Report text available as:

  • TXT
  • PDF   (PDF provides a complete and accurate display of this text.) Tip ?

104th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES                
 1st Session                                                    104-131
_______________________________________________________________________




                   NATIONAL DEFENSE AUTHORIZATION ACT

                          FOR FISCAL YEAR 1996

                               __________

                              R E P O R T

                                 of the

                     COMMITTEE ON NATIONAL SECURITY

                        HOUSE OF REPRESENTATIVES

                                   on

                               H.R. 1530

                             together with

                     ADDITIONAL, SUPPLEMENTAL, AND

                            DISSENTING VIEWS

      [Including cost estimate of the Congressional Budget Office]

[GRAPHIC] [TIFF OMITTED] TONGRESS.#13


  June 1, 1995.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed


                  HOUSE COMMITTEE ON NATIONAL SECURITY

                      One Hundred Fourth Congress

               FLOYD D. SPENCE, South Carolina, Chairman
                                     RONALD V. DELLUMS, California
BOB STUMP, Arizona                   G.V. (SONNY) MONTGOMERY, 
DUNCAN HUNTER, California                Mississippi
JOHN R. KASICH, Ohio                 PATRICIA SCHROEDER, Colorado
HERBERT H. BATEMAN, Virginia         IKE SKELTON, Missouri
JAMES V. HANSEN, Utah                NORMAN SISISKY, Virginia
CURT WELDON, Pennsylvania            JOHN M. SPRATT, Jr., South 
ROBERT K. DORNAN, California             Carolina
JOEL HEFLEY, Colorado                SOLOMON P. ORTIZ, Texas
JIM SAXTON, New Jersey               OWEN PICKETT, Virginia
RANDY ``DUKE'' CUNNINGHAM,           LANE EVANS, Illinios
    California                       JOHN TANNER, Tennessee
STEVE BUYER, Indiana                 GLEN BROWDER, Alabama
PETER G. TORKILDSEN, Massachusetts   GENE TAYLOR, Mississippi
TILLIE K. FOWLER, Florida            NEIL ABERCROMBIE, Hawaii
JOHN M. McHUGH, New York             CHET EDWARDS, Texas
JAMES TALENT, Missouri               FRANK TEJEDA, Texas
TERRY EVERETT, Alabama               MARTIN T. MEEHAN, Massachusetts
ROSCOE G. BARTLETT, Maryland         ROBERT A. UNDERWOOD, Guam
HOWARD ``BUCK'' McKEON, California   JANE HARMAN, California
RON LEWIS, Kentucky                  PAUL McHALE, Pennsylvania
J.C. WATTS, Jr., Oklahoma            PETE GEREN, Texas
MAC THORNBERRY, Texas                PETE PETERSON, Florida
JOHN N. HOSTETTLER, Indiana          WILLIAM J. JEFFERSON, Louisiana
SAXBY CHAMBLISS, Georgia             ROSA L. DeLAURO, Connecticut
VAN HILLEARY, Tennessee              MIKE WARD, Kentucky
JOE SCARBOROUGH, Florida             PATRICK J. KENNEDY, Rhode Island
WALTER B. JONES, Jr., North 
    Carolina
JAMES B. LONGLEY, Jr., Maine
TODD TIAHRT, Kansas
RICHARD ``DOC'' HASTINGS, 
    Washington
                    Andrew K. Ellis, Staff Director


