration project at seven military installations in the 
United States, after consideration of the survey results. The 
demonstration project, if conducted, would only be permitted in 
those states in which the sale of beer and wine in grocery 
stores is lawful, and would authorize the sale of beer and wine 
in commissary stores at exchange prices.

                       Subtitle F--Other Matters

 Section 361--Eligibility Requirements for Attendance at Department of 
      Defense Domestic Dependent Elementary and Secondary Schools

    This section would permit dependents residing in a 
territory, commonwealth, or possession of the United States to 
participate in an educational program where the parent is a 
service member assigned to a remote or unaccompanied location. 
This section would also clarify the Secretary of Defense's 
authority to provide exceptions for enrollment in dependent 
schools for dependents of civilian employees in Puerto Rico and 
Guam, where such employees reside off the installation, and 
would provide that the Department would be reimbursed for the 
cost of such education.

Section 362--Specific Emphasis of Program to Investigate Fraud, Waste, 
                 and Abuse within Department of Defense

    This section would identify the specific Department of 
Defense (DOD) agency to manage the pilot program established in 
section 388 of the National Defense Authorization Act for 
Fiscal Year 1998 (Public Law 105-85). The committee understands 
that the General Accounting Office (GAO) has identified 
hundreds of millions of dollars in contract overpayments at 
DOD. In the National Defense Authorization Act for Fiscal Year 
1996 (Public Law 104-106), the Congress provided the authority 
for a DOD pilot study to test private sector methods in 
identifying contract overpayments. This pilot was expanded by 
section 388 of Public Law 105-85 to test whether such 
commercial techniques were applicable to a larger variety of 
DOD contracts. The committee has learned that, to date, DOD has 
failed to take the necessary steps to fully implement section 
388. Specifically, DOD has not determined the functional 
contract areas for review, established a program management 
office, or established a date for the release of a request for 
proposal for this program.
    Therefore, the committee directs the Secretary of Defense 
to select at least two commercial functions within the working 
capital funds accounts and release a Request For Proposal (RFP) 
for competitive bid by December 31, 1998 that would fully 
implement section 388 of Public Law 105-85. The committee also 
directs the GAO to provide an initial review of both pilot 
programs by April 1, 1999.

  Section 363--Revision of Inspection Requirements Relating to Armed 
                         Forces Retirement Home

    This section would revise the current procedures for the 
periodic inspection of the Armed Forces Retirement Homes by the 
Inspector General of each of the military departments on an 
alternating basis, and would require that upon completion of 
these inspections, the report of the inspections shall be 
provided to Congress.

   Section 364-Assistance to Local Educational Agencies that Benefit 
  Dependents of Members of the Armed Forces and Department of Defense 
                           Civilian Employees

    This section would authorize $35.0 million for educational 
assistance to local education agencies where the standard for 
the minimum level of education within the state could not be 
maintained because of the large number of military connected 
students or the effects of base realignments and closures. The 
Department of Education impact aid program provides 
supplementary funds to eligible school districts nationwide. 
The committee believes that the Department of Education bears 
the principal responsibility for providing support for the 
education needs of the nation's children, and, therefore, does 
not support additional assistance beyond what is authorized in 
the section.

    Section 365--Strategic Plan for Expansion of Distance Learning 
                              Initiatives

    This section would require the Department of Defense (DOD) 
to develop a plan to establish a framework for developing and 
applying distance learning technologies to training courses 
where it makes sense and is cost effective. The committee is 
concerned that DOD has not taken sufficient steps to avoid 
duplicative investment in distance learning technology, has not 
established appropriate standards for software design, and may 
not be fully exploring new technologies for distance learning 
such as the use of home study through the internet. Further, 
the committee believes there is insufficient funding in the 
five year defense plan to take best advantage of the economies 
of inter-operable information distribution platforms that are 
durable and can be accessed globally. The committee believes 
that DOD should refocus its efforts on distance learning and 
take steps to ensure the initiatives associated with distance 
learning are adequately funded and are clearly established as a 
DOD priority.

   Section 366--Public Availability of Operating Agreements Between 
           Military Installations and Financial Institutions

    This section would subject operating agreements that 
provide financial services, including electronic banking, on 
military installations in the United States, to the same 
requirements of the Freedom of Information Act (FOIA) as all 
other federal contracts. The committee believes this section 
would not provide any new authorization, nor does it extend or 
limit any part of the financial agreements, services, or 
institutions governed by the Department of Defense Directive 
1000.11, ``Financial Institutions on DoD Facilities'', dated 
July 26, 1989.
    The committee is concerned that all solicitations for 
banking services on military installations may not currently be 
conducted in an open competition, which could impact potential 
services to military personnel. The committee believes that 
subjecting these solicitations and agreements to FOIA will 
provide a means for all interested parties to review the 
proposals. In addition, the committee directs the General 
Accounting Office to review and report its findings to the 
committee by March 1, 1999 on the solicitation process for 
selecting banking services on military installations and the 
potential for generating revenue from fees, charges, or other 
payments from depository institutions.

     Section 367--Department of Defense Readiness Reporting System

    Over the past four years, the committee has become 
increasingly frustrated by the contradictions between 
assessments of military unit readiness as reflected in official 
reports and the observations made by military personnel in the 
field. Where official reports portray the overall readiness of 
U.S. armed forces as high, soldiers, sailors, airmen and 
marines increasingly admit that their units are slipping below 
past standards. Indeed, they frequently state that the 
readiness reporting system is inaccurate, even corrupted.
    In recent hearings before the committee, service officials 
at all levels expressed significant concern over many issues 
affecting readiness, including operating tempo, increased 
deployments, morale, the impact of peacekeeping operations, and 
the increasing use of training funds for other purposes. 
Ironically, none of these factors are measured by the current 
reporting system. Their effects on readiness, and the effects 
of other such factors, are not apparent in formal readiness 
assessments and could go unnoticed by senior officials until 
readiness is severely degraded.
    The themes of this testimony are not new and are consistent 
with those enumerated in past committee hearings and reports. 
The persistence of these problems leaves the committee 
concerned by the lack of progress the Department of Defense has 
made to develop a more comprehensive readiness measurement 
system reflective of today's operational realities. As defense 
resources have declined in real terms, and the number, 
frequency and duration of contingency operations has increased, 
the ability of U.S. armed forces to train for their primary 
warfighting missions has been compromised. Yet at the same 
time, unit readiness reports have remained unchanged, at high 
levels. Therefore, the committee recommends a provision (sec. 
367) that would direct the Secretary of Defense to create a 
more complete and accurate readiness reporting system by July 
1, 1999.
    Senior uniformed leaders frankly acknowledge this lack of 
accuracy in readiness reporting. The committee recognizes and 
praises the efforts now being made to enhance joint assessments 
through the Joint Monthly Readiness Reviews, the establishment 
of a Senior Readiness Oversight Council that elevates readiness 
issues to the senior officer level, and those efforts aimed at 
developing a Readiness Baseline. In addition, some of the 
services are attempting to adjust their readiness reporting 
systems. However, none of the actions undertaken by the 
Department, the Joint Chiefs of Staff, nor the services has yet 
to result in a readiness measurement system capable of timely 
and accurate reporting. The committee is concerned that the 
current plan for achieving such a system has been underfunded, 
suffered from lack of senior leadership attention, and suffered 
from entrenched bureaucratic resistance.
    In light of its review of the current readiness reporting 
system, the committee believes that an improved and 
comprehensive readiness reporting system would consist of four 
basic elements: a unit status report, measuring the readiness 
of service units; a training establishment status report, 
measuring the condition of service training institutions; a 
defense infrastructure status report, measuring the ability of 
service and other defense facilities to deploy, sustain and 
reconstitute forces from the United States and abroad; and a 
joint forces status report, which would measure the ability of 
the Department of Defense to successfully conduct the two major 
theater wars as called for in the Defense Planning Guidance and 
on the timelines specified by the relevant theater commanders-
in-chief.
    Moreover, the committee believes that these status reports 
should accomplish three fundamental tasks: objectively capture 
current conditions as of the date of reporting, separately 
report commander's readiness estimates and risk assessments, 
and highlight deficiencies so that programmatic adjustments can 
be made. The committee firmly believes that the results of this 
readiness reporting system need to be widely available to 
senior civilian leaders in the Department of Defense and 
Congress; the complexity, incompleteness and inaccuracies of 
the current system create confusion where there should be 
common understanding. The committee also encourages the 
Department and the services to reassess their readiness 
reporting regulations to eliminate loopholes, exceptions, 
inconsistencies and inappropriate subjective assessments. In 
sum, it is the committee's view that the purpose of the 
readiness reporting system should be to capture what personnel 
and equipment are available and what training has been 
accomplished as of the date of the report, and that these 
quantitative measures should be considered in light of wartime 
requirements alone.
    The heart of any readiness reporting system must be to 
capture the current status of operational units. In the 
committee's judgment, the unit status report should quantify 
personnel available for duty, the number of available ``skill-
qualified'' personnel, the available officers and senior-grade 
enlisted personnel (pay grade E-5 and above, and the percentage 
of these personnel who are available for duty when calculated 
against the unit's wartime requirements--not against the 
budgeted level of unit fill. The committee's study of service 
regulations governing personnel reporting provides a cause for 
deep concern in that many of these measurements are devalued by 
the variety of waivers and loopholes that permit units to 
consider personnel as available even when they are temporarily 
deployed in a distant theater of operations. The committee 
urges the services, the Chairman of the Joint Chiefs of Staff 
and the Secretary of Defense to review these regulations with 
an intent to make them more realistic.
    Equipment readiness also is recognized as an essential 
measure of unit readiness. The committee is concerned that 
current equipment measures are insufficient and riddled with 
waivers and loopholes. The committee firmly believes that the 
appropriate standard of unit readiness is the calculation of 
equipment that is both on hand and rated as mission capable. 
The committee has been dismayed to learn that the services 
continue to rate the percentage of on-hand equipment against 
the level of equipment authorized, and the level of serviceable 
equipment compared to that which is on-hand. The committee 
urges the Secretary of Defense to enforce a department-wide 
standard establishing the percentage of equipment both on-hand 
and mission capable as the unexceptionable measure of equipment 
readiness.
    However, the key element in improving the objectivity, 
consistency and credibility of the unit readiness reporting 
system is an improvement in training measures. The committee 
has concluded that it is of the highest importance that the 
Department of Defense establish a set of objective criteria for 
judging training readiness, and to develop an automated system 
for weighting warfighting training priorities. Projects now 
underway in the Army and other services have demonstrated the 
validity of this concept, and the committee applauds the Army's 
attempt to develop a set of algorithms that willmake training 
readiness calculations as simple as a computer-assisted tax preparation 
program. Despite the complexity of the task, the committee is 
encouraged by the Army's example that an automated training reporting 
system is an achievable goal, and urges the Secretary of Defense to 
make such efforts his highest priority in reforming the readiness 
reporting system.
    This objective training reporting system must be keyed to 
the unit's wartime mission and the identified tasks associated 
with that mission. Yet because military units are so often 
called today to execute missions in peacekeeping operations and 
other similar operations other than war, the Secretary should 
consider including an element in the unit status report that 
allows for recognition of this reality. Thus, an Army unit 
deployed to Bosnia or an Air Force squadron conducting a no-fly 
zone may be performing their assigned missions at a high level 
of competence and readiness, but require additional training to 
properly execute their warfighting missions. The committee 
believes it is appropriate to measure both kinds of readiness, 
but that the core readiness rating should be that related to 
the wartime requirement.
    As suggested above, the committee believes that, even as 
the level of objectivity in readiness reporting is raised, 
there is an important role to be played by unit commanders in 
assessing overall readiness. In particular, the committee has 
concluded that the commander can bring a unique perspective in 
regard to two salient factors: the overall ability of the unit 
to accomplish its assigned wartime mission and the level of 
risk associated with the conduct of that mission based upon the 
unit's current status. Such judgments are already an element in 
the Department's readiness assessments, yet the committee 
believes these judgments should be part of a regular and formal 
process, and conducted at all levels of command. Commanders 
should be encouraged to draw upon the full range of their 
professional experience and expertise in making such judgments, 
including such factors as equipment modernization, doctrinal 
development or other assessments as appropriate. While these 
judgments should generally reflect and be based upon the 
results of the objective readiness reporting system, their 
purpose should be to add nuance, context and fuller explanation 
of the unit's combat status.
    The committee also believes that a comprehensive readiness 
reporting system must better capture the effects of factors 
outside the current unit reporting system. This, the second 
component of an improved overall readiness system must be an 
assessment of the institutional training establishments that 
are the seed-corn of sustained unit readiness over time. In 
hearings, interviews and in reports, the committee has become 
alarmed at the degree to which training establishments 
increasingly are being deprived of resources, equipment and 
personnel in order to provide for the needs of deploying 
operational units. The committee applauds the Army's efforts to 
measure the readiness of its training establishment and the 
fact that this report has served as an important tool in 
maintaining the health of its Training and Doctrine Command. 
Though the command continues to suffer resource shortfalls, the 
Army has found that at least it can measure and limit the 
effects of these shortfalls.
    Likewise, in the committee's judgment, defense 
infrastructure is an increasing factor in the readiness of 
units that are constantly deployed. The committee has heard 
repeated testimony that such factors as the quantity and 
quality of child care, medical care and housing have become 
major concerns as the pace of operations increases. These and a 
variety of other factors must be properly assessed and weighed 
to create a comprehensive picture of current military 
readiness.
    The committee has been pleased to learn of the efforts of 
the Chairman of the Joint Chiefs of Staff and senior military 
leaders of all services that have led to the creation of the 
Joint Monthly Readiness Report. This will provide a very good 
basis for monitoring the readiness of joint U.S. armed forces 
to support the National Military Strategy, and the committee 
applauds the explicit requirement to assess the risk to that 
strategy resulting from the pace of current operations. Though 
the committee has been sobered to learn how senior military 
leaders currently assess that risk, it finds the effort to do 
so commendable and correct; indeed, overdue.
    In conclusion, the committee underscores its belief that 
this reporting system must be as objective and as widely 
disseminated as possible. Past assessments and discussions of 
readiness have suffered from the Department's inability to 
create and implement objective and consistent readiness 
reporting criteria, especially with respect to training 
assessments, that are capable of providing a clear picture to 
senior uniformed leaders, senior defense civilians, and the 
Congress. The committee urges the Secretary of Defense to 
establish the rapid creation of such a readiness reporting 
system as one of his top priorities.

   Section 368--Travel by Reservists on Carriers under Contract with 
                    General Services Administration

    This section would permit members of the reserve components 
to use General
    Services Administration (GSA) federal supply contracts for 
commercial air transportation in order to perform inactive duty 
training. At present, travel arranged through the GSA contract 
is limited to service members and federal employees traveling 
at government expense. Although reserve personnel are not 
authorized reimbursement for travel to and from inactive duty 
training, the committee notes that reserve personnel are 
eligible for military medical care for any injuries incurred in 
connection with such travel. The committee believes that this 
provision would assist the reserve components in recruiting 
qualified personnel to perform reserve duties in overseas and 
other remote locations.

   Subtitle G--Demonstration of Commercial-Type Practices to Improve 
                 Quality of Personal Property Shipments

              Section 381--Demonstration Program Required

    This section would require the Secretary of Defense to 
conduct a demonstration program to test commercial-style 
practices to improve the quality of personal property shipments 
within the Department of Defense.

              Section 382--Goals of Demonstration Program

    This section would establish the goals of a demonstration 
program to test commercial-style practices to improve the 
quality of personal property shipments within the Department of 
Defense.

                   Section 383--Program Participants

    This section would establish the participants of a 
demonstration program to test commercial-style practices to 
improve the quality of personal property shipments within the 
Department of Defense.

                         Section 384--Test Plan

    This section would establish the components of a 
demonstration program to test commercial-style practices to 
improve the quality of personal property shipments within the 
Department of Defense. The section would also provide for 
performance evaluations during the demonstration test program 
and would revise procedures for the settlement of claims for 
losses or damage during shipments of household goods.

        Section 385--Other Methods of Personal Property Shipping

    This section would specify that the demonstration program 
for the improvement of personal property shipments would not 
affect the existing Do-It-Yourself or the Direct Procurement 
Method Program for the shipment of household goods.

             Section 386--Duration of Demonstration Program

    This section would establish the beginning date and the 
duration of a demonstration program to test commercial-style 
practices to improve the quality of personal property shipments 
within the Department of Defense.

            Section 387--Evaluation of Demonstration Program

    This section would require the Secretary of Defense to 
provide for the evaluation of a demonstration program to test 
commercial-style practices to improve the quality of personal 
property shipments within the Department of Defense. The 
evaluation would be provided to Congress within 180 days before 
the termination date of the demonstration program.

              TITLE IV--MILITARY PERSONNEL AUTHORIZATIONS

                         LEGISLATIVE PROVISIONS

                       Subtitle A--Active Forces

              Section 401--End Strengths for Active Forces

    Based on repeated reports of manpower shortages in all 
services, and especially in the Army, the committee believes 
that the end strengths for active forces requested in fiscal 
year 1999 are too low to adequately support service 
requirements. Therefore, the committee recommends end strengths 
levels nearly 11,000 above those requested. Accordingly, this 
section would authorize the following end strengths for active 
duty personnel of the Armed Force as of September 30, 1999:

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                            FY 1998                      FY 1999               Change from fiscal year  
                                                                 ---------------------------------------------------------------------------------------
                             Service                               Authorized                                                                           
                                                                    and floor      Program       Request    Recommendation  1999 Request   1998 Program 
--------------------------------------------------------------------------------------------------------------------------------------------------------
Army............................................................       495,000       488,000       480,000        484,800          4,800         (3,200)
Navy............................................................       390,802       386,894       372,696        376,423          3,727        (10,471)
USMC............................................................       174,000       172,987       172,200        173,922          1,722            935 
USAF............................................................       371,577       371,409       370,882        371,577            695            168 
DOD.............................................................     1,431,379     1,419,290     1,395,778      1,406,722         10,944        (12,568)
--------------------------------------------------------------------------------------------------------------------------------------------------------

    In addition, based on a high priority requirement 
identified by the Army Chief of Staff, the committee recommends 
an increase of $74.0 million in the Army's military personnel 
account over the amount requested to assist the Army in 
maintaining active force manning levels throughout fiscal year 
1999.

         Section 402--Revision in Permanent End Strength Levels

    The budget request sought to repeal section 691 of title 
10, United States Code, that established permanent end strength 
levels for members of the armed forces on active duty. The 
committee believes that it is necessary to retain end strength 
floors, not only because of a long-standing concern that the 
end strength levels of active forces remain inadequate to 
support the national military strategy, but also because of a 
growing concern that military personnel reductions are now and 
will continue to be an expedient means to finance the growing 
shortfalls across the defense budget. Retention of the end 
strength floors remains, therefore, a means for Congress to 
control the propensity by the services to accelerate personnel 
reductions in order to generate savings during a fiscal year as 
assumptions about presumed savings and efficiencies in other 
programs fail to materialize. Therefore, this section would 
amend section 691 of title 10, United States Code, by 
establishing new end strength floors for the active forces at 
the levelsrecommended by the committee in section 401. This 
section would also permit active end strengths to vary up to one 
percent below the established floor.
    In addition, the committee notes that fiscal year 1998 end 
strengths for some of the services will fall below the 
appropriated levels. Such underexecution works to the advantage 
of a service in two ways: (1) as people are eliminated faster 
than planned, savings are achieved and funds are made available 
for other purposes in fiscal year 1998, the current fiscal 
year, and (2) savings are achieved for the following year, 
fiscal year 1999, because the service starts the year with 
fewer people than anticipated. The committee estimates the 
fiscal year 1999 so-called ``savings'' associated with the 
Department's fiscal year 1998 military personnel underexecution 
to be $125.0 million. The committee recommends reallocation of 
the fiscal year 1999 underexecution savings to support a range 
of military pay, end strength, and recruiting initiatives that 
were not included in the budget request.

Section 403--Date for Submission of Annual Manpower Requirements Report

    Section 115a of title 10, United States Code, requires the 
submission of an Annual Manpower Requirements Report not later 
than February 15 of each fiscal year. This section would 
establish a new suspense date for the report, requiring it to 
be transmitted to Congress not later than 30 days after the 
budget for the next fiscal year is submitted to Congress.

Section 404--Extension of Authority for Chairman of the Joint Chiefs of 
 Staff to Designate Up to 12 General and Flag Officer Positions to Be 
        Excluded from General and Flag Officer Grade Limitations

    This section would extend to October 1, 2001, from October 
1, 1998, the authority for the Chairman of the Joint Chiefs of 
Staff to exclude up to 12 general and flag officer positions 
from existing grade limitations.

                       Subtitle B--Reserve Forces

            Section 411--End Strengths for Selected Reserve

    This section would authorize the following end strengths 
for the selected reserve personnel, including the end strength 
for reserves on active duty in support of the reserves, as of 
September 30, 1999:

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Fiscal year 1998             Fiscal year 1999           Change from fiscal year  
                             Service                             ---------------------------------------------------------------------------------------
                                                                   Authorized      Program       Request    Recommendation  1999 request   1998 program 
--------------------------------------------------------------------------------------------------------------------------------------------------------
ARNG............................................................       361,516       361,516       357,000        357,000              0         (4,516)
USAR............................................................       208,000       208,000       208,000        209,000          1,000          1,000 
USNR............................................................        94,294        94,294        90,843         90,843              0         (3,451)
USMCR...........................................................        42,000        40,855        40,018         40,018              0           (837)
ANG.............................................................       108,002       108,002       106,991        106,991              0         (1,011)
USAFR...........................................................        73,447        73,447        74,242         74,242              0            795 
CGR.............................................................         8,000         7,800         8,000          8,000              0            200 
                                                                 ---------------------------------------------------------------------------------------
      Total.....................................................       895,259       893,914       885,094        886,094          1,000         (7,820)
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The increases in selected reserve end strength shown above 
include the additions to the end strength for reserves on 
active duty in support of the reserves described in section 
412.

 Section 412--End Strengths for Reserves on Active Duty in Support of 
                              the Reserves

    This section would authorize the following end strengths 
for reserves on active duty in support of the reserves as of 
September 30, 1999:

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Fiscal year 1998             Fiscal year 1999           Change from fiscal year  
                             Service                             ---------------------------------------------------------------------------------------
                                                                   Authorized      Program       Request    Recommendation  1999 request   1998 program 
--------------------------------------------------------------------------------------------------------------------------------------------------------
ARNG............................................................        22,310        22,310        21,763         21,763              0           (547)
USAR............................................................        11,500        11,500        11,804         12,804          1,000          1,304 
USNR............................................................        16,136        16,136        15,590         15,590              0           (546)
USMCR...........................................................         2,559         2,494         2,362          2,362              0           (132)
ANG.............................................................        10,616        10,671        10,930         10,930              0            259 
USAFR...........................................................           748           867           991            991              0            124 
                                                                 ---------------------------------------------------------------------------------------
      Total.....................................................        63,869        63,978        63,440         64,440          1,000            462 
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The section would also increase by 1,000 the number of 
AGR's requested for the United States Army Reserve. The 
committee believes this increase is necessary to offset 
reductions in other components of the full-time force 
supporting the Army Reserve, and to improve the readiness of 
early deploying units. To support this additional end strength, 
the committee recommends an increase of $25.0 million in the 
Army Reserve military personnel account.

   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, 
1999:

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Fiscal year 1998             Fiscal year 1999           Change from fiscal year  
                             Service                             ---------------------------------------------------------------------------------------
                                                                   Authorized      Program       Request    Recommendation  1999 request   1998 program 
--------------------------------------------------------------------------------------------------------------------------------------------------------
ARNG............................................................        23,125        22,849        22,179         23,125            946            276 
USAR............................................................         5,503         5,503         5,205          5,395            190           (108)
ANG.............................................................        22,853        22,853        22,408         22,408              0           (445)
USAFR...........................................................         9,802         9,802         9,761          9,761              0            (41)
                                                                 ---------------------------------------------------------------------------------------
      Total.....................................................        61,283        61,007        59,553         60,689          1,136           (318)
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Section 10216 of title 10, United States Code, provides 
that military technician end strength authorizations shall only 
be reduced in connection with military force structure 
reductions. The committee notes that the President's budget 
requested end strengths for military technicians (dual status) 
in the Army National Guard and the Army Reserve that were well 
below the fiscal year 1998 authorizations, however, in 
violation of the statute, the Army National Guard reductions 
were unsupported by force structure changes, and the Army 
Reserve reductions were supported only in part by force 
structure changes. The committee admonishes the Secretary of 
the Army to ensure that all future budget requests for 
reductions in military technician (dual status) end strength 
below the level authorized in fiscal year 1999 are made only as 
a result of force structure changes.
    The committee is also aware that the Chief of Staff of the 
Army identified the restoration of national guard military 
technician (dual status) end strength as the second highest 
priority among the Army's unfunded requirements list submitted 
to the committee. The restoration was required because of a 
total Army decision to defer some national guard force 
structure reductions until fiscal year 2000 and beyond. The 
committee commends the senior Army leadership (both active and 
national guard) for the priority afforded to this Army National 
Guard requirement, and recommends that the Army National Guard 
operations and maintenance account for operating forces (land 
forces) be increased by $27.0 million to facilitate the 
restoration of military technicians (dual status).

Section 414--Increase in Number of Members in Certain Grades Authorized 
           to Serve on Active Duty in Support of the Reserves

    This section would authorize increases in the grades of 
reserve members authorized to serve on active duty or on full-
time national guard duty for the administration of the reserves 
or the national guard. The provision would authorize 133 
additional majors, 22 additional E-9s, and 89 additional E-8s 
in the Air Force. The provision would also authorize 26 
additional colonels and 20 additional E-9s in the Army. The 
committee believes these increases are necessary to support the 
additional missions now being performed by the reserve 
components.

              Subtitle C--Authorization of Appropriations

  Section 421--Authorization of Appropriations for Military Personnel

    This section would authorize $70,697.1 million to be 
appropriated for military personnel.
    This authorization of appropriation reflects both 
reductions and additions to the President's budget request.

