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The Administration supports prompt congressional consideration of its
national defense authorization legislative proposal for FY 1999. As
reported by the Committee on National Security, however, H.R. 3616 raises
serious budget and policy concerns which must be addressed satisfactorily.
The Administration also has particular concerns, addressed below, about a
number of amendments which have been ruled in order for floor
consideration.
Reduction of Department of Energy (DOE) Funds
The Administration strongly objects to the net reduction of $401 million
from DOE's defense activities, particularly the $358 million cut from
weapons activities and the earmarking of $60 million from the Stockpile
Stewardship account for DOD's Ballistic Missile Defense Organization. A
significant portion of the Stockpile Stewardship reduction results from
$341 million taken from prior year balances which are not available. This
will force real reductions in critical programs needed to ensure the
safety, security, and reliability of America's nuclear deterrent.
In addition, the Administration opposes the $230 million reduction in the
Environmental Management Privatization account that cuts funds which are
needed to demonstrate to the financial investment community the
Administration's commitment to the privatization approach, and which are
required to complete key nuclear waste disposal facilities. The bill would
also delay the decision to select a primary source for tritium until the
results of tests at the Watts Bar nuclear station are determined. This
would delay the selection decision by over one year, increase the costs of
the program, and prevent the Department from meeting its 2005 deadline for
achieving a tritium production capability. The Administration also opposes
the premature sun-setting of the Worker and Community Transition Program,
which has facilitated the orderly reduction of 43,000 contractor employees
at DOE sites since 1992.
Program Funding
H.R. 3616 would reduce funding for basic and applied research by over $1
billion in FY 1999. This research provides the fundamental knowledge and
technical know-how required to develop future defense systems. The failure
to provide adequate funding for this research will ultimately result in the
inability to upgrade systems at an adequate pace. The Administration
strongly urges the House to authorize the Administration's full $4.1
billion request for these programs.
Conversely, the bill adds a net total of $250 million for procurement and
$450 million for construction programs. Some of these increases are for
programs that, due to higher priority military requirements, are not in the
Future Years Defense Program (FYDP). This includes, for example, $398
million for seven additional C-130J airlift aircraft, and $300 million for
other unrequested items for the National Guard and Reserve. These
increases for lower priority weapons modernization and military
construction programs would be at the expense of higher priority defense
programs.
The Administration appreciates the bill's emphasis on preserving military
readiness through strong funding for maintenance and spare parts. Force
readiness could be threatened, however, by the bill's reductions to other
O&M programs. The President's request is very tightly constructed within
the discretionary caps agreed to in the bipartisan budget agreement. Any
adjustments must be carefully evaluated to ensure that sufficient funding
is available for DoD operations and support programs. The Administration
will work with the Congress to reexamine any adjustments to the O&M
programs prior to final congressional action on the bill.
In particular, the Administration opposes the bill's $500 million funding
reduction for defense contractual services, which are an integral part of
DOD functions and are essential to critical military objectives. This
reduction would have a direct adverse impact on operational readiness and
modernization. The prohibitions and limitations on: (1) accounting
procedures for contractual services and (2) the performance of core
logistics capabilities are also objectionable. In addition, the bill's
requirement for a comprehensive annual review of Defense service contracts
would be costly and divert personnel from higher priority areas.
Base Realignment and Closure
The Administration is disappointed that the bill does not adopt the Defense
proposal to authorize two additional rounds of base closure and realignment
in 2001 and 2005. Defense's base infrastructure is far too large for its
military forces and must be reduced if the Department is to obtain adequate
appropriations for readiness and modernization requirements during the next
decade.
Gender Integrated Training
The Administration strongly opposes any legislatively mandated changes for
initial entry training within the military services.
The Federal Advisory Committee on Gender Integrated Training and Related
Issues made several recommendations on training that have been reviewed by
the Secretary of Defense and each of the services. In addition to the
Committee's recommendations, the Secretary directed the services to take
additional action in the areas of training leadership, training rigor, and
recruit billeting. The services have each taken a number of steps in
support of the Committee's recommendations and Secretary's additional
direction. The implementation of future initiatives will also be
monitored. All actions are geared toward providing new recruits with the
best training possible in a safe and secure environment. In order to
achieve this goal, each service must be allowed to tailor its basic
training as needed to prepare recruits for their specific service's
missions. Legislation at this time would be counter productive to meeting
this goal.
Weapons of Mass Destruction
H.R. 3616 does not include authorities requested to allow a more rapid
response to threats to U.S. forces, and permit Defense to support
interagency efforts to combat terrorism. The bill also defers action on
authorizing the National Guard and Reserves to assist other Federal, state,
and local authorities in responding to domestic terrorist incidents
involving weapons of mass destruction. These authorities are critical to
improving the Nation's ability to deter and combat terrorism. The
Administration strongly urges prompt congressional enactment of these
important authorities.
Bosnia Expenditure Cap
The Administration opposes section 1201 which would impose an expenditure
limitation on funds for U.S. participation in Bosnia peacekeeping
operations. It is imperative that the Administration retain the
flexibility necessary to meet exigent circumstances.