                            C O N T E N T S

                              ----------                              
                                                                   Page
Explanation of the Committee Amendment...........................     1
Purpose..........................................................     1
Relationship of Authorization and Appropriations.................     2
Summary of Authorization in the Bill.............................     2
Summary Table of Authorizations..................................     2
Rationale for the Committee Bill.................................     6
Hearings.........................................................    12
Division A--Department of Defense Authorization..................    12
Title I--Procurement:
    Aircraft Procurement, Army...................................    15
        Overview.................................................    15
        Items of special interest................................    17
    Missile Procurement, Army....................................    17
        Overview.................................................    17
         Items of special interest...............................    19
     Weapons and Tracked Combat Vehicles, Army...................    20
         Overview................................................    20
         Items of special interest...............................    22
     Ammunition Procurement, Army................................    23
         Overview................................................    23
         Items of special interest...............................    25
     Other Procurement, Army.....................................    25
         Overview................................................    25
         Items of special interest...............................    29
     Aircraft Procurement, Navy..................................    29
         Overview................................................    29
         Items of special interest...............................    31
     Weapons Procurement, Navy...................................    31
         Overview................................................    31
     Ammunition Procurement, Navy/Marine Corps...................    34
         Overview................................................    34
         Items of special interest...............................    36
     Other Procurement, Navy.....................................    43
         Overview................................................    43
         Items of special interest...............................    48
     Procurement, Marine Corps...................................    49
         Overview................................................    49
         Items of special interest...............................    52
     Aircraft Procurement, Air Force.............................    52
         Overview................................................    52
         Items of special interest...............................    55
     Ammunition Procurement, Air Force...........................    57
         Overview................................................    57
     Missile Procurement, Air Force..............................    59
         Overview................................................    59
         Items of special interest...............................    62
     Other Procurement, Air Force................................    63
         Overview................................................    63
     Procurement, Defense-Wide...................................    67
         Overview................................................    67
         Items of special interest...............................    70
     National Guard and Reserve Equipment........................    71
         Overview................................................    71
     Chemical Agents and Munitions Destruction, Defense..........    73
         Overview................................................    73
     Legislative Provisions:
         Section 131--repeal of prohibition on backfit of trident 
          submarines.............................................    75
         Section 141--repeal of limitations......................    75
         Section 151--repeal of requirement to proceed 
          expeditiously with chemical demilitarization 
          cryofracture facility at Tooele Army Depot, Utah.......    75
         Section 152--sense of Congress regarding cost growth in 
          program for destruction of the existing stockpile of 
          lethal chemical agents and munitions...................    75
Title II--Research, Development, Test, and Evaluation (RDT&E;)....    75
         Overview................................................    75
     Defense-Wide Programs.......................................    77
         Special considerations..................................    77
     Army RDT&E..................................................;    85
         Overview................................................    85
         Items of special interest...............................    89
     Navy RDT&E..................................................;    96
         Overview................................................    96
         Items of special interest...............................   100
     Air Force RDT&E.............................................;   114
         Overview................................................   114
         Items of special interest...............................   118
     Defense Agencies RDT&E......................................;   122
         Overview................................................   122
         Items of special interest...............................   132
     Legislative Provisions......................................   142
         Section 203--modifications to strategic environmental 
          research and development program.......................   142
         Section 211--space launch modernization.................   142
         Section 212--maneuver variant unmanned aerial vehicle...   143
         Section 213--tactical manned reconnaissance.............   143
         Section 214--advanced lithography program...............   143
         Section 215--enhanced fiber optic guided missile (EFOG-
          M).....................................................   143
         Section 216--joint advanced strike technology program...   143
     Subtitle C--Ballistic Missile Defense Act of 1995...........   143
         Section 231--short title................................   143
         Section 232--ballistic missile defense policy of the 
          United States..........................................   143
         Section 233--implementation of policy...................   143
         Section 234--follow-on technologies research and 
          development............................................   144
         Section 235--policy on compliance with the ABM Treaty...   144
         Section 236--ballistic missile defense program 
          accountability.........................................   144
         Section 237--ABM Treaty defined.........................   144
        Section 238--repeal of Missile Defense Act of 1991.......   144
    Subtitle D--Other Ballistic Missile Defense Provisions.......   144
        Section 241--ballistic missile defense funding for fiscal 
          year 1996..............................................   144
        Section 242--policy concerning ballistic missile defense.   144
        Section 243--testing of theater missile defense 
          interceptors...........................................   144
        Section 244--repeal of missile defense provisions........   145
        Section 251--allocation of funds for medical 
          countermeasures against biowarfare threats.............   145
        Section 252--basic research..............................   145
        Section 253--awards of grants and contracts to colleges 
          and universities: requirements of competition..........   145
        Section 254--university research initiative support 
          program................................................   145
        Section 255--advanced field artillery system (Crusader)..   145
        Section 256--command, control, communications, and 
          intelligence interoperability..........................   146
        Section 257--federally funded research and development 
          centers................................................   146
        Section 258--manufacturing technology program............   146
        Section 259--laboratory test and evaluation strategic 
          plan...................................................   146
        Section 260--aeronautical research and test capabilities 
          assessment.............................................   146
        Section 261--T-38 avionics upgrade.......................   147
        Section 262--dual use technology programs................   147
Title III--Operation and Maintenance.............................   147
    Overview.....................................................   147
    Items of Special Interest....................................   148
        Assessing readiness......................................   148
        Readiness funding........................................   149
        Real property maintenance................................   151
        Reserve readiness........................................   151
        Mobility infrastructure enhancement......................   152
        B1-B repair and maintenance improvements.................   152
        Chemical and biological terrorism........................   152
        Joint warfighting center.................................   152
        Joint deployment and transportation center...............   152
        Conversion of military positions to civilian positions...   153
        UH-1 refurbishment policy................................   153
        Condition of M1 tank fleet...............................   153
        Strategic command ``bulwark bronze'' exercise............   154
    Depot Maintenance Issues.....................................   154
        Core logistics capability................................   154
        Depot maintenance workload carryover.....................   155
        Navy ordnance............................................   155
        Ship repair subcontractors...............................   156
        DOD Financial Management.................................   156
        Cash management..........................................   157
        Prior year losses........................................   158
        Financial systems........................................   158
        DBOF prices should include the full cost of military 
          personnel..............................................   158
        Capital assets...........................................   159
        Overpayment collection demonstration.....................   159
        Offsetting collections...................................   159
        Emergency and extraordinary expenses.....................   160
    Information Technology.......................................   161
        Performance measures.....................................   161
        Off-the-shelf systems....................................   161
    Defense Support Services Reform..............................   161
        Reengineering transportation.............................   162
        Reengineering household moves............................   163
        Travel processing........................................   163
        Outsourcing travel.......................................   164
        Property disposal outsourcing............................   164
        Contracting-out..........................................   164
        Inventories..............................................   165
        Inventory management consolidation.......................   165
        Depot level repairable consolidation.....................   165
        Fuel management..........................................   166
        Electricity..............................................   166
        Contract management oversight............................   166
        General Services Administration added costs..............   166
        Prime vendor delivery....................................   166
        Two-year operation and maintenance funding...............   167
        DFAS consolidation.......................................   167
        Logistics outsourcing....................................   167
        Outsourcing payroll......................................   168
        DOD printing operations..................................   168
        Outsourcing printing.....................................   169
        Outsourcing expertise....................................   169
    Civilian Employees...........................................   169
        DOD civilian employee management.........................   169
        Army civilian personnel management.......................   170
        Overseas allowances......................................   170
    IG and Audits................................................   171
        Inspectors General.......................................   171
        Consolidation of procurement fraud within the DOD IG.....   172
        Unnecessary audits.......................................   172
    Environmental Issues of Concern..............................   173
    Morale, Welfare and Recreation Issues........................   173
        PX and commissary transportation.........................   173
        Credit...................................................   174
        Unified resources demonstration..........................   174
        Europe exchange drawdown.................................   175
        Military resale and MWR efficiencies.....................   175
        Commissary construction..................................   176
        Distilled spirits distribution...........................   176
        United Services Organization.............................   176
    Other Issues.................................................   176
        Norway prepositioning program............................   176
        Impact aid...............................................   177
        Military clothing sales stores, replacement sales........   177
        Navy enlisted storage space..............................   177
        Pilot project to improve economic adjustment planning....   178
        Contractor operated parts stores (COPARS)................   178
        Air Force automated maintenance data systems.............   178
    Legislative Provisions.......................................   201
Title IV--Military Personnel Authorizations......................   211
    Subtitle A--Active Forces....................................   211
        Section 401--end strengths for active forces.............   211
        Section 402--temporary variations in DOPMA authorized end 
          strength limitations for active duty Navy and Air Force 
          officers in certain grades.............................   211
    Subtitle B--Reserve Forces...................................   211
        Section 411--end strengths for selected reserve..........   211
        Section 412--end strengths for reserves on active duty in 
          support of the reserves................................   212
        Section 413--counting of active component personnel 
          assigned in support of reserve component training......   212
    Subtitle C--Military Training Student Loads..................   212
        Section 421--authorization of training student loads.....   212
    Subtitle D--Authorization of Appropriations..................   212
        Section 431--authorization for appropriations for 
          military personnel.....................................   212
        Section 432--authorization for increases in active duty 
          end strengths..........................................   213
Title V--Military Personnel Policy...............................   213
    Subtitle A--Officer Personnel Policy.........................   213
        Section 501--authority to extend transition period for 
          officers selected for early retirement.................   213
    Subtitle B--Matters Relating to Reserve Components...........   214
        Section 511--military technician full-time support 
          program for Army and Air Force reserve components......   214
        Section 512--military leave for military reserve 
          technicians for certain duty overseas..................   214
        Section 513--revisions to Army guard combat reform 
          initiative to include Army Reserve under certain 
          provisions and make certain revisions..................   214
        Section 514--ROTC scholarships for the National Guard....   215
        Section 515--report on feasibility of providing education 
          benefits protection insurance for service academy and 
          ROTC scholarship students who become medically unable 
          to serve...............................................   215
        Section 516--active-duty officers detailed to ROTC duty 
          at senior military colleges to serve as commandant and 
          assistant commandant of cadets and as tactical officers   215
        Section 517--mobilization income insurance program for 
          members of the ready reserve...........................   215
    Subtitle C--Matters Relating to Force Levels.................   216
        Section 521--floor on end strengths......................   216
        Section 522--Army officer manning levels.................   216
        Section 523--comptroller general review of proposed Army 
          end strength allocations...............................   216
        Section 524--manning status of highly deployable support 
          units..................................................   217
        Section 525--sense of Congress concerning personnel tempo 
          rates..................................................   217
    Subtitle D--Amendments to the Uniform Code of Military 
      Justice....................................................   217
        Section 541--references to Uniform Code of Military 
          Justice................................................   217
        Section 542--forfeiture of pay and allowances during 
          confinement by sentence of court-martial...............   218
        Section 543--refusal to testify before court-martial.....   218
        Section 544--flight from apprehension....................   218
        Section 545--carnal knowledge............................   218
        Section 546--time after accession for initial instruction 
          in the Uniform Code of Military Justice................   218
        Section 547--persons who may appear before the United 
          States Court of Appeals for the armed forces...........   218
        Section 548--discretionary representation by government 
          appellate defense counsel in petitioning Supreme Court 
          for writ of certiorari.................................   219
        Section 549--repeal of termination of authority for Chief 
          Justice of the United States to designate article III 
          judges for temporary service on Court of Appeals for 
          the Armed Forces.......................................   219
        Section 550--technical amendment.........................   220
    Subtitle E--Other Matters....................................   220
        Section 551--equalization of accrual of service credit 
          for officers and enlisted members......................   220
        Section 552--extension of expiring personnel authorities.   220
        Section 553--increase in educational assistance allowance 
          with respect to skills or specialties for which there 
          is a critical shortage of personnel....................   220
        Section 554--amendments to education loan repayment 
          programs...............................................   220
        Section 555--recognition by states of living wills of 
          members, certain former members, and their dependents..   220
        Section 556--transition compensation for dependents of 
          members of the armed forces separated for dependent 
          abuse..................................................   220
        Section 557--Army ranger training........................   220
        Section 558--repeal of certain civil-military programs...   222
        Section 559--eligibility for armed forces expeditionary 
          medal based upon service in El Salvador................   222
        Section 560--revision and codification of Military Family 
          Act and Military Child Care Act........................   223
        Section 561--discharge of members of the armed forces who 
          have the HIV-1 virus...................................   223
        Section 562--authority to appoint Brigadier General 
          Charles E. Yeager, United States Air Force (retired), 
          to the grade of Major General on the retired list......   223
        Section 563--determination of whereabouts and status of 
          missing persons........................................   223
        Section 564--nominations to service academies from 
          Commonwealth of the Northern Mariana Islands...........   224
    Items of Special Interest....................................   224
        Additional funds for recruiting..........................   224
        Enlistment propensity....................................   224
        Family advocacy program and new parent support program...   225
        Recruiting equity for general education development (GED) 
          certificates...........................................   225
        Air national guard fighter and airlift force structure 
          Revitalization of the reserve forces...................   226
        Army active component and reserve component offsite 
          agreement..............................................   227
        Air national guard support to the United States antarctic 
          program................................................   227
        Simultaneous membership program..........................   228
        Service academy admission acceptance decision point......   228
        Decorations for heroic acts..............................   228
Title VI--Compensation and Other Personnel Benefits..............   229
    Subtitle A--Pay and Allowances...............................   229
        Section 601--military pay raise for fiscal year 1996.....   229
        Section 602--limitation on basic allowance for 
          subsistence for members without dependents residing in 
          government quarters....................................   229
        Section 603--authorization of payment of basic allowance 
          for quarters to additional members assigned to sea duty   230
        Section 604--establishment of minimum amounts of variable 
          housing allowance for high housing cost areas and 
          additional limitation on reduction of allowance for 
          certain members........................................   230
        Section 605--clarification of limitation on receipt of 
          family separation allowance............................   230
    Subtitle B--Bonuses and Special and Incentive Pays...........   230
        Section 611--extension of certain bonuses for reserve 
          forces.................................................   230
        Section 612--extension of certain bonuses and special pay 
          for nurse officer candidates, registered nurses, and 
          nurse anesthetists.....................................   230
        Section 613--extension of authority relating to payment 
          of other bonuses and special pays......................   231
        Section 614--codification and extension of special pay 
          for critically short wartime health specialists in the 
          selected reserves......................................   231
        Section 615--change in eligibility requirements for 
          continuous monthly aviation incentive pay..............   231
        Section 616--continuous entitlement to career sea pay for 
          crewmembers of ships designated as tenders.............   231
        Section 617--increase in maximum rate of special duty 
          assignment pay for enlisted members serving as 
          recruiters.............................................   231
    Subtitle C--Travel and Transportation Allowances.............   231
        Section 621--authorization of return to United States of 
          formerly dependent children who attain age overseas....   231
        Section 622--authorization of dislocation allowance for 
          moves in connection with base realignments and closures   232
    Subtitle D--Other Matters....................................   232
        Section 631--elimination of unnecessary annual reporting 
          requirements regarding compensation matters............   232
        Section 632--study of joint process for determining the 
          location of recruiting stations........................   232
        Section 633--fiscal year 1996 cost-of-living adjustment 
          for military retirees..................................   232
Title VII--Health Care Provisions................................   233
    Subtitle A--Health Care Services.............................   233
        Section 701--modification of requirements regarding 
          routine physical examinations and immunizations under 
          CHAMPUS................................................   233
        Section 702--correction of inequities in medical and 
          dental care and death and disability benefits for 
          certain reservists.....................................   233
        Section 703--medical and dental care for members of the 
          selected reserve.......................................   233
    Subtitle B--TRICARE Program..................................   234
        Section 711--priority use of military treatment 
          facilities for persons enrolled in managed care 
          initiatives............................................   234
        Section 712--staggered payment of enrollment fees for 
          TRICARE................................................   234
        Section 713--requirement of budget neutrality for TRICARE 
          to be based on entire program..........................   234
        Section 714--training in health care management and 
          administration for TRICARE lead agents.................   235
        Section 715--evaluation and report on tricare 
          effectiveness..........................................   235
    Subtitle C--Uniformed Services Treatment Facilities..........   235
        Section 721--limitation on expenditures to support 
          uniformed services treatment facilities and limitation 
          on number of participants in USTF managed care plans...   235
        Section 722--application of federal acquisition 
          regulation to participation agreements with uniformed 
          services treatment facilities..........................   235
        Section 723--development of plan for integrating 
          uniformed services treatment facilities in managed care 
          programs of department of defense......................   236
        Section 724--equitable implementation of uniform cost 
          sharing requirements for uniformed services treatment 
          facilities.............................................   236
    Subtitle D--Other Changes to Existing Laws Regarding Health 
      Care Management............................................   236
        Section 731--maximum allowable payments to individual 
          health care providers under CHAMPUS....................   236
        Section 732--expansion of existing restriction on use of 
          defense funds for abortion.............................   237
        Section 734--redesignation of military health care 
          account as defense health program account and two-year 
          availability of certain account funds..................   237
    Subtitle E--Other Matters....................................   237
        Section 741--termination of program to train and utilize 
          military psychologists to prescribe psychotropic 