------------------------------------------------------------------------
                                                  Military              
             Recommended Increases               personnel       O&M    
                                                  accounts     accounts 
------------------------------------------------------------------------
Basic Pay Increase (3.6% vs 3.1%).............        186.0  ...........
Recruiting Advertising:                                                 
    Navy Recruiting Advertising...............  ...........         35.0
    USMC Recruiting Advertising...............  ...........         12.0
    Air National Guard Recruiting Advertising.  ...........          3.0
    USAFR Recruiting Advertising..............          3.0  ...........
End Strength:                                                           
    Active Army...............................         74.0  ...........
Reserve Components:                                                     
    USNR Contributory Support to CINCs (ADT)                            
     (RPN)....................................         10.0  ...........
    USNR Active Duty Special Work (MPN).......         10.0  ...........
    USMCR Increased Use.......................          3.4          1.2
    USMCR Active Duty Special Work............  ...........          2.1
    Increase USAR AGR's.......................         25.0  ...........
    Retain Army National Guard Mil.                                     
     Technicians..............................  ...........         27.0
    Equitable Imminent Danger Pay for RC......          3.0  ...........
Other Recruiting Priorities:                                            
    Navy:                                                               
        Enlistment Bonus......................          9.4  ...........
        College Fund..........................         13.9             
        Recruiter Support.....................  ...........          3.6
    USMC:                                                               
        Enlistment Bonus......................          3.0  ...........
        College Fund..........................          5.9  ...........
        Recruiter Support.....................  ...........          1.5
    Army:                                                               
        Enlistment Bonus......................         10.0  ...........
Defense Health Program:                                                 
    Environmental Risk Assessment.............  ...........          1.8
    Medical Trauma Training...................  ...........          4.8
    Transitional CHAMPUS for Disabled Retirees  ...........          3.0
Other:                                                                  
    Repayment of Health Professional                                    
     Scholarship..............................          5.0  ...........
    Authorize Rental Car when Shipped POV                               
     Delayed..................................          2.0  ...........
    National Guard Youth Challenge Program....  ...........         21.5
    Army Basic Training Barracks Modifications  ...........          8.0
                                               -------------------------
      Total Increases.........................        360.6        127.5
------------------------------------------------------------------------


------------------------------------------------------------------------
                                                              Revolving 
                                     Military       O&M          and    
      Recommended reductions        personnel     accounts    management
                                     accounts                   funds   
------------------------------------------------------------------------
Obligations for Advanced Pay:                                           
    Army.........................        161.0  ...........  ...........
    Navy.........................         69.0  ...........  ...........
    Air Force....................         53.0  ...........  ...........
    USMC.........................         18.0  ...........  ...........
Innovative Readiness Training....  ...........         16.0  ...........
FY 98 End Strength                                                      
 Underexecution:                                                        
    Navy.........................         94.0  ...........  ...........
    USMC.........................         21.0  ...........  ...........
    USAF.........................          4.0  ...........  ...........
    USMCR........................          6.0  ...........  ...........
Weapons of Mass Destruction:                                            
    Military Personnel, Army.....          0.1  ...........  ...........
    Reserve Personnel, Army......          0.8  ...........  ...........
    National Guard Personnel,                                           
     Army........................         13.4  ...........  ...........
    Military Personnel, Navy.....          0.1  ...........  ...........
    Military Personnel, Air Force          0.1  ...........  ...........
    National Guard Personnel, Air                                       
     Force.......................          0.1  ...........  ...........
    O&M, Army Reserve............          5.0  ...........  ...........
    O&M, Army National Guard.....          2.0  ...........  ...........
Mobilization Income Insurance....  ...........  ...........         24.5
                                  --------------------------------------
      Total Reductions...........        440.6         23.0         24.5
------------------------------------------------------------------------


                   TITLE V--MILITARY PERSONNEL POLICY

                       ITEMS OF SPECIAL INTEREST

                     National Guard Youth Challenge

    The National Defense Authorization Act for Fiscal Year 1998 
(Public Law 105-85) provided the Secretary of Defense, acting 
through the Chief of the National Guard Bureau, authority to 
conduct a program known as the National Guard Youth ChalleNGe 
Program and authorized the expenditure of up to $50.0 million 
in federal funds on the program. The budget request only 
contained $28.5 million for the ChalleNGe program. The program 
is a 22-week, quasi-military, residential program for drug-free 
16- to 18-year old high school dropouts who are unemployed and 
have no criminal record. The program seeks to improve the life 
skills and potential for employment or military service of its 
participants through military-based training, supervised work 
experience, and post-graduation mentoring. The committee 
recommends an increase of $21.5 million to maintain the fiscal 
year 98 level of funding. The committee urges the Secretary to 
maintain this level of funding in future budget requests.

                               Recruiting

    The committee continues to be concerned that the services 
are not able to attract sufficient high quality recruits to 
maintain the quality force so critical to military readiness. 
The Army, traditionally the first service to feel pressure from 
downturns in recruiting trends, was barely able to meet their 
recruiting objectives in fiscal year 1997 despite reducing 
recruit quality objectives, increasing the number of field 
recruiters, lowering accession goals, and adding over $100.0 
million to recruiting accounts.
    As expected, the Navy was the next to experience severe 
problems. During the first quarter of fiscal year 1998, Navy 
recruiters missed their mission by over 1,400 recruits and the 
Navy offered little hope of recovery before the end of the 
year. Today, all the services acknowledge that recruiting 
objectives are exceedingly difficult to attain given the 
increased competition from a strong economy and increasing 
propensity for youth to attend college.
    The committee asked the services to provide lists of 
unfunded recruiting requirements in the fiscal year 1999 budget 
request. Following a review of those lists, the committee 
recommends the following increases in funding.
          (1) Navy recruiting advertising: $35.0 million.
          (2) Marine Corps recruiting advertising: $12.0 
        million.
          (3) Air National Guard recruiting advertising: $3.0 
        million.
          (4) Air Force Reserve recruiting advertising: $3.0 
        million
          (5) Navy enlistment bonus: $9.4 million.
          (6) Navy College Fund: $13.9 million.
          (7) Navy recruiter support: $3.6 million.
          (8) Marine Corps enlistment bonus: $3.0 million.
          (9) Marine Corps College Fund: $5.9 million.
          (10) Marine Corps recruiter support: $1.5 million.
          (11) Army enlistment bonus: $10.0 million.

               Reserve Component Full-time Support Force

    Since the end of the Cold War, significant reductions in 
the size of U.S. active forces, combined with a national 
military strategy that is characterized by unprecedented levels 
and frequency of peacetime commitment of U.S. military forces, 
has resulted in an increased reliance on U.S. reserve component 
forces. As a consequence, in the last decade, the reserve 
components have been transformed from a force training and 
waiting to be mobilized for major wars, to a force that is 
integrated and essential to the success of nearly every 
military operation during peace and war. The committee notes 
that the recent recommendations flowing from both the 
Quadrennial Defense Review (QDR) and the National Defense Panel 
(NDP) portend even broader roles for and greater integration of 
the reserve components in the day-to-day conduct of the 
national military strategy.
    The committee has long understood that an important 
component in the ability of the reserve components to be ready 
when mobilized for a major war was a full-time support force 
numbering in excess of 150,000 and consisting of military 
technicians, reservists on active duty, active component 
personnel and Department of Defense civilians. Heretofore, the 
principal focus of this full-time force was to facilitate the 
training, readiness and maintenance of the reserve components 
for deployment in a major war. Consistent with that focus, 
Congress constrained in law the roles that the full-time 
support force may perform. For example, reservists on full-time 
active guard and reserve duty are limited to duties related to 
organizing, administering, recruiting, instructing, or training 
the reserve components. Neither the support of the active 
components, nor the performance of full-time operational 
missions was contemplated as permissible by such congressional 
limitations.
    With the increasing integration of the reserve components 
into the day-to-day operation of the Total Force--in many cases 
as a substitute for the active components--the committee is 
concerned that there has been a de facto, incremental shift in 
the role of the full-time support force that is not now 
permitted by law, and the implications of which are only 
partially understood by the Congress, the Department of Defense 
and the military services. The committee notes as evidence of 
such shifts, for example: reserve component assumption of the 
active Air Force command and control mission for continental 
air defense; reserve component assumption of control of the 
Operational Support Aircraft command for the Department; the 
increasing presence of full-time reservists performing Total 
Force missions like legislative affairs in the Department's 
national capital region headquarters; assignment of active duty 
officers as reserve component unit commanders; the recent 
formation of Army active/guard integrated divisions; the 
contemplated formation of Army multi-component units; and, the 
Department's request in the budget request to expand the role 
of full time reservists to conduct operational missions in 
connection with the domestic preparedness and response to the 
use of weapons of mass destruction.
    The committee fully supports further integration of the 
reserve components into the performance of Total Force 
missions. However, the proliferation of initiatives that expand 
the roles and purpose of the full-time force appear to be being 
applied in an applique fashion without a comprehensive 
understanding of the personnel, force structure or cost-benefit 
implications. Nor does there seem to be an effort within the 
Department to redesign the full-time support force in a 
rational way that anticipates the future Total Force missions 
contemplated for the reserve components by the QDR and NDP. 
Therefore, the committee directs the Secretary of Defense to 
conduct an assessment and report to the Senate Committee on 
Armed Services and the House Committee on National Security, 
not later than May 1, 1999, on the revisions in law and policy 
necessary to reform the reserve component full-time support 
force to meet current and anticipated Total Force requirements. 
The assessment and recommendations should address, at a 
minimum, the following:
          (1) An overview that provides a comprehensive 
        statement of the future of the reserve component full-
        time support force;
          (2) The extent to which the reserve components have 
        assumed and will assume peacetime operational missions 
        previously performed by active component forces;
          (3) The extent to which the existing reserve 
        component full-time support force remains capable of 
        performing its traditional role of preparing the 
        reserve components for major war missions while 
        assuming greater responsibility for and involvement in 
        peacetime Total Force missions;
          (4) The nature and extent to which the reserve 
        component full-time support forces are performing 
        missions in support of the Total Force like legislative 
        affairs in the Department's National Capital region 
        headquarters;
          (5) The need for changes in law and policy that would 
        enable military technicians and reservists on active 
        Guard and Reserve duty to serve full careers;
          (6) The need to revise the end-strength;
          (7) The need to continue the various categories of 
        the full-time support force; and
          (8) The development of a system to rationalize the 
        assignment of specific missions to those forces.

        Reserve Component Joint Professional Military Education

    The committee is concerned about inadequacies in the 
Department's professional military educational curricula with 
respect to the preparation of reserve component officers for 
joint duty assignments. Section 666 of title 10, United States 
Code, requires only that the Secretary of Defense establish 
policies emphasizing joint education and experience for reserve 
component officers. To date, none of the services requires any 
joint professional military education for reserve officers.
    The reality is that reserve component officers serve with 
increasing frequency with our war-fighting commands in a joint 
environment. In order to assure maximum effectiveness in such 
roles, the committee believes that reserve component officers 
require joint professional military education. To some extent, 
the Department has recognized this requirement for its most 
senior officers and has recently opened the Capstone course to 
more reserve component officers. However, it is clear to the 
committee that as the military services participate in more 
joint military operations than ever before, more active and 
reserve junior officers will serve in joint duty assignments in 
the future.
    In order to prepare reserve component field grade officers 
for joint duty assignments, the committee directs that a course 
similar in content to, but not identical to, the in-residence 
Armed Forces Staff College course for field grade active 
component officers be developed as soon as possible. Although 
the specifics of the course of instruction are best left to the 
Secretary of Defense and the service secretaries, the committee 
believes that a curriculum including periods of in-residence 
training, as well as distance learning, presents the best 
combination of academic rigor, cohort development, and cross-
service acculturation. The committee recognizes that even 
during a full career, the time available to reserve component 
officers to complete training and education requirements is 
extremely limited. Therefore, the committee urges the Secretary 
of Defense to be cognizant of such limitation in developing 
joint professional military education requirements for reserve 
component officers.
    In addition, the committee directs the Chairman of the 
Joint Chiefs of Staff, through the Secretary of Defense, to 
submit a report by not later than April 1, 1999, setting forth 
the progress made in establishing a joint professional military 
education course for mid-career reserve component officers.

 Sustaining Education and Teaching Excellence at the National Defense 
                               University

    The committee notes that the National Defense University 
has assumed numerous additional functions in recent years which 
have challenged both the capacity of the current faculty and 
the available resources. In addition, the committee is 
concerned that the increasing competition for resources within 
the Department of Defense is challenging the Department's 
ability to sustain the requisite level of excellence. The 
committee is aware of the commitment of the Chairman of the 
Joint Chiefs of Staff to the university's teaching and 
education excellence. In order to understand that commitment 
more fully, the committee directs the Chairman of the Joint 
Chiefs of Staff to report to the committee on measures both 
ongoing and projected to ensure that the University is able to 
recruit and retain the best possible, nationally recognized, 
military and civilian faculty. The report should address 
options for maintaining and filling the current 67 civilian 
faculty positions (51 funded authorizations and 16 additional 
hires) operated under the authority of title 10, United States 
Code. The report should be submitted to the committee within 
120 days of the enactment of the National Defense Authorization 
Act for Fiscal Year 1999.

                         LEGISLATIVE PROVISIONS

                  Subtitle A--Officer Personnel Policy

Section 501--Codification of Eligibility of Retired Officers and Former 
         Officers for Consideration by Special Selection Boards

    This section would clarify that a retired or former officer 
may be considered for promotion by a special selection board 
without being returned to active duty.

   Section 502--Communication to Promotion Boards by Officers under 
                             Consideration

    This section would clarify that the Congress intended that 
written communications from officers to promotion boards 
authorized in section 614 of title 10, United States Code, be 
limited to matters that enhance the officer's case for 
promotion. The committee believes that officers who do not wish 
to be promoted should discuss their desire for non-selection 
for promotion and separation from the military with their 
immediate supervisor so that a solution can be found that 
serves the mutual interests of the military service and the 
officer.

    Section 503--Procedures for Separation of Regular Officers for 
        Substandard Performance of Duty or Certain Other Reasons

    This section would eliminate the requirement to convene 
boards of review for regular officers who have been recommended 
for administrative separation by boards of inquiry. The 
provision would also eliminate the 30-day board of inquiry 
notification process. The committee believes that boards of 
review are redundant and their elimination, in addition to the 
elimination 30-day board of inquiry notification requirement, 
would not detract from the substantial due process afforded 
regular officers being considered for separation.

            Section 504--Posthumous Commissions and Warrants

    Currently, a posthumous promotion may be granted only when 
the service secretary has approved the results of the promotion 
board prior to the date of death. This section would authorize 
the President to promote an officer posthumously when the 
service secretary approves the results of the board after the 
date of death of the officer, so long as the officer is 
selected for promotion by a promotion board before the date of 
death.

       Section 505--Tenure of Chief of the Air Force Nurse Corps

    This section would clarify that the Secretary of the Air 
Force determines the length of the tour served by the Chief of 
the Air Force Nurse Corps.

                 Subtitle B--Reserve Component Matters

   Section 511--Composition of Selective Early Retirement Boards of 
     Reserve General and Flag Officers of the Navy and Marine Corps

    This section would authorize the Secretary of the Navy to 
convene selective early retirement boards for rear admirals in 
the Navy Reserve and major generals in the Marine Corps Reserve 
without complying with the requirement specified in section 
14102 of title 10, United States Code, that one half of the 
selection board members be reserve officers and that all the 
board members hold higher permanent grades than the officers 
being considered by the board.

     Section 512--Active Status Service Requirement for Promotion 
   Consideration for Army and Air Force Reserve Component Brigadier 
                                Generals

    This section would require the Secretary of the Army and 
the Secretary of the Air Force to consider reserve brigadier 
generals serving in an inactive status for promotion if the 
officers had been in an inactive status for less than one year 
as of the date of the convening of the promotion board, and had 
continuously served for at least one year on the reserve active 
status list or the active duty list immediately before transfer 
to inactive status. Such officers are not currently eligible 
for promotion consideration.

   Section 513--Revision to Educational Requirement for Promotion of 
                            Reserve Officers

    This section would authorize an exception to the 
requirement for reserve officers in the Army commissioned 
through the Army Officer Candidate School to possess a 
baccalaureate degree before being promoted to the grade of 
captain. The exception would expire on October 1, 2000.

              Subtitle C--Military Education and Training

      Section 521--Requirements Relating to Recruit Basic Training

    This section would amend title 10, U.S. Code, to require 
each of the military services to assign male and female 
recruits to same-gender units at the platoon, flight and 
division levels, and to house male and female recruits in 
separate barracks or troop housing facilities. It would provide 
each of the service secretaries the authority to waive the 
separate barracks requirement initially at specific 
installations due to a lack of adequate facilities at the 
installation. However, it would require that no such waiver be 
in effect after October 1, 2001. This section also would 
require that if a waiver is granted at a particular 
installation, the service secretary shall require that male and 
female recruits be housed on separate floors in military 
barracks or troop housing facilities at that installation. 
During the interim period, housing recruits on separate floors 
is defined to include billeting male and female recruits 
separately and securely either on separatefloors, in separate 
bays or on same floors with a fire-safe wall separating the recruits. 
Further, the separate billeting spaces should include independent 
sleeping areas, latrines and separate, lockable entrances. To 
facilitate the Army's ability to make barracks modifications needed for 
housing by separate floors, the committee recommends an increase of 
$8.0 million in that service's operations and maintenance account.

  Section 522--After-Hours Privacy for Recruits During Basic Training

    This section would amend title 10, United States Code, to 
require each of the service secretaries to restrict after-hours 
access to recruit housing areas to same-sex training personnel. 
The provision would allow an exception to this policy in case 
of an emergency or circumstance requiring immediate action.

 Section 523--Extension of Reporting Dates for Commission on Military 
                   Training and Gender-Related Issues

    This section would amend section 562 of the National 
Defense Authorization Act for Fiscal Year 1998 (Public Law 105-
85) to extend the reporting dates required of the Commission on 
Military Training and Gender-Related Issues. This provision 
would extend the date of the initial report to October 15, 
1998, and the final report to March 15, 1999.

    Section 524--Improved Oversight of Innovative Readiness Training

    The General Accounting Office, following a case-study 
review of six of the Department's Innovative Readiness Training 
(IRT) projects, concluded that the IRT `program required 
stronger oversight. This section would require the Department 
to implement the GAO recommendations to improve program 
compliance with section 2012 of title 10, United States Code, 
which governs the IRT program. In addition, the section would 
require the Department to establish better cost accounting 
methods so as not only to capture the total costs of the 
program, but also to provide proper fiscal oversight of the 
program. The committee believes this latter requirement is 
needed because an additional GAO review of the documentation 
and cost accounting records for 143 IRT projects conducted in 
1997 found that it was not possible in many cases to determine 
either an amount requested or an amount approved for each 
project. In addition, the GAO review found that: some projects 
were not recorded in the files because the Department approved 
them orally, with no supporting documentation; additional 
funding may have been provided but was not documented in the 
Department files; the military services may have spent the 
money approved for an IRT project on other approved projects as 
the military services deemed appropriate; some approved 
projects may not have been conducted; and some projects may 
have required less funding that had been approved. As a result 
of this ineffective oversight and cost accounting by the 
Department, the committee recommends that the $16.0 million 
contained in the budget request for the IRT program be 
reallocated to other committee priorities.

           Subtitle D--Decorations, Awards and Commendations

 Section 531--Study of New Decorations for Injury or Death in Line of 
                                  Duty

    This section would require the Secretary of Defense, in 
cooperation with the secretaries of the military departments 
and the Secretary of Transportation with regard to the Coast 
Guard, to determine the appropriate name, policy, award 
criteria, and design for two new decorations to recognize the 
services of members of the armed forces who are killed or 
wounded under non-combat conditions and U.S. civilian nationals 
who are killed or wounded while serving in an official capacity 
with a U.S. armed force. The provision would require the 
Secretary to submit a legislative proposal to establish the two 
decorations and a recommendation concerning the need for the 
new decorations to the Senate Committee on Armed Services and 
the House Committee on National Security not later than July 
31, 1999.

     Section 532--Waiver of Time Limitations for Award of Certain 
                    Decorations to Specified Persons

    This section would waive the statutory time limitations for 
the award of military decorations to individuals who have been 
recommended for award of the decorations by the secretaries of 
the military departments.

 Section 533--Commendation of the Navy and Marine Corps Personnel who 
     Served in the United States Navy Asiatic Fleet from 1910-1942

    This section would express the commendation of the Congress 
to those personnel who served in the Asiatic Fleet of the 
United States Navy between 1910 and 1942.

Section 534--Appreciation for Service during World War I and World War 
II by Members of the Navy Assigned on Board Merchant Ships as the Naval 
                          Armed Guard Service

    This section would express the appreciation of the Congress 
and the American people for the service of members of the Navy 
assigned as gun crews aboard merchant ships as part of the 
Naval Armed Guard Service during World War I and World War II.
    The committee notes that merchant marine officers and crew 
served with great courage and distinction during World War I 
and World War II on the same vessels as the Naval Armed Guard 
Service and are also deserving of the appreciation of a 
grateful nation.

 Section 535--Sense of Congress Regarding the Heroism, Sacrifice, and 
 Service of the Military Forces of South Vietnam and Other Nations in 
   Connection with the United States Armed Forces during the Vietnam 
                                Conflict

    This section would recognize and honor the significant 
heroism, sacrifices, and service that the armed forces of South 
Vietnam and other allies made while fighting together with 
American military forces during the Vietnam conflict.

 Section 536--Sense of the Congress Regarding the Heroism, Sacrifice, 
  and Service of Former South Vietnamese Commandos in Connection with 
        United States Armed Forces during the Vietnam Conflict.

    This section would recognize and honor the significant 
heroism, sacrifices and service that the South Vietnamese 
commandos made during the Vietnam conflict. The committee notes 
that section 657 of the National Defense Authorization Act for 
Fiscal Year 1997 (Public Law 104-201) authorized compensation 
for Vietnamese commandos who were incarcerated for 20 years or 
more.

   Subtitle E--Administration of Agencies Responsible for Review and 
                     Correction of Military Records

            Sections 541-544-Corrections of Military Records

    Section 541 would preserve the current level of performance 
of the Army Review Board Agency, the Air Force Review Boards 
Agency, and the Board for Correction of Naval Records by 
requiring a report to the Congress 90 days before the number of 
employees assigned to those organizations is reduced below the 
number assigned as of October 1, 1997.
    Sections 542-544 would amend chapter 79 of title 10, United 
States Code to improve the timeliness, independence, and 
fairness of actions to correct the military records. The 
amendments include:
          (1) A requirement for each agency to employ an 
        attorney and a physician to serve as advisors to the 
        staff on legal and medical matters being considered by 
        the board.
          (2) A requirement for each agency to provide 
        applicants copies of communications that directly apply 
        to or have a material effect on the applicants' cases.
          (3) A requirement for each board for the correction 
        of military records to improve the timeliness of board 
        actions over a ten year period beginning in fiscal year 
        2001 and culminating with a requirement to complete 
        action on 90 percent of the cases within ten months of 
        receipt during fiscal year 2011 and beyond.
    The committee is strongly committed to making improvements 
to the process for correcting military records within each of 
the military departments. The committee is very sensitive to 
the many complaints from constituents about the timeliness of 
actions and perceived problems concerning the independence and 
fairness of decisions by the boards for the correction of 
military records. The committee views the boards as 
administrative arms of the Congress entrusted with the 
responsibility to be the guarantors of fair and equitable 
treatment for thousands of active duty military members, 
veterans, and retirees. The committee expects that the service 
secretaries will provide the manpower, equipment, and fiscal 
resources necessary to ensure that the boards are able to meet 
the timeliness standards specified in the provision.

                       Subtitle F--Other Matters

 Section 551--One-Year Extension of Certain Force Drawdown Transition 
       Authorities Relating to Personnel Management and Benefits

    This section would extend through fiscal year 2000 certain 
temporary authorities which provide the tools the armed 
services need to manage personnel reductions and shape the 
force following the completion of the drawdown of military 
forces. These authorities include:
          (1) Active duty early retirement authority.
          (2) Special separation benefit authority.
          (3) Voluntary separation incentive authority.
          (4) Increased flexibility in the management of 
        selective early retirement boards.
          (5) Reduction of time-in-grade requirement for 
        retention of grade upon voluntary retirement.
          (6) Reduction of length of commissioned service for 
        voluntary retirement as an officer.
          (7) Increased flexibility in the management of 
        limited duty officer retirements.
          (8) Enhanced travel and transportation allowances and 
        storage of baggage and household effects for certain 
        involuntary separated members.
          (9) Increased flexibility for granting educational 
        leave relating to continuing public and community 
        service.
          (10) Enhanced health, commissary, and family housing 
        benefits.
          (11) Increased flexibility in the management of 
        enrollments of dependents in the Defense Dependents' 
        Education System.
          (12) Definition of the force reduction transition 
        period for reserve forces.
          (13) Force reduction period reserve retirement 
        authority.
          (14) Reduction of length of non-regular service 
        requirements for reserve retirements.
          (15) Reserve early retirement authority.
          (16) Increased flexibility in the management of the 
        affiliation of active duty personnel with reserve 
        units.
          (17) Increased flexibility in the management of 
        eligibility for reserve educational assistance.
    The committee has elected to limit the extension of these 
authorities to one additional year because of concern that 
further reductions of the armed forces are ill-advised and 
should be carefully scrutinized before being facilitated by the 
authorization of these drawdown tools. The committee believes 
that the continued reductions in end strengths has contributed 
to the increased personnel tempo within the armed services that 
has eroded readiness and severely hampered efforts to retain 
quality military members.

    Section 552--Leave Without Pay for Academy Cadets and Midshipmen

    This section would authorize the appropriate service 
secretary, upon the recommendation of the Superintendent of the 
United States Military Academy, the United States Naval 
Academy, the United States Air Force Academy, or the United 
States Coast Guard Academy, to order a cadet or midshipman to 
be placed on involuntary leave without pay under certain 
circumstances.

   Section 553--Provision for Recovery, Care, and Disposition of the 
                Remains of All Medically Retired Members

    This section would authorize military retirees the same 
recovery, care, and disposition of remains benefits as active 
duty members when that member is medically retired from active 
duty while hospitalized and the hospitalization is continuous 
until date of death.

Section 554--Continued Eligibility under Voluntary Separation Incentive 
  Program for Members who Involuntarily Lose Membership in a Reserve 
                               Component

    Section 1175 of title 10, United States Code, requires 
recipients of the Variable Separation Incentive (VSI) to 
maintain an active status in the reserves to remain eligible 
for VSI payments. This section would authorize VSI recipients 
to continue to receive VSI payments after separation from the 
reserves when the separation was due to age, years of service, 
failure to be selected for promotion, or medical 
disqualification, provided the ineligibility does not result 
from a deliberate action to avoid service.

Section 555--Definition of Financial Institution for Direct Deposit of 
                                  Pay

    This section would amend sections 1053 and 1594 of title 
10, United States Code, to specify that the term financial 
institution means a bank, savings and loan association or 
similar institution, or credit union chartered by the United 
States or a State.

    Section 556--Increase in Maximum Amount for College Fund Program

    This section would increase the maximum payment offered 
with the College Fund to $50,000. The current maximum of 
$40,000 is not expected to provide an adequate incentive to 
enlist beyond 1999 due to the 6 percent annual inflation rate 
in college costs. The increase in authorization is effective 
October 1, 1999 for service members enlisting after that date.

         Section 557--Central Identification Laboratory, Hawaii

    This section would require the Secretary of Defense to 
establish joint manning requirements for the Central 
Identification Laboratory, Hawaii (CILHI), and to staff CILHI 
at 100 percent of its manpower requirements. Although CILHI is 
an Army activity, it performs the important national mission of 
identifying the remains of soldiers, sailors, airmen, and 
Marines lost in previous conflicts. The committee has learned 
that the Army intends to reduce CILHI staffing by 33 personnel 
in fiscal year 1999 in anticipation of receiving personnel 
support from other services. The committee believes this 
reduction is premature and ill advised given the sensitive 
mission of CILHI, the workload increase expected by more open 
access to sites on the Korean peninsula, and the uncertainty of 
other service support. This provision would prohibit the Army 
from executing any personnel reductions until the Secretary of 
Defense has a comprehensive joint staffing plan in place.

        Section 558--Honor Guard Details at Funerals of Veterans

    This section would require the secretaries of the military 
departments to provide, upon request, honor guard details for 
the funerals of veterans. The provision would specify that the 
honor guard details be comprised of not less than three persons 
with the capability to play a recording of Taps, unless a 
bugler is included in the detail. The honor guard detail would 
consist of members of the armed forces, members of veterans 
organizations, or other organizations approved for 
participation by the Secretary of Defense.
    The Secretary of Defense would be required to establish a 
system for selection of units of the armed forces or other 
organizations to provide honor guard details. Before issuing 
regulations to establish the system, the Secretary of Defense 
would be required to consult with veterans service 
organizations to determine the views of those organization 
regarding methods for providing honor guard details at funerals 
for veterans, suggestions for organizing the system to provide 
those details, and estimates of the resources that those 
organizations could provide for honor guard details. The system 
required by this provision would apply to burials of veterans 
that occur on or after October 1, 1999.
    The Secretary of Defense, in coordination with the 
Secretary of Veterans Affairs, would be required to study 
alternative means for providing the honor guard details at the 
funerals of veterans and to provide a report to the Senate 
Committee on Armed Services and the House Committee on National 
Security not later than March 31, 1999.

Section 559--Applicability to All Persons in Chain of Command of Policy 
   Requiring Exemplary Conduct by Commanding Officers and Others in 
                     Authority in the Armed Forces

    Since 1956, title 10 of the United States Code has required 
commanding officers and others in authority in the Navy and 
Marine Corps to conduct themselves in an exemplary manner. The 
National Defense Authorization Act for Fiscal Year 1998 (Public 
Law 105-85) established the same requirement for exemplary 
conduct for commanding officers and others in authority in the 
Army and Air Force. This section would extend the requirement 
for exemplary conduct to the President, as commander in chief, 
and the Secretary of Defense, both of whom exercise authority 
in the military chain of command.