Chemical Weapons Convention
The Administration urges the House to include the requested authorization
of appropriations for the DOD to reimburse the Organization for the
Prohibition of Chemical Weapons for costs incurred in inspecting DOD sites
and facilities. These funds are necessary to fulfill the requirements of
the recently ratified Chemical Weapons Convention.
Management Issues
A number of provisions in H.R. 3616 would undermine the Administration's
efforts to improve governmental operations. For example, the bill would
terminate a DOD "household goods moving services" pilot program that was
designed to adopt corporate business practices and foster competition. The
bill would replace this DOD pilot with an approach that was proposed by the
industry that perpetuates the current inefficient system.
The Administration objects to section 337 which would require DOD to
perform depot-level maintenance and repair of the C-17 at Government-owned,
Government-operated facilities. This section also states that the C-17
Flexible Sustainment contract does not meet the requirements of law.
Although the language is specific to the C-17 support contract, it has far
reaching implications for many DOD weapon systems. The bill sets a
precedent for bypassing the DOD risk assessment and core determination
process, and directing that weapon systems be supported in public depots
without regard to cost or readiness. The resulting investments would have
a significant adverse affect on DOD's long term plans for funding.
Section 336 of the bill would require complicated and cumbersome tests for
determining what qualifies as a commercial item under 10 U.S.C. §2464,
and would require application of those tests to determine whether or not a
V-22 engine component or system is a "commercial item" that, by definition,
should be procured with simplified, streamlined procurement procedures.
Whether intended or not, the provision would duplicate a capability that
already exists commercially.
Section 331 of the bill would expand current requirements that the
Secretary report to Congress before outsourcing any commercial or
industrial type function currently accomplished in-house. This would be
counterproductive to efficient and effective government, and should be
deleted. These additional requirements would only slow the process,
discourage contractors from taking over activities that DOD no longer needs
to perform in-house, and waste money that should be used to modernize DOD
weapons systems.
Military Pay Raise
H.R. 3616 contains a minimum of a 3.6 percent increase in basic pay for
military members, an increase that is 0.5 percent higher than the amount
requested. At this time, the Adminstration is reviewing the implications
of a higher pay raise, and will work with Congress to provide a fair pay
raise that does not force unacceptable reductions in other high priority
Defense programs.
Cooperative Threat Reduction (CTR)
The Administration generally supports the bill's authorizations for the
Cooperative Threat Reduction Program and urges full funding of the FY 1999
request for CTR. The Administration opposes, however, language that would
restrict the use of CTR funds for chemical weapons destruction facility
construction. The restriction would preclude any construction until FY
2000, thereby imposing a minimum delay of one year in the current project
schedule.
The Administration, as it continues to review H.R. 3616, may identify other
issues, and will work with the Congress to develop a more acceptable bill.
Unacceptable Amendments
In addition, the Administration strongly opposes a number of seriously
problematic amendments that may be offered, including:
- any amendment that would further restrict or prohibit licensing of
commercial satellite launches by China. Transfer to China or
Chinese entities of technology, data, or defense services relevant to
ballistic missiles or warhead delivery is controlled under the Arms
Export Control Act. Existing procedures, including the bilateral
Satellite Technology Safeguards Agreement (negotiated under the Bush
Administration and signed in February 1993) explicitly prohibit
transfer of ballistic missile technology to China.
- any amendment to require licenses for nuclear exports and
retransfers to non-OECD countries to be reported to Congress 30 days
before issuance. Such a requirement is unnecessary as
applications for licenses to export controlled nuclear technology and
items are already reported to the public immediately upon filing with
the Nuclear Regulatory Commission. The licensing process provides
for a unique degree of transparency, including public intervention.
To require such a notification before licenses are issed to non-OECD
countries would impose significant delays to many commercial
contracts, reducing U.S. commercial competitiveness, and reducing
U.S. influence with countries of great importance to our nuclear
non-proliferation efforts.
- the amendment which would cap expenditures for NATO enlargement at
$2 billion or 10 percent of the total cost. At the Madrid summit
Allied heads of State and government agreed that the costs of NATO
enlargement would be reasonable and they would be met in accordance
with current Alliance procedures. After careful study, NATO agreed
that the costs of enlargement to the Alliance common budgets for the
first 10 years would be $1.5 billion. Using the current shares of
NATO common budget that would mean the costs to the U.S. during that
period would be approximately $400 million. However, a reduction to
10 percent of enlargement costs as called for in the amendment is
neither reasonable nor consistent with the Madrid communique agreed
by all Allied heads of state and government.
- prohibit the use of commercial light water reactors for the
production of tritium; eliminating the least costly, most
technically mature option under consideration by DOE. Tritium
production in commercial reactors is not inconsistent with U.S.
nonproliferation policy. There have been several instances of
cooperation between U.S. military and civilian nuclear programs,
including dual use of uranium enrichment facilities and commercial
sale of electricity originating from a weapons material production
reactor.
The inclusion of such amendments in the bill presented to the President
would be unacceptable.
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