          medications............................................   237
        Section 742--waiver of collection of payments due from 
          certain persons unaware of loss of champus eligibility.   237
        Section 743--notification of certain champus-covered 
          beneficiaries of loss of champus eligibility...........   238
        Section 744--demonstration program to train military 
          medical personnel in civilian shock trauma units.......   238
        Section 745--study regarding Department of Defense 
          efforts to determine appropriate force levels of 
          wartime medical personnel..............................   238
        Section 746--study regarding expanded mental health 
          services for certain covered beneficiaries.............   239
        Section 747--report on improved access to military health 
          care for covered beneficiaries entitled to medicare....   239
    Items of Special Interest....................................   239
        Medicare reimbursement to the defense health program for 
          care provided to medicare-eligible beneficiaries.......   239
        Formation of veteran's wing within naval hospital Guam...   240
        Health-care sharing agreement between Department of 
          Veterans Affairs and Department of Defense.............   240
Title VIII--Acquisition Policy, Acquisition Management, and 
  Related Matters................................................   241
        Legislative Provisions...................................   241
        Section 801--repeals of certain procurement provisions...   241
        Section 802--fees for certain testing services...........   241
        Section 803--testing of defense acquisition programs.....   241
        Section 804--coordination and communication of defense 
          research activities....................................   241
        Section 805--addition of certain items to domestic source 
          limitation.............................................   241
        Section 806--revisions to procurement notice provisions..   241
        Section 807--international competitiveness...............   241
        Section 808--encouragement of use of leasing authority...   242
    Items of Special Interest....................................   242
        Implementation of the federal acquisition streamlining 
          act....................................................   242
        Management responsibility for acquisition policy.........   243
        Machine tool industrial base.............................   243
Title IX--Department of Defense Organization and Management......   243
    Legislative Provisions.......................................   243
        Section 901--reorganization of office of the Secretary of 
          Defense................................................   243
        Section 902--restructuring of Department of Defense 
          acquisition organization and workforce.................   244
        Section 903--plan for incorporation of department energy 
          national security functions in Department of Defense...   245
        Section 904--change in titles of certain Marine Corps 
          general officer billets resulting from reorganization 
          of the headquarters, Marine Corps......................   245
        Section 905--inclusion of the information resources 
          management college in the national defense university..   246
        Section 906--employment of civilians at the Asia-Pacific 
          center for security analysis...........................   246
        Section 907--continued operation of uniformed services 
          university of the health sciences......................   246
        Section 908--redesignation of advanced research projects 
          agency.................................................   246
    Items of Interest............................................   247
        Growth in legislative liaison operations.................   247
Title X--General Provisions......................................   247
    Subtitle A--Financial Matters................................   247
        Section 1001--transfer authority.........................   247
        Section 1002--incorporation of classified annex..........   248
        Section 1003--improved funding mechanisms for unbudgeted 
          operations.............................................   248
        Section 1004--designation and liability of disbursing and 
          certifying officials...................................   249
        Section 1005--authority for obligation of certain 
          unauthorized fiscal year 1995 defense appropriations...   249
        Section 1006--authorization of prior emergency 
          supplemental appropriations for fiscal year 1995.......   249
        Section 1007--prohibition on incremental funding of 
          procurement issues.....................................   249
    Subtitle B--Naval Vessels and Shipyards......................   250
        Section 1021--contract options for LSMR vessels..........   250
        Section 1022--vessels subject to repair under phased 
          maintenance contracts..................................   250
        Section 1023--clarification of requirements relating to 
          repairs of vessels.....................................   250
        Section 1024--naming of naval vessel.....................   250
        Section 1025--transfer of riverine patrol craft..........   250
    Subtitle C--Other Matters....................................   250
        Section 1031--termination and modification of authorities 
          regarding national defense technology and industrial 
          base, defense reinvestment, and defense conversion.....   250
        Section 1032--repeal of miscellaneous provisions of law..   250
    Items of Special Interest....................................   251
        Counter-drug activities..................................   251
        Chemical-biological warfare defense program..............   251
        Army experimental force..................................   254
        Integration of national security space programs..........   254
        Report on nuclear command, control, communications, and 
          intelligence...........................................   255
        Federal emergency management agency funding..............   255
Title XI--Cooperative Threat Reduction With States of the Former 
  Soviet Union...................................................   255
    Section 1101--specification of cooperative threat reductions.   255
    Section 1102--fiscal year 1996 authorization.................   256
    Section 1103--repeal of demilitarization enterprise fund 
      authority..................................................   257
    Section 1104--prohibition on use of funds for peacekeeping 
      exercises and related activities with Russia...............   258
    Section 1105--revision to authority for assistance for 
      weapons destruction........................................   258
    Section 1106--prior notice to Congress on obligation of funds   258
    Section 1107--report on accounting for United States 
      assistance.................................................   258
Title XII--Matters Relating to Other Nations.....................   259
    Subtitle A--Peacekeeping Provisions..........................   259
        Section 1201--limitation on expenditure of Department of 
          Defense funds for United States forces placed under 
          United Nations command or control......................   259
        Section 1202--limitation on use of Department of Defense 
          funds for United States share of costs of United 
          Nations peacekeeping activities........................   260
    Subtitle B--Humanitarian Assistance Programs.................   261
        Section 1211--overseas humanitarian, disaster, and civic 
          aid programs...........................................   261
        Section 1212--humanitarian assistance....................   261
        Section 1213--landmine clearance program.................   261
    Subtitle C--Other Matters....................................   261
        Section 1221--revision of definition of landmine for 
          purposes of landmine export moratorium.................   261
        Section 1222--extension and amendment of 
          counterproliferation authorities.......................   261
        Section 1223--prohibition on use of funds for activities 
          associated with the United States-People's Republic of 
          China joint defense conversion commission..............   261
        Section 1224--defense export loan guarantees.............   262
        Section 1225--accounting for burdensharing contributions.   262
        Section 1226--authority to accept contributions for 
          expenses of relocation within host nation of United 
          States armed forces overseas...........................   262
        Section 1227--sense of Congress on ABM treaty violations.   262
    Items of Special Interest....................................   262
        Report on North Korean military power....................   262
        African center for security studies......................   262
        Sharing of intelligence with the United Nations..........   263
Division B--Military Construction Authorizations.................   263
Purpose..........................................................   263
Overview.........................................................   265
    Quality of Housing, Installations, and Facilities............   265
    Base Closure and Realignment.................................   265
    NATO Security Investment Program.............................   272
Authorization For Military Construction..........................   272
Title XXI--Army..................................................   272
    Summary......................................................   272
    Legislative Provisions.......................................   272
        Section 2101--authorized Army construction and land 
          acquisition projects...................................   272
        Section 2102--family housing.............................   272
        Section 2103--improvements to military family housing 
          units..................................................   272
        Section 2104--authorization of appropriations, Army......   272
    Items of Special Interest....................................   273
        Repair and maintenance, Army.............................   273
        Improvements of military family housing..................   273
        Fort Dix, New Jersey.....................................   273
Title XXII--Navy.................................................   273
    Summary......................................................   273
    Legislative Provisions.......................................   274
        Section 2201--authorized Navy construction and land 
          acquisition projects...................................   274
        Section 2202--family housing.............................   274
        Section 2203--improvements to military family housing 
          units..................................................   274
        Section 2204--authorization of appropriations, Navy......   274
    Items of Special Interest....................................   274
        Repair and maintenance, Navy.............................   274
        Unspecified minor construction...........................   274
        Planning and design......................................   274
        Improvements of military family housing..................   275
        Power plant upgrade, public works center, Guam...........   275
        Navy SEAL facility, Guam.................................   275
        Ordnance storage needs of Marine Corps Air Station Yuma, 
          Arizona................................................   275
Title XXIII--Air Force...........................................   276
    Summary......................................................   276
    Legislative Provisions.......................................   276
        Section 2301--authorized Air Force construction and land 
          acquisition projects...................................   276
        Section 2302--family housing.............................   276
        Section 2303--improvements to military family housing 
          units..................................................   276
        Section 2304--authorization of appropriations, Air Force.   276
        Section 2305--retention of accrued interest on funds 
          deposited for construction of family housing, Scott Air 
          Force base, Illinois...................................   276
    Items of Special Interest....................................   277
        Improvements of military family housing..................   277
        Tyndall Air Force Base, Florida..........................   277
Title XXIV--Defense Agencies.....................................   277
    Summary......................................................   277
    Legislative Provisions.......................................   277
        Section 2401--authorized defense agencies construction 
          and land acquisition projects..........................   277
        Section 2402--family housing private investment..........   277
        Section 2403--improvements to military family housing 
          units..................................................   277
        Section 2404--energy conservation projects...............   277
        Section 2405--authorization of appropriations, defense 
          agencies...............................................   278
        Section 2406--modification of authority to carry out 
          fiscal year 1995 projects..............................   278
        Section 2407--limitation on expenditures for construction 
          project at Umatilla Army Depot, Oregon.................   278
Title XXV--North Atlantic Treaty Organization Infrastructure.....   278
    Summary......................................................   278
    Legislative Provisions.......................................   278
        Section 2501--authorized NATO construction and land 
          acquisition projects...................................   278
        Section 2502--authorization of appropriations, NATO......   278
Title XXVI--Guard and Reserve Forces Facilities..................   278
    Summary......................................................   278
    Legislative Provisions.......................................   279
        Section 2601--authorized guard and reserve construction 
          and land acquisition projects..........................   279
        Section 2602--correction in authorized uses of funds for 
          Army National Guard Projects in Mississippi............   279
Title XXVII--Expiration and Extension of Authorizations..........   279
        Section 2701--expiration of authorizations and amounts 
          required to be specified by law........................   279
        Section 2702--extension of authorizations of certain 
          fiscal year 1993 projects..............................   279
        Section 2703--extension of authorizations of certain 
          fiscal year 1992 projects..............................   279
        Section 2704--effective date.............................   280
Title XXVIII--General Provisions.................................   280
    Subtitle A--Military Construction Program and Military Family 
      Housing Changes............................................   280
        Section 2801--alternative means of acquiring and 
          improving family housing and supporting facilities for 
          the armed forces.......................................   280
        Section 2802--inclusion of other armed forces in Navy 
          program of limited partnerships with private developers 
          for military housing...................................   280
        Section 2803--special unspecified minor construction 
          thresholds for projects to correct life, health, and 
          safety deficiencies and clarification of unspecified 
          minor construction authority...........................   280
        Section 2804--disposition of amounts recovered as a 
          result of damage to real property......................   281
        Section 2805--rental of family housing in foreign 
          countries..............................................   281
        Section 2806--pilot program to provide interest rate buy 
          down authority on loans for housing within housing 
          shortage areas at military installations...............   281
    Items of Special Interest....................................   281
        Impediments to reform of military family housing.........   281
        Measurement of housing deficiencies......................   281
    Subtitle B--Defense Base Closure and Realignment.............   282
        Section 2811--authority to transfer property at military 
          installations to be closed to persons who construct or 
          provide military family housing........................   282
        Section 2812--deposit of proceeds from leases of property 
          located at installations being closed or realigned.....   282
        Section 2813--agreements for certain services at 
          installations being closed.............................   282
    Items of Special Interest....................................   282
        Management of excess military lands for certain 
          recreational purposes..................................   282
    Subtitle C--Land Conveyances Generally.......................   283
        Section 2821--transfer of jurisdiction, Fort Sam Houston, 
          Texas..................................................   283
        Section 2822--land acquisition or exchange, Shaw Air 
          Force Base, Sumter, South Carolina.....................   283
         Section 2823--transfer of certain real property at Naval 
          Weapons Industrial Reserve Plant, Calverton, New York, 
          for use as National Cemetery...........................   283
        Section 2824--land conveyance, Fort Ord, California......   283
        Section 2825--land conveyance, Indiana Army Ammunition 
          Plant, Charlestown, Indiana............................   283
        Section 2826--land conveyance, Naval Air Station, 
          Pensacola, Florida.....................................   284
        Section 2827--land conveyance, Avon Park Air Force Range, 
          Sebring, Florida.......................................   284
        Section 2828--land conveyance, Parks Reserve Forces 
          Training Area, Dublin, California......................   284
        Section 2829--land conveyance, Holston Army Ammunition 
          Plant, Mount Carmel, Tennessee.........................   284
        Section 2830--land conveyance, Naval Weapons Industrial 
          Reserve Plant, Mcgregor, Texas.........................   284
        Section 2831--transfer of jurisdiction and land 
          conveyance, Fort Devens Military Reservation, 
          Massachusetts..........................................   285
        Section 2832--land conveyance, Elmendorf Air Force Base, 
          Alaska.................................................   285
        Section 2833--land conveyance alternative to existing 
          lease authority, Naval Supply Center, Oakland, 
          California.............................................   285
    Subtitle D--Land Conveyances Involving Utilities.............   286
        Section 2841--conveyance of resource recovery facility, 
          Fort Dix, New Jersey...................................   286
        Section 2842--conveyance of water and wastewater 
          treatment plants, Fort Gordon, Georgia.................   286
        Section 2843--conveyance of electrical distribution 
          system, Fort Irwin, California.........................   286
    Subtitle E--Other Matters....................................   286
        Section 2851--expansion of authority to sell electricity.   286
        Section 2852--authority for Mississippi State Port 
          Authority to use navy property at naval construction 
          battalion center, Gulfport, Mississippi................   287
        Section 2853--prohibition on joint civil aviation use of 
          Naval Air Station Miramar, California..................   287
        Section 2854--report regarding army water craft support 
          facilities and activities..............................   287
    Items of Special Interest....................................   287
        Wargaming infrastructure and facilities..................   287
Division C--Department of Energy National Security Authorizations 
  and Other Authorizations.......................................   298
Title XXXI--Department of Energy National Security Programs......   298
    Purpose......................................................   298
    Overall Concerns.............................................   298
    Subtitle A--National Security Program Authorizations.........   298
        Summary of committee changes.............................   298
        Section 3101--weapons activities.........................   301
        Section 3102--defense environmental restoration and waste 
          management.............................................   301
        Section 3103--payment of civil penalties.................   302
        Section 3104--other defense activities...................   302
        Section 3105--defense nuclear waste disposal.............   302
    Subtitle B--Legislative Provisions...........................   302
        Section 3121--reprogramming..............................   302
        Section 3122--limits on general plant projects...........   302
        Section 3123--limits on construction projects............   302
        Section 3124--fund transfer authority....................   302
        Section 3125--authority for conceptual and construction 
          design.................................................   303
        Section 3126--authority for emergency planning, design, 
          and construction activities............................   303
        Section 3127--funds available for all national security 
          programs of the department of energy...................   303
        Section 3128--availability of funds......................   303
    Subtitle C--Program Authorizations, Restrictions, and 
      Limitations................................................   303
        Section 3131--authority to conduct program relating to 
          fissile materials......................................   303
        Section 3132--national ignition facility.................   303
         Section 3133--tritium production........................   304
     Subtitle D--Other Matters...................................   305
         Section 3141--report on foreign tritium purchases.......   305
         Section 3142--study on nuclear test readiness postures..   305
         Section 3143--master plan on warheads in the enduring 
          stockpile..............................................   306
         Section 3144--prohibition on international inspections 
          of Department of Energy facilities unless protection of 
          restricted data is certified...........................   306
     Items of Interest...........................................   306
         Enhanced surveillance...................................   306
         Accelerated strategic computing initiative..............   306
         Dual revalidation.......................................   307
         Advanced manufacturing..................................   307
         Stockpile management activities.........................   308
         Dual-axis radiographic hydrodynamic test facility.......   308
         Technology transfer.....................................   308
         National resource center for plutonium..................   308
         Emergency management....................................   309
         Merger of capital equipment and general plant project 
          funding................................................   309
         International center for applied research...............   309
         Nevada test site........................................   310
         Reporting requirement for the total project costs for 
          construction activities................................   310
         Commission on management of environmental restoration 
          and waste management program contracts at Department of 
          Energy sites...........................................   310
Title XXXII--Defense Nuclear Facilities Safety Board 
  Authorization..................................................   325
     Legislative Provision.......................................   325
         Section 3201--authorization.............................   325
Title XXXIII--National Defense Stockpile.........................   325
     National Defense Stockpile Issues...........................   325
     Legislative Provisions......................................   325
         Section 3301--fiscal year 1996 authorized use of 
          stockpile funds........................................   325
         Section 3302--preference for domestic upgraders in 
          disposal of chromite and manganese ores and chromium 
          ferro and manganese metal electrolytic.................   325
        Section 3303--restrictions on disposal of manganese ferro   326
         Section 3304--titanium initiative to support battle tank 
          upgrade program........................................   326
Title XXXIV--Naval Petroleum Reserve.............................   326
     Naval Petroleum & Oil Shale Reserves........................   326
     Legislative Provisions......................................   327
         Section 3401--authorization of appropriations...........   327
         Section 3402--price requirement on sale of certain 
          petroleum during fiscal year 1996......................   327
         Section 3403--sale of naval petroleum reserve numbered 1 
          (Elk Hills)............................................   327
         Section 3304--study regarding future of naval petroleum 
          reserves (other than naval petroleum reserve numbered 
          1).....................................................   327
Title XXXV--Panama Canal Commission..............................   327
     Subtitle A--Authorization of Appropriations.................   327
     Subtitle B--Reconstitution of Commission as Government 
      Corporation................................................   328
Departmental Data................................................   328
Department of Defense Authorization Request......................   329
Military Construction Authorization Request......................   329
Committee Position...............................................   330
Communications From Other Committees.............................   330
Fiscal Data......................................................   333
Congressional Budget Office Estimate.............................   333
Congressional Budget Office Cost Estimate........................   333
     Authorization of Appropriations.............................   338
Committee Cost Estimate..........................................   346
Inflation-Impact Statement.......................................   346
Oversight Findings...............................................   346
Roll Call Votes..................................................   347
Changes in Existing Law Mode by the Bill, as Reported............   373
Additional Views of Herbert H. Bateman...........................   645
Additional Views of Robert K. Dornan.............................   648
Additional Views of Chet Edwards.................................   650
Dissenting Views of Ronald V. Dellums, Patricia Schroeder, Lane 
  Evans and Martin T. Meehan.....................................   652
Dissenting Views of Rep. Lane Evans..............................   656
Dissenting Views on the Provisions Requiring the Immediate 
  Separation of HIV-Positive Personnel and Banning Abortions in 
  Military Hospitals Overseas of Jane Harman, Rosa DeLauro, 
  Ronald Dellums, Pat Schroeder, Lane Evans, Neil Abercrombie, 
  Martin Meehan, Mike Ward.......................................   657
Additional and Dissenting Views of Patrick J. Kennedy............   659