    Section 560--Report on Prisoners Transferred from United States 
 Disciplinary Barracks, Fort Leavenworth, Kansas, to Federal Bureau of 
                                Prisons

    This section would require the Secretary of Defense to 
evaluate and report to Congress on the rationale for and 
effectiveness of the policy of transferring prisoners from the 
United States Disciplinary Barracks, Fort Leavenworth, Kansas, 
to the Federal Bureau of Prisons. The section would also 
require the Secretary of the Army to monitor the parole and 
recidivism rates of the military prisoners transferred to the 
Federal Bureau of Prisons. The committee takes these actions in 
order to understand whether implementation of the transfer 
policy facilitates or hinders one of the major objectives of 
the military prison system: rehabilitation of military 
prisoners.

Section 561--Report on Process for Selection of Members for Service on 
                             Courts-Martial

    As now required by title 10, United State Code, the 
convening authority selects members for service on courts-
martial, but is not required to use a statistically random 
selection process. The committee believes that the use of a 
statistically random selection process may help to insulate the 
process from charges of undue command influence. Therefore, 
this section would require the Secretary of Defense, in 
cooperation with the secretaries of the military departments, 
to develop a plan for random selection of members of courts-
martial as a potential replacement for the current selection 
process. In developing this plan, the Secretary of Defense is 
required to obtain the views of the members of the code 
committee for the Uniformed Code of Military Justice on such a 
plan and submit both the plan and those views to the Senate 
Committee on Armed Services and the House Committee on National 
Security no later than April 15, 1999.

 Section 562--Study of Revising the Term of Service of Members of the 
          United States Court of Appeals for the Armed Forces

    The section would require the Secretary of Defense to 
report to Congress on the desirability of revising the term of 
appointment of judges of the United States Court of Appeals so 
that they might serve until age 65. At present, a judge is 
limited to a term of 15 years. The report is due not later than 
April 15, 1999.

      Section 563--Status of Cadets at the Merchant Marine Academy

    The section would require the Secretary of Defense, in 
coordination with the Secretary of Transportation, to ensure 
that citizens of the United States appointed as cadets at the 
United States Merchant Marine Academy are members of the Naval 
Reserve. The provision would also require the Secretary of 
Defense to issue such cadets military identification cards.

          TITLE VI--COMPENSATION AND OTHER PERSONNEL BENEFITS

                                OVERVIEW

    The committee remains deeply concerned about the level of 
compensation provided to service members and their families. 
Although the committee has embarked on a strategy to 
incrementally increase the various elements of military 
compensation, the committee has observed with growing alarm 
that the services are struggling to recruit and retain the 
quality force that has been the hallmark of the U.S. military 
over the last 15 years. The committee believes that the 
continuing erosion in the value of military pay and allowances 
has contributed to the recruiting and retention problems that 
plague the armed services.
    This year, the committee has elected to add $186.0 million 
to increase the military pay raise from the 3.1 percent 
requested in the President's budget to 3.6 percent. The 
additional one half of one percent brings the pay raise level 
in line with pay increases in the private sector as measured by 
the Employment Cost Index (ECI). The Committee was again 
disappointed that the President's budget request for fiscal 
year 1999 continues to employ the ``by law'' model for the 
military pay raise that would allow the gap between pay raises 
in the private sector and pay raises in the military to grow to 
14 percent.
    The committee is convinced that the continued erosion in 
the value of military compensation can only serve to further 
exacerbate recruiting and retention challenges that confront 
each of the armed services. So long as the budget request 
undervalues the high degree of professionalism, long work 
hours, and extended absences from home demanded from our 
military personnel, the committee believes that the 
preservation of a quality force so critical to readiness will 
grow increasingly difficult. The committee remains committed to 
improving compensation programs and will continue to seek the 
additional funding needed to make those improvements in the 
future.

                       ITEMS OF SPECIAL INTEREST

                          Military Retirement

    The committee remains concerned about the ability of the 
services to retain quality officers and enlisted members. The 
committee continues to receive reports, including the testimony 
of the service chiefs, that the calculation of retired pay 
using the high-three average of income implemented in 1980 and 
the changes associated with the Military Retirement Reform Act 
of 1986 (Public Law 99-348) have seriously degraded the 
retirement system as a retention incentive. The committee 
believes it is necessary to determine the effect on retention 
of the retirement changes cited above and assess the need to 
restore the value of military retirement.
    Accordingly, the committee directs the Secretary of 
Defense, in coordination with the service secretaries, to 
examine the implications for retention of the 1980 and 1986 
changes to the retirement system and submit a report not later 
than June 30, 1999 to theSenate Committee on Armed Services and 
the House Committee on National Security. In addition to the findings 
concerning the implications for current retention, the report should 
include the Secretary's recommendation on the need to restore the value 
of military retirement, a review of the costs associated with restoring 
the value of retirement, and a proposed plan to facilitate a 
Congressional review of retirement issues. The plan should include an 
outline of the studies that would be undertaken, the agencies that 
would be tasked to complete the studies, and a projected schedule for 
completion of the studies.

                         Survivor Benefit Plan

    The committee remains concerned that the government subsidy 
of the Survivor Benefit Plan (SBP) has fallen to 26 percent, 
well below the objective for a 40 percent subsidy set by the 
Congress. Although the process for making the necessary changes 
is complicated by budgetary rules that restrict increases in 
entitlement spending, the committee remains committed to 
exploring options that will increase the subsidy and make the 
program more attractive to military retirees and their 
families.

                         LEGISLATIVE PROVISIONS

                     Subtitle A--Pay and Allowances

        Section 601--Increase in Basic Pay for Fiscal Year 1999

    This section would provide a 3.6 percent military pay 
raise. This is one half of one percent more than the pay raise 
called for in the President's budget request. The committee, 
therefore, recommends an increase in funding for the additional 
one half of one percent increase in the military pay raise 
during fiscal year 1999 of $186.0 million over the amount 
requested in the President's budget.

   Section 602--Basic Allowance for Housing Outside the United States

    This section would authorize the payment of advance 
deposits and rent for housing in overseas areas when required 
by local conditions. The provision would also protect the 
member from losses due to fluctuations in the value of foreign 
currency and would allow the government to recoup the full 
amount of advances, to include any gain resulting from currency 
fluctuations.

       Section 603--Basic Allowance for Subsistence for Reserves

    This section would clarify the entitlement of reservists to 
rations in kind when training or payment for meals purchased 
when rations in kind are not available.

           Subtitle B--Bonuses and Special and Incentive Pays

  Section 611--One-Year Extension of Certain Bonuses and Special Pay 
                     Authorities for Reserve Forces

    This section would extend the authority for the special pay 
for health care professionals who serve in the selected reserve 
in critically short wartime specialties, selected reserve 
reenlistment bonus, the selected reserve enlistment bonus, 
special pay for enlisted members of the selected reserve 
assigned to certain high priority units, the selected reserve 
affiliation bonus, the ready reserve enlistment and 
reenlistment bonus, and the prior service enlistment bonus 
until September 30, 2000. The provision would also extend the 
authority for repayment of educational loans for certain health 
professionals who serve in the selected reserve until October 
1, 2000.

  Section 612--One-Year Extension of Certain Bonuses and Special Pay 
Authorities for Nurse Officer Candidates, Registered Nurses, and Nurse 
                              Anesthetists

    This section would extend the authority for the nurse 
officer candidate accession program, the accession bonus for 
registered nurses, and the incentive special pay for nurse 
anesthetists until September 30, 2000.

 Section 613--One-Year Extension of Authorities Relating to Payment of 
                     Other Bonuses and Special Pays

    This section would extend the authority for the aviation 
officer retention bonus, reenlistment bonus for active members, 
enlistment bonuses for members with critical skills, special 
pay for nuclear qualified officers extending the period of 
active service, and nuclear career accession bonus to September 
30, 2000. The provision would also extend the authority for the 
nuclear career annual incentive bonus until October 1, 2000.

    Section 614--Aviation Career Incentive Pay and Aviation Officer 
                            Retention Bonus

    This section would make clarifying amendments to sections 
301a and 301b of title 37, United States Code, to facilitate 
the payment of Aviation Career Incentive Pay and Aviation 
Continuation Pay to warrant officers.

                Section 615--Special Pay for Diving Duty

    This section would clarify that the service secretaries may 
continue paying diving pay to members not assigned to diving 
duties when the members are required to maintain diving 
proficiency. The committee believes that members should be 
required to maintain proficiency as a diver only when they are 
subject to no notice return to diving duty on a temporary or 
permanent basis.

   Section 616--Selective Reenlistment Bonus Eligibility for Reserve 
            Members Performing Active Guard and Reserve Duty

    This section would authorize payment of selective 
reenlistment bonuses to members of reserve components who are 
on extended active duty in the Active Guard and Reserve (AGR) 
program.

     Section 617--Removal of Ten Percent Restriction on Selective 
                          Reenlistment Bonuses

    This section would remove the 10 percent limitation on the 
number of selective reenlistment bonuses in excess of $20,000 
that may be paid.

    Section 618--Increase in Maximum Amount of Army Enlistment Bonus

    This section would increase the maximum bonus for 
enlistment in the Army from $4,000 to $6,000.

 Section 619--Equitable Treatment of Reserves Eligible for Special Pay 
          for Duty Subject to Hostile Fire or Imminent Danger

    This section would authorize reserve members to receive the 
amount of imminent danger pay authorized for a full month 
regardless of the number of qualifying days served by the 
member during the month. The provision makes the imminent 
danger pay payment policy for reservists consistent with the 
policy for active duty members. Accordingly, the committee 
recommends an increase in funding for reserve imminent danger 
pay of $3.0 million over the amount contained in the budget 
request.

            Subtitle C--Travel and Transportation Allowances

  Section 631--Exception to Maximum Weight Allowance for Baggage and 
                           Household Effects

    This section would authorize the service secretaries to 
exceed the maximum weight allowance for shipment of household 
goods to a new permanent duty station to accommodate shipment 
of consumable goods that cannot be reasonably obtained at the 
new location.

Section 632--Travel and Transportation Allowances for Travel Performed 
by Members in Connection with Rest and Recuperative Leave from Overseas 
                                Stations

    This section would clarify that the service secretaries may 
provide the transportation authorized for the rest and 
recuperation travel using either government or commercial 
carriers. This amendment would enhance the cost efficiency of 
the rest and recuperation program being provided to personnel 
assigned to Operation Joint Guard in the Republic of Bosnia and 
Herzegovina.

         Section 633--Storage of Baggage of Certain Dependents

    Section 430 of title 37, United States Code, authorizes 
dependents of military members assigned to overseas locations 
annual round trip visits while those dependents are college 
students in the United States. This section would authorize the 
storage of unaccompanied baggage of such dependents in lieu of 
shipment if advantageous to the government.

    Subtitle D--Retired Pay, Survivor Benefits, and Related Matters

 Section 641--Effective Date of Former Spouse Survivor Benefit Coverage

    This section would standardize the effective date of 
Survivor Benefit Plan coverage for a former spouse as the first 
day of the first month following the date of the court order 
directing the coverage.

                       Subtitle E--Other Matters

 Section 651--Deletion of Canal Zone from Definition of United States 
             Possessions for Purposes of Pay and Allowances

    This section would delete the Canal Zone from the list of 
U.S. possessions as defined in title 37, United States Code.

              Section 652--Accounting of Advance Payments

    The budget request, based upon technical interpretations of 
law by the Department of Defense general counsel, set aside 
from the services' personnel accounts $301.0 million to be 
available to provide for advance pay obligations or 
expenditures at the end of a fiscal year. This section would 
clarify that obligations and expenditures incurred for advanced 
payment of pay and allowances shall not be accounted for or 
included in any determination of amounts available for 
obligation or expenditure except in the fiscal year in which 
such advances are ultimately earned. The clarification provided 
by this section would make the $301.0 million that was included 
in the President's request available to the committee for other 
purposes.

 Section 653--Reimbursement of Rental Vehicle Costs when Motor Vehicle 
               Transported at Government Expense Is Late

    This section would authorize a service member being 
transferred to an overseas station to rent a car when his 
privately owned vehicle that he shipped to the overseas 
location does not arrive as scheduled. The provision would 
limit the car rental reimbursement to $30 a day for one week. 
Prior to any reimbursement for a rental car, the provision 
would require the Secretary of Defense to certify in a report 
to the Congress that a system is in place and operational to 
recover the cost of the reimbursement for the rental car from 
the shipping company that caused the delay.

   Section 654--Education Loan Repayment Program for Certain Health 
            Profession Officers Serving in Selected Reserve

    This section would increase the authorized caps on the 
education loan amounts that may be repaid by the Secretary of 
Defense to recruit and retain health professionals with 
shortage wartime critical medical skills who serve in the 
selected reserve. The provision would increase the repayment 
amounts from $3,000 per year and $20,000 total to $10,000 and 
$50,000, respectively.

                   TITLE VII--HEALTH CARE PROVISIONS

                                OVERVIEW

    The committee was pleased that the Department, after under-
funding the Defense Health Program for two consecutive years, 
announced that the President's budget request for fiscal year 
1999 provides full funding for the Defense Health Program. 
However, the committee was disappointed to note that, despite 
repeated encouragement from the congressional defense 
committees to provide adequate funding for retiree health care 
coverage, the President's budget request does not include any 
additional funding for retiree health care; nor does it offer 
any viable new alternatives for meeting the health care needs 
of this well-deserving beneficiary population.
    This omission is particularly glaring in light of the fact 
that Department of Defense (DOD) witnesses have testified that 
the TRICARE program is saving the Department billions of 
dollars in health care costs. Apparently, though, these savings 
are not being used to improve health care coverage for military 
retirees and their families who were promised a lifetime of 
medical care. The committee believes that the Department should 
consider using at least part of these savings to ensure the 
availability of health care for all beneficiaries, including 
those eligible for Medicare.
    In addition, the committee is disappointed that the 
Department continues to severely limit the manner in which the 
Civilian Health and Medical Program of the Uniformed Services 
(CHAMPUS) provides reimbursement as a second payer to other 
health insurance in order to ``live within the Defense Health 
Program budget.'' Last year the committee expressed concern 
over this policy change and urged the Secretary of Defense to 
either improve enforcement of the limitation for health care 
providers to charge CHAMPUS beneficiaries no more than 115 
percent of the CHAMPUS maximum allowable rate, or to continue 
to use the Department's previous policy on paying for health 
care services when paying as a second payer to other health 
insurance. The Department adopted neither of these two 
recommendations. The committee views this action to limit an 
important benefit as one more signal being sent to military 
personnel that benefits are eroding.
    With health care benefits being limited or denied to some 
beneficiaries, the committee strongly urges the Secretary of 
Defense to provide sufficient funding for the Defense Health 
Program in the budget request for fiscal year 2000 to meet the 
health care needs of all military beneficiaries who rely on the 
military health system. Further, the committee directs the 
Secretary to submit as part of the President's budget request 
any proposals for legislation that may be needed to correct 
deficiencies in retiree health care. The committee continues to 
believe that health care coverage is viewed as one of the most 
important quality of life benefits to military members and 
their families. Failure to provide adequate health care 
coverage not only constitutes a serious breach of faith with 
those who have served, it also may have a noticeable, negative 
effect on recruiting and retention efforts. The committee 
believes that this very important quality of life issue 
deserves the full attention and support of the Department of 
Defense.

                       ITEMS OF SPECIAL INTEREST

           Depleted Uranium Training and Health Surveillance

    The committee supports Department of Defense efforts to 
institute training programs on the proper safety standards 
concerning the use of depleted uranium (DU) munitions. DU is 
radioactive, but more importantly in terms of potential health 
effects, it is chemically toxic. Studies have shown that 
exposure to uranium may be associated with some adverse health 
effects. Lessons learned from the Gulf War show that many 
service personnel were unaware of the potential health hazards 
posed by contamination from the use of DU munitions. While some 
exposure took place as a result of ``friendly fire,'' many 
soldiers who worked with contaminated combat vehicles hit by DU 
munitions and other debris were exposed unnecessarily. Attempts 
by the Department after the conflict to direct the services to 
enact DU training programs have met with little success.
    The committee believes that every attempt should be made to 
inform soldiers of the proper precautions that must be taken to 
avoid exposure to DU. Therefore, the committee directs the 
Secretary of Defense to implement DU training programs across 
the services and to report to the Senate Committee on Armed 
Services and the House Committee on National Security no later 
than March 1, 1999, on progress made by each of the services in 
their implementation of depleted uranium training programs. 
This report shall include each service's plans to fully 
implement training, identification of specific units to receive 
the training, and plans to conduct follow-up training.
    Furthermore, the committee supports the DOD and Secretary 
of Veterans Affairs (VA) efforts to conduct medical 
surveillance of Gulf War veterans exposed to DU, in particular, 
the Depleted Uranium Follow-up Program. This program, which is 
managed by the VA, tracks the health status of Gulf War 
veterans who were exposed to DU munitions due to ``friendly-
fire'' incidents. The committee believes this program will lead 
to more definitive answers about the short and long-term 
effects of exposure to DU. However, the committee understands 
there have been problems in identifying Gulf War veterans who 
may have been exposed during ``friendly-fire'' incidents, as 
well as in DOD support to the study to ensure that Gulf War 
veterans and control subjects are made available for needed 
medical examinations and tests. The committee strongly supports 
the Department's full cooperation with VA's Depleted Uranium 
Follow-up Program and directs the Secretary of Defense to 
provide all support necessary to ensure that the study is 
completed successfully.

                  Graduate Medical Education Programs

    In response to concerns over a controversial Navy decision 
to close selected Graduate Medical Education (GME) programs, 
the committee directed the Comptroller General of the United 
States, in the National Defense Authorization Act for Fiscal 
Year 1998 (Public Law 105-85), to evaluate the validity of the 
recommendations made by the Navy's Medical Education Policy 
Council. The forthcoming report of this evaluation is expected 
to conclude that the Department of Defense and the services 
lack policy guidance and criteria governing site and program 
selection, including collaborationamong decision makers and 
those affected. Further, the study found that other DOD initiatives, 
including TRICARE, on-going sizing studies, and medical modeling 
application differences can bear on GME decisions and need to be taken 
into account in the development of GME program closure guidance for the 
closure process to be effective. While the Department and the Air Force 
and Navy fully concur with the report and its recommendations, the Army 
apparently does not.
    Based on the findings and recommendations of the 
Comptroller General's evaluation of military graduate medical 
education programs, the committee directs the Secretary of 
Defense to take the following actions in coordination with each 
of the military services chiefs:
          (1) Develop GME closure policy guidance and 
        implementing criteria and processes covering such 
        matters as key factors in identifying and screening 
        potential sites; how to project and mitigate potential 
        adverse effects on beneficiary health care and 
        readiness; how and when to involve affected parties in 
        the services and local areas in the decision-making 
        process; how to reach program closure agreement; and 
        how to communicate and implement the resulting 
        decisions;
          (2) Provide in the guidance for the potential effects 
        of DOD and service initiatives, such as TRICARE, that 
        can affect GME decisions; and
          (3) Develop, obtain agreement upon, and publish such 
        policy guidance before any further GME closure 
        decisions are made.
    The committee understands that in order to attain the 
Department's overall policy goal of training to wartime 
requirements, the services may need the ability to make GME 
reductions. However, the committee believes that any decisions 
to reduce service GME programs should be based on well-defined 
criteria, and should be fully coordinated among decision makers 
and those affected by the reduction. As exemplified by the 
Army's apparent non-concurrence with the Comptroller General's 
recommendations, the committee understands that getting 
agreement on the criteria and implementing closure decisions 
will not be easy. Therefore, the committee further directs the 
Secretary of Defense to develop and report the GME closure 
policy guidance and implementation criteria to the committee 
within six months after the issuance of the Comptroller 
General's report.

                 Medical Readiness Learning Initiative

    The committee understands that the Department of Defense 
faces significant training challenges if the reserve components 
are to be adequately prepared to respond to the domestic use of 
weapons of mass destruction (WMD). No more challenging 
requirement exists than the need to develop and implement cost 
effective training that increases the core medical readiness of 
those charged with responding to WMD emergencies. The committee 
is aware that the Uniformed Services University of the Health 
Sciences (USUHS), working in connection with the Henry M. 
``Scoop'' Jackson Foundation, has tested interactive training 
programs that enabled reserve component units to improve their 
standard of care and management of mass casualties. The 
committee urges that the Secretary of Defense give early 
priority and close scrutiny to the USUHS interactive training 
initiative to determine its usefulness and cost effectiveness 
in meeting WMD medical training challenges.

                      TRICARE Contract Performance

    The committee remains very concerned about the delivery of 
health care services under the TRICARE program. Specifically, 
the committee is concerned about the complaints of many 
beneficiaries that the transition to this managed care program 
is compromising the quality and availability of their health 
care benefit. Concerns have been raised by beneficiary groups 
about the program's ability to provide a uniform benefit for 
all military beneficiaries, its ability to attract well-
qualified civilian physicians, and its ability to provide 
access to quality, low-cost care in remote or rural locations. 
Additionally, civilian medical providers have expressed 
concerns about administrative shortcomings under TRICARE such 
as slow reimbursement, unreliable customer telephone service, 
and a slow preauthorization process to approve medical 
treatment, which contribute to their apprehension to 
participate in the TRICARE program.
    Based on these concerns, the committee has questions about 
TRICARE contractor performance in delivering health care 
benefits in some regions, particularly the Central Region. The 
committee is particularly disturbed by reports of cases in 
which the administrative process has taken precedence over the 
provision of needed health care services. Therefore, the 
committee strongly urges the Secretary of Defense to closely 
monitor contractor performance to ensure the delivery of 
responsive, quality and adequate care. Specifically, the 
committee encourages the Department to examine contractor 
performance in the areas of network development, timely 
reimbursement to providers, overall beneficiary satisfaction, 
and commitment to patient care.
    The committee believes the Secretary should take all 
appropriate actions to ensure TRICARE contractors comply with 
the program requirements and to ensure patient care is the 
number one priority. In cases where the contractor repeatedly 
has difficulty in complying with these standards, the committee 
urges the Secretary to consider termination of the contract for 
the good of the government.
    Furthermore, the committee appreciates that implementation 
of any new system may result in initial issues and problems 
that need to be addressed to ensure an effective program. 
However, the committee believes that if the Department of 
Defense cannot promptly and efficiently address the concerns 
associated with the TRICARE program, and make substantive 
changes to improve it, the Secretary should consider 
alternative options for delivering health care coverage to 
military beneficiaries.

                         LEGISLATIVE PROVISIONS

                    Subtitle A--Health Care Services

 Section 701--Expansion of Dependent Eligibility Under Retiree Dental 
                                Program

    This section would amend section 1076c of title 10, United 
States Code, to allow dependents of certain retired service 
members to enroll in the retiree dental program even if the 
retired member does not enroll in the program. Presently, 
dependents may enroll in the program only if the retired member 
also enrolls. However, some retired members are entitled to 
receive dental care from the Secretary of Veterans Affairs or 
have medical or dental conditions which preclude their use of 
the dental program. The committee believes it is not reasonable 
to ask these retirees to enroll in, and pay premiums for, a 
program which offers them no benefits only so their dependents 
may also enroll in the program. Therefore, this provision would 
allow the dependents of these specific retirees to enroll in 
the retiree dental program independently.

 Section 702--Plan for Provision of Health Care for Military Retirees 
 and Their Dependents Comparable to Health Care Provided Under TRICARE 
                                 Prime

    This section would require the Secretary of Defense to 
submit to Congress, by March 1, 1999, a plan for ensuring that 
military retirees, including Medicare-eligible retirees, and 
their dependents have access to health care benefits comparable 
to those offered through TRICARE Prime, the managed-care option 
of the TRICARE program.
    The availability of medical care for military retirees and 
their families has become an issue of tremendous concern to the 
committee over the past few years. Due to budget cuts, medical 
personnel reductions and base closures, access to quality care 
within the Military Health System has become increasingly 
difficult for military retirees and their dependents. While 
retirees under age 65 are eligible for TRICARE benefits, 
retirees over age 65, who are eligible for Medicare, are not. 
As a result of these factors, many military retirees have 
discovered that the military health care they ``earned'' 
through dedicated career service in the military may be 
difficult to obtain when they need it.
    The committee strongly supports efforts to enact 
legislation authorizing Medicare subvention, which provides for 
Medicare reimbursement to the Department of Defense for care 
rendered to Medicare-eligible military retirees and their 
spouses in the Military Health Services System. Additionally, 
in response to concerns that subvention would only help part of 
the military Medicare-eligible population, the committee 
directed both the General Accounting Office (GAO) and the 
Department of Defense to study alternatives to subvention, 
including authorizing eligibility in the Federal Employees 
Health Benefits Program (FEHBP) for military retirees, and 
making CHAMPUS/TRICARE a second-payer to Medicare. While GAO 
completed its study of numerous alternatives in June 1997, the 
Department to date has not presented any formal recommendations 
nor offered any viable alternatives for meeting the health care 
needs of all military retirees.
    The committee is extremely disappointed with the 
Department's inaction on this very important issue, and 
understands that it is due in part to concerns about the costs 
of the various options. While the committee appreciates that 
the cost of some of these options may be substantial, the 
committee believes that not delivering on the health care 
promises made to career service members could have an equally 
substantial cost on recruiting and retention. Therefore, the 
committee directs the Secretary of Defense to develop a plan, 
including a legislative proposal and cost estimate, under which 
all military beneficiaries will have access to an adequate 
health care benefit by October 1, 2001. In developing this 
plan, the committee believes the Department should fairly 
evaluate all potential options, including TRICARE eligibility 
and enrollment, Medicare subvention, Medicare Partnering, 
FEHBP, Medigap supplemental policies, Medicare risk plans, and 
CHAMPUS as a second-payer to TRICARE. The committee strongly 
believes the Administration has an obligation to fulfill the 
commitments made to our military retirees.

       Section 703--Plan for Redesign of Military Pharmacy System

    This section would require the Secretary of Defense to 
submit a plan to Congress by March 1, 1999, that would provide 
for a system-wide redesign of the military and contractor 
retail and mail-order pharmacy system. Additionally, it would 
require the Secretary to suspend any plans for establishing a 
national retail pharmacy program until the plan is submitted to 
Congress and cost-saving reforms have been implemented.
    Over the past few years, the committee increasingly has 
become concerned about the quality and consistency of the 
military pharmacy benefit, as well as its effectiveness in 
meeting the needs of all military beneficiaries. The committee 
has received numerous complaints from beneficiaries about not 
being able to obtain certain prescribed medications at military 
pharmacies, and it remains concerned that many military 
treatment facilities (MTFs) are severely reducing pharmacy 
formularies as a cost-saving measure. The committee also 
remains concerned about the tremendous increase in pharmacy 
costs within the TRICARE retail pharmacy networks, and believes 
that the use of very restrictive formularies in military 
treatment facilities may be contributing to these substantial 
cost increases. As a result of these concerns, the committee 
directed, in the National Defense Authorization Act for Fiscal 
Year 1998 (Public Law 105-85), that the Comptroller General of 
the United States conduct a comprehensive evaluation of the DOD 
pharmacy system to identify solutions for providing for a more 
uniform, cost-effective pharmacy program. The forthcoming 
report of this evaluation is expected to include a 
recommendation that the Secretary of Defense redesign the 
entire pharmacy system, in consultation with TRICARE and 
national mail-order contractors and industry experts, to 
incorporate pharmacy ``best practices'' of the private sector 
and to achieve integrated, cost-effective and uniform pharmacy 
programs. The General Accounting Office estimates that such a 
comprehensive redesign of the program would result in 
tremendous cost savings to the Department of Defense.
    Based on the findings of the Comptroller General study, and 
consistent with the committee's recent efforts to encourage the 
Department of Defense to make greater use of best business 
practices, the committee directs the Secretary of Defense, in 
consultationwith TRICARE and national mail-order contractors 
and industry experts in pharmacy management, to develop a plan that 
would provide for a completely redesigned pharmacy system. The 
redesigned system shall provide for a universal, uniform pharmacy 
benefit that is available to all categories of military beneficiaries, 
including those eligible for Medicare, and it should incorporate 
pharmacy best practices. Specifically, this redesigned pharmacy benefit 
should include:
          (1) A uniform formulary for use by both military 
        treatment facilities and TRICARE and national mail-
        order pharmacy contractors that is consistent with 
        industry standards;
          (2) Computer integration of pharmacy patient 
        databases to implement automated prospective drug 
        utilization review systems; and
          (3) A system-wide drug benefit for all beneficiaries, 
        including Medicare-eligible beneficiaries.
    Additionally, the benefit may include an incentive-based 
formulary under which non-formulary or ``special order'' 
prescription drugs would be available with a higher cost-
sharing requirement, even at MTFs. The committee believes that 
this approach would be beneficial to both the Department and to 
the beneficiary. By offering non-formulary or special order 
drugs to beneficiaries at a TRICARE cost sharing level at MTFs, 
the Department could save money by purchasing pharmaceuticals 
under the federal pricing schedule, and the beneficiary would 
not have to run all over town trying to fill a given 
prescription. However, the committee stresses that this option 
should not be used as a way to restrict the uniform formulary 
even further. By applying pharmacy best business practices, the 
committee hopes that the Department actually would establish a 
uniform formulary that is less restrictive than the formularies 
in use by most MTFs today.
    The committee understands that the pharmacy program is a 
very important benefit to military beneficiaries. As such, the 
committee believes it should be a reliable, consistent, and 
easily understood benefit that effectively meets the needs of 
all beneficiaries, regardless of their beneficiary category.