104th Congress                                                   Report
                       HOUSE OF REPRESENTATIVES 
 1st Session                                                    104-131

======================================================================



 
        NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 1996

                                _______
                                

  June 1, 1995.--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 Armed Services, submitted the 
                               following

                              R E P O R T

                             together with

             ADDITIONAL, SUPPLEMENTAL, AND DISSENTING VIEWS

                        [To accompany H.R. 1530]

      [Including cost estimate of the Congressional Budget Office]

                 Explanation of the Committee Amendment

    The committee adopted an amendment in the nature of a 
substitute during the consideration of H.R. 1530. The remainder 
of the report discusses the bill, as amended.

                                Purpose

    The bill would--
          (1) Authorize appropriations for fiscal years 1996 
        through 2000 for procurement and for research, 
        development, test and evaluation (RDT&E;);
          (2) Authorize appropriations for fiscal year 1996 for 
        operation and maintenance (O&M;) and working capital 
        funds;
          (3) Authorize for fiscal year 1996: (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 1996 for 
        military construction and family housing;
          (6) Authorize appropriations for fiscal year 1996 for 
        the Department of Energy National Security Programs;
          (7) Modify provisions related to the National Defense 
        Stockpile; and
          (8) Authorize appropriations for fiscal year 1996 for 
        the operation of the Panama Canal Commission.

            Relationship of Authorization and Appropriations

    Importantly, 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.
    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 $257.6 billion 
for the National Defense budget function for fiscal year 1996. 
Of this amount, the President requested $245.8 billion for the 
Department of Defense (including $10.7 billion for military 
construction and family housing) and $11.2 billion for 
Department of Energy National Security Programs and the Defense 
Nuclear Facilities Safety Board.
    The committee recommends an overall level of $267.3 billion 
in budget authority. This amount is an increase of 
approximately $9.7 billion from the amount requested for the 
National Defense function by the President. Overall, the 
committee's recommendation is largely consistent with the 
amounts established in the House-passed Budget Resolution for 
fiscal year 1996.

                    SUMMARY TABLE OF AUTHORIZATIONS

    The following table provides a summary of the amounts 
requested and that would be authorized for appropriation in the 
bill and (in the column labeled ``Budget Authority Implication 
of Committee Recommendation'') the committee's estimate of how 
the committee's recommendations relate to the budget totals for 
the National Defense function in the Budget Resolution. 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.

    Offset Folios 26 to 28 Insert here



                    RATIONALE FOR THE COMMITTEE BILL

    The committee's action on the National Defense 
Authorization Act for Fiscal Year 1996 acknowledges the 
evolving nature of the post-Cold War strategic order: worldwide 
power balances have shifted, and geopolitical structures that 
have held regional hatreds and rivalries in check have 
disintegrated. While the United States no longer faces an 
immediate global challenge from a competing superpower, it now 
faces a multiplicity of challenges to its ability to protect 
and promote its national interests around the globe. The 
collapse of the Soviet Union has by no means meant the end of 
discord and conflict among nation states.
    This bill establishes the course for what the committee 
believes is the beginning of an important revitalization of 
America's armed forces to better meet these challenges. 
Maintaining American strength and presence in the chaos and 
confusion of the post-Cold War world will not be possible 
without a properly sized, trained and equipped military. As a 
nation with global interests, the United States must be able to 
respond decisively across the entire spectrum of military 
conflict--from unconventional to increasingly high-technology 
conventional and ultimately to strategic nuclear warfare. As a 
nation, we can ill afford to let our capabilities in any of 
these areas erode. However, defense budgets and military force 
structure have dramatically declined over the last ten years. 
This bill decisively halts this decade-long slide, establishing 
a floor from which to stabilize U.S. military capabilities as 
well as reinvigorate long-term defense investment.
    Clearly, however, freezing the defense budget after a ten-
year decline will not fully provide the necessary resources to 
support the Clinton administration's expansive, albeit 
ambiguous national security strategy. In a clear shift from 
America's Cold War policy of containment, the administration 
has embarked upon an ambitious policy of ``engagement'' and 
``enlargement.'' While these are principles, they are certainly 
not policies, with the predictable result that U.S. military 
power is increasingly dissipated upon missions of ambiguous 
purpose and of mere peripheral relation to vital national 
interests.
    Moreover, the Administration has chosen to regard these 
missions, and the expanding roster of so-called ``peace 
operations'' they mandate, as an assumed subset of the major 
regional contingencies (MRC) that form the fundamental building 
block for our national military strategy and planning. However, 
it is increasingly clear that the Administration remains 
unwilling to devote the resources necessary not only to support 
its own two-MRC strategy, but also the additional resources 
necessary to carry out extensive operations other than war.
    Consequently, a dangerous inconsistency has arisen between 
America's announced strategic intentions and the reality of 
maintaining the military forces required to act decisively on 
those intentions. Because the potential threats to our national 
interests continue to multiply, we can no longer rely 
exclusively upon nuclear deterrence to accomplish our larger 
strategic objectives, as done during the Cold War. Under 
current conditions, the growing gap between declared strategy 
and actual capability will have swifter and surer consequences 
across a wide range of regional crises.
    This strategy-forces-resources mismatch has also had 
profound consequences for the readiness of U.S. military 
forces. The shortage of funds, coupled with the higher 
operating tempos required by multiple peace operations other 
than war, has resulted in deteriorating readiness for front-
line, active-duty units. The Administration's attempt to 
address this near-term problem within the context of a 
declining budget has resulted in the virtual elimination of 
whatever modest planning previously existed to prepare for 
future challenges to U.S. national security interests. 
Modernization, by most accounts the key to long-term readiness, 
has been over-mortgaged by the Administration in a desperate 
attempt to bolster near-term readiness requirements.
    In response, the committee's bill represents an attempt to 
reorder spending priorities to better address both near- and 
long-term readiness, modernization and other core defense 
needs. The shifting strategic landscape demands not merely 
rapid response to current threats, but prudent planning today 
for tomorrow's challenges. Unless preparations to address both 
immediate and future challenges are properly balanced within 
the context of strategic decision-making, the United States 
will find itself unable to effectively respond to emerging 
global competitors or new military capabilities in the hands of 
regional powers.
    Shortfalls and shortcomings in the Administration's budget, 
estimated in the hundreds, not tens of billions, make 
revitalizing and reshaping U.S. military capabilities an urgent 
task. Clinging to past successes--even those as recent as the 
Persian Gulf War--is no substitute for keeping an eye on the 
future by making difficult choices in the present.
    An uncertain but violent world also places an increasingly 
important premium on a more agile Department of Defense. 
Inefficient and outdated practices will detract directly from 
our military's ability to meet its mission in a resource-
constrained environment. The Pentagon bureaucracy will have to 
be as responsive as the forces it supports.
    This new measure of agility must reflect more than the 
result of aggressive acquisition and bureaucratic reform. It 
must also manifest itself in a Department more singularly 
focused on issues of national defense--non-defense initiatives, 
in many cases worthwhile cases, will have to play a lesser role 
in the budgets of a leaner Department of Defense. While 
creating and encouraging more efficient defense practices, the 
Department must return to basics: it is the only way the 
American taxpayer and, more importantly, those in uniform, will 
get the most defense out of every defense dollar.

                         Addressing Shortfalls

    The thrust of the committee's actions in adjusting the 
President's fiscal year 1996 defense request was aimed at 
addressing near- and long-term shortfalls in three of the 
critical components that make up military readiness; quality of 
life, core readiness and modernization. In addition, the bill 
includes a host of structure and process reforms intended to 
produce a more efficient, and more effective Department of 
Defense. As an intended consequence, such reforms will also 
generate savings that are essential to a politically and 
financially sustainable approach to maintaining a military 
capability that remains second-to-none.

                            Quality of Life

    The committee remains concerned that the quality of 
military life continues to erode. As dollars decline, critical 
services are being cut back. As deployments--and family 
separations--lengthen and increase in cost, spending for 
construction and maintenance of family housing, troop barracks 
and other essential infrastructure is being deferred. The 
committee has recommended a range of initiatives to begin 
stabilizing and hopefully restoring the quality of life owed 
those who serve in the nation's armed forces.
    First, the committee has approved the administration's 
request for a pay raise as required by law. The committee 
welcomes the Administration's belated recognition of the 
importance of a pay raise after two years during which the 
President's budget proposed to freeze or substantially reduce 
military pay. To more fully address deficiencies in troop and 
family housing, the committee funded a series of expanded and 
accelerated housing improvements to address shortfalls not 
currently budgeted by the Administration. The committee also 
recommended a series of steps in the areas of basic allowances 
for quarters and the variable housing allowance to ease the 
severe financial strain on many of our military personnel and 
their families.
    Prompted by indications that the Administration was 
considering further reductions in personnel below the already 
low Bottom Up Review levels, the bill would also establish in 
law personnel endstrength ``floors'' for each service. The 
committee's action is based on the need to ensure, in the 
administration's own words, the minimum forces necessary to 
implement the national strategy. In addition, the committee has 
also recommended additional funds to increase endstrengths 
above those requested by the Administration. The committee 
believes that a small but targeted endstrength increase will 
help to lower personnel tempos in certain high demand units 
that are disproportionally bearing the brunt of the 
Administration's deployment of military forces around the 
world.
    Other recommended initiatives range from the mundane--
assuring that Navy enlisted personnel assigned to surface ships 
are provided with adequate storage space ashore--to those which 
are the pillars of military quality of life programs--ensuring 
the long-term viability of the commissary and exchange system 
and morale, recreation and welfare benefits. Each is intended 
to calm the growing turbulence of service life during an 
extended downsizing--a turbulence that has been exacerbated by 
the Administration's heavy reliance on the military for 
operations other than war.

                             Core Readiness

    The increased pace of contingency operations is 
overextending a shrinking U.S. military and consequently, the 
services are being asked to do more with less. The increased 
use of this smaller force has created short and long-term 
readiness problems. Planned training events have been deferred 
or canceled outright, spare parts have not been bought and 
necessary maintenance on both equipment and infrastructure has 
been delayed.
    The committee recognizes that readiness is a complex issue, 
consisting not only of current requirements but of future 
needs, and thus has taken a comprehensive approach to 
addressing as many of these shortfalls as possible. This bill 
mandates that the Department reconsider its readiness reporting 
procedures to better capture unit readiness over time. The 
committee was concerned to learn late last year, just weeks 
after having been assured by senior Department officials that 
force readiness was as high as it had ever been, that all 
services were suffering through severe readiness shortcomings. 
The committee believes the traditional system for measuring 
readiness is inadequate, representing only a ``snapshot'' and 
providing ambiguous predictive value of future force readiness. 
The committee has concluded that a comprehensive readiness 
system based on relevant and reliable indicators, measuring not 
only current readiness but providing warning of future 
problems, is required.
    Although the Administration responded to last fall's 
reports of declining readiness by increasing defense spending 
slightly over the five-year plan, their welcome, albeit 
belated, recognition of the problem falls far short of 
addressing a problem of this magnitude. Accordingly, the 
committee has recommended additional spending in core readiness 
accounts such as depot maintenance in order to bring backlogs 
down and get equipment back into the field, real property 
maintenance to begin addressing what is likely to be a thirty 
to fifty year problem of halting the deterioration of base 
support facilities, mobility enhancements to allow for more 
timely deployment of forces, and reserve component readiness.
    Finally, the committee has taken a two-track approach to 
addressing the problems caused by the Administration's use of 
budgeted readiness funds to pay for the costs of unbudgeted 
contingency operations. In the case of unbudgeted and unplanned 
operations, the committee bill would provide an interim 
financing authority that protects core readiness accounts in 
the early stages of such operations while the Administration 
secures supplemental funding. In the case of unbudgeted but 
planned (i.e., ongoing) operations, the committee bill would 
require that the Administration seek funds in advance of such 
operations that are expected to continue into the next fiscal 
year. Should the Administration ignore this requirement and 
Congress does not unilaterally provide supplemental funding, 
funds for the operation in question would be cut off.