 Section 704--Transitional Authority to Provide Continued Health Care 
  Coverage for Certain Persons Unaware of Loss of CHAMPUS Eligibility

    The section would provide the Secretary of Defense the 
authority to temporarily extend CHAMPUS eligibility to certain 
beneficiaries who may have been unaware of their loss of 
eligibility for CHAMPUS coverage. Under the National Defense 
Authorization Act for Fiscal Year 1992, (Public Law 102-190) 
CHAMPUS became second payer for beneficiaries entitled to 
Medicare on the basis of disability, but only if they also 
enrolled in Medicare Part B. However, many of these 
beneficiaries were not informed of the change in the law and 
continued to use CHAMPUS erroneously. Recently, the Department 
of Defense and the Health Care Financing Administration, the 
agency that manages the Medicare program, devised a mechanism 
for notifying these individuals of the requirements of the law. 
However, this was accomplished too late for many of them to 
enroll in Medicare Part B during the 1998 open-enrollment 
period. As a result, this section would provide for continued 
CHAMPUS coverage of these beneficiaries until they have been 
given a sufficient opportunity to enroll in Part B during the 
next open enrollment period, and until that enrollment takes 
effect on July 1, 1999.

                      Subtitle B--TRICARE Program

 Section 711--Payment of Claims for Provision of Health Care Under the 
         TRICARE Program for which a Third Party May be Liable

    This section would amend section 1095 of title 10, United 
States Code, to authorize the Secretary of Defense to allow 
TRICARE contractors to pay certain provider claims for the 
provision of health care services for accidental injury prior 
to seeking payment from potential third-party payers.
    The committee was distressed to learn at a February 26, 
1998, TRICARE hearing that beneficiaries have been subjected to 
collection actions due to contractor delays in settling claims 
for health care services provided under the TRICARE program. 
According to program contractors, this problem is partially due 
to the TRICARE procedure for processing claims with an 
indication of third party liability due to accidental injury. 
The current TRICARE policy requires the contractor to gather 
information regarding potential third-party payers which will 
enable the government and/or the contractor to seek 
reimbursement for the medical care provided, before the TRICARE 
claims may be paid. This ``chase and pay'' method is contrary 
to standard insurance industry practice in which the contractor 
pays the claim first, and then seeks recovery of payment from 
the other insurance coverage. TRICARE will remain secondary 
payer under coordination of benefits rules, and this will not 
effect other primary health insurance coverage, but will 
include special coverage such as personal injury protection 
payments.
    The committee believes that the credit records of military 
beneficiaries should not be tarnished by a cumbersome TRICARE 
claims processing requirement. Therefore, the committee 
believes the TRICARE contractors should pay all provider claims 
in a timely manner, then seek recovery from third parties who 
may be liable.

     Section 712--Procedures Regarding Enrollment in TRICARE Prime

    This section would amend chapter 55 of title 10, United 
States Code, to insert a new section 1097a that requires the 
Secretary of Defense to establish procedures for certain 
enrollments in TRICARE Prime, the managed care option of the 
TRICARE program.
    This section would direct the Department to establish 
procedures for the automatic enrollment in TRICARE Prime at a 
military treatment facility for active-duty dependents residing 
within the catchment area of the facility. These procedures 
would include advance written notification of this enrollment, 
and shall allow enrolled family members to disenroll from MTF 
TRICARE Prime at any time. Since TRICARE Prime is designed to 
reduce out-of-pocket costs to beneficiaries, and since active-
duty family members do not pay an enrollment fee for TRICARE 
Prime, this provision would facilitate easy enrollment and 
prompt coverage under this cost-saving option.
    This section also would require the Secretary of Defense to 
establish procedures for the automatic re-enrollment of TRICARE 
Prime enrollees and to allow retired members and their 
dependents to pay the annual enrollment fee for TRICARE Prime 
by monthly allotment.

                       Subtitle C--Other Matters

  Section 721--Inflation Adjustment of Premium Amounts for Dependents 
                             Dental Program

    This section would amend section 1076a(b)(2) of title 10, 
United States Code, to allow for the cap on an enrolled 
member's share of the monthly premium to be adjusted annually 
for inflation.

  Section 722--System for Tracking Data and Measuring Performance in 
                    Meeting TRICARE Access Standards

    This section would require the Secretary of Defense to 
establish a system for measuring military treatment facilities 
(MTFs) and TRICARE contractors' performance in meeting the 
Department of Defense's standards for access to primary care 
services. Under TRICARE, the Department's managed health care 
program, the Department established access standards that apply 
to both military and civilian providers and address areas such 
as wait times for appointments and the availability of 
emergency services. However, beneficiary groups and the General 
Accounting Office have been critical of the Department's 
ability to monitor adherence to these standards. Therefore, 
this provision would require implementation of a TRICARE-wide 
system to collect data on the timeliness of appointments in 
order to measure TRICARE's performance in improving beneficiary 
access to care, as well as to capture precise waiting time 
information.

Section 723--Air Force Research, Development, Training and Education on 
       Exposure to Chemical, Biological, and Radiological Hazards

    This section would authorize the Secretary of the Air Force 
to conduct research on the health-related, environmental and 
ecological effects of exposure to chemical, biological and 
radiological hazards and to develop more accurate risk 
assessment tools. This section would specifically recommend 
research on soil and ground water contamination and its impact 
on the biosystem and the health risk of exposure to jet fuel. 
The committee recommends an increase of $1.8 million in the 
Defense Health Program to support the Air Force Environmental 
and Occupational Health Program to conduct this environmental 
risk assessment program.

   Section 724--Authorization to Establish a Level 1 Trauma Training 
                                 Center

    This section would authorize the Secretary of the Army to 
establish a Level 1 Trauma Training Center in accordance with 
the American College of Surgeons standards for trauma centers. 
The establishment of the trauma training center would allow for 
forward surgical teams to train together as full teams. The 
committee recommends an increase of $4.8 million in the Defense 
Health Program to support the Army Medical Department in this 
initiative.

 Section 725--Report on Implementation of Enrollment-based Capitation 
         for Funding for Military Medical Treatment Facilities

    This provision would require the Secretary of Defense to 
provide Congress with a report by March 1, 1999, on the 
potential impact of using an enrollment-based capitation 
methodology to allocate funds to military medical treatment 
facilities. Under this methodology, referred to as enrollment-
based capitation, military treatment facilities would be 
allocated funding based primarily on the number of eligible 
beneficiaries who enroll in TRICARE Prime, the program's 
managed care option, at the military treatment facility (MTF).
    The committee previously has expressed concerns over this 
funding mechanism because it attempts to apply a strict 
managed-care financing mechanism to facilities that do not 
operate solely as managed-care facilities. The committee's 
concerns have increased based on inputs it has received from 
senior MTF and service officials, TRICARE contractors and 
beneficiary associations. Specific concerns include the 
potential impact on the pharmacy benefit; the availability of 
space-available care for non-enrolled beneficiaries, 
particularly those eligible for Medicare; and the TRICARE 
uniform benefit.
    As a result of these concerns, the committee directed the 
Secretary of Defense, in the committee report on H.R. 3230, (H. 
Rept. 104-563), to test this concept in one TRICARE region 
prior to implementing the concept across the military health 
system. However, to date, that test has not been conducted, and 
the committee is disappointed to learn that the Department 
plans to move forward with full implementation of this concept. 
Therefore, this section would require a report that provides:
          (1) The Department's plans to implement enrollment-
        based capitation;
          (2) The justification for implementing this concept 
        without conducting a demonstration of the concept;
          (3) The potential impact on space-available care, 
        particularly for Medicare-eligible retirees and 
        beneficiaries residing outside the catchment area of an 
        MTF;
          (4) The potential impact on the MTF pharmacy benefit, 
        since this approach funds MTFs based on the number of 
        Prime enrollees, but any beneficiary is allowed to fill 
        a prescription at an MTF pharmacy;
          (5) An explanation of how additional funding will be 
        provided to ensure the provision of care and pharmacy 
        benefits to non-enrolled eligible beneficiaries; and
          (6) An explanation of how the concept will impact the 
        TRICARE uniform benefit.
    The committee commends the Department for trying to provide 
incentives to MTF commanders to improve the efficiency of their 
facilities. However, the committee is concerned that using a 
straight managed-care financing approach to fund military 
treatment facilities could have a detrimental effect on the 
availability of military medical care to beneficiaries who 
either cannot, or elect not to, enroll in TRICARE Prime.

  TITLE VIII--ACQUISITION POLICY, ACQUISITION MANAGEMENT, AND RELATED 
                                MATTERS

                        ITEM OF SPECIAL INTEREST

                    Payments to Subtier Contractors

    The committee has become aware of a continuing problem 
facing subtier contractors in receiving proper compensation 
from prime or second tier contractors on Department of Defense 
contracts following delivery of contracted goods and services. 
In particular, this situation appears to have significantly 
impacted a number of subtier contractors involved in 
environmental cleanup activities at military facilities 
affected by the base closure process. The committee urges the 
Secretary of Defense to assess the extent of this problem and 
take whatever remedial actions may be necessary to ensure that 
subtier contractors are properly compensated for services 
provided under Department of Defense contracts. The committee 
notes that the Department currently has at its disposal a 
number of contractual options such as requiring the use of 
payment bonds, applying past performance criteria to this area, 
and others. The committee urges the Secretary to determine 
whether the use of any such options might prove beneficial in 
ensuring the proper compensation of subtier contractors.

                         LEGISLATIVE PROVISIONS

  Section 801--Limitation on Procurement of Ammunition and Components

    This section would require that ammunition procured by the 
Department of Defense be acquired from domestic sources 
pursuant to section 2534 of title 10, United States Code.

               Section 802--Acquisition Corps Eligibility

    This section would enable civilian members of the Defense 
Acquisition Corps who are reduced in grade due to a base 
closing or downsizing to retain their membership in the 
Acquisition Corps for the purposes of the Defense Acquisition 
Workforce Improvement Act (title XII of Public Law 101-510).

     Section 803--Amendments Relating to Procurement From Firms in 
              Industrial Base for Production of Small Arms

    This section would amend section 2473 of title 10, United 
States Code, to require the Secretary of Defense to procure all 
small arms end items, small arms repair parts, modifications to 
improve small arms, and repair parts consisting of small arms 
barrels, bolts and receivers from the small arms production 
industrial base.

      TITLE IX--DEPARTMENT OF DEFENSE ORGANIZATION AND MANAGEMENT

                         LEGISLATIVE PROVISIONS

    Section 901--Further Reductions in Defense Acquisition Workforce

    The committee recommends a provision (sec. 901) that would 
annually reduce the defense acquisition workforce, as defined 
in section 912(a) of the National Defense Authorization Act for 
Fiscal Year 1998 (Public Law 105-85), by a total of 70,000 over 
three years.
    The committee commends the members of the Defense Science 
Board (DSB) for the report in response to the requirement 
contained in section 912(e) of the National Defense 
Authorization Act for Fiscal Year 1998 (Public Law 105-85). 
Specifically, the DSB identified a variety of areas where the 
Department can and should endeavor to re-organize and 
streamline its acquisition operations for the purposes of 
reducing overhead and improving interoperability and jointness 
among the military services.
    While the Department has technically complied with the 
multiple reporting requirements contained in section 912, the 
Secretary's implementation plan postpones enacting virtually 
every major initiative proposed in the DSB study pending 
further examination and analysis. The committee notes the 
Congress previously required the Secretary of Defense to 
conduct a detailed review of the issue in section 906 of the 
National Defense Authorization Act for Fiscal Year 1996 (Public 
Law 104-106). The committee believes the Department has had 
ample time to consider the issue and must expeditiously proceed 
to fundamentally restructure its acquisition organizations.
    Further, the committee urges the Secretary not to exercise 
the waiver authority provided in section 912(a) as personnel 
streamlining is an essential element of acquisition re-
organization. The committee remains convinced that the 
Department's failure to reduce acquisition overhead will 
continue to drain critical resources from high priority, combat 
mission areas.

 Section 902--Limitation on Operation and Support Funds for the Office 
                      of the Secretary of Defense

    The committee notes with particular concern the 
Department's failure to provide Congress with statutorily 
mandated reports on the topics of management headquarters and 
advisory committees. While the committee recognizes the 
significant progress made by the Department in issuing the 
Defense Reform Initiative (DRI) to reorganize and streamline 
the Office of the Secretary of Defense (OSD), the committee 
does not believe the DRI is a substitute for the 
Congressionally mandated reports and implementation plans. 
Additionally, the committee firmly opposes the Department's 
request for repeal of the personnel reductions and reporting 
requirements contained in section 911 of the National Defense 
Authorization Act for Fiscal Year 1998 (Public Law 105-85).
    The committee reiterates its strong belief that the 
Department must comply with existing statutory reports on 
management headquarters contained in section 904 of the 
National Defense Authorization Act for Fiscal Year 1997 (Public 
Law 104-201) and section 911 of the National Defense 
Authorization Act for Fiscal Year 1998 (Public Law 105-85) in 
addition to the annual justification report for advisory 
committees contained in section 904 of the National Defense 
Authorization Act for Fiscal Year 1998 (Public Law 105-85). 
Accordingly, the committee recommends a provision (sec. 902) 
that would restrict the obligation of 10 percent of funding 
authorized in fiscal year 1999 associated with the operation 
and support activities of the Office of the Secretary of 
Defense until the Department complies with the aforementioned 
reports on management headquarters.

   Section 903--Revision to Defense Directive Relating to Management 
            Headquarters and Headquarters Support Activities

    The committee understands the Department has begun to 
examine and improve its definition of management headquarters 
and headquarters support activities as contained in Department 
of Defense Directive 5100.73. The committee supports this 
effort in light of the significant loopholes within the current 
governing regulation that identifies personnel by organization 
rather than actual activity. Both the General Accounting Office 
(GAO) and the study initiated by the Quadrennial Defense Review 
(QDR) on the topic have stated the current definition of 
management headquarters contributes to widespread 
underreporting of management headquarters personnel.
    Section 911 of the National Defense Authorization Act for 
Fiscal Year 1998 (Public Law 105-85) requires an overall 
reduction in personnel dedicated to management headquarters 
activities of 25 percent over five years. The basis for this 
action was a concern with the size and cost of the Department's 
management headquarters relative to an overall diminished force 
structure. Section 911 also required the Secretary of Defense 
to provide an implementation plan by January 15, 1998, that 
includes recommendations on revising, replacing, or augmenting 
Directive 5100.73. To date, that report has not been 
forthcoming. Therefore, the committee recommends a provision 
(sec. 903) that would require the Department to implement a 
revised directive, to be applied uniformly throughout the 
Department, that accounts for management headquarters personnel 
by function rather than organization.

      Section 904--Under Secretary of Defense for Policy to Have 
    Responsibility with Respect to Export Control Activities of the 
                         Department of Defense

    The committee supports the Department's commitment to 
reforming its organization and operation consistent with 
congressional mandate and notes that under the Defense Reform 
Initiative a new Defense Threat Reduction Agency (DTRA) would 
be created, consolidating the work of a number of existing 
agencies under the DTRA umbrella. Functionally, the DTRA would 
be responsible for arms control on-site inspection, technology 
security, nuclear support, special weapons technology, 
cooperative threat reduction, chemical and biological weapons 
defense, counterproliferation, and force protection. The 
existing On-Site Inspection Agency, Defense Technology Security 
Administration, and Defense Special Weapons Agency would be 
disestablished and their activities, along with several program 
management functions within the Office of the Secretary of 
Defense, consolidated within DTRA. The Director of DTRA, who 
has not yet been appointed, would report directly to the Under 
Secretary of Defense for Acquisition and Technology (USD(A&T)).
    The committee is concerned that the proposed DTRA reporting 
chain through the USD(A&T) is incompatible with the role and 
responsibilities that several DTRA components exercise in 
policy decision-making. In particular, the committee notes that 
the mission of the Defense Technology Security Administration, 
which would be abolished and consolidated within DTRA, has a 
primarily policy orientation. The committee is further 
concerned that establishing the reporting chain for this 
function through the USD(A&T) may create an unhealthy 
institutional conflict of interest between the sometimes 
contradictory missions of preventing the acquisition of 
sophisticated technologies by other countries and promoting 
technology transfers as a means of reducing unit production 
costs to the U.S. Government or fostering cooperative 
development programs with other nations.
    The committee's concern is heightened in this regard by the 
draft DTRA charter, which requires the Director of DTRA to 
``represent or support the USD(A&T) in departmental processes 
involving matters relating to the DTRA mission * * *.'' In the 
case of a particularly controversial export decision, this 
might lead to DOD acquisition priorities taking precedence over 
nonproliferation policy priorities. In addition, the committee 
believes that important counterproliferation activities that 
would be carried out by the DTRA also require a more explicit 
and tangible link to the Department's policy organization. 
While the committee recognizes that the draft DTRA charter 
remains a work in progress, the committee is concerned that it 
may lead to ambiguity and confusion as to who is precisely 
responsible for policy direction. For instance, the draft 
charter's direction that the DTRA Director shall fulfill 
certain technology security-related functions ``pursuant to the 
direction of the Under Secretary of Defense (Policy)''--despite 
the charter's establishment of DTRA ``under the authority, 
direction, and control'' of the USD(A&T)--reflects an apparent 
confusion over who should be responsible for these issues.
    The committee is particularly concerned about how the issue 
of supercomputer exports will be handled by the Department, 
given the requirements established by section 1211 of the 
National Defense Authorization Act for Fiscal Year 1998 (Public 
Law 105-85). This provision establishes a procedure by which 
the Department is notified in advance of proposed supercomputer 
exports and may object within a 10-day period after 
notification to such exports taking place without a formal 
license review. However, the regulations for implementing this 
provision require that any objection must be raised at the 
Under Secretary level. Although the committee believes that it 
is more appropriate for those directly in charge of technology 
security to exercise this function, requiring action by an 
Under Secretary illustrates the importance of clarifying the 
relationship between the Director of DTRA and the Department's 
policy organization. In light of the concerns expressed above, 
the committee believes that the responsibility for exercising 
this requirement should rest within the Under Secretary of 
Defense (Policy) organization.
    For these reasons, the committee recommends a provision 
(sec. 904) that would amend section 134(b)(1) of title 10, 
United States Code, to include among the responsibilities of 
the Under Secretary of Defense for Policy issues related to 
export control. This change would clarify the preeminent role 
of the Under Secretary of Defense for Policy in this area. In 
addition, this provision would require the Secretary of Defense 
to submit a report to the committee explaining how the 
Department intends to implement this change organizationally 
and describing the procedures for Joint Staff involvement in 
policy decisions on export control issues.
    The committee is pleased that the Department has sought 
congressional input in an effort to deal with these concerns, 
and believes that they can be addressed within the 
organizational framework of a new agency. The committee 
welcomes continued dialogue with the Department on these 
issues.

Section 905--Independent Task Force on Transformation and Department of 
                          Defense Organization

    This section would require the Secretary of Defense to 
create a task force of the Defense Science Board for the 
purpose of determining the appropriate organization of the 
Department of Defense in light of the ongoing transformation in 
the conduct of war. The task force is to be established not 
later than November 1, 1998 and the Secretary is to transmit 
its findings along with recommendations and comments to the 
Congress by March 1, 1999.

     Section 906--Improved Accounting for Defense Contract Services

    The Congress has repeatedly expressed concern with the 
volume and cost of Advisory and Assistance Services (AAS) to 
the Department of Defense (DOD). Despite efforts to reduce 
annual AAS expenses, the Department has continued to rely 
heavily upon such support services. While the committee 
recognizes the value of AAS for short-term, specialized 
professional or technical advice and assistance, historical 
steady-state AAS funding levels of approximately $3.0 billion 
suggest an institutional dependency by the Department upon the 
private sector for these services. By definition, AAS are 
project-based contractual services that are limited in scope 
and duration. Moreover, DOD Directive 4205.2 specifically 
prohibits AAS contracts unless readily available, in-house 
capability does not exist within the Department or another 
government agency. The committee notes the Department employs 
over two million uniformed and civilian personnel and has 
immediate access to immense resources, to include a technically 
proficient and highly trained acquisition workforce in excess 
of 343,000 people.
    While the fiscal year 1999 Department of Defense budget 
estimate of AAS is nearly identical to the amount reported in 
fiscal year 1998, the committee is aware of extensive analysis 
conducted by the General Accounting Office (GAO) of the 
Department's contract action reporting system that indicates 
AAS was underreported by $9.0 billion in fiscal year 1996. 
According to GAO, since 1985, over 30 reports have identified 
problems with DOD's management and reporting of AAS. In 
particular, a 1995 DOD Inspector General audit report estimated 
that AAS was underreported by $4 billion to $9 billion. Both 
GAO and the Inspector General attribute a portion of the 
underreporting to unclear terminology and lack of consistency 
in identifying, recording, and reporting advisory and 
assistance costs.
    Of the $132.4 billion in services expected to be contracted 
by the Department in fiscal year 1999, less than two percent 
are identified by the Department as Advisory and Assistance 
Services while over 50 percent are largely undefined and 
located in a miscellaneous budget category. According to Office 
of Management and Budget (OMB) data, this miscellaneous 
category has grown from $46.7 billion in fiscal year 1996 to an 
estimated $69.2 billion in fiscal year 1999. The committee 
finds this trend unacceptable and suggestive of a pattern of 
deficient fiscal management that obscures proper visibility of 
AAS costs and permits significant underreporting of AAS 
activity to continue.
    Therefore, the committee recommends a provision (sec. 906) 
that would prohibit the Department from classifying more than 
15 percent of its contractual services in a miscellaneous 
budget category. The provision would provide a transition 
period by allowing the Department, in the budget request for 
fiscal year 2000, to report up to 30 percent of its contractual 
services as miscellaneous services. In addition, the section 
would provide a statutory definition of AAS for the Department 
of Defense and require the Under Secretary of Defense 
(Comptroller) to annually review all DOD service contracts for 
applicability under this definition by February 1, 1999, and 
prior to the submission of the DOD budget request hereafter. 
The review would also include a requirement for the Comptroller 
to identify and report to Congress on the total costs and level 
of manpower effort involved in contract services. The provision 
would task the General Accounting Office (GAO) with reviewing 
the information contained in the Comptroller report and 
transmitting its findings to Congress. Subsequent to the 
Comptroller review, the provision would require the Secretary 
of Defense to reduce Advisory and Assistance Services by $500 
million in fiscal year 1999.

 Section 907--Repeal of Requirement Relating to Assignment of Tactical 
                 Airlift Mission to Reserve Components

    This section would repeal section 1438 of the National 
Defense Authorization Act for Fiscal year 1991 (Public Law 101-
510) which requires the Department of Defense to shift the 
tactical airlift mission to the reserves, unless the Secretary 
of Defense waives this requirement on annual basis. The 
committee notes that this requirement has been routinely waived 
by the Secretary of Defense every year and therefore finds this 
provision to be obsolete and serving no particular purpose.

   Section 908--Repeal of Certain Requirements Relating to Inspector 
             General Investigations of Reprisal Complaints

    This section would eliminate two burdensome administrative 
requirements in the process of investigating and resolving 
reprisal complaints. One provision would eliminate the 
requirement to report to the Secretary of Defense and the 
member if the complaint cannot be resolved in 90 days. The 
second provision would eliminate the requirement for a post 
investigation interview. Although the committee supports the 
elimination of both requirements, the committee expects the 
Department to maintain reasonable communication with the member 
during the course of each investigation.

Section 909--Consultation with Commandant of the Marine Corps Regarding 
                         Marine Corps Aviation

    The committee is aware that, due to the unique relationship 
between the Secretary of the Navy and the Commandant of the 
Marine Corps, the Commandant has sometimes not been fully 
consulted on matters related to Marine Corps aviation programs, 
which are funded in the Navy Aircraft procurement and research, 
development, test and evaluation accounts. The committee is 
concerned that this arrangement may be leading to situations 
where critical decisions affecting the core combat capability 
of the Marine Corps may be made without the benefit of the 
input or the perspective of the Commandant, as may have 
occurred with the decision on how to proceed with depot 
maintenance support for the V-22 engine. Therefore, the 
committee recommends a provision (sec. 909) that would require 
the Secretary of the Navy to ensure that the views of the 
Commandant of the Marine Corps' are obtained before a major 
acquisition decision is made on Marine Corps aviation matters. 
The committee notes that this provision is not intended to 
provide a mechanism by which the Commandant may block the 
ability of the Secretary of the Navy to proceed with a 
particular acquisition decision. Rather, the provision is 
intended to ensure that the Commandant's expertise and 
important perspective is taken fully into account when 
acquisition decisions are made that affect Marine Corps 
aviation.