                             Modernization

    The committee remains deeply concerned with the 
Department's lack of a viable long-range modernization program. 
Moreover, the committee is alarmed that the Department 
continues to exacerbate this problem by canceling or deferring 
modernization programs in order to address near-term readiness 
shortfalls. For example, the fiscal year 1996 procurement 
budget is approximately $9 billion less than was proposed for 
fiscal year 1996 by last year's budget request. The drastic 
cuts in just one year--the fiscal year 1996 procurement request 
marks a 15 percent decline over current fiscal year spending--
in the context of a decade of decline has resulted in a budget 
request representing the lowest defense procurement budget in 
45 years.
    The fiscal year 1996 procurement budget request does not 
provide for the acquisition of any new bombers, scout or attack 
helicopters, tanks or fighting vehicles, Air Force fighter 
aircraft or small arms. In fact, many programs cited by the 
Department as central to the viability of the Bottom Up Review 
strategy just 18 months ago have been deferred, canceled or 
scaled-back to a development-only status. Even the Secretary of 
Defense has publicly admitted that modernization is woefully 
lacking in the Department's long-range budgeting and planning 
priorities.
     Consequently, the committee has undertaken a number of 
initiatives to stabilize the modernization accounts and key 
elements of the defense industrial base. These include the 
procurement of F-16 and F-15E attrition reserve aircraft, 
additional precision guided munitions, small arms, ammunition, 
tactical wheeled vehicles, scout helicopters, sealift ships, a 
third DDG-51 destroyer and a LPD amphibious transport dock ship 
for the Marine Corps. Looking ahead to fiscal year 1997, the 
committee also provided long-lead funding for additional B-2 
bombers and UH-60 Blackhawk helicopters.
     The status of the research and development budget--the 
``seed corn'' essential to ensuring the U.S. military's 
technological edge twenty or thirty years from now--is only 
marginally better. The fiscal year 1996 budget request marked a 
reduction of $1.7 billion from the current fiscal year spending 
levels. Moreover, as the Administration has reduced overall 
research and development spending, it has also increasingly 
relied upon these smaller budgets to fund a range of non-
defense initiatives such as the Technology Reinvestment 
Program. This trend of declining top-line allocations and 
expanding non-defense spending has had the effect of 
``cannibalizing'' the Department's research and development 
budgets from within.
     The committee's research and development recommendations 
include an attempt to revitalize the Army's moribund 
modernization program, a renewed emphasis on the Navy's 
littoral warfare programs in anti-submarine warfare, mine 
countermeasures and naval surface fire support, as well as a 
significant boost to the Air Force's space and reusable launch 
efforts. However, the centerpiece of the committee's efforts to 
refocus defense research is found in its efforts to 
reinvigorate the ballistic missile defense program. As rogue 
nations determinedly seek to acquire weapons of mass 
destruction and the technology to deliver them over great 
distances, the United States can ill-afford not to pursue a 
more robust effort to develop and deploy effective theater and 
national missile defenses.
     The nation must not forget how a crude, conventionally-
armed Scud missile accounted for the greatest single loss of 
American lives during the Gulf War. Contrary to those who 
criticize attempts to defend U.S. troops or the American people 
from these weapons of terror, a massive SDI-like program to 
deploy exotic technologies is not envisioned. Yet it would be 
unconscionable in this emerging world of proliferating 
technology not to protect our troops abroad as well as 
Americans at home from ballistic missile attack--whether 
deliberate or accidental. Theater and national missile defense 
must once again become a national priority. To this end, the 
committee has accelerated funding for both theater and national 
missile defense programs.

                         Reforming the Pentagon

    Although military and civilian force structure has been 
downsized in recent years, the same is not true for the defense 
bureaucracy--involving either infrastructure and overhead 
reductions or improvements in inefficient and often obsolete 
business practices. Therefore, structural and process reforms 
are essential if the Department is to provide the best quality 
goods and services at the lowest cost. Moreover, aggressive 
reforms are in order to generate necessary savings to sustain 
adequate levels of funding for quality of life, core readiness 
and modernization initiatives.
     The committee has taken several initiatives to begin 
structurally reducing the Pentagon's bureaucracy. First, the 
Office of the Secretary of Defense (OSD) would be reduced by at 
least 25% over four years. The committee was dismayed to learn 
that while the defense budget has declined by 34% and military 
force structure by 28% over the past decade, the size of OSD 
has actually grown by 22%. As part of the committee's 
reorganization initiatives, the number of Assistant Secretary 
positions would be reduced from the current eleven to nine. In 
order to allow the Secretary of Defense maximum flexibility to 
reorganize his own office, the committee recommends repeal of a 
number of provisions of current law that would prevent the 
Secretary from downsizing in the most orderly and efficient 
manner.
     Second, the committee would direct an accelerated 
downsizing of the bloated civilian acquisition workforce to 25% 
over four years. As a fiscal year 1996 ``downpayment,'' the 
committee would also direct an acquisition personnel reduction 
of 30,000. Approximately 50% of the Department's 867,000 
civilians are currently employed in some element of the 
acquisition bureaucracy. In tandem with the personnel 
reductions, the committee would direct the Secretary to begin 
eliminating duplicative functions among the Department's 
numerous acquisition organizations. This structural downsizing, 
in combination with additional reforms of the overly complex 
and burdensome federal and defense acquisition process are 
central components to allowing the Department to operate in a 
more cost-effective and productive manner in the future.
     While the committee considers last year's enactment of the 
Federal Acquisition Streamlining Act of 1994 as a significant 
step toward a more efficient federal procurement process, it 
was nonetheless an incremental step. The committee believes 
that a more fundamental reassessment of the policies and 
principles that underlie federal acquisition policy is in order 
and has begun a comprehensive review of such policies in tandem 
with other committees of the House with jurisdiction in this 
area.
     These concerns underlie the committee's wide range of 
recommended structural and process reforms. Without dramatic 
change in the way in which the Department conducts its 
business, it will never be able to effectively respond to the 
challenges of the post Cold War world, maximize the defense 
output of every defense dollar or rebuild the taxpayer's 
confidence in the Pentagon.

                               Conclusion

     In developing the bill, the committee has taken a 
comprehensive series of steps to build a solid foundation for 
the revitalization of the U.S. military following a decade of 
decline. However, the committee recognizes that the challenges 
facing the defense establishment will require a longer-term 
sustained effort to protect core readiness, restore personnel 
quality of life and rebuild a virtually non-existent equipment 
modernization program. The committee stands prepared to 
continue this process in the years ahead to ensure that U.S. 
military capabilities are up to the difficult but certain 
challenges that an unsettled world will bring.

                                HEARINGS

     Committee consideration of the Defense authorization bill 
for fiscal year 1996 results from extensive hearings that began 
on January 18, 1995 and that were completed on May 3, 1995. The 
full committee conducted 12 sessions, including markup 
meetings. In addition, a total of 44 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


                         Modernization Overview

    The committee continues to be concerned with the 
Department's anemic pace of equipment modernization, and notes 
with distress the delay or cancellation of long-term 
modernization programs to fund near-term personnel and 
readiness shortfalls. The fiscal year 1996 procurement budget 
request of $39.4 billion is $5.4 billion less than fiscal year 
1995--a 15 percent cut in one year--and $9 billion less than 
was forecast for fiscal year 1996 by the Department one year 
ago. Furthermore, this request represents, after adjusting for 
inflation, the eleventh consecutive year of decline in the 
procurement account--cumulatively totaling 71 percent since 
fiscal year 1985--and the lowest procurement budget in 45 
years.
    The committee notes that the budget request does not 
provide for the acquisition of any bombers, scout or attack 
helicopters, new tanks or fighting vehicles, amphibious 
transport dock ships, Air Force fighter aircraft, or Army small 
arms procurement. With few exceptions, equipment modernization 
has come to a virtual standstill. Moreover, certain programs 
that the Department's Bottom Up Review endorsed just 18 months 
ago have been slipped, terminated or reduced to a development-
only status. For the last year, CBO has testified that it will 
require $7-$30 billion per year, each of the first ten years of 
next century, above projected 1999 spending levels to properly 
equip and modernize the smaller Bottom Up Review force. The 
implications of this dramatic underfunded shortfall on the 
services as well as on the industrial base are obvious.
    In order to better understand the implications of the 
Department's ``procurement holiday,'' the committee held 
hearings to examine whether requirements continue to exist for 
certain programs; if so, the schedule associated with 
addressing these requirements; and the impact on the industrial 
base if either the requirements do not exist, are unfunded, or 
are sequenced such that they create production gaps. The 
committee was impressed by the testimony given by four retired 
four-star officers, whose recent assessment of current military 
capabilities and readiness concluded with the following 
admonition:

          Each generation owes the next a duty to invest in 
        their future, to ensure they will have the equipment 
        necessary to meet the challenges that will surely 
        confront them. Today we are failing utterly to make 
        that investment. Our legacy to the next generation is 
        likely to be 45-year-old training aircraft, 35-year-old 
        bombers and airlifters, 25-year-old fighters, 35-year-
        old trucks, and 40-year-old medium lift helicopters. If 
        care is not taken to ensure mid-term readiness through 
        modernization and long-term readiness through 
        investment in research and development, we will 
        eventually find ourselves facing an insurmountable bill 
        to replace entire inventories of aging equipment with 
        an industrial base unprepared for the task.

    In response to this admonition and in order to prevent the 
atrophy of critical components of the industrial base, the 
committee has added over $6 billion to various modernization 
programs in this and other titles. Highlights include:

                        [In millions of dollars]

Army:
    UH-60L advanced procurement...................................    75
    OH-58D........................................................   125
    Javelin missiles..............................................    39
    Hellfire II missiles..........................................    40
    TOW II missiles...............................................    20
    MLRS rockets & launchers......................................    59
    ATACMS missiles...............................................    18
    Small arms....................................................    77
    Ammunition....................................................   268
    Medium trucks.................................................   110
    Heavy trucks..................................................   100
    HMMWVs........................................................    39
    Communications equipment......................................    83
Navy/Marine Corps:
    AV-8B.........................................................   160
    E-2C..........................................................    70
    SLAM missiles.................................................    40
    DDG-51 Aegis destroyer........................................   650
    LPD-17........................................................   974
    ammunition....................................................   150
Air Force:
    B-2...........................................................   553
    F-15E.........................................................   250
    F-16C/D.......................................................   175
    Non-Developmental Airlift Aircraft............................    70
    AGM-130 missiles..............................................    45
    AGM-142 HAVE NAP missiles.....................................    39
    Conventional Air-Launched Cruise Missiles.....................    27
Defense-Wide:
    National Guard & Reserve Equipment............................   770
    Offset Folio 42 Insert here



                       Aircraft Procurement, Army


                                overview

    The budget request contained $1,223.1 million for Aircraft 
Procurement, Army in fiscal year 1996. The committee recommends 
authorization of $1,423.1 million for fiscal year 1996.
    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.
    Offset Folio 44 Insert here



OH-58D Armed Kiowa Warrior

    The budget request contained $71.3 million for upgrade of 
33 OH-58D helicopters to the Armed Kiowa Warrior configuration. 
While the Army currently plans for the Kiowa Warrior to provide 
critical armed reconnaissance capability on an interim basis 
until fielding the RAH-66 Comanche, the committee notes that 
the current inventory of Armed Kiowa Warriors is still well 
below the requirement for over 507 aircraft. Moveover, the 
committee observes that the Comanche program continues to 
experience program delays and currently has no Department-
approved production schedule or fielding date.
    For these reasons, the committee feels the Army should 
continue the Armed Kiowa Warrior upgrade program and recommends 
authorization of $196.3 million, an increase of $125 million, 
to fund an additional 20 aircraft. The committee recommends a 
legislative provision (sec. 111) that would modify current law 
to permit this procurement.

UH-60L helicopter

    The budget request contained $334.9 million for procurement 
of 60 Blackhawk medium lift helicopters. The committee notes 
that the Army is terminating this program after fiscal year 
1996, even though following delivery of these last 60 aircraft, 
the Blackhawk fleet will stand more than 700 helicopters short 
of the stated requirement for the 10-active-division Army. 
Moreover, the committee observes that neither the Navy, the 
Marine Corps, nor the Air Force is procuring any additional 
helicopters in the foreseeable future and that the only new 
helicopter program in development--the Army's RAH-66 Comanche--
is not funded for production.
    Given these circumstances, the committee believes there is 
a compelling need to maintain the Blackhawk production line and 
therefore recommends $75 million for advanced procurement of 36 
helicopters in fiscal year 1997. The committee urges the Army 
to fully fund these 36 aircraft in the fiscal year 1997 budget.

                       Missile Procurement, Army


                                overview

    The budget request contained $676.4 million for Missile 
Procurement, Army in fiscal year 1996. The committee recommends 
authorization of $862.8 million for fiscal year 1996.
    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.
    Offset Folio 48 Insert Here



Hellfire missile

    The budget request contained $209.5 million, which included 
$197.5 million to procure 352 Longbow Hellfire missiles and $12 
million for post-production support for the Hellfire II 
program. The committee notes that the Army has prematurely 
stopped production of Hellfire II missiles well short of 
requirements due to budget constraints. While the Longbow 
Hellfire is sufficiently funded to enter production, this 
newest variant of the Hellfire family is not intended to fill 
all Hellfire requirements, and does not address the remaining 
requirement for over 6000 Hellfire II missiles.
    The committee is informed that an additional $40 million, 
combined with the $12 million requested for post production 
support, would enable the Army to procure 750 Hellfire II 
missiles. Accordingly, the committee recommends authorization 
of $249.5 million, of which $52 million is for procurement of 
750 Hellfire II missiles.

Stinger missile modifications

    The budget request contained $10.1 million for retrofitting 
upgrades to 650 Stinger missiles. While this enhancement to 
existing missiles provides a valuable increase in close air 
defense for Army forces, the program is currently constrained 
by a Department-directed annual funding ceiling of $10 million 
through fiscal year 1999. The committee does not agree with 
this arbitrary ceiling and understands that adding $10 million 
to the budget request will enable the Army to upgrade an 
additional 550 missiles. Therefore, the committee recommends 
authorization of $20.1 million to be used to upgrade at least 
1200 existing Stinger missiles.

Multiple launch rocket system launcher systems

    The budget request contained $48.2 million for annual 
support and fielding of the Army's Multiple Launch Rocket 
System (MLRS) launcher systems, but this amount did not include 
funding for procurement of any new launchers. While the Army 
has progressed in its plan for fielding launcher systems to 
active and reserve forces, the committee notes that the final 
MLRS fielding package does not contain sufficient launchers to 
complete equipping the last Army National Guard battalion for 
which funds have previously been provided. Therefore, the 
committee recommends authorization of $64.6 million, an 
increase of $16.4 million, to procure sufficient MLRS launcher 
units to complete the battalion.

Javelin

    The budget request contained $171.4 million for procurement 
of 557 Javelin missiles and 142 command launch units. Despite 
the Congress having added $83 million to the Army's underfunded 
fiscal year 1995 request to restore an efficient rate of 
missile production, the committee notes that the fiscal year 
1996 request is once again insufficiently funded.
    Therefore, the committee recommends authorization of $210.4 
million, an increase of $39 million, to procure an additional 
453 missiles.

               Weapons and Tracked Combat Vehicles, Army


                                overview

    The budget request contained $1,299 million for procurement 
of Army weapons and tracked combat vehicles for fiscal year 
1996. The committee recommends authorization of $1,359.7 
million for fiscal year 1996.
    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.
    Offset Folio 54 Insert Here



Bradley fighting vehicle upgrade program

    The budget request contained $138.3 million for the Bradley 
Base Sustainment program. Fiscal year 1996 is the last year 
that funding has been budgeted for the upgrade of the oldest 
configuration of the Bradley Fighting Vehicle (BFV) family--the 
A0--to the more modern and survivable A2 configuration. The 
committee is concerned that the termination of the A0 to A2 
upgrade program is premature. When the current program is 
completed, there will still be about 2,000 A0 vehicles in the 
fleet. These vehicles lack the survivability and other 
enhancements needed for the modern battlefield. Indeed, Desert 
Storm proved that commanders demanded the more modern 
configuration when faced with a real battlefield threat. Thus, 
the committee believes that the Army should seriously consider 
continuation of the A0 to A2 BFV upgrade program. Consequently, 
the committee directs the Army to submit a detailed 
modification plan, including a funding profile, for 
continuation of this program with the fiscal year 1997 budget.

Small arms industrial base

    The budget request contained no funds for procurement of 
personal defense weapons, M-16 rifles, M4 carbines, 5.56mm 
machine guns, or MK-19 40mm grenade machine guns.
    In response to congressional action in fiscal year 1994, 
the Army directed the Army Science Board (ASB) to assess the 
health of the small arms industrial base. The ASB study 
confirmed emerging industrial base problems and presented 
funding and restructuring recommendations to avoid losing 
critical industrial capability.
    However, in its fiscal year 1995 request, the Army did not 
fund any of the ASB recommendations and, instead, submitted 
another seriously underfunded small arms procurement request. 
The Congress was again compelled to provide additional funding 
for small arms and directed the Army to take seriously its 
industrial base commitment by budgeting for small arms in the 
fiscal year 1996 request. However, the results were the same as 
in prior years. The committee is disturbed by the Army's 
continuing failure to make any effort to sustain critical 
capabilities in the small arms industrial base, and the 
committee expects the Army to take appropriate action in the 
fiscal year 1997 request to address these problems.
    The committee recommends authorization of an additional 
$77.0 million for continued small arms production and directs 
the Army to provide a report to the defense committees not 
later than February 1, 1996, outlining its plans for long-term 
preservation of the small arms industrial base. Recommended 
increases to small arms programs are as follows:

                        [In millions of dollars]

M-16 rifle........................................................  13.5
5.56mm M4 carbine.................................................   6.5
Personal defense weapon...........................................   2.0
5.56mm machine gun, (SAW).........................................  28.5
40mm MK 19 grenade launcher.......................................  20.0
Medium machine gun................................................   6.5

                      Ammunition Procurement, Army


                                overview

    The budget request contained $795 million for Ammunition 
Procurement, Army in fiscal year 1996. The committee recommends 
authorization of $1,062.7 million for fiscal year 1996.
    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.
    Offset Folio 58 Insert Here



Ammunition

    The budget request contained $590.4 million for procurement 
of ammunition.
    While the defense budget has experienced significant 
reductions in the last decade, funding for ammunition 
production has suffered a rate of decline that best 
approximates a virtual freefall. The committee is concerned by 
the fact that these large dollar reductions have led to severe 
losses of industrial capability. Of the 286 ammunition 
companies existing in 1978, only 88 remained in 1994, and only 
52 are forecasted to remain by the end of 1995. At the same 
time, all branches of the armed forces continue to report large 
shortages of ammunition.
    Congress added almost $400 million to the fiscal year 1995 
budget request ($336 million of which went to the Army) to 
shore up this decline and to redress the shortages. 
Nevertheless, the Army's fiscal year 1996 request is some $50 
million less than its fiscal year 1995 request. The committee 
recognizes the urgent need to address the shortfalls in the 
Army's procurement budget and the particularly urgent situation 
facing the ammunition account. Consequently, the committee 
recommends $858.1 for ammunition, an increase of $267.7 above 
the request, distributed as denoted in the accompanying table.

                        Other Procurement, Army


                                overview

    The budget request contained $2,256.6 million for Other 
Procurement, Army in fiscal year 1996. The committee recommends 
authorization of $2,545.6 million for fiscal year 1996.
    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.
    Offset Folios 61 to 63 Insert Here



Common hardware/software

    The budget request did not contain any funds for 
procurement of common hardware/software (CHS).
    The committee continues to monitor the progress in fielding 
CHS for the five battlefield functional areas of the Army 
Tactical Command and Control Systems (ATCCS) and remains 
concerned over the ability to achieve a smooth and timely 
fielding transition between CHS-I and CHS-II. The committee 
believes it would be imprudent, given the troubled testing and 
acquisition history of the program, to begin fielding CHS-II 
hardware prior to completing all required pre-production 
testing and evaluation. However, the Army's current plan allows 
the CHS-I contract to expire prior to completion of all CHS-II 
testing, in effect guaranteeing a production break. The 
committee believes that such an interruption would be 
detrimental to the overall success of ATCCS and unnecessarily 
delay fielding of critically needed command and control 
capabilities. Consequently, the committee directs the Army to 
extend the expiring CHS-I contract for two years, a period of 
time commensurate with minimizing fielding interruptions and 
final certification of CHS-II.

                       Aircraft Procurement, Navy


                                overview

    The budget request contained $3,886.5 million for Aircraft 
Procurement, Navy in fiscal year 1996. The committee recommends 
authorization of $4,106.5 million for fiscal year 1996.
    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.
    Offset Folio 66 Insert Here



V-22 tiltrotor aircraft

    The budget request contained $762.5 million in research and 
development, test and evaluation funds and $48 million in 
advanced procurement funds for the V-22.
    The committee notes that the Marine Corps, Navy and Air 
Force plan to acquire a total of 523 V-22 aircraft over a 
period of twenty seven years, resulting in a very low and 
inefficient production rate. Although it is technically 
feasible to accelerate that production schedule, the Department 
has placed an arbitrary $1 billion-per-year funding cap on the 
program.
    The committee is also aware that the Defense Science Board 
(DSB) has made recommendations to reduce V-22 program costs by 
treating the three low rate initial production lots as a 
package in order to permit more efficient purchasing of parts 
and materials. Accordingly, the committee directs the 
Department to report to the congressional defense committees on 
options to implement the DSB recommendations and to provide 
more efficient production rates for the V-22 program. The 
Department's findings should accompany the fiscal year 1997 
budget submission.

                       Weapons Procurement, Navy


                                overview

    The budget request contained $1,787.1 million for Weapons 
Procurement, Navy in fiscal year 1996. The committee recommends 
authorization of $1,626.4 million for fiscal year 1996.
    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.
    offset folios 69 to 70 insert here



Penguin anti-ship missile

    The budget request did not contain any funds for 
procurement of the Penguin missile.
    The committee is concerned that the Navy has failed to 
complete a commitment to procure 193 Penguin missiles in spite 
of an identified, ongoing requirement. The confusion that this 
issue has caused could have a significant long-term impact on 
readiness as well as future foreign military sales. The 
committee directs the Department of the Navy to review the 
Penguin missile program and report to the congressional defense 
committees on its status, the success rate of the missile under 
the mandated rules of the insensitive munition specification, 
the requirement to procure additional Penguin missiles, the 
unit cost of the missile, and the overall funding required to 
economically procure additional missiles to augment the Navy's 
current capability.