                      TITLE X--GENERAL PROVISIONS

                        Counter Drug Activities

                                Overview

    The committee remains deeply concerned that the President's 
request for Department of Defense counter-drug activities once 
again contains funding for programs beyond its traditional 
authority, even though the DOD Counter-Drug Program does not 
adequately support its primary role as the lead agency for 
detection and monitoring of aerial and maritime transit of 
illegal drugs into the United States. The committee continues 
to support the Department's core counter-drug mission, but is 
concerned by the continuing pattern of expansion into 
additional missions that jeopardize the critical task assigned 
to the Department of Defense.
    This year, the committee's initiatives include a 
reprioritization of programs within the DOD counter-drug 
account to maintain the integrity of the Department's role in 
disrupting the flow of illegal drugs into the United States. In 
support of a promising operation in the eastern Pacific Ocean, 
the committee provides direction and redirects funds from 
lesser priority projects included in the budget request. In 
addition, the committee increases funding to enhance 
intelligence capabilities in support of law enforcement 
counter-drug efforts worldwide. Finally, the committee, in 
response to requests for assistance from the National Guard and 
law enforcement agencies, recommends additional funds for 
programs aimed at interdicting drugs and drug operations in the 
United States. These budgetary and legislative initiatives are 
discussed in greater detail below.
    The budget request for Department of Defense fiscal year 
1999 drug interdiction and counter-drug activities contained 
$727.6 million, plus $155.3 million for operational tempo which 
is included within the operating budgets of the military 
services. This represents a net increase of $14.7 million from 
the fiscal year 1998 appropriated level of $712.9 million, and 
an increase of $20.4 million for operational tempo from the 
fiscal year 1998 appropriated level of $134.9 million.
    The committee recommends an authorization for fiscal year 
1999 defense counter-drug activities as follows:

                        [In thousands of dollars]

FY99 Drug Interdiction & Counter-Drug Request.................   727,582
    Demand Reduction and Use..................................    12,830
    Domestic Law Enforcement Agencies Support.................    86,669
    Demand Reduction for Department of Defense and National 
      Guard Personnel-........................................    72,936
    Transit Zone and Southwest Border.........................   301,334
    Source Zone and Domestic Marijuana Eradication............   253,813
Recommended Decreases:
    Joint Military Intelligence Program.......................     3,500
    Southern Air Forces Counter-Drug Support (Project #4419)..    19,000
    JIATF-South (Project #4450)...............................    15,400
    National Guard Cargo/Mail Inspection Support (Project 
      #7401)..................................................    29,000
Recommended Increases:
    Joint Military Intelligence Program.......................     3,500
    National Guard General Support (Project #7403)............    29,000
    Gulf States Counter-Drug Initiative (Project #7406).......     4,000
    Multi-Jurisdictional Task Force (Project #7408)...........     1,000
    Operation Caper Focus.....................................    24,400
    Southwest Border Fence Project............................     5,000
Recommendation................................................   727,582

                       Items of Special Interest

Gulf states counter-drug initiative command, control, communications 
        and computer network

    The budget request contained $1.1 million for the Gulf 
States Counter-Drug Initiative (GSCI) automated Command, 
Control, Communications and Computer (C<SUP>4</SUP>) network.
    The committee fully supports the GSCI C<SUP>4</SUP> 
network, which assists law enforcement counter-drug efforts in 
Alabama, Georgia, Louisiana and Mississippi. The committee 
notes that although the information system was initiated and is 
currently funded as a counter-drug program, the state law 
enforcement agencies have adopted the GSCI network as a 
Regional Investigative and Intelligence Support System that can 
also support weapons proliferation, transnational organized 
crime and counterterrorism efforts. In addition, the committee 
understands that the role of the Department of Defense (DOD) in 
the design, development, acquisition and implementation of the 

information system is nearing conclusion. The GSCI network is 
fully operational and DOD continues to provide system 
maintenance and training.
    The committee recommends $4.1 million, an increase of $3.0 
million, for the sustainment of the GSCI network. Given the 
expanded mission of the GSCI in the final phase of DOD 
involvement, the committee encourages the designation of non-
counter-drug DOD, Department of Justice, state or local funds 
for additional operation and maintenance and procurement costs 
identified by law enforcement agencies to sustain the GSCI 
information system in the outyears.

Gulf states counter-drug initiative regional counter-drug training 
        academy

    The budget request contained $2.2 million for the Gulf 
States Counter-Drug Initiative Regional Counter-Drug Training 
Academy (RCTA).
    The committee continues to support the efforts of the RCTA 
in Meridian, Mississippi. This unique, multi-state training 
facility provides counter-drug courses to civilian law 
enforcement officers of state, county, and municipal agencies 
throughout theUnited States and to National Guard personnel 
providing support to local law enforcement agencies. The committee 
understands that the additional funds are necessary to accommodate the 
increasing number of students from Alabama, Georgia, Louisiana and 
Mississippi on the RCTA waiting list.
    The committee recommends $3.2 million, an increase of $1.0 
million, for personnel and administrative costs, operations and 
maintenance, student expenses (to include quarters and 
subsistence), and equipment expenses for the RCTA.

Joint interagency task force south

    The budget request contained $23.1 million for Joint 
Interagency Task Force South (JIATF-S), an increase of almost 
$17.0 million from the fiscal year 1998 appropriated level of 
$6.1 million.
    While the committee is well aware of the role of JIATF-S in 
the coordination of DOD resources in support of interdiction 
agencies, it believes there should be a more moderate budget 
increase in light of the stalled negotiations regarding a post-
1999 U.S. presence in Panama. The committee understands that 
JIATF-S has been operating out of Howard Air Force Base since 
June 11, 1997 as an interim organization while relocation plans 
are under consideration. Consequently, the committee wishes to 
maintain a sufficient funding level to meet mission 
requirements until a permanent organization is established.
    For these reasons, the committee recommends $7.7 million, a 
decrease of $15.4 million for JIATF-S.

Joint military intelligence program

    The budget request contained $4.2 million for a program 
funded within the Defense Intelligence Counterdrug Program.
    The committee recommends $0.7 million for this program, a 
decrease of $3.5 million and a corresponding increase of $3.5 
million for other programs funded within the Defense 
Intelligence Counterdrug Program. Further discussion of these 
programs can be found in the classified annex accompanying this 
report.

Multi-jurisdictional task force

    The budget request contained $2.0 million for the Multi-
Jurisdictional Counterdrug Task Force.
    The committee understands that additional funds are needed 
to improve the Multi-Jurisdictional Counterdrug Task Force's 
training program by increasing the number of conventional 
courses, distance learning projects and state narcotics 
conventions for law enforcement officers.
    The committee recommends $3.0 million, an increase of $1.0 
million for the Multi-Jurisdictional Counterdrug Task Force.

National guard state plans

    The budget request contained $29.0 million for National 
Guard Cargo/Mail Inspection Support and $118.6 million for 
National Guard General Support.
    The committee notes that beginning in fiscal year 1998, 
funds for cargo/mail inspection support were transferred from 
the general support account due to its high priority at the 
national level. While the committee continues to endorse this 
program as a means to deny illegal drugs from entering the 
United States, the committee directs that funding for this 
project be transferred back to the general support account. The 
committee encourages the state and territorial governors to 
include adequate funding for the cargo/mail inspection program 
within the state plans submitted under section 112 of title 32, 
United States Code.
    Therefore, the committee recommends $147.6 million for 
National Guard General Support, an increase of $29.0 million 
and a corresponding decrease of $29.0 million for National 
Guard Cargo/Mail Inspection Support.

Southern air forces counter-drug support

    The budget request contained $24.4 million for Southern Air 
Forces (SOUTHAF) Counter-Drug Support, including $19.0 million 
for the operation and maintenance of ground mobile radars 
(GMRs) within the US Southern Command area of operations.
    The committee recommends $5.4 million for SOUTHAF Counter-
Drug Support, a decrease of $19.0 million. Further discussion 
of this program can be found in the classified annex 
accompanying this report.

Southwest border fence project

    The committee continues to support the Southwest border 
road, fence and lighting project in East San Diego County, 
California.
    The committee has consistently added funds for a reinforced 
fence along the fourteen miles of international border east of 
the Pacific Ocean, and the construction of second and third 
fences, with roads between the fences, to improve border 
security in this high intensity drug trafficking area (HIDTA). 
The committee notes that in just three years, the seizure of 
illegal drugs and the number of murders that occurred along 
this section of the border have decreased significantly as a 
result of this initiative, according to ``The National Drug 
Control Strategy, 1998.'' To ensure the efficient execution of 
this project, the committee encourages the California National 
Guard and the Joint Task Force Six (JTF-6) to allocate 
sufficient resources for this national priority from within 
their respective counter-drug budgets. Further, the committee 
directs that funds authorized and appropriated in fiscal year 
1998 be obligated for this project as intended by the Congress.
    In addition, the committee recommends $5.0 million to 
facilitate completion of the Southwest border fence project 
from within the domestic law enforcement agencies support 
component of the Department of Defense Counter-Drug Plan.

Support for counter-drug activities of Peru and Colombia

    Section 1033 of the National Defense Authorization Act for 
Fiscal Year 1998 (Public Law 105-85) authorized the Secretary 
of Defense to provide support for the counter-drug activities 
of the Governments of Peru and Colombia. The committee wishes 
to clarify that the intent of Congress was to provide nonlethal 
assistance, including unarmed riverine patrol boats, to 
establish a riverine interdiction program in Peru and Colombia.

                             Other Matters

    Counterterrorism and Defense Against Weapons of Mass Destruction

    The budget request contained a number of legislative 
provisions to expand the ability of the Department of Defense 
to respond to domestic terrorist activity and to the potential 
use by terrorists of weapons of mass destruction on U.S. 
territory. Other DOD proposals provide for the procurement, 
operation, and maintenance of equipment, and the authority to 
transfer funds among DOD accounts for counterterrorism or force 
protection purposes. In addition, the Department's fiscal year 
1999 legislative proposal for defense reform seeks expanded 
authority to use the National Guard and reserves to respond to 
domestic emergencies involving the use of weapons of mass 
destruction.
    After careful review of these proposals, the committee is 
concerned that the Department's efforts and initiatives are not 
closely coordinated with other agencies within the government--
federal, state, and local--who share responsibility for 
responding to domestic incidents involving weapons of mass 
destruction. The need for such coordination was the hallmark 
theme of the Defense Against Weapons of Mass Destruction Act of 
1996, enacted into law as part of the National Defense 
Authorization Act for Fiscal Year 1997 (Public Law 104-201).
    The committee believes strongly in the need for greater 
overall preparedness to deal with potential terrorist activity 
within the United States and that a significant amount of 
counterterrorism expertise and materiel resides with the DOD. 
However, the committee is troubled that the Department has not 
provided a comprehensive blueprint detailing the extent to 
which the expanded authority it seeks is necessary. Nor has the 
Department addressed critical questions involving the 
appropriate use of the armed forces for purposes of countering 
the effects of domestic terrorism. Instead, the Department's 
proposals appear to reflect a presumption that DOD alone can 
and should shoulder the response burden, as well as a piecemeal 
approach for incrementally expanding its authority to counter 
terrorist activity without an apparent consideration of the 
broader implications involved. The committee believes that the 
effort to counter terrorist acts against the United States, 
especially those involving the use of weapons of mass 
destruction, goes well beyond the purview of the Department of 
Defense.
    The committee is also troubled by the apparent lack of an 
effective coordinated effort on the part of other federal 
departments and agencies that address the overall federal 
response and support to state and local governments. The 
committee's concerns in this regard are heightened by the fact 
that FEMA recently withdrew as chair and administrator of the 
Senior Interagency Coordination Group, the interagency forum 
for domestic terrorism-related consequence management issues, 
and by the results of a draft study commissioned by the U.S. 
Attorney General, which reportedly concludes that significant 
deficiencies exist in the inter-agency coordination process. 
Although a September 1997 GAO report considered the efforts of 
federal agencies to implement national policy on 
counterterrorism, it did not evaluate the effectiveness of the 
federal government's programs or coordination activities. 
Accordingly, the committee directs that the GAO should conduct 
a follow-up assessment of this issue. In addition, the 
committee expects that a new Presidential Decision Directive 
reportedly being drafted will clarify the appropriate roles of 
government agencies in dealing with terrorism.
    In this regard, the committee is concerned by reports that 
the National Security Council may be given a central 
operational role to oversee the federal government's 
counterterrorism efforts, including the activities of the DOD. 
The committee believes this proposal raises questions regarding 
the statutory role of the National Security Council to advise 
and make recommendations to the President with regard to 
national security policy, in contrast to the operational role 
of executive departments and agencies to carry out that policy. 
Accordingly, the committee holds serious concerns about where 
operational control of the Department's counterterrorism 
efforts will reside. These concerns extend to uncertainty over 
funding and program prioritization issues. While the committee 
believes in and strongly endorses the need for a coordinated 
effort at the national level, the committee does not believe as 
a matter of policy that it is appropriate to assign operational 
responsibilities to the National Security Council.
    With respect to the DOD, the committee considers that 
approval by Congress of the Department's suggested changes to 
law, without a comprehensive understanding of the overall 
implications for the military's role in countering terrorism, 
would be premature. Therefore, the committee recommends that 
action on the changes proposed by the Department be deferred 
until the committee has received and analyzed the Department's 
overall plan for addressing these issues. Consequently, the 
committee directs the Secretary of Defense to submit a report 
to the congressional defense committees by no later than 
December 31, 1998 that:
          (1) Outlines the Department's overall strategy for 
        countering terrorism, including the use of weapons of 
        mass destruction on U.S. soil, and explains the 
        existing legal authorities that allow DOD to assist 
        other federal agencies in the event of a terrorist 
        incident;
          (2) Describes how the Department's proposals for 
        changes to existing statutes and statutory prohibitions 
        correspond to its broader counterterrorism strategy;
          (3) Provides a detailed justification for such 
        changes, including an explanation of what specific 
        activities would be prevented if the Department's 
        recommended changes were not enacted, what consequences 
        would ensue, and whether the proposed changes are in 
        response to specific problems that have arisen or 
        represent simply an attempt to prepare for all 
        contingencies;
          (4) Describes how counterterrorism functions will be 
        organizationally integrated into the Department's 
        proposed Defense Threat Reduction Agency;
          (5) Describes the role of the National Guard and 
        reserves in domestic counterterrorism and how these 
        roles are to be integrated with the efforts of state 
        and local authorities responsible for responding to 
        domestic emergencies;
          (6) Describes the relationship between federal, 
        state, and local authorities regarding domestic 
        counterterrorism, including the Department's 
        cooperative efforts with other federal agencies to 
        prevent and respond to domestic emergencies involving 
        the use of weapons of mass destruction, and addresses 
        what modifications to the Stafford Act are necessary 
        for the Department to implement these efforts;
          (7) Explains the rationale for the current legal 
        prohibition on using the armed forces for civilian law 
        enforcement-type purposes, provides the Department's 
        assessment of whether that demarcation line needs to be 
        revised in light of the nature of terrorist threats, 
        and provides an assessment of whether enacting the 
        changes proposed by the Department will blur this 
        traditional distinction; and
          (8) Assesses whether an agreement to expand the 
        Department's authority and role in counterterrorism 
        would set a precedent for greater DOD involvement in 
        countering other types of transnational domestic 
        threats that have traditionally been handled by 
        domestic state and local law enforcement agencies.
    The committee notes its intent to work with the other 
committees of the House of Representatives to formulate a 
comprehensive and effective approach to the issue of 
counterterrorism.

                      Electromagnetic Pulse (EMP)

    The committee is concerned that U.S. political and military 
leaders have underestimated the potential impact of 
electromagnetic pulse on U.S. military systems and critical 
portions of the nation's infrastructure. The committee is aware 
of foreign research into the effects of EMP resulting from a 
high-altitude nuclear explosion and that not all of these 
effects are well understood or widely recognized. The committee 
directs that the Secretary of Defense, in conjunction with the 
Director of Central Intelligence, submit a report by March 1, 
1999 to the congressional defense committees on the potential 
effects of high- and low-frequency EMP, including magneto-
hydrodynamic EMP. The report should include an assessment of 
the effects on U.S. military systems, commercial systems on 
which the military now relies (such as communications systems), 
overall military effectiveness, and key aspects of the U.S. 
civilian infrastructure necessary to sustain life and commerce 
(such as the power grid, water pumping stations, and data 
storage and processing systems); steps that might be taken to 
reduce vulnerability to EMP; the costs associated with those 
steps; and a judgment concerning preferred courses of action.

      Intelligence Community Access to Export Control Information

    The committee is troubled by the pattern of delay and 
obfuscation by the Department of Commerce in providing critical 
export control information upon request by intelligence 
agencies engaged in assessing the national security impact of 
the transfer of U.S. technology abroad. In particular, the 
committee notes that the Defense Intelligence Agency (DIA) and 
the Department of Energy (DOE) were requested in December 1997 
to prepare for the committee assessments of the impact on 
national security of high-performance computer exports to 
certain countries. These assessments were to be submitted to 
the committee by March 3, 1998 and have not yet been received. 
Export information necessary to conduct these assessments is in 
the possession of the Department of Commerce and was not 
promptly transmitted to DIA and DOE, despite the formal 
requests by these agencies and the committee's direct request 
to the Secretary of Commerce to do so.
    The committee is particularly perplexed by the failure of 
the Deputy Director of Central Intelligence to support the 
committee's request that this information be provided to DIA 
and DOE. During testimony before the committee on February 25, 
1998, the Deputy Director was asked if the Central Intelligence 
Agency (CIA) supported the DIA and DOE's request for access to 
this information. This question was not answered and a written 
response was promised. Repeated subsequent inquiries to the CIA 
have yet to produce the promised response. The committee fails 
to understand why the CIA would not unequivocally support 
access by other intelligence agencies to information necessary 
to conduct assessments of the national security implications of 
potentially dangerous technology transfers, especially in 
response to congressional requests. The committee considers 
this a serious issue and believes it raises important policy 
and procedural concerns over how the national security agencies 
are afforded an opportunity to influence the executive branch's 
formulation of technology transfer and export control policy.
    Accordingly, the committee directs the Director of Central 
Intelligence to provide the congressional defense and 
intelligence committees with a report by no later than 
September 30, 1998 on the steps being taking to ensure that the 
intelligence community has full and timely access to export 
license information in order to assess the national security 
and proliferation consequences of U.S. technology transfers.

                         LEGISLATIVE PROVISIONS

                     Subtitle A--Financial Matters

                    Section 1001--Transfer Authority

    This section would permit the transfer of amounts of 
authorizations made available in Division A of the bill for any 
fiscal year to any other authorization made available in 
Division A upon determination by the Secretary of Defense that 
such a transfer would be in the national interest. The 
provision would provide the authorization for reprogramming 
involving the transfer of authorization between amounts 
authorized as set out in bill language.
    The authority to transfer could only be used to provide 
authorization for higher priority items than the items from 
which authorization was transferred and could not be used to 
provide authorization for an item that was denied authorization 
by the Congress. The Secretary of Defense would be required to 
notify Congress promptly of transfers. The total amount of 
transfers would be limited to $2.0 billion. Historically, the 
transfer authority authorized has changed as follows:
        Fiscal year                                             Billions
1985-1988......................................................... $2.00
1989-1991.........................................................  3.00
1992..............................................................  2.25
1993..............................................................  1.50
1994-1998.........................................................  2.00

            Section 1002--Incorporation of Classified Annex

    This section would incorporate the classified annex 
prepared by the Committee on National Security into the 
National Defense Authorization Act for Fiscal Year 1999.

                    Section 1003--Outlay Limitations

    This section would restrict the amount of discretionary 
outlays in the national defense function to the totals provided 
in the Balanced Budget Act of 1997 for fiscal year 1999.

                Subtitle B--Naval Vessels and Shipyards

  Section 1011--Revision to Requirement for Continued Listing of Two 
              Iowa-Class Battleships on the Naval Register

    This section would direct the Secretary of the Navy to 
maintain the U.S.S. Iowa (BB-61) and the U.S.S Wisconsin (BB-
64) on the naval register in compliance with section 1011 of 
the National Defense Authorization Act for Fiscal Year 1996 
(Public Law 104-106).

            Section 1012--Transfer of the U.S.S. New Jersey

    This section would direct the Secretary of the Navy to 
strike the U.S.S New Jersey (BB-62) from the naval vessel 
register and transfer that vessel to a non-for-profit entity, 
in accordance with section 7306 of title 10, United States 
Code. The section would further direct the Secretary to require 
that the transferee locate the vessel in the State of New 
Jersey as a condition of transfer.

    Section 1013--Long-Term Charter of Three Vessels in Support of 
                  Submarine Rescue, Escort, and Towing

    This section would authorize the Secretary of the Navy to 
enter into contracts in accordance with section 2401 of title 
10, United States Code, for the charter of three vessels, the 
CAROLYN CHOUEST, KELLIE CHOUEST, and DELORES CHOUEST through 
fiscal year 2003 in support of Navy's submarine rescue, escort 
and towing missions.

            Section 1014--Transfer of Obsolete Army Tugboat

    This section would allow the Secretary of the Army to 
substitute and transfer one obsolete tugboat in place of a 
previously designated obsolete tugboat to the Brownsville 
Navigation District, Brownsville, Texas.

Section 1015--Long-Term Charter Contracts for Acquisition of Auxiliary 
                 Vessels for the Department of Defense

    This section would authorize the Secretary of the Navy to 
contract for the long-term lease or charter of newly 
constructed surface vessels, including their crews. Such leases 
or charters would apply to the Navy's combat logistics force 
and strategic sealift programs, as well as other auxiliary 
support vessels of the Department of Defense.

        Subtitle C--Matters Relating to Counter-Drug Activities

Section 1021--Department of Defense Support for Counter-Drug Activities

    This section would amend section 1004 of the National 
Defense Authorization Act of Fiscal Year 1991 (Public Law 101-
510), as amended, to extend the current authority governing 
Department of Defense (DOD) support for other agencies for 
counter-drug activities.
    The DOD counter-drug objectives include assistance to 
international and domestic law enforcement agencies to disrupt 
the illegal drug traffic into the United States and support for 
domestic law enforcement to interdict drugs and drug operations 
in the United States. To achieve these objectives, the 
Secretary of Defense is authorized under currentlaw to provide 
the following types of support to facilitate counter-drug activities 
within or outside the United States:
          (1) The maintenance, repair and upgrading of 
        equipment made available to any federal department or 
        agency or to any state or local government by DOD;
          (2) The transportation of U.S. and foreign personnel 
        and the transportation of equipment;
          (3) The establishment and operation of training 
        facilities and bases of operation;
          (4) The training of law enforcement personnel of the 
        federal, state, local or foreign governments;
          (5) The detection, monitoring and communication of 
        the movement of air, sea and surface traffic;
          (6) The construction of roads, fences and 
        installation of lighting across international 
        boundaries;
          (7) The establishment of command, control, 
        communications and computer networks for integration of 
        law enforcement, active military, and National Guard 
        activities;
          (8) The provision of linguist and intelligence 
        analysis services;
          (9) Aerial and ground reconnaissance.
    This section would reauthorize DOD assistance for the 
counter-drug activities of any other department or agency of 
the federal government or of any state, local or foreign law 
enforcement agency through fiscal year 2000. In addition, this 
section would clarify that the expanded establishment of 
training facilities and bases of operation shall comply with 
section 2805 of title 10, United States Code, regarding 
unspecified minor construction.

      Section 1022--Support for Counter-Drug Operation Caper Focus

    The committee understands that although the Department of 
Defense continues to serve as the single lead federal agency 
for the detection and monitoring of suspected drug-trafficking 
activities within the transit zone, the Department's budget in 
this region has declined dramatically since 1993. This decline 
is a result of presidential guidance in 1993 that directed a 
gradual shift in emphasis from the transit zone to the source 
zone counter-drug activities. While the Administration's 
strategic focus moved to South America, illegal drugs continued 
to flow through the eastern Pacific Ocean and Caribbean Sea to 
U.S. markets. In fact, according to the Department of State's 
1997 International Narcotics Control Strategy Report, about 760 
metric tons were produced in South America in 1996 and about 
608 metric tons of cocaine moved through the transit zone into 
the United States. Of this amount, approximately 234 metric 
tons flowed through the Eastern Pacific.
    The committee is disturbed by the recent testimony of 
General Charles E. Wilhelm, Commander-in-Chief, United States 
Southern Command (CINCSOUTH), regarding the Department's 
inability ``to mount effective detection, monitoring and 
tracking operations in the Eastern Pacific, a pipeline which 
feeds Mexico and ultimately the U.S.'' As a result of competing 
demands for maritime patrol aircraft, the Secretary of Defense 
postponed the final phase of Operation Caper Focus, a promising 
operation targeting multiton cargo vessels in the eastern 
Pacific. During the initial phases of Operation Caper Focus, 
Joint Interagency Task Force East (JIATF-E) assets interdicted 
27 metric tons of cocaine and gained valuable intelligence on 
regional trafficking methods. Despite these preliminary 
results, the Secretary of Defense has not made available the 
additional air or maritime assets necessary to execute the 
operation, nor has the Director of JIATF-E transferred assets 
from the Caribbean because the ``movement of assets may have 
undesirable political consequences,'' according to an October 
1997 study by the General Accounting Office entitled ``Update 
on U.S. Interdiction Efforts in the Caribbean and Eastern 
Pacific'' (GAO/NSIAD-98-30).
    The committee is convinced of the need to take advantage of 
this opportunity to seize large amounts of cocaine through the 
execution of Operation Caper Focus. The committee further 
understands that JIATF-E has requested a total of four surface 
ships and 650 aircraft surveillance flight hours per month to 
support an 18-month Eastern Pacific operation. Therefore, the 
committee includes a provision (sec. 1022) that would direct 
that the Secretary of Defense reevaluate the Department's 
priorities and make available the requisite number of maritime 
patrol aircraft and surface assets and crews currently 
available within the existing DOD infrastructure for the 
purposes of executing Operation Caper Focus.
    In addition, the provision would authorize $24.4 million to 
support this operation. The committee urges the Secretary of 
Defense to seek the views of the CINCSOUTH in identifying the 
capabilities needed to determine how these funds should be 
applied. Finally, the committee directs that the Secretary of 
Defense provide the Congressional defense committees a report 
outlining the recommendations of CINCSOUTH and an 
implementation plan detailing DOD's expanded operational 
support to Operation Caper Focus no later than September 30, 
1998.

       Subtitle D--Miscellaneous Report Requirements and Repeals

   Section 1031-Annual Report on Resources Allocated to Support and 
                           Mission Activities

    The committee is increasingly concerned over the growing 
gap between the level of resources within the Department of 
Defense (DOD) dedicated to support versus mission activities. 
The General Accounting Office (GAO) has estimated that the 
Department of Defense will spend nearly 60 percent of its 
budget on mission support programs from fiscal year 1997 
through 2001. Furthermore, GAO calculates that 45 percent of 
all active duty military personnel are currently assigned to 
support programs. A 1996 Defense Science Board report concurs 
with GAO's findings and adds that only 20 percent of all active 
duty military personnel serve in combat related positions.
    During a period of steadily declining defense budgets and 
growing readiness, quality of life, and modernization 
shortfalls, the committee is alarmed by these trends and 
believes increased understanding and clarification of the issue 
is imperative. Accordingly, the committee recommends a 
provision (sec. 1031) that would require the Secretary of 
Defense to provide in his annual report to the Congress a 
detailed description of the personnel and budgetary resources 
dedicated to support activities as compared to mission related 
activities.

                       Subtitle E--Other Matters

Section 1041--Clarification of Land Conveyance Authority, Armed Forces 
                 Retirement Home, District of Columbia

    This section would clarify subsection (a) of section 1053 
of the National Defense Authorization Act for Fiscal Year 1997 
(Public law 104-201), to state clearly that the original 
purpose of this disposal provision was to authorize only the 
sale of a specific parcel of land at the Armed Forces 
Retirement Home, Washington, DC. The committee understands that 
the Armed Forces Retirement Homes Board of Directors may be 
considering a development strategy for the property. The 
intention of the original provision was for the outright sale, 
at fair market value, of this property with the receipts of the 
sale to be deposited in the Armed Forces Retirement Homes Trust 
Fund. The committee believes that if the Armed Forces 
Retirement Homes Board of Directors wishes to propose a 
development plan for any portion of either the Soldiers' and 
Airmen's Retirement Home or the Naval Retirement Home, the 
board should provide a proposal to Congress for review.

  Section 1042--Content of Notice Required to be Provided Garnishees 
                 Before Garnishment of Pay or Benefits

    This section would authorize the Secretary of Defense to 
notify service members and DOD civilian employees, in cases 
where the secretary has been directed by court order to 
withhold pay from a service member or DOD civilian employee in 
order to enforce child support or alimony payments, that their 
pay will be withheld by including a description of the legal 
document that authorizes the garnishment of wages. Currently, 
the secretary is required to forward a copy of the legal 
document to the service member or civilian employee. The 
secretary would continue to be required to provide written 
notice of the intent to withhold pay to the affected 
individual, and to inform the individual of the means to obtain 
a copy of the notice, but the secretary would be relieved of 
the obligation of sending a copy of the actual legal notice 
directing the garnishment. This requirement has served little 
purpose since the individual had already been through a full 
judicial process to have the obligation decreed.

   Section 1043--Training of Special Operations Forces with Friendly 
                             Foreign Forces

    This section would amend section 2011 of title 10, United 
States Code, which authorizes the Commander of the Special 
Operations Command (SOCOM) to pay for the costs to conduct 
training activities with the forces of other nations. The 
amendments would improve the level of reporting associated with 
the use of this authority and require that any training program 
that occurs under this authority receive the prior approval of 
the Secretary of Defense.

           TITLE XI--DEPARTMENT OF DEFENSE CIVILIAN PERSONNEL

                         LEGISLATIVE PROVISIONS

Section 1101--Authority for Release to Coast Guard of Drug Test Results 
       of Civil Service Mariners of the Military Sealift Command

    This section would permit the Secretary of the Navy to 
release to the Coast Guard the results of a drug test of a 
former employee of the Department of the Navy who was employed 
as a civil service mariner. This authority would allow the 
Coast Guard full disclosure of positive drug results as part of 
Coast Guard mariner licensing procedures.

              Section 1102--Limitations on Back Pay Awards

    This section would clarify that any award of back pay to 
Civil Service employees, resulting from a finding of an 
unjustified personnel action adjudged under section 5596 of 
title 5, United States Code, shall not exceed six years, unless 
a shorter limitation period applies. Arbitrators and 
administrators have, in some cases, applied the six year limit 
found in section 2402 of title 28, United States Code, and in 
section 3702 of title 31, United States Code. In other cases, 
some arbitrators and administrators have applied no time limit, 
since none is specified within section 5596 of title 5, United 
States Code. This provision would remove the ambiguity of these 
various sections by establishing a standard six year limit in 
title 5, United States Code, and would ensure that the amount 
of redress available to employees would be the same regardless 
of the statutory avenue chosen to seek that redress.

   Section 1103--Restoration of Annual Leave Accumulated by Civilian 
   Employees at Installations in the Republic of Panama to be Closed 
              Pursuant to the Panama Canal Treaty of 1977

    This section would provide federal employees, working to 
close installations in the Republic of Panama in accordance 
with the Panama Canal Treaty Implementation Plan, the same 
automatic restoration of excess annual leave that is provided 
to employees at bases closed under current Base Realignment and 
Closure procedures. The committee has learned that as the 1999 
deadline for the turnover of the Canal Zone nears, there are 
fewer employees available to perform the required work of 
preparing bases for reversion to the Republic of Panama, 
thereby reducing the opportunity for those employees to take 
annual leave.

Section 1104--Repeal of Program Providing Preference for Employment of 
           Military Spouses in Military Child Care Facilities

    This section would repeal section 1792d of title 10, United 
States Code, which provides military spouses with an additional 
hiring preference in the civil service. This job preference has 
proven unnecessary given the more general military spouse 
preferences provided by section 1784 of title 10, United States 
Code. Additionally, the provision had the unintended effect of 
incentivizing applicants to use the child care preference as a 
stepping stone to other civil service positions, after 
undergoing extensive child care training but working minimal 
time in child care.

 Section 1105--Elimination of Retained Pay as a Basis for Determining 
                       Locality Based Adjustments

    This section would eliminate windfall pay adjustments that 
have been made to some federal employees. In cases where 
special pay rates are no longer required to retain employees, 
sections 5302(8)(B) and 5363(a)(2) of title 5, United States 
Code, requires that pay adjustments continue to be made against 
those unnecessary higher rates, resulting in pay that is more 
generous than is needed to compensate and retain those 
employees. This provision would require that future pay 
adjustments be measured against the pay rate necessary to 
retain the employees, and eliminate the windfall.

Section 1106--Observance of Certain Holidays at Duty Posts Outside the 
                             United States

    This section would allow Civil Service employees, working 
in foreign areas where the regular work week is other than 
Monday through Friday, to observe federal holidays in 
conjunction with a weekend. Since the enactment of section 6103 
of title 5, United States Code, which established five public 
holidays that are to be observed on a Monday, federal employees 
working in foreign countries where the work week begins on 
Saturday or Sunday, have lost the opportunity to observe these 
holidays as part of a three day weekend.

              TITLE XII--MATTERS RELATING TO OTHER NATIONS

                       ITEMS OF SPECIAL INTEREST

                      Arms Control Implementation

    The fiscal year 1999 budget request contained $275.2 
million, representing a slight decrease from the fiscal year 
1998 appropriated level of $288.8 million. The committee 
recommends $237.2 million, a decrease of $38.0 million.
    The committee finds that the requested level of funding is 
based in large measure on optimistic planning assumptions 
regarding a number of treaties that have not yet entered into 
force, including START II, the Open Skies Treaty, and the 
Comprehensive Test Ban Treaty (CTBT). For example, according to 
the budget justification documents on which the START II budget 
request was based, ``the current EIF assumption is first/second 
quarter 1998; however, we anticipate revised planning 
assumptions will be issued in the near future which will slip 
the EIF date until the third quarter 1998.'' Because of START 
II's delayed entry into force, the additional time allowed for 
the elimination of strategic offensive arms as a result of the 
March 1997 Helsinki summit agreement, and the likely relaxation 
in the schedule of inspection activity, the committee 
recommends a reduction of $1.5 million for START II 
implementation activities.
    The Department's planning assumption regarding entry into 
force of the Open Skies Treaty also appears optimistic. 
Therefore, the committee recommends a reduction of $1.0 million 
for Open Skies Treaty implementation activities.
    In addition, the Department is still planning for entry 
into force of the CTBT sometime in fiscal year 1999. This 
assumption appears unrealistic. Forty four specific states--
including the United States--are required to ratify the treaty 
before it can enter into force. Only six of these states have 
ratified it so far. Three required ratifiers--India, Pakistan, 
and North Korea--have so far refused even to sign the treaty 
and are unlikely to do so anytime soon. For this reason, the 
committee recommends a reduction of $1.0 million in the 
operations and maintenance request to support CTBT activities.
    The budget request also contained $35.2 million for 
research, development, testing and evaluation activities to be 
conducted in support of CTBT requirements. However, a portion 
of this activity does not appear to be strictly ``research and 
development'' (R&D) type activity and may duplicate the 
activities of the U.S. Geological Survey. For these reasons, 
the committee recommends a reduction of $25.0 million for CTBT 
R&D activities and directs the Secretary of Defense to submit a 
report to the committee no later than September 30, 1998 that 
provides a detailed explanation of CTBT-related projects using 
R&D funds.
    With respect to the Chemical Weapons Convention (CWC), the 
committee disapproves of the Department's plan to reimburse the 
Organization for the Prohibition of Chemical Weapons for costs 
associated with CWC inspections of DOD facilities. Therefore, 
the committee recommends a reduction of $9.0 million for CWC 
activities.
    Finally, as many of the responsibilities for arms control 
treaty implementation transfer from existing agencies to the 
new Defense Threat Reduction Agency, the committee expects 
additional savings beyond the projected five percent 
consolidation savings and recommends an additional $0.5 million 
reduction in the general and administrative support function 
for the new agency.

 Commission to Assess the Ballistic Missile Threat to the United States

    Subtitle B of Title XIII of the National Defense 
Authorization Act for Fiscal Year 1997 (Public Law 104-201), as 
amended by section 1306 of the National Defense Authorization 
Act for Fiscal Year 1998 (Public Law 105-85), established a 
Commission to Assess the Ballistic Missile Threat to the United 
States and notes that the commission's work is proceeding in 
accordance with its legislative mandate. The committee 
anticipates receiving the commission's report, as called for in 
section 1323 of Public Law 104-201, this summer.
    The committee regrets the delay in constituting the 
commission according to the original legislation, necessitating 
an amendment last year to the original fiscal year 1997 
enabling legislation. The delay has also made it difficult for 
the results of the commission's work to be considered in this 
year's legislative cycle. The committee believes in the value 
of competitive intelligence assessments and anticipates that 
the commission's work will play a valuable role in the debate 
next year over ballistic missile defense policy. The recent 
release of a classified intelligence assessment, ``Annual 
Report to Congress on Foreign Missile Developments,'' prepared 
by the National Intelligence Council in response to a request 
from members of the Senate Select Committee on Intelligence, is 
also likely to contribute to this debate. Consequently, the 
committee encourages the Director of Central Intelligence to 
extend the security clearances of commission members and key 
staff until the end of 1999 so that they may continue to have 
access to up to date information in the event the Congress 
wishes to call on them to provide updated assessments of the 
conclusions reached in their report.

                         LEGISLATIVE PROVISIONS

 Section 1201--Limitation on Funds for Peacekeeping in the Republic of 
                         Bosnia and Hercegovina

    This section would limit the Secretary of Defense from 
expending funds appropriated to the Department of Defense for 
fiscal year 1999 in excess of $1,858.6 million for the purpose 
of providing for United States participation in Bosnia 
peacekeeping operations. The section also contains a provision 
for an emergency exception of not more than $100.0 million for 
the purpose of safeguarding United States forces in the event 
of hostilities, and requires the Secretary of Defense to submit 
a report to Congress by April 1, 1999 projecting any additional 
funds required for Bosnia operations in fiscal year 1999.

  Section 1202--Reports on the Mission of United States Forces in the 
                   Republic of Bosnia and Hercegovina

    This section would require the President to prepare a 
report on progress in tasks related to implementation of 
civilian tasks associated with the Dayton Accords. The 
committee believes that President Clinton's decision to extend 
the participation of U.S. military forces in the NATO mission 
in Bosnia has changed the character of their mission. In 
particular, the duration of the NATO mission will be measured 
by the achievement of an ``end-state''--reconstructing Bosnian 
society and political life along the guidelines established in 
Dayton--rather than as previously by an ``end-date.''
    The duration of the associated deployment of U.S. ground 
combat forces in Bosnia will be determined by the pace of 
progress in implementing these civilian tasks, which are well 
defined and understood. The report required by this section is 
based upon those measures identified by the Administration as 
appropriate for judging progress.
    In addition, the committee believes this change of mission 
will have a variety of effects upon U.S. military forces in 
Bosnia, in Europe, and around the world. Thus, this section 
also would require the Secretary of Defense to prepare a report 
on the effects of U.S. military operations in Bosnia and the 
Balkans on the ability of U.S. military forces to execute the 
missions called for in the National Military Strategy and, in 
particular, the ability to conduct successfully two nearly 
simultaneous major theater wars.
    The committee recognizes that security and stability in 
Europe constitute a vital national security interest of the 
United States. Yet the ability to successfully conduct two 
major theater wars in Southwest Asia and on the Korean 
peninsula remains the heart of U.S. national military strategy. 
The new Bosnia mission will have a substantial impact on U.S. 
forces in Europe and the entire U.S. Army, as the recent 
decision to deploy the 1st Cavalry Division to Bosnia makes 
clear. The combined effects of an open-ended mission and the 
repeat deployments, often of understrength units, will limit 
the number of Army units available to participate in a major 
theater war.
    The committee believes that this report is essential to 
measuring the true risk--measured not in dollars but in terms 
of reduced ability to respond to other crises including major 
theater wars--of repeated contingency operations in Bosnia and 
the Balkans. Without such an accounting, the complete costs of 
the Bosnia mission to U.S. national security strategy and 
interests will be elusive.

   Section 1203--Report on Military Capabilities of an Expanded NATO 
                                Alliance

    This section would require the Secretary of Defense to 
prepare a report on the planned future military capabilities of 
the North Atlantic Treaty Organization (NATO). The committee 
has found that past U.S. and NATO reports on the costs of 
alliance expansion to include Poland, Hungary, and the Czech 
Republic have been confusing and contradictory. More 
significantly, the focus of these reports on cost, though 
important, is misdirected in that these reports have not 
adequately addressed the more fundamental issue of future 
alliance military capability and requirements.
    The expansion of NATO raises a host of basic questions of 
concern to the committee, such as: What are alliance plans for 
defending the territory of the new, candidate member states, 
particularly Hungary, which is not contiguous to the current 
alliance? What abilities do the national militaries of Poland, 
the Czech Republic, and Hungary possess for their own 
territorial defense? What abilities do current alliance members 
have to project forces forward to defend new members? Can they 
sustain these forces? What additional burdens will the United 
States be required to shoulder? What are the plans of current 
and candidate members for addressing these shortfalls? Detailed 
committee inquiries on these and related questions, including a 
letter sent by the chairman and former ranking member to the 
President, have failed to provide satisfactory answers.
    The committee supports the concept of NATO expansion, 
believing that it will help preserve the current general peace 
in Europe and advance U.S. national security interests in the 
region and around the world. However, the committee is equally 
concerned that the decision to expand the alliance has been 
made without adequate discussion and debate about the 
additional military responsibilities imposed by expansion or an 
understanding of how alliance members will address these new 
responsibilities separately and collectively.

 Section 1204--One-Year Extension of Counterproliferation Authorities 
        for Support of United Nations Special Commission on Iraq

    This section would extend the authority through fiscal year 
1999 for the Department of Defense to provide support to the UN 
Special Commission on Iraq (UNSCOM) under the Weapons of Mass 
Destruction Control Act of 1992.
    The committee supports the extension of this authority 
given Iraq's continued efforts to preserve a weapons of mass 
destruction capability and its interference with the work of 
the Special Commission. The committee notes that the work of 
UNSCOM has been made more difficult as a result of the 
disruption in the weapons inspection process resulting from 
Iraq's expulsion of U.S. inspectors last year and the temporary 
suspension of the UN weapons monitoring program. This action by 
Iraq was a flagrant violation of its obligations under UN 
Security Council resolutions. While the agreement reached in 
February 1998 between Iraq and the UN Secretary General to 
allow inspections to resume under a modified inspection regime 
forestalled military action, the committee is concerned that 
the conditions attached to the agreement regarding the 
inspection of so-called presidential sites represent a retreat 
from previous UN Security Council resolutions calling for 
``immediate, unconditional and unrestricted access to any and 
all areas, facilities, equipment, records and means of 
transportation'' and may undermine the ultimate viability of 
the UNSCOM inspection regime.
    Although supportive of an extension of this authority in 
light of recent events, the committee reiterates its view that 
the costs of providing specialized support to UNSCOM should not 
be permanently borne by the Department of Defense. The 
committee notes that much of the cost of UNSCOM activities is 
funded from a portion of the revenues generated by Iraqi oil 
sales. Under UN Security Council Resolution 1153, adopted on 
February 20, 1998, the quantity of oil that Iraq is allowed to 
sell was more than doubled. Because existing oil revenues are 
sufficient to fund UNSCOM's annual operating budget, no 
additional revenues from increased oil sales are expected to 
flow to UNSCOM. However, the committee reiterates its belief 
that the Department should seek reimbursement for expenses 
incurred in providing support to UNSCOM, and encourages the 
Department to seek an agreement with the United Nations that 
would reimburse the Department for the specialized services it 
provides to UNSCOM through a portion of the increased revenues 
generated by additional Iraqi oil sales. The committee notes 
that the Department of Defense and the Department of State have 
discussed the possibility of seeking an agreement with the 
United Nations that would allow U.S. government support to be 
provided on a reimbursable basis, along the lines provided for 
by section 607 of the Foreign Assistance Act of 1961. The 
committee supports this effort and directs the Secretary of 
Defense to provide it with a report no later than September 30, 
1998 detailing the efforts being pursued by the Department to 
seek reimbursement, the specific support activities for which 
reimbursement would be sought, and the results of any 
discussions with United Nations officials on this issue.

              Section 1205--Repeal of Landmine Moratorium

    This section would repeal the one-year moratorium on the 
use by U.S. armed forces of antipersonnel landmines mandated by 
section 580 of the Foreign Operations Appropriations Act of 
1996 (Public Law 104-107).

 TITLE XIII--COOPERATIVE THREAT REDUCTION WITH STATES OF FORMER SOVIET 
                                 UNION

                                OVERVIEW

    The budget request contained $442.4 million for cooperative 
threat reduction (CTR) activities, representing an increase of 
$60.2 million over the amounts appropriated for fiscal year 
1998. The request included $9.4 million for warhead 
dismantlement processing in Russia, $10.3 million for weapons 
transportation security in Russia, and $2.0 million for 
biological weapons proliferation prevention in Russia. Funding 
for these programs was not included in last year's CTR budget 
request.
    The request also included $287.7 million for destruction 
and dismantlement, $112.9 million for fissile materials and 
nuclear weapons safety and storage, $29.8 million for reactor 
core conversion in Russia, and $12.0 million for other program 
support, including defense and military contacts.
    The committee recommends a total of $417.4 million for CTR 
activities in fiscal year 1999, a reduction of $25.0 million 
from the budget request and an increase of $35.2 million over 
the amounts appropriated for fiscal year 1998. The committee 
recommends the request of $142.4 million for strategic 
offensive arms elimination activities in Russia; $47.5 million 
for strategic nuclear arms elimination in Ukraine; $60.9 
million for a fissile material storage facility in Russia; $9.4 
million for warhead dismantlement processing in Russia; $10.3 
million for weapons transportation security in Russia; $41 
million for weapons storage security in Russia; $29.8 million 
for reactor core conversion in Russia; and $2.0 million for 
biological weapons proliferation prevention. In addition, the 
committee recommends an additional $31.4 million for strategic 
arms elimination activities in Russia and Ukraine. The 
committee recommends the following reductions to the budget 
request: $53.4 million for chemical weapons destruction; $2.0 
million for defense and military contacts; and $1.0 million for 
other program support. The discussion below provides the 
rationale for these reductions and raises other matters of 
interest and concern to the committee.

                       ITEMS OF SPECIAL INTEREST

                  Arms Elimination Projects in Russia

    The budget request contained $142.4 million for strategic 
offensive arms elimination projects in Russia, almost double 
the fiscal year 1998 appropriated amount of $77.9 million.
    The committee again emphasizes its support for the 
accelerated dismantlement and destruction of strategic 
offensive weapons in Russia under the terms of the START I 
Treaty. However, the committee is concerned over Russia's 
willingness, in the absence of U.S. funding, to eliminate 
certain strategic systems in accordance with its START I Treaty 
obligations. The committee believes that the United States 
should not have to buy Russian compliance with its arms control 
commitments.
    The committee also supports efforts to reduce Russian 
strategic offensive arms in accordance with START II 
limitations, even though Russia has still not ratified the 
treaty. The committee understands that the increased budget 
request for strategic offensive arms elimination reflects a 
greater level of activity in this area and approves the 
requested amount. However, the committee remains concerned with 
Russia's delay in ratifying START II while it continues to 
invest scarce resources in the modernization of its land- based 
and sea-based strategic missile force despite its purported 
inability to contribute financially to the strategic arms 
elimination effort. Moreover, the committee notes that the 
certification required by section 1404 of the National Defense 
Authorization Act for Fiscal Year 1998 (Public Law 105-85) with 
respect to START II Treaty-related elimination activities in 
Russia has not yet been received by the Congress. For these 
reasons, the committee recommends a provision (sec. 1307) that 
would prohibit the obligation or expenditure of fiscal year 
1999 funds for START II-related elimination activities until 
the requirements of section 1404 of Public Law 105-85 have been 
met. Because the committee believes that strategic arms 
eliminations should take priority over chemical weapons 
elimination activities, the committee also recommends that 
additional funds be directed toward strategic arms elimination 
activities in Russia in lieu of increases for chemical weapons 
destruction purposes. Specifically, the committee recommends 
that $31.4 million be allocated for additional strategic arms 
elimination activities in Russia and Ukraine, and recommends a 
provision (sec. 1310) that would prohibit the obligation or 
expenditure of these funds until 30 days after the Secretary of 
Defense has notified the congressional defense committees of 
the Department's plan for using these funds.

                  Arms Elimination Projects in Ukraine

    The budget request contained $47.5 million for strategic 
nuclear arms elimination projects in Ukraine, a reduction of 
$29.2 million from the fiscal year 1998 appropriated level. The 
committee supports this effort and approves the requested 
amount for strategic nuclear arms elimination in Ukraine. As 
noted above, the committee recommends that additional funds be 
directed toward strategic arms elimination activities in 
Ukraine in lieu of increases for chemical weapons destruction 
purposes, and recommends a provision (sec. 1310) that would 
prohibit the obligation or expenditure of these funds until 30 
days after the Secretary of Defense has notified the 
congressional defense committees of the Department's plan for 
using these funds.

         Biological Weapons Proliferation Prevention in Russia

    The budget request contained $2.0 million to initiate a new 
project that would fund collaborative research work with 
scientists currently employed at Russian institutes where 
biological weapons work has been carried out. This effort 
appears to be similar to the Department of State-funded 
scientific exchange program carried out under the auspices of 
the International Science and Technology Center (ISTC), and 
would channel DOD funds through the ISTC for this purpose.
    The committee recognizes the serious threat posed by the 
proliferation of biological weapons and the unique difficulties 
of countering that threat, given the extensive nature of the 
former Soviet Union's biological weapons activities. However, 
the committee questions whether this new project will achieve 
the desired objective and is skeptical that non-weapons-related 
work on biological toxins can be divorced from potential 
weapons applications.
    The committee notes that the Russian biological weapons 
program remains shrouded in secrecy, despite the fact that 
Russian President Yeltsin officially canceled the program in 
1992 (former Soviet President Mikhail Gorbachev also officially 
canceled it in 1990). In addition, Russia has reportedly 
refused repeated requests to allow international inspection of 
its biological weapons facilities and has rejected U.S. 
proposals to expand the coverage of a trilateral confidence-
building agreement it signed with the United States and the 
United Kingdom in 1992 to include military sites. While an 
October 1997 National Academy of Sciences report asserts that 
``by increasing linkages between the civilian and military 
sectors, transparency will increase * * *'' it also notes that 
the Russian Ministry of Defense (MOD) has been unwilling to 
participate in these collaborative efforts. The committee 
believes that no level of cooperative research will produce the 
desired level of transparency in Russia's biological weapons 
program as long as the Russian MOD continues its work in 
secrecy.
    The committee is also troubled to learn that Russian 
scientists working at the State Research Center for Applied 
Microbiology in Obolensk, one of the facilities at which pilot 
collaborative research projects have taken place and additional 
projects are planned with this funding, have developed a 
genetically-engineered strain of anthrax that is reportedly 
resistant to the anti-anthrax vaccine being administered to 
U.S. military personnel. The Russians have reportedly refused 
U.S. requests to inspect this anthrax strain.
    The committee believes that far greater transparency on 
Russia's part is essential. Without greater U.S. visibility 
into the kinds of activities Russian biological weapons 
scientists are pursuing and the relationship of these 
activities to actual weapons development, collaborative efforts 
to channel Russian scientific activity into more peaceful 
pursuits may produce the opposite result from that intended. 
The committee notes the statement earlier this year of Ken 
Alibek, the former First Deputy Director of the Soviet Union's 
main biological weapons directorate: ``Unfortunately, until 
Russia opens its military biological weapons sites. to full-
scale inspections, as the United States did many years ago, 
such cooperation is not only senseless, but also dangerous.''
    Accordingly, the committee recommends a provision (sec. 
1309) that would prohibit the obligation of expenditure of 
fiscal year 1999 CTR funds on this project until 15 days after 
the Secretary of Defense has certified to Congress that CTR 
funds have not been used to support activities that have 
resulted in the development by Russia of new strains of anthrax 
and has notified the congressional defense committees that the 
United States has inspected and tested the new anthrax strain 
developed at the aforementioned Obolensk institute. In 
addition, the committee recommends a provision (sec. 1308) that 
would require the Secretary of Defense to submit a report to 
Congress by no later than December 31, 1998 detailing Russia's 
activity in the biological weapons area, outlining the security 
benefits expected to accrue to the United States through 
collaborative biological programs with Russia, and detailing 
the effect previous pilot projects have had in increasing 
transparency in Russia's biological weapons program.

                 Chemical Weapons Destruction in Russia

    The budget request contained $88.4 million for chemical 
weapon destruction activities in Russia, including funding for 
construction activities and procurement of equipment for a 
chemical weapons destruction facility to be built near 
Shchuch'ye, Russia. This represents a nearly 150 percent 
increase over the fiscal year 1998 appropriated level for this 
particular project.
    The committee has a number of continuing concerns about 
this project. Unlike strategic nuclear weapons and long-range 
ballistic missiles, which pose a direct threat to U.S. 
security, the Russian chemical weapons stockpile poses more of 
a local environmental threat than it does a security threat to 
Americans.
    According to the Department, the ultimate cost of this 
project may be as much as $800.0 million. Moreover, the 
committee is concerned with Russia's ability to absorb its 
share of the costs associated with chemical weapons 
destruction, a situation which the Department acknowledges 
``remains problematic.'' The costs of destroying Russia's 
40,000 tons of declared chemical weapons agents has been 
estimated at between roughly $5.0 billion and $10.0 billion. 
Although Russia budgeted a modest amount--approximately $24.0 
million--for this activity in fiscal year 1997, only about one-
third of these funds were actually made available. For fiscal 
year 1998, Russia has budgeted approximately $85.0 million for 
chemical weapons destruction activities. However, it is again 
unlikely that all of these resources will be made available to 
support work on this project, as the focus of Russia's chemical 
weapons destruction efforts involves activities at other 
chemical weapons sites. In the words of one CTR official, 
``Shchuch'ye is not their top priority.''
    While the committee believes that initial CTR expenditures 
on this project indirectly contributed to U.S. security by 
funding research and development of the two-stage 
neutralization process for demilitarizing chemical agents, the 
development of that neutralization technology was essentially 
completed last year. The project is now transitioning to the 
construction of the Shchuch'ye facility, which raises the 
broader concerns discussed above. Despite the fact that a final 
site for construction has yet to be chosen, more than one-half 
of the CTR budget request for chemical weapons destruction for 
fiscal year 1999 is to fund preliminary construction work at 
Shchuch'ye.
    The committee notes that sections 1405 and 1406 of the 
National Defense Authorization Act for Fiscal Year 1998 (Public 
Law 105-85) required that notifications and certifications be 
sent to Congress regarding Russia's political and financial 
commitment to chemical weapons destruction prior to the 
obligation or expenditure of fiscal year 1998 funds on this 
project. These notifications and certifications have not yet 
been received and no fiscal year 1998 funds have yet been 
obligated. Consequently, the committee recommends a provision 
(sec. 1307) that would prohibit the obligation or expenditure 
of fiscal year 1999 funds for chemical weapons destruction 
purposes until the requirements of sections 1405 and 1406 of 
Public Law 105-85 are met. In addition, because of the concerns 
expressed above, the committee denies the request for 
$53.4million in construction funds for this project and recommends a 
provision (sec. 1304) that would prohibit the obligation or expenditure 
of any fiscal year 1999 or prior year CTR funds for construction of a 
chemical weapons destruction facility in Russia. As previously noted, 
the committee believes that additional CTR funds can more productively 
be used for strategic arms elimination projects in Russia and Ukraine 
rather than for chemical weapons destruction purposes.

                   Fissile Material Storage Facility

    The budget request contained $60.9 million for equipment 
and construction of a fissile material storage facility in 
Russia to house materials from dismantled strategic nuclear 
weapons. This is a modest increase from the $57.7 million 
appropriated for fiscal year 1998. The committee reiterates its 
support for efforts to ensure the safe and secure storage of 
fissile materials in Russia and approves the requested amount 
for this project.
    Nevertheless, the committee continues to be concerned over 
the total cost of the facility and the U.S. share, which the 
Department has indicated will be capped at $275.0 million. The 
committee also remains concerned over the lack of a 
transparency agreement with Russia that would ensure the 
facility is in fact being used for its intended purpose and 
that materials stored there are not capable of being used in 
the construction of additional weapons. Section 1407 of the 
National Defense Authorization Act for Fiscal Year 1998 (Public 
Law 105-85) requires the Secretary of Defense to notify 
Congress that cost-sharing and transparency agreements have 
been reached prior to the obligation or expenditure of fiscal 
year 1998 funds. That certification has not yet been received 
and no fiscal year 1998 funds have been obligated. 
Consequently, the committee recommends a provision (sec. 1307) 
that would prohibit the obligation or expenditure of fiscal 
year 1999 funds for this purpose until 15 days after the 
notification required by section 1407 of Public Law 105-85 has 
been received.
    The committee is also concerned by recent Russian press 
reports indicating that the State Committee on the Environment 
ordered a halt to construction of the fissile material storage 
facility on March 27, 1998 on the grounds that the necessary 
environmental impact study was not conducted. A halt in 
construction would likely impact the funding and schedule for 
completion of the project and raise questions about the 
Department's ability to execute its plans with the requested 
level of funding. The Russian Ministry of Atomic Energy has 
reportedly asserted that this situation developed as a 
consequence of the lack of Russian government funding for the 
project. Therefore, the committee directs the Secretary of 
Defense to submit a report to the congressional defense 
committees not later than December 31, 1998 on how this issue 
is being addressed by U.S. and Russian authorities and what 
impact it will have on project completion and cost.

                    Nuclear Reactor Core Conversion

    The budget request included $29.8 million for nuclear 
reactor core conversion projects in Russia to support the goal 
of eliminating Russian plutonium production by 2000. This is a 
reduction from the $41.0 million appropriated for fiscal year 
1998 and, according to the Department, represents the last 
fiscal year they intend to request CTR funds for this project.
    The committee supports this objective, but continues to 
believe that this activity is more appropriately the 
responsibility of the Department of Energy, which initially 
began this project and is primarily responsible for its 
execution. The committee approves the requested amount for this 
project.

           Nuclear Warhead Dismantlement Processing in Russia

    The budget request contained $9.4 million to initiate a 
project that would assist Russia in processing the fissile 
components of dismantled nuclear warheads for long-term 
storage. The committee understands that this project was 
considered as a result of Russia's July 1997 request for U.S. 
assistance. The committee supports this effort, which is 
consistent with the core objectives of the CTR program, and 
approves the requested amount for this purpose.

               Nuclear Weapons Storage Security in Russia

    The budget request included $41.7 million for nuclear 
weapons storage security activities in Russia, a $5.7 million 
increase over the amount appropriated for fiscal year 1998.
    The committee reiterates its support for efforts to ensure 
the safe and secure storage of fissile materials. The committee 
also notes the establishment in February 1998 of a Security 
Assessment and Training Center in Sergiev Possad that, 
according to the Department of Defense, is intended to serve as 
a testing and evaluation facility for ``advanced security 
protection technologies and procedures.''
    Last year, the committee noted its concern over Russia's 
unwillingness to allow the United States access to certain 
weapons storage sites, raising questions regarding the use of 
CTR-provided equipment. Consequently, section 1408 of the 
National Defense Authorization Act for Fiscal Year 1998 (Public 
Law 105-85) required the Secretary of Defense to submit to 
Congress a report ``on the status of negotiations between the 
United States and Russia on audits and examinations with 
respect to weapons storage security'' prior to the obligation 
or expenditure of fiscal year 1998 funds. Although the 
committee has been informed that audit and examination issues 
have been resolved, the report required by section 1408 of 
Public Law 105-85 has not been received and no fiscal year 1998 
funds have yet been obligated. Therefore, the committee 
recommends a provision (sec. 1307) that would prohibit the 
obligation or expenditure of fiscal year 1999 funds for weapons 
storage security purposes in Russia until the reporting 
requirements noted above have been met.

                Nuclear Weapons Transportation Security

    The budget request contained $10.3 million for nuclear 
weapons transportation security in Russia. No funds were 
requested for this activity for fiscal year 1998. The bulk of 
the requested fiscal year 1999 funds would be used to pay the 
costs of railtransportation of nuclear weapons from operational 
deployment sites to storage facilities, a cost that has, to date, been 
borne by the Russian Ministry of Defense (MOD). However, the Russian 
MOD has informed the United States that it can no longer afford to pay 
these transportation costs. Consequently, the Department of Defense is 
proposing to fund this effort.
    The committee supports continuing with the nuclear weapons 
elimination process and the transportation of nuclear weapons 
safely and securely as part of that process. Consequently, the 
committee approves the requested amount for this purpose. 
However, the committee emphasizes that its support for this 
funding for fiscal year 1999 should not be interpreted by 
Russia as an open-ended willingness on the part of the United 
States to pay any and all future expenses associated with 
weapons elimination for which the Russians decide they will no 
longer pay. In addition, the committee encourages the 
Department to work with Russia toward a prompt resolution of 
this issue in a manner that will alleviate the need for future 
U.S. funding for this purpose.

                         Other Support Programs

    The budget request contained $2.0 million for defense and 
military contacts with the states of the former Soviet Union, 
an amount that is significantly less than previous requests as 
a result of a backlog of unobligated prior-year balances. The 
committee does not support the Department's request for an 
additional $2.0 million for fiscal year 1999 when more than 
$25.0 million in unobligated prior year funds remain available 
for this purpose. Consequently, the committee denies this 
request.

                            Program Overhead

    The budget request contained $8.0 million for management 
and administrative costs, project development, and audits and 
examinations, a reduction from the $20.5 million appropriated 
for fiscal year 1998. As the Department has noted, this 
reduction is made possible as a result of funds appropriated in 
prior years in excess of requirements. Indeed, a significant 
portion of prior-year appropriated funds were used from this 
account last year to help fund the purchase of MiG aircraft 
from Moldova.
    While the committee welcomes the Department's admission 
that prior-year requests exceeded requirements, the committee 
also believes that additional efficiencies and savings are 
possible in this account as a result of the consolidation of 
much of the CTR program within the proposed Defense Threat 
Reduction Agency (DTRA), scheduled to stand up on October 1, 
1998. As the consolidated DTRA budget request for fiscal year 
1999 does not reflect all of the management savings that the 
Department acknowledges are likely to be achieved as a result 
of the consolidation of various agencies into the DTRA, the 
committee recommends a reduction in the budget request of $1.0 
million for this purpose. The committee intends that this 
reduction not impact the number, frequency, or thoroughness of 
audits conducted.

                  Prohibition of Specified Activities

    The committee reiterates its belief that funding for CTR 
activities should be directed toward facilitating the safe 
transportation, storage, and elimination of weapons of mass 
destruction, their delivery vehicles, and components, and for 
programs and activities to prevent proliferation. The committee 
has an established record of not supporting CTR funding for 
activities outside these basic purposes.
    In this regard, the committee is troubled by the 
Department's often broad interpretation of what constitutes a 
duly authorized nonproliferation program eligible for CTR 
funding. Specifically, the committee notes the Department's use 
of CTR funds last year to purchase from Moldova MiG-29 aircraft 
sought by Iran. The Department contends that it has the legal 
authority under CTR legislation to fund ``preemptive 
acquisition'' programs involving any former Soviet weapons, 
including conventional arms, although it acknowledges that ``as 
a matter of policy--and consistent with congressional 
preference--CTR programs have addressed exclusively nuclear, 
chemical and biological weapons of mass destruction, and 
related delivery vehicles, materials and expertise.'' The 
committee does not challenge the wisdom or desirability of 
acquiring from foreign suppliers sophisticated conventional 
weaponry or delivery systems as a means of preventing their 
proliferation. However, since, for example, all tactical 
aircraft have an inherent capability to deliver weapons of mass 
destruction, the committee does not understand where the 
Department draws the line in cases of using CTR funds for the 
``preemptive acquisition'' of items for nonproliferation 
purposes. Therefore, the committee encourages the Secretary of 
Defense to work with the Secretary of State, the Secretary of 
Energy, and other appropriate U.S. government officials 
involved in nonproliferation policy to identify appropriate 
options for addressing and funding such non-proliferation 
initiatives in the future.
    For these reasons, the committee recommends a provision 
(sec. 1303) that would maintain a prohibition on the use of CTR 
funds for peacekeeping-related activities, housing, 
environmental restoration, job retraining, and defense 
conversion. The committee also recommends a provision (sec. 
1305) that would clarify the definition of CTR programs.

                         LEGISLATIVE PROVISIONS

 Section 1301--Specification of Cooperative Threat Reduction Programs 
                               and Funds

    This section would specify the kinds of programs to be 
funded under this title.

                   Section 1302--Funding Allocations

    This section would allocate fiscal year 1999 funding for 
various CTR purposes and activities.

    Section 1303--Prohibition on Use of Funds for Specified Purposes

    This section would prohibit the use of CTR funds for 
specified activities, including peacekeeping-related, housing, 
environmental restoration, job retraining, and defense 
conversion purposes.

     Section 1304--Limitation on Use of Funds for Chemical Weapons 
                          Destruction Facility

    This section would prohibit the obligation or expenditure 
of fiscal year 1999 or prior year funds for the construction of 
a chemical weapons destruction facility in Russia.

 Section 1305--Limitation on Obligation of Funds for a Specified Period

    This section would amend title 10, United States Code to 
limit the use of all appropriated funds for CTR purposes to a 
period of three years. It would also clarify the definition of 
CTR programs.

 Section 1306--Requirement to Submit Breakdown of Amounts Requested by 
                            Project Category

    This section would require the Secretary of Defense to 
submit, within 30 days of the President's annual budget 
submission, a detailed breakdown of requested funding by CTR 
project category and a comparison of that request with the 
previous fiscal year's allocations.

  Section 1307--Limitation on Use of Funds Until Completion of Fiscal 
                         Year 1998 Requirements

    This section would prohibit the obligation or expenditure 
of funds for various CTR projects until the requirements 
established by the National Defense Authorization Act for 
Fiscal Year 1998 (Public Law 105-85) are met.

     Section 1308--Report on Biological Weapons Programs in Russia

    This section would require the Secretary of Defense to 
submit to the congressional defense committees not later than 
December 31, 1998 a detailed report on Russia's biological 
weapons program, Russia's compliance with international 
agreements relating to the control of biological weapons, and 
the political and military utility of collaborative U.S.-Russia 
biological research programs.

    Section 1309--Limitation on Use of Funds for Biological Weapons 
             Proliferation Prevention Activities in Russia

    This section would prohibit the obligation or expenditure 
of funds on biological weapons proliferation prevention 
programs in Russia until 15 days after the Secretary of Defense 
certifies that CTR funds have not been used for illegitimate 
purposes and notifies the congressional defense committees that 
the United States has inspected the new strain of anthrax 
developed in Russia.

  Section 1310--Limitation on Use of Certain Funds for Strategic Arms 
                    Elimination in Russia or Ukraine

    This section would prohibit the obligation or expenditure 
of certain funds for strategic arms elimination purposes in 
Russia and Ukraine until 30 days after the Secretary of Defense 
submits to the congressional defense committees notification on 
how these funds are to be used.

                  Section 1311--Availability of Funds

    This section would make fiscal year 1999 CTR funds 
available for obligation for three years.
            DIVISION B--MILITARY CONSTRUCTION AUTHORIZATIONS

                                PURPOSE

    The purpose of Division B is to provide military 
construction authorizations and related authority in support of 
the military departments during fiscal year 1999. As approved 
by the committee, Division B would authorize appropriations in 
the amount of $8,228,074,000 for construction in support of the 
active forces, reserve components, defense agencies for fiscal 
year 1999.

                     MILITARY CONSTRUCTION OVERVIEW

    The military construction authorization request for fiscal 
year 1999 was introduced by request as H.R. 3695 on April 21, 
1998.
    The Department of Defense requested authorization of 
appropriations of $4,300,744,000 for fiscal year 1999 for 
military construction, including $1,730,704,000 for activities 
associated with base closure and realignment, and 
$3,477,330,000 for family housing construction and support. The 
committee recommends $4,721,521,000 for military construction, 
including $1,730,704,000 for activities associated with base 
closure and realignment, and $3,506,553,000 for family housing 
construction and support for fiscal year 1999.
    The committee restates its serious concern about the 
condition of the Nation's military installations and facilities 
and continues to be troubled by the continuing and persistent 
underinvestment by the Administration in military facilities 
and infrastructure. The budget request for the military 
construction and military family housing programs of the 
Department of Defense (DOD) represents a 15 percent reduction 
from current spending levels, a seven percent reduction from 
the budget submission for fiscal year 1998, and a four percent 
reduction from the budget estimates for the coming fiscal year 
presented to Congress one year ago. If enacted, the 
Administration's program would represent a 30 percent reduction 
in funding for basic construction requirements and facilities 
upgrades than the program authorized by Congress for fiscal 
year 1996. The committee notes that the service chiefs have 
identified a shortfall over of $7.6 billion in military 
construction and military family housing funding within the 
current Future Years Defense Program.
     The effects of sustained and structural inattention by DOD 
and the military departments to basic infrastructure are 
apparent on nearly every military installation. The committee 
has noted on prior occasions the findings of the Defense 
Science Board Task Force on Quality of Life which reported that 
62 percent of barracks and dormitories are unsuitable and 64 
percent of military family housing units are in a similar 
condition. Likewise, the committee has noted on prior occasions 
the effects of underfunding for military construction on 
facilities which support the training and readiness of the 
active and reserve components. While the committee notes the 
progress of the military departments in addressing a select 
group of facilities problems, such as the implementation of an 
improved standard for permanent party troop housing 
construction and the modernization of infrastructure to support 
strategic mobility, the committee regrets the lack of 
comprehensive, long-term, and sustainable facilities 
modernization planning by DOD and the military departments.
    In an effort to improve the quality of life for military 
personnel and their families, the committee reiterates its 
support for the authorities provided in subchapter IV, chapter 
169 of title 10, United States Code. The Military Housing 
Privatization Initiative remains a central component of the 
ultimate resolution of the military housing crisis. The 
committee, however, reiterates its view that the Initiative 
should not be viewed by the military departments as a 
substitute for military family housing construction projects 
where those projects are necessary to alleviate immediate 
housing problems or in those locations where the privatization 
initiative is not economically or otherwise feasible. The 
committee urges the Department to ensure that the military 
departments provide a sustained level of investment in military 
family housing construction that will permit the resolution of 
the military housing crisis within the next decade. The 
committee further urges the Department to ensure the timely 
execution of military family housing construction projects 
authorized by Congress in prior years.
    To alleviate some of the facilities shortfall, the 
committee recommends an increase in new budget authority for 
these programs of $450,000,000.
    A tabular summary of the authorizations provided in 
Division B for fiscal year 1999 follows:
<GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT>

    A tabular summary of the military construction projects 
included with the authorization of appropriations for fiscal 
year 1999 for the BRAC III and BRAC IV accounts follows:
<GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT>


                            TITLE XXI--ARMY

                                SUMMARY

     The budget request contained $790,876,000 for Army 
military construction and $1,220,973,000 for family housing for 
fiscal year 1999. The committee recommends authorization of 
$780,599,000 for military construction and $1,229,437,000 for 
family housing for fiscal year 1999.

                       ITEMS OF SPECIAL INTEREST

                Improvements of Military Family Housing

    The committee recommends that, within authorized amounts 
for improvements of military family housing and facilities, the 
Secretary of the Army execute the following project: $8,800,000 
for Whole Neighborhood Revitalization, Phase II (104 units) at 
Fort Campbell, Kentucky.

                         LEGISLATIVE PROVISIONS

    Section 2101--Authorized Army Construction and Land Acquisition 
                                Projects

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

                      Section 2102--Family Housing

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

      Section 2103--Improvements to Military Family Housing Units

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

          Section 2104--Authorization of Appropriations, Army

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

 Section 2105--Increase in Fiscal Year 1998 Authorization for Military 
  Construction Project at Fort Drum, New York, and Fort Sill, Oklahoma

    This section would amend the table in section 2101 of the 
Military Construction Authorization Act for Fiscal Year 1998 
(division B of Public Law 105-85) to provide for an increase in 
the amount authorized for the construction of an aerial gunnery 
range at Fort Drum, New York, and a barracks at Fort Sill, 
Oklahoma.

                            TITLE XXII--NAVY

                                SUMMARY

    The budget request contained $468,150,000 for Navy military 
construction and $1,196,083,000 for family housing for fiscal 
year 1999. The committee recommends authorization of 
$570,643,000 for military construction and $1,206,083,000 for 
family housing for fiscal year 1999.

                       ITEMS OF SPECIAL INTEREST

Condition of Laboratory Facilities, Naval Air Warfare Center, Aircraft 
                    Division, Lakehurst, New Jersey

    The committee notes the continuing importance to the safety 
and efficiency of carrier-based naval aviation of advancements 
in aircraft/platform interface systems and equipment. The 
committee is concerned that current engineering and testing 
facilities at Naval Air Warfare Center, Aircraft Division, 
Lakehurst, New Jersey, are inadequate to the requirements 
imposed by advances in technology and the tolerances demanded 
by contemporary equipment and is further concerned about the 
serious safety deficiencies present in the current facility. 
The committee understands that funding for a military 
construction project to provide for needed laboratory and other 
facilities upgrades is currently programmed within the Future 
Years Defense Program of the Department of the Navy. The 
committee supports the funding for planning and design for this 
facility included in the budget request for fiscal year 1999 
and further urges the Secretary of the Navy to make every 
effort to include this construction requirement in the fiscal 
year 2000 budget request.

                         LEGISLATIVE PROVISIONS

    Section 2201--Authorized Navy Construction and Land Acquisition 
                                Projects

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

                      Section 2202--Family Housing

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

      Section 2203--Improvements to Military Family Housing Units

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

          Section 2204--Authorization of Appropriations, Navy

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

Section 2205--Authorization to Accept Road Construction Project, Marine 
                Corps Base, Camp Lejeune, North Carolina

    This section would authorize the Secretary of the Navy to 
accept a road construction project valued at $2,000,000 from 
the State of North Carolina at Marine Corps Base, Camp Lejeune, 
North Carolina.

                         TITLE XXIII--AIR FORCE

                                SUMMARY

    The budget request contained $454,810,000 for Air Force 
military construction and $1,016,030,000 for family housing for 
fiscal year 1999. The committee recommends authorization of 
$550,475,000 for military construction and $1,026,789,000 for 
family housing for fiscal year 1999.

                         LEGISLATIVE PROVISIONS

  Section 2301-Authorized Air Force Construction and Land Acquisition 
                                Projects

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

                      Section 2302--Family Housing

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

      Section 2303--Improvements to Military Family Housing Units

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

        Section 2304--Authorization of Appropriations, Air Force

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

                      TITLE XXIV--DEFENSE AGENCIES

                                SUMMARY

    The budget request contained $491,675,000 for defense 
agencies military construction, $1,730,704,000 for base closure 
and realignment activities, and $44,244,000 for family housing 
for fiscal year 1999. The committee recommends authorization of 
$611,075,000 for military construction, $1,730,704,000 for base 
realignment and closure activities, and $44,244,000 for family 
housing.

                        ITEM OF SPECIAL INTEREST

             Department of Defense Education Activity, Guam

    The committee recognizes the decision by the Secretary of 
Defense to establish a system of Department of Defense 
Dependents Schools (DODDS) in Guam. The committee acknowledges 
the inadequate conditions of facilities currently being 
utilized for educational purposes which were not designed for 
that purpose. The committee supports the $13,200,000 contained 
in the budget request for military construction projects to 
provide facilities for the elementary and secondary education 
needs of the dependents of U.S. military personnel stationed in 
Guam. The committee also acknowledges questions raised by 
representatives of the Government of Guam about the basis for 
the decision to establish DODDS schools in Guam. The committee 
directs the Secretary of Defense to report on the Department's 
findings which led to the decision to establish DODDS schools 
in Guam, the prospects and conditions for reintegration of the 
educational system, and to identify any additional military 
construction requirements associated with the establishment of 
a DODDS system in Guam. The Secretary shall submit a report on 
the Department's findings to the congressional defense 
committees by December 1, 1998.

                         LEGISLATIVE PROVISIONS

    Section 2401--Authorized Defense Agencies Construction and Land 
                          Acquisition Projects

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

      Section 2402--Improvements to Military Family Housing Units

    This section would authorize the Secretary of Defense to 
make improvements to existing units of family housing for 
fiscal year 1999 in an amount not to exceed $345,000.

               Section 2403--Energy Conservation Projects

    This section would authorize the Secretary of Defense to 
carry out energy conservation projects.

    Section 2404--Authorization of Appropriations, Defense Agencies

    This section would authorize specific appropriations for 
each line item in the Defense Agencies' budget for fiscal year 
1998. This section would also provide an overall limit on the 
amount the Defense Agencies may spend on military construction 
projects.

 Section 2405--Increase in Fiscal Year 1995 Authorization for Military 
  Construction Projects at Pine Bluff Arsenal, Arkansas, and Umatilla 
                           Army Depot, Oregon

    This section would amend the table in section 2401 of the 
Military Construction Authorization Act for Fiscal Year 1995 
(division B of Public Law 103-337), as amended, to provide for 
an increase in the amount authorized for military construction 
projects to support chemical weapons and munitions destruction 
at Pine Bluff Arsenal, Arkansas, and Umatilla Army Depot, 
Oregon.

 Section 2406-Increase in Fiscal Year 1990 Authorization for Military 
      Construction Project at Portsmouth Naval Hospital, Virginia

    This section would amend the table in section 2401 of the 
Military Construction Authorization Act for Fiscal Years 1990 
and 1991 (division B of Public Law 100-189) to provide for an 
increase in the amount authorized for the construction of a 
replacement hospital at Portsmouth Naval Hospital, Virginia.

      TITLE XXV--NORTH ATLANTIC TREATY ORGANIZATION INFRASTRUCTURE

                                SUMMARY

    The budget request contained $185,000,000 for the NATO 
infrastructure fund (NATO Security Investment Program) for 
fiscal year 1999. The committee recommends $169,000,000.

                         LEGISLATIVE PROVISIONS

    Section 2501--Authorized NATO Construction and Land Acquisition 
                                Projects

    This section would authorize the Secretary of Defense to 
make contributions to the North Atlantic Treaty Organization 
security investment program in an amount equal to the sum of 
the amount specifically authorized in section 2502 of this bill 
and the amount of recoupment due to the United States for 
construction previously financed by the United States.

          Section 2502--Authorization of Appropriations, NATO

    This section would authorize appropriations of $169,000,000 
as the U.S. contribution to the NATO security investment 
program.

            TITLE XXVI--GUARD AND RESERVE FORCES FACILITIES

                                SUMMARY

    The budget request contained $179,529,000 for fiscal year 
1999 for guard and reserve facilities. The committee recommends 
authorization for fiscal year 1999 of $321,739,000 to be 
distributed as follows:

Army National Guard.....................................     $70,338,000
Air National Guard......................................      97,701,000
Army Reserve............................................      84,608,000
Air Force Reserve.......................................      35,371,000
Naval and Marine Corps Reserve..........................      33,721,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................     321,739,000

                         LEGISLATIVE PROVISIONS

   Section 2601--Authorized Guard and Reserve Construction and Land 
                          Acquisition Projects

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

 Section 2602--Army Reserve Construction Project, Salt Lake City, Utah

    This section would authorize the Secretary of the Army to 
accept financial or in-kind contributions from the State of 
Utah in connection with the construction of a reserve center 

and organizational maintenance shop in Salt Lake City, Utah. 
This section would also terminate the authorization for a 
similar military construction project at Camp Williams, Utah, 
authorized in section 2601 of the Military Construction 
Authorization Act for Fiscal Year 1998 (division B of Public 
Law 105-85).

        TITLE XXVII--EXPIRATION AND EXTENSION OF AUTHORIZATIONS

                         LEGISLATIVE PROVISIONS

 Section 2701--Expiration of Authorizations and Amounts Required to be 
                            Specified by Law

    This section would provide that authorizations for military 
construction projects, repair of real property, land 
acquisition, family housing projects and facilities, 
contributions to the North Atlantic Treaty Organization 
infrastructure program, and guard and reserve projects will 
expire on October 1, 2001 or the date of enactment of an Act 
authorizing funds for military construction for fiscal year 
2002, whichever is later. This expiration would not apply to 
authorizations for which appropriated funds have been obligated 
before October 1, 2001 or the date of enactment of an Act 
authorizing funds for these projects, whichever is later.

Section 2702--Extensions of Authorizations of Certain Fiscal Year 1996 
                                Projects

    This section would provide for selected extension of 
certain fiscal year 1996 military construction authorizations 
until October 1, 1999, or the date of the enactment of an Act 
authorizing funds for military construction for fiscal year 
2000, whichever is later.

 Section 2703--Extension of Authorizations of Certain Fiscal Year 1995 
                                Projects

    This section would provide for selected extension of 
certain fiscal year 1995 military construction authorizations 
until October 1, 1999, or the date of the enactment of the Act 
authorizing funds for military construction for fiscal year 
2000, whichever is later.

                      Section 2704--Effective Date

    This section would provide that Titles XXI, XXII, XXIII, 
XXIV, and XXVI of this bill shall take effect on October 1, 
1998, or the date of the enactment of this Act, whichever is 
later.

                    TITLE XXVIII--GENERAL PROVISIONS

                       ITEMS OF SPECIAL INTEREST

   Incorporation of Energy Conservation Criteria in the Planning and 
                          Design of Facilities

    The committee notes a recent report conducted by the 
Inspector General of the Department of Defense concerning the 
inadequacies in the Department's performance measurements in 
reaching targets for energy conservation in the planning and 
design of new facilities. The committee directs the Secretary 
of Defense to issue guidance to the military departments to re-
emphasize existing design requirements to perform energy 
studies and life-cycle cost analyses in the development of new 
facilities. The committee further directs the Secretary, in 
consultation with the secretaries of the military departments, 
to establish a system to validate the accuracy of design energy 
targets. The committee further directs the Secretary and the 
secretaries of the military departments to indicate as part of 
the budget justification for specific new military construction 
projects whether an energy study and a life-cycle cost analysis 
was performed in support of the design of proposed new 
facilities.

        Military Family Housing Referral and Set-Aside Programs

    The committee continues to be seriously concerned about the 
condition and adequacy of military housing. In addition to the 
military housing privatization program, the committee 
encourages the military departments to accelerate the 
development of referral and set-aside arrangements with local 
housing interests in the private sector. The committee notes 
the success of such arrangements at a number of military 
installations, particularly those of the Marine Corps. The 
committee believes such arrangements may work effectively on a 
broader basis at little cost to the military departments. The 
committee notes, however, that the military departments have 
not made a serious effort to expand existing programs or to 
coordinate programs jointly at locations containing a number of 
military installations. The committee directs the Secretary of 
Defense, in coordination with the secretaries of the military 
departments, to conduct a study on the effectiveness of 
referral and set-aside arrangements in addressing military 
housing shortfalls, including a detailed list of installations 
where such arrangements are in use and the number of units 
provided under such arrangements. The committee further directs 
the Secretary to submit a report on the Department's findings, 
including any recommendations, to the congressional defense 
committees by March 1, 1999.

                         LEGISLATIVE PROVISIONS

 Subtitle A--Military Construction Program and Military Family Housing 
                                Changes

 Section 2801--Definition of Ancillary Supporting Facilities under the 
   Alternative Authority for Acquisition and Improvement of Military 
                                Housing

    This section would amend section 2871 of title 10, United 
States Code, to clarify that the development of ancillary 
supporting facilities in military housing projects undertaken 
under the authority of subchapter IV, chapter 169 of title 10, 
United States Code, may include the development of educational 
facilities to support the needs of dependents of military 
personnel. The committee encourages the military departments, 
where economically feasible and without a significant effect on 
the number of housing units to be provided, to incorporate 
plans for the development of dependent educational facilities 
into future requests for proposals for the development of 
military family housing, particularly in those instances where 
the development is intended to address comprehensively the 
housing requirements at a military installation.

        Subtitle B--Real Property and Facilities Administration

   Section 2811--Restoration of Department of Defense Lands Used by 
                         Another Federal Agency

    This section would amend section 2662 of title 10, United 
States Code, to provide the authority for the secretary of a 
military department to require, as a condition of a lease, 
permit, license, or other grant of access to lands under the 
control of the secretary to another federal agency, the removal 
of any improvements or the taking of any corrective action 
necessary to restore the land used by another federal agency to 
the condition the land was in prior to such use.

Section 2812--Outdoor Recreation Development on Military Installations 
for Disabled Veterans, Military Dependents with Disabilities, and Other 
                       Persons with Disabilities

    This section would amend section 103 of the Sikes Act to 
ensure, to the maximum extent practicable, that opportunities 
for outdoor recreation on military installations would be 
equally available, without substantial modification of the 
natural environment, to disabled veterans, military dependents 
with disabilities, and other persons with disabilities.

   Section 2813--Report on Use of Utility System Conveyance Authority

    This section would require the secretary of each military 
department to submit to Congress not later than March 1, 1999, 
a report describing the criteria to be used by the secretary in 
the selection of utility systems and related real property for 
conveyance pursuant to the authority provided by section 2688 
of title 10, United States Code, a description of the manner in 
which the secretary will ensure that any such conveyance would 
not adversely affect the national security of the United 
States, and a list of utility systems which are likely to be 
conveyed.

            Subtitle C--Defense Base Closure and Realignment

   Section 2821--Payment of Stipulated Penalties Assessed under the 
 Comprehensive Environmental Response, Compensation, and Liability Act 
    of 1980 in Connection with McClellan Air Force Base, California

    This section would authorize payments from the base closure 
and realignment accounts for stipulated penalties assessed 
under the Comprehensive Environmental Response, Compensation, 
and Liability Act of 1980 (CERCLA) in connection with the 
closure of McClellan Air Force Base, California. The committee 
wishes to make clear that this provision shall not result in 
any limitation on the ability of the Secretary of Defense to 
pay CERCLA stipulated penalties from non-Base Realignment and 
Closure (BRAC) accounts.

  Section 2822--Elimination of Waiver Authority Regarding Prohibition 
 Against Certain Conveyances of Property at Naval Station, Long Beach, 
                               California

    This section would amend section 2826 of the Military 
Construction Authorization Act for Fiscal Year 1998 (division B 
of Public Law 105-85) to eliminate the authority of the 
President to wave the prohibition against the direct or 
indirect conveyance, by sale, lease, or other method, of real 
property at the former Naval Station, Long Beach, California, 
under the authority provided by the Defense Base Closure and 
Realignment Act of 1990 (part A of title XXIX of Public Law 
101-510) to the China Ocean Shipping Company or any successor 
of that company.

                      Subtitle D--Land Conveyances

                        Part I--Army Conveyances

 Section 2831--Land Conveyance, Army Reserve Center, Massena, New York

    This section would authorize the Secretary of the Army to 
convey, without consideration, a parcel of real property with 
improvements in Massena, New York, to the Village of Massena. 
The property is to be used for recreational, educational, or 
other public purposes. The cost of any surveys necessary for 
the conveyance would be borne by the Village.

  Section 2832--Land Conveyance, Army Reserve Center, Ogdensberg, New 
                                  York

    This section would authorize the Secretary of the Army to 
convey, without consideration, a parcel of real property with 
improvements in Ogdensberg, New York, to the Town of 
Ogdensberg. The property is to be used for recreational, 
educational, or other public purposes. The cost of any surveys 
necessary for the conveyance would be borne by the Town.

  Section 2833--Land Conveyance, Army Reserve Center, Jamestown, Ohio

    This section would authorize the Secretary of the Army to 
convey, without consideration, a parcel of real property with 
improvements in Jamestown, Ohio, to the Greeneview Local School 
District. The property is to be used for educational purposes. 
The cost of any surveys necessary for the conveyance would be 
borne by the District.

Section 2834--Land Conveyance, Stewart Army Sub-Post, New Windsor, New 
                                  York

    This section would authorize the Secretary of the Army to 
convey, without consideration, a parcel of real property with 
improvements, consisting of approximately 391 acres, to the 
Town of New Windsor, New York. The property is to be used for 
economic development purposes. The cost of any surveys 
necessary for the conveyance would be borne by the Town.

     Section 2835--Land Conveyance, Indiana Army Ammunition Plant, 
                          Charlestown, Indiana

    This section would authorize the Secretary of the Army to 
convey a parcel of real property with improvements, consisting 
of approximately 4,660 acres at the Indiana Army Ammunition 
Plant, Charlestown, Indiana, to the Indiana Army Ammunition 
Plant Reuse Authority. The property is to be used for economic 
development purposes. As consideration for the conveyance, the 
Authority would pay to the United States an amount equal to the 
fair market value of the property at the end of the ten year 
period beginning on the date the conveyance is completed. The 
cost of any surveys necessary for the conveyance, and any 
additional administrative expenses, would be borne by the 
Authority. This section would also amend section 2858(a) of the 
Military Construction Authorization Act for Fiscal Year 1996 
(division B of Public Law 104-106), as amended, to authorize 
the Secretary of the Army to convey, without consideration, an 
additional parcel of real property consisting of approximately 
2,000 acres at the Indiana Army Ammunition Plant, Charlestown, 
Indiana, to the State of Indiana. The property is to be used 
for recreational purposes.

    Section 2836--Land Conveyance, Volunteer Army Ammunition Plant, 
                         Chattanooga, Tennessee

    This section would authorize the Secretary of the Army to 
convey a parcel of real property with improvements, consisting 
of approximately 1,033 acres at the Volunteer Army Ammunition 
Plant, Chattanooga, Tennessee, to Hamilton County, Tennessee. 
The property is to be used for economic development purposes. 
As consideration for the conveyance, the County would pay to 
the United States an amount equal to the fair market value of 
the property at the end of the ten year period beginning on the 
date the conveyance is completed. The cost of any surveys 
necessary for the conveyance, and any additional administrative 
expenses, would be borne by the County.

  Section 2837--Release of Reversionary Interest of United States in 
Former Redstone Army Arsenal Property Conveyed to Alabama Space Science 
                           Exhibit Commission

    This section would authorize the Secretary of the Army to 
release, without consideration and to such extent necessary to 
protect the interests of the United States, the reversionary 
interests of the United States in a parcel of real property 
conveyed to the Alabama Space Science Exhibit Commission 
pursuant to Public Law 90-276, section 813 of the Military 
Construction Authorization Act, 1980 (Public Law 96-125), and 
section 813 of the Military Construction Authorization Act, 
1984 (Public Law 98-115).

                       Part II--Navy Conveyances

  Section 2841--Easement, Camp Pendleton Marine Corps Base, California

    This section would authorize the Secretary of the Navy to 
grant an easement in perpetuity over a parcel of real property, 
consisting of approximately 340 acres, to the Foothill/Eastern 
Transportation Corridor Agency. The easement is to be used to 
permit the construction, operation, and maintenance of a 
restricted access highway. As consideration for the easement, 
the Agency would pay to the United States an amount equal to 
the fair market value of the easement. The cost of any surveys 
necessary for the easement would be borne by the Agency.

    Section 2842--Land Conveyance, Naval Reserve Readiness Center, 
                            Portland, Maine

    This section would authorize the Secretary of the Navy to 
convey a parcel of real property, with improvements, consisting 
of approximately 3.72 acres, to the Gulf of Maine Aquarium 
Development Corporation. As consideration for the conveyance, 
the Corporation would pay to the United States an amount equal 
to the fair market value of the property. The Secretary would 
use the funds paid by the Corporation for the design, 
construction, or acquisition of facilities suitable for use by 
the Naval Reserve.

                    Part III--Air Force Conveyances

    Section 2851--Land Conveyance, Lake Charles Air Force Station, 
                               Louisiana

    This section would authorize the Secretary of the Air Force 
to convey, without consideration, a parcel of real property 
with improvements, consisting of approximately 4.38 acres, at 
Lake Charles Air Force Station, Louisiana, to McNeese State 
University. The property is to be used for educational purposes 
and for agricultural research. The cost of any surveys 
necessary for the conveyance would be borne by the University.

 Section 2852--Land Conveyance, Air Force Housing Facility, La Junta, 
                                Colorado

    This section would authorize the Secretary of the Air Force 
to convey, without consideration, a parcel of real property 
with improvements, consisting of approximately 28 acres, to the 
City of La Junta, Colorado. The property is to be used for 
housing and educational purposes. The cost of any surveys 
necessary for the conveyance would be borne by the City.

                       Subtitle E--Other Matters

Section 2861--Repeal of Prohibition on Joint Use of Gray Army Airfield, 
                 Fort Hood, Texas, with Civil Aviation

    This section would repeal the prohibition on joint civilian 
and military use of Gray Army Airfield, Fort Hood, Texas, 
contained in section 319 of the National Defense Authorization 
Act for Fiscal Year 1987 (Public Law 99-661).

Section 2862--Designation of Building Containing Navy and Marine Corps 
                    Reserve Center, Augusta, Georgia

    This section would designate the building housing the Navy 
and Marine Corps Reserve Center in Augusta, Georgia, as the A. 
James Dyess Building.

         Section 2863--Expansion of Arlington National Cemetery

    This section would authorize the transfer of real property, 
and exchange of jurisdiction, between the Secretary of Defense 
and the Secretary of the Army to provide for an expansion of 
Arlington National Cemetery, Virginia. The property to be 
transferred to the administrative jurisdiction of the Secretary 
of the Army consists of three parcels, totaling approximately 
36.5 acres, located at the Navy Annex of the Pentagon. The 
provision would also require the Secretary of the Army modify 
the boundary of Arlington National Cemetery to include two 
parcels of real property, totaling approximately eight acres, 
situated in Fort Myer, Virginia, contiguous to the Cemetery.

 Section 2864--Reporting Requirements Under Demonstration Project for 
Purchase of Fire, Security, Police, Public Works, and Utility Services 
                     from Local Government Agencies

    This section would amend section 816(b) of the National 
Defense Authorization Act for Fiscal Year 1995 (Public Law 103-
337) to extend the period under which a demonstration project 
is authorized for the purchase of fire, security, police, 
public works, and utility services from local government at 
specified locations in Monterey, California.
 DIVISION C--DEPARTMENT OF ENERGY NATIONAL SECURITY AUTHORIZATION AND 
                          OTHER AUTHORIZATIONS

      TITLE XXXI--DEPARTMENT OF ENERGY NATIONAL SECURITY PROGRAMS

                                OVERVIEW

    The budget request contained $12.1 billion for DOE national 
security programs, including $4.5 billion for weapons 
activities, $5.8 billion for environmental restoration and 
waste management, $1.7 billion for other defense activities, 
and $190.0 million for defense nuclear waste disposal. The 
committee recommends $11.7 billion, a reduction of $400.7 
million. The following table summarizes the request and the 
committee recommendations:
<GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT>

                       ITEMS OF SPECIAL INTEREST

               Accelerated Strategic Computing Initiative

    The budget request contained $517.8 million for stockpile 
stewardship computing needs, of which $329.1 million is for the 
Accelerated Strategic Computing Initiative (ASCI).
    ASCI is a centerpiece of the science based stockpile 
stewardship effort being pursued by the Department to assure 
the safety and reliability of the nuclear weapons stockpile 
while the United States observes a nuclear test ban. The goal 
of the ASCI program is to develop computers that perform 100 
trillion operations (teraflops) a second, software for three 
dimensional simulation of nuclear weapons performance, and 
storage, communications, and visualization technology capable 
of handling the massive quantities of data required. The 
committee notes that the ASCI funding request represents an 
increase of 47 percent over fiscal year 1998 in order to 
aggressively advance the state-of-the-art in computer hardware 
and software.
    The committee is concerned that ASCI remains a high risk 
program. The committee is aware that ASCI computer hardware 
development has resulted in some impressive accomplishments, 
including the one teraflop Option Red computer at Sandia 
National Laboratory. However, the committee understands that 
Option Red architecture is not optimal for the tasks for which 
it was designed and that contractors have not met early 
milestones for the three teraflop Option Blue computers at Los 
Alamos and Lawrence Livermore National Laboratories. The 
committee has also received information indicating that 
software development needed for science based stockpile 
stewardship remains a significant challenge and has not 
proceeded at the pace necessary to fully utilize the computer 
hardware in place.
    Therefore, the committee recommends $279.1 million for 
ASCI, a reduction of $50.0 million. The committee believes that 
this level of funding, which would represent a 25 percent 
increase over fiscal year 1998, will provide a healthy infusion 
of funds to keep the program on an aggressive, but more 
measured, pace.
    The committee is also concerned over the adequacy of 
compliance with section 3157 of the National Defense 
Authorization Act for Fiscal Year 1998 (Public Law 105-85), 
requiring that ASCI contractors report, on a quarterly basis, 
all exports to Tier III countries of computers capable of 
operating at speeds in excess of 2,000 millions of theoretical 
operations per second (MTOPS). The committee continues to 
believe that DOE should use these reports to monitor exports of 
U.S.-origin high performance computers to end-users of 
proliferation concern. The committee remains committed to 
monitoring compliance with this statutory requirement and 
expects that the Department will notify the committee of any 
systemic compliance problem it should encounter in fulfilling 
the requirements of this provision of law.

       Advanced Manufacturing, Design and Production Technologies

    The budget request contained $62.6 million for the advanced 
manufacturing, design and production technologies (ADAPT) 
program. The committee notes that this funding level represents 
a 15 percent reduction from fiscal year 1998. The committee 
believes that ADAPT funding is essential to the development of 
technologies critical to an efficiently operated nuclear 
weapons production complex and that the funding requested is 
inadequate. The Kansas City plant, for example, may have to lay 
off a significant portion of its engineering staff without 
additional funding for this program. Consequently, the 
committee recommends $78.1 million, an increase of $15.5 
million.

                Comprehensive Test Ban Treaty Safeguards

    The President has established six necessary conditions 
which must be met for the United States to enter into the 
Comprehensive Test Ban Treaty (CTBT). These include:
          (1) The conduct of a broad range of experimental 
        tests which do not result in a sustained nuclear 
        reaction;
          (2) The maintenance of very capable weapons labs;
          (3) The maintenance of the ability to resume nuclear 
        testing;
          (4) The development of strong treaty monitoring 
        capabilities;
          (5) The development of strong intelligence 
        capabilities to monitor nuclear weapons programs in 
        other nations; and
          (6) The definition of a process under which the 
        President would withdraw from the CTBT for reasons of 
        ``supreme national interest.''
    The committee believes that strong manufacturing 
capabilities and a viable production complex to support our 
nuclear stockpile are also essential, whether or not the United 
States enters into the CTBT. Consequently, the committee urges 
the Department to recognize the importance of the production 
complex in this context, to advise the committee on any 
shortfalls in the ability of the production complex to support 
stockpile needs in the absence of testing, and to include the 
maintenance of a robust production complex in any future 
delineation of safeguards required for U.S. entry into the 
CTBT.

               Core Stockpile Management Weapons Program

    The budget request contained $307.4 million for the core 
stockpile management weapons program. The committee understands 
that the request is not adequate to meet requirements for 
surveillance of the B61-3/4/10, the B61-7/11, and the W62; 
dismantlement of the W79, W56, and W70; maintenance for a 
number of weapons; and other projects pertaining to component 
disposition and containers performed at the Pantex plant. 
Accordingly, the committee recommends $332.4 million, an 
increase of $25.0 million.

  Defense Environmental Restoration and Waste Management Science and 
                               Technology

    The budget request contained $193.0 million for Defense 
Environmental Restoration and Waste Management Science and 
Technology. The committee recommends $279.5 million, an 
increase of $77.8 million. The committee intends that the 
additional resources will be used to develop new technologies 
for defense nuclear waste cleanup. The committee believes that 
such new technologies are necessary to expedite site cleanup so 
that landlord costs at the sites can be reduced. The committee 
directs that $30.0 million of the additional resources be 
allocated to the use of innovative environmental restoration 
technologies at projects designated as ``Site/project 
completion'' projects, and $30.0 million be allocated to the 
use of innovative environmental restoration technologies at 
projects designated as ``Post 2006 completion'' projects.

                 Defense Programs Construction Projects

    The budget request contained $515.1 million for 
construction projects at the laboratories and production 
facilities, of which $65.7 million would be for 13 new starts.
    The committee is aware that a number of the projects for 
which the Department is requesting funding have suffered cost 
overruns and delays and have been reviewed for management 
deficiencies. The committee appreciates the Department's self-
critique, which attributes the poor performance on these and 
other construction projects to inadequate oversight from 
headquarters, poor input and support from the intended end 
users of the facilities, lack of adequate definition in the 
design phase, and a poor requirements review process.
    The committee is encouraged that the Department is taking 
action to avoid the recurrence of these problems. However, the 
committee is concerned that the budget request fails to 
consider the time necessary to implement the Department's 
reforms and consequently believes that the number of new starts 
in the request is excessive. The committee also believes that 
continuing construction projects which have experienced these 
systemic difficulties should be carefully reviewed to determine 
appropriate corrective actions.
    Therefore, the committee recommends $200.9 million, a 
reduction of $30.0 million to the construction accounts in 
stockpile stewardship and management. The committee believes 
that this amount would allow the Department to proceed with the 
high priority construction projects necessary to assure the 
future safety, reliability and effectiveness of the stockpile 
while at the same time implementing needed reforms.

                          Emergency Management

    The budget request contained $23.7 million for Emergency 
Management. The committee believes that two of the activities 
for which funds were requested involve responses to non-
radiological events--expanding the Atmospheric Release Advisory 
Capability for chemical and hazardous material releases and 
assisting state and local governments in their response to 
natural and manmade disasters--and are more appropriately 
funded by the Federal Emergency Management Agency. Therefore, 
the committee recommends $21.3 million, a reduction of $2.4 
million.

              Hanford Tank Safety and Remediation Projects

    The budget request contained $273.8 million for High-Level 
Waste Management in the Post 2006 Completion project at the 
Hanford Site. The committee recommends $308.8 million, an 
increase of $35.0 million. The committee directs that this 
increase be provided for the following activities: $18.0 
million to drain single-shell tanks that contain high-level 
waste, $7.0 million for implementation of the final safety 
analysis report for tank farm operations, $9.0 million for 
timely resolution of flammable gas and organic safety issues, 
and $1.0 million for reduction of vadose zone contamination.

      Hanford Tank Waste Remediation System Privatization Phase I

    The budget request contained $330.0 million for the Hanford 
Tank Waste Remediation System Privatization Project, Phase I.
    The committee understands that the two contractors working 
on Phase IA of the project have submitted their proposals for 
proceeding with Phase IB and that each of the contractors has 
stated the need to conduct further development work for a 
period of 16 to 24 months before they are ready to proceed with 
Phase IB work. The contractors have indicated that this 
additional development work is necessary to reduce technical 
uncertainty. Therefore, the committee believes that the $330.0 
million requested is not needed in fiscal year 1999. However, 
consistent with its commitment to cleanup the Hanford tank 
wastes, the committee recommends authorization of $100.0 
million to be added to the accumulated budget authority 
currently held in reserve for this project. This recommendation 
represents a reduction of $230.0 million.
    In addition, the committee recommends the requested amounts 
for two other projects that support the Hanford privatization 
project: $14.8 million for the Privatization Phase I 
infrastructure support project (99-D-403), and $16.1 million 
for the Pretreatment and Immobilization Science and Technology 
Development project.

 Hazardous Material Management and Emergency Response (HAMMER) Program

    The budget request contained $65.1 million for program 
direction at the Richland, Washington Field Office. The 
committee recommends that $0.8 million of that amount be used 
to support the HAMMER program for training in emergency 
response to hazardous materials release at DOE's Hanford, 
Washington site.

                         Heavy Water Processing

    The budget request contained $2.6 million for the Heavy 
Water Processing project at the Savannah River Site. The 
committee recommends $22.6 million, an increase of $20.0 
million.
    The budget request would support the continued 
consolidation and storage of 3,000 drums of tritium-
contaminated heavy water into the former K-Reactor at Savannah 
River. However, the committee believes that this excess heavy 
water, a potential pollution source, should be removed from the 
site since its monitoring and maintenance will continue to cost 
millions of dollars. The committee understands that the heavy 
water is contaminated with tritium. The committee also 
understands that if the tritium is removed from the heavy 
water, the heavy water can be removed from the Savannah River 
Site and sold. The committee believes that this would have two 
beneficial effects: (1) it would remove a potential pollution 
source from Savannah River, and (2) the sale of the heavy water 
would generate revenue for the government. The committee 
directs that the additional resources provided by this increase 
be used to implement such a project.

                      Inertial Confinement Fusion

    The budget request contained $213.8 million for the 
inertial confinement fusion (ICF) program. The committee 
believes that work by the University of Rochester's Laboratory 
for Laser Energetics with the Omega laser is an essential 
element of the ICF program. The committee recommends the 
requested amount and directs that, within this total, the 
Department make available the $29.0 million requested for the 
Laboratory for Laser Energetics.

                     In-Tank Precipitation Process

    The budget request contained $382.7 million for the High-
Level Waste Treatment at the Savannah River Site. The committee 
recommends $412.7 million, an increase of $30.0 million. The 
committee directs that the additional resources provided by 
this increase be used to modify the In Tank Precipitation 
Process equipment to address equipment problems associated with 
the release of explosive benzene that were identified in recent 
startup testing.

                      International Nuclear Safety

    The budget request contained $35.0 million for the 
International Nuclear Safety program. The committee recommends 
the requested amount, but believes DOE should broaden the 
program's focus beyond reducing environmental threats from 
unsafe Soviet-designed reactors. The committee directs DOE to 
begin to address nuclear materials safety during the 
disposition of excess weapons plutonium and HEU in Russia.

      Laboratory Collaboration With the Ballistic Missile Defense 
                              Organization

    The budget request contained no funding for the use of 
Department of Energy assets or expertise to assist the 
Department of Defense Ballistic Missile Defense Organization's 
(BMDO) test program. The committee notes that in fiscal year 
1998, $49.9 million in BMDO funding is expected to be spent at 
the DOE national laboratories and that the National Defense 
Authorization Act for Fiscal Year 1998 (Public Law 105-85) 
required the Secretaries of Energy and Defense to enter into a 
memorandum of understanding (MOU) to facilitate the use of 
assets and expertise at the national laboratories for ballistic 
missile defense programs.
    The committee understands that this MOU has now been signed 
and the Department of Energy and BMDO have identified several 
additional projects in whichlaboratory expertise could meet 
legitimate BMDO needs. The committee believes these projects, like 
other laboratory projects that are not directly related to DOE's 
nuclear weapons programs, will assist the laboratories in the 
development of tools and expertise necessary for effective stockpile 
stewardship and further believes that this proposed expansion of 
collaboration between BMDO and the Department of Energy will be 
beneficial for both organizations. The committee, therefore, recommends 
an increase of $20.0 million to the core stockpile stewardship program 
to implement the additional projects identified by BMDO and the DOE 
laboratories. The committee expects that regular reviews by BMDO and 
the Department of Energy will continue to refine and improve this 
cooperative arrangement and that future budget requests will reflect 
appropriate cost sharing between the two organizations.
    In addition, the committee recommends a provision (sec. 
3133) that would require the Secretary of Energy to make 
available, of the funds authorized for Department of Energy 
defense programs, no less than $60.0 million for additional 
missile technology development in cooperation with BMDO for the 
purpose of developing, demonstrating, and testing hit-to-kill 
interceptor vehicles for theater missile defense systems. The 
committee recognizes that the development of such vehicles 
remains a significant technical challenge. The committee 
believes that this effort should be in parallel to ongoing 
BMDO-managed system and technology development programs.

                             Naval Reactors

    The budget request contained $665.5 million for the naval 
reactors program.
    The committee understands that the current program for 
shutdown and environmental remediation of land-based training 
and research and development reactors is making substantial 
progress and the Navy is managing a successful on-going program 
for the disposal of defueled decommissioned nuclear propulsion 
plants.
    However, the committee understands that planned non-
pressure vessel removal work at the Kesselring site in New York 
was deferred and other remediation work was scaled back in 
response to fiscal year 1998 funding shortfalls. The committee 
is concerned that the budget request for inactivation of 
prototype reactors failed again to fully fund these efforts as 
well as planned remediation efforts in Idaho.
    The committee believes that additional funding is required 
to proceed with the shutdown and environmental remediation of 
naval reactor sites in New York and Idaho at a prudent and 
efficient pace. Therefore, the committee recommends $681.5 
million, an increase of $16.0 million for this purpose.

               Office of Environment, Safety, and Health

    The budget request contained $74.0 million for the defense 
component of the Office of Environment, Safety, and Health. The 
committee recommends $94.0 million, an increase of $20.0 
million. This increase would restore funding for the defense 
component of the program to the fiscal year 1998 level. The 
committee does not endorse the Department's transfer of half of 
the Environment, Safety, and Health staff to the DOE Energy 
Supply program. The DOE workforce at the current and former 
weapons production sites are those most at risk, and the 
committee believes emphasis should be placed on their health 
and safety.

                           Program Direction

    The budget request contained $260.5 million for defense 
programs program direction, which includes salaries, personnel, 
contractor support, and advisory and assistance funding. This 
amount represents a $10.5 million increase to the level of 
funding approved by Congress for fiscal year 1998. The 
committee recommends $240.0 million, a reduction of $20.5 
million to advisory, assistance, and support services.

              Reactor Decontamination and Decommissioning

    The budget request contained $4.8 million for Facility 
Decommissioning at the Hanford Site. The committee recommends 
$16.8 million, an increase of $12.0 million. The committee 
directs that these additional resources be used to continue 
progress on the cocooning of the F and H reactors at the 
Hanford site. Such safe storage of the reactor cores on an 
interim basis will allow the Department to target remediation 
funds to decontaminate and decommission ancillary buildings at 
Hanford, potentially saving millions of dollars in annual 
maintenance and surveillance costs.

       Rocky Flats Environmental Technology Site Closure Project

    The budget request contained $625.2 million for the Rocky 
Flats Environmental Technology Site Closure Project. For the 
last two years, the committee has emphasized the importance of 
providing adequate funding for the cleanup efforts at sites 
that are nearing closure. The Rocky Flats Environmental 
Technology Site is scheduled for closure by 2010 at a projected 
total cost of $7.3 billion. However, the Secretary has 
challenged the Department staff and associated contractors to 
close the site by 2006, which would save an estimated $1.3 
billion. The committee endorses the Secretary's challenge and 
recommends $665.2 million, an increase of $40.0 million for 
this cleanup acceleration.

             Savannah River Site Infrastructure Investment

    The budget request contained $492.3 million for site and 
project completion at the Savannah River site. The committee is 
concerned that capital equipment projects and spare equipment 
needs have gone unmet due to funding shortfalls, resulting in 
recent operational shutdowns at the defense waste processing 
facility (DWPF). Therefore, the committee recommends an 
increase of $18.0 million to replace required equipment and 
thus ensure continuity of operations at the DWPF.

                   Stockpile Management at Y-12 Plant

    The budget request contained $2.1 billion for the stockpile 
management program.
    The committee believes that additional funding is required 
for reprocessing of uranium materials and infrastructure 
upgrades, as well as completion of priority actions recommended 
by the 1997 Highly Enriched Uranium (HEU) Study, including 
seismic upgrades to storage fixtures and removal of HEU from 
inadequate Y-12 facilities. Therefore, the committee recommends 
an increase of $13.0 million for these purposes.

                        Technology Partnerships

    The budget request contained $60.0 million for the 
technology partnership program.
    Funding for technology partnerships is used at the 
discretion of the Department's laboratory directors to enter 
into cooperative research and development agreements with 
industry to help commercialize DOE technology and provide the 
Department with information useful to its stockpile stewardship 
program.
    The committee understands the value of leveraging 
investment in the commercial sector, but notes that the program 
remains too diffuse and lacks insufficient overall direction 
and coordination. Moreover, the committee believes that the 
Department has done a poor job of justifying its budget 
request.
    Accordingly, the committee recommends $40.0 million for 
technology partnerships, a reduction of $20.0 million. Of the 
remaining amount, the committee expects $10.0 million to be 
used for the American Textiles Partnership project.

                           Tritium production

    The budget request contained $157.0 million for production 
of tritium.
    The committee understands that the Department is examining 
two technical options, a commercial light water reactor and an 
accelerator, to produce tritium necessary to meet its future 
requirements and that the Department will sustain the option 
not selected as a potential back-up source. The committee is 
concerned that the request fails to support the design work 
necessary for the accelerator produced tritium (APT) option. 
The committee notes that this design work will be necessary 
whether APT is selected as the primary or back-up source and, 
therefore, recommends an increase of $30.0 million to support 
this effort.
    The committee also understands that the performance of 
tritium collecting fuel rods is being tested at the Watts Bar 
nuclear plant. The committee believes that the information 
generated by this test is essential to the selection of a 
primary technology for future tritium production. Therefore, 
the committee recommends a provision (sec. 3134) that would 
require the Secretary of Energy to submit a report on the 
results of the test and would defer the selection date for 
tritium production technology to December 31, 1999.

             Uncosted Obligations and Unobligated Balances

    The committee concurs with the Department's assessment that 
efficient operations require uncosted obligations and 
unobligated balances from prior year funding be carried over to 
succeeding fiscal years. These funds, also known as carryover 
balances, serve as a financial bridge from one fiscal year to 
the next. The General Accounting Office (GAO) has recommended 
that targets be set for these balances to help determine 
whether they are excess to Departmental needs. In its initial 
reports, GAO used targets, developed by DOE, of 8 percent of 
operating funds and 50 percent of fun