               Ammunition Procurement, Navy/Marine Corps


                                overview

    The budget request did not contain any funds for Ammunition 
Procurement, Navy/Marine Corps in fiscal year 1996. The 
committee recommends authorization of $461.8 million for fiscal 
year 1996.
    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.
    offset folio 173 inserts here



Ammunition

    The budget request contained $110.9 million for procurement 
of ammunition for the Marine Corps. As expressed elsewhere in 
this report, the committee is deeply concerned with the low 
level of ammunition procurement for both the Army and the 
Marine Corps in the fiscal year 1996 budget request. Marine 
Corps ammunition has been reduced to such low inventory levels 
that the Commandant identified unfunded ammunition requirements 
as his highest priority for increased procurement funding.
    Accordingly, the committee recommends authorization of 
$230.9 million for procurement of ammunition for the Marine 
Corps, an increase of $120 million to be distributed as 
follows:

                        [In millions of dollars]

7.62 mm, all types................................................  10.0
.50 cal. SLAP M903/M962...........................................  24.3
.50 cal. API M8/M20...............................................  33.8
81 mm mortar XM816................................................   6.7
155mm propellant charge M203A1....................................  32.0
Fuze, ET, XM762...................................................  10.0
Smoke grenade M18.................................................   0.7
Blasting time fuze igniter M60....................................   0.4
Demolition explosive..............................................   2.1

                   Shipbuilding and Conversion, Navy


                                overview

    The budget request contained $5,051.9 million for 
Shipbuilding and Conversion, Navy in fiscal year 1996. The 
committee recommends authorization of $6,228 million for fiscal 
year 1996.
    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.
    offset folio 176 inserts here



National defense sealift fund

    The budget request contained $974.2 million for the 
National Defense Sealift Fund (NDSF). Of this amount, $596.1 
million is requested for two new large medium-speed roll-on/
roll-off (LMSR) vessels that will be used for prepositioning of 
equipment and surge sealift requirements, $289 million for 
operation and maintenance of the Ready Reserve Force (RRF) 
fleet, $70 million to purchase existing roll-on/roll-off (RO/
RO) ships for the RRF, and $19.1 million to continue sealift 
development technology efforts.
    The committee recommends authorization of the requested 
amounts and an additional $600 million for the purpose of 
accelerating the acquisition of two more LMSRs. However, 
consistent with its actions last year, the committee denies 
authorization of the funds requested to purchase existing RO/
Ros for the RRF.

Roll-on/roll-off ships for the ready reserve force

    The committee believes that the $70 million requested to 
purchase used, foreign-built and -owned RO/RO ships for the RRF 
is not in the national security interest, is not cost-
effective, and would weaken the U.S. shipbuilding industrial 
base. Accordingly, the committee does not recommend 
authorization of these funds for this purpose. Instead, the 
committee recommends authorizing $70 million for the 
procurement and installation of national defense features (NDF) 
on commercial vehicle carriers built in and documented under 
the laws of the United States, as provided for in section 1024 
of the National Defense Authorization Act for Fiscal Year 1993 
(Public Law 102-484). The committee believes an NDF program 
will provide substantially superior ships, save or create a 
significant number of jobs in the shipbuilding and supplier 
industrial base, assist U.S. shipyards in reentering the 
commercial shipbuilding market, and help preserve rapidly 
dwindling seafaring manpower and skills.
    Confirming the committee's assessment, the Department has 
submitted a report demonstrating that an active RRF, utilizing 
NDF on newly built commercial vehicle carriers, would have 
``important benefits'' and would be a cost-effective means of 
recapitalizing the aging, lower-readiness RRF fleet at the end 
of the decade. The report estimates, for example, that total 
discounted life cycle cost for a thirteen-year old, inactive 
RRF-5 day ship would be $860 per square foot, whereas a newly 
built active RRF vessel with NDF would have a net present value 
cost of $320 per square foot. The report further shows that an 
active RRF of vehicle carriers with strengthened decks and 
ramps and sufficient space to carry heavy, out-sized military 
equipment would provide fully-crewed RO/Ros within the time 
demands contemplated in an emergency.
    However, as the Department's report correctly indicated, 
securing entry into the commercial vehicle carrier market will 
be a ``critical element'' for the success of the NDF program. 
The committee considers the NDF program and, in particular, the 
entry of new U.S.-built commercial car carriers equipped with 
NDF in the U.S.-Japan trading market to be in the national 
interest. The committee therefore urges the Department of 
Defense to encourage the Government of Japan to recognize that 
cooperation to overcome flag barriers and to augment American 
participation in this trade market will advance the mutual 
defense and security interests of our two nations.
    The committee further directs the Navy to submit a detailed 
plan for executing this NDF program, including the process by 
which the Navy will review U.S. shipyard proposals and designs 
to determine their dual-use capability and the schedule for 
initiating the program. The report is to be submitted to the 
congressional defense committees no later than six months from 
the date of enactment of the National Defense Authorization Act 
for fiscal year 1996.

Large medium-speed roll-on/roll off ship (LMSR) contract options

    The committee notes that there continues to be a shortfall 
in meeting the prepositioning and surge sealift requirements 
established by the Department's Mobility Requirements Study 
(MRS) and recently revalidated by the MRS Bottom Up Review 
Update. The acquisition of 19 LMSRs is underway to partially 
address this shortfall. Contracts have been placed for 17 of 
the LMSRs: conversions of five existing ships and 12 new 
construction vessels. Six of these new construction vessels 
have been awarded and contract option prices have been 
negotiated for the remaining six--three options each at two 
shipyards. Funding for two of the options, one at each yard, is 
requested in fiscal year 1996.
    The acquisition strategy of the final two LMSRs has not yet 
been determined by the Navy, although funding for these two 
ships is currently planned in fiscal year 1999. The committee 
received testimony that each of the two shipyards building new 
LMSRs could possibly deliver an additional LMSR before the 
current scheduled delivery of their sixth ship, if the seventh 
LMSR were awarded soon and each yard were allowed to fit the 
ship into its production schedule at the most efficient point. 
Accordingly, the committee believes that the options for these 
last two LMSRs should be added to the current contracts in 
order to allow the yards to do the necessary planning and to 
obtain material pricing options to integrate an additional ship 
into their series production process.
    Therefore, the committee recommends a provision (sec. 1021) 
urging the Navy to negotiate an option price for the seventh 
LMSR at each of the two new-construction shipyards, assuming an 
option exercise on or before either December 31, 1995, December 
31, 1996, or December 31, 1997.

Attack submarines

    The budget request contained $1,507.5 million for 
procurement of a third Seawolf-class nuclear attack submarine 
(SSN-23). It also contained $704.5 million for advanced 
procurement of a follow-on to the Seawolf, the New Attack 
Submarine (NAS).
    The Seawolf, originally slated to replace the Los Angeles-
class submarines (SSN-688s), was designed to counter the Cold-
War, open-ocean threat posed by the Soviet navy. The first 
Seawolf (SSN-21) was funded in fiscal year 1989 and the second 
in fiscal year 1991. However, with the demise of the former 
Soviet Union, Seawolf production was terminated by the Bush 
Administration in fiscal year 1993. The Navy began preliminary 
work on the NAS in 1988 and publicly announced the program in 
1991.
    The rationale for completing construction of the SSN-23 was 
first made in the September 1993 Department of Defense Bottom 
Up Review (BUR). When the Department completed the BUR, there 
were around 90 nuclear attack submarines in the fleet. By the 
end of fiscal year 1995 there will be 82 and by the end of 
fiscal year 1999 the number will shrink to 55. This latter 
number is the upper end of the force size endorsed by the BUR 
as needed to meet both the Department's wartime and its 
peacetime presence requirements. The number judged to be 
necessary to meet only wartime requirements was 45. Therefore, 
the committee observes that there were in September 1993 and 
are now more attack submarines on hand and in the delivery 
pipeline than needed to meet the BUR force levels.
    In formulating the BUR recommendation, the Department was 
confronted with how to modernize the attack submarine fleet in 
the face of a significantly reduced requirement, while 
preserving a viable submarine production base. Unlike those 
defense industry segments that have a commercial counterpart 
for their military products, no commercial market exists for 
nuclear attack submarines. Confronted with this prospect, and 
the fact that the Navy would place no production orders until 
those for the NAS in fiscal year 1998, the BUR faced either 
shutting down one of the nuclear-certified shipyards, or 
devising an option to keep both yards open. The latter option 
was chosen.
    The BUR decision was to produce a third Seawolf in fiscal 
year 1995 or fiscal year 1996. Furthermore, construction of 
this submarine was to be directed on a sole-source basis to the 
Electric Boat Division of General Dynamics to ``bridge'' the 
projected gap in submarine production until NAS (also directed 
to be produced at Electric Boat) is to begin construction in 
fiscal year 1998. This decision assumed that much of the 
skilled submarine workforce at Newport News Shipbuilding, the 
nation's other producer of attack submarines, would be 
transferred to construction of nuclear aircraft carriers.
    Thus, the committee was faced with two issues regarding 
submarine acquisition: whether to complete funding of the third 
Seawolf and whether to provide the initial increment of 
procurement funding for the NAS. In the process of addressing 
the latter issue, the committee also had to address the 
question of who should build the NAS.
    As a result of the committee's oversight hearing on 
submarine acquisition issues, an analysis was undertaken to 
estimate the relative long-term costs to the government of two-
yard and one-yard strategies for acquisition of nuclear-powered 
warships. Under the one-yard or consolidated strategy, Newport 
News would build both submarines and aircraft carriers. This 
analysis involved input from Newport News and the Navy and was 
reviewed by the Congressional Budget Office, the Congressional 
Research Service, and the General Accounting Office.
    The results of this analysis indicated that if a decision 
between the two-yard and one-yard strategies were to be made 
solely on the basis of relative long-term costs to the 
government, the one-yard strategy would be the lower cost 
approach. Nevertheless, the committee has not opted to 
consolidate construction of nuclear-powered warships at one 
yard at this time.
    However, the committee disagrees with the Department's plan 
to determine the builder of the NAS by administrative 
allocation, without the benefit of competition. The committee 
shares the strong concerns expressed last year by the 
Appropriations Committees that the estimated procurement cost 
of the NAS must be reduced substantially--from the current 
estimated figure of $1.5 billion per submarine down to $1.2 
billion--and believes this objective can best be achieved 
through competition. But the committee rejects the idea of a 
one-time, winner-take-all competition based on paper bids by 
the two shipyards to decide the builder of the NAS. The 
committee is also concerned, in light of the potential 
performance of Russian fourth- and fifth-generation submarines, 
that the current NAS design may not be capable enough, even 
with modular upgrades for later boats in the class, to meet the 
potential Russian submarine threat of 2004, when the fiscal 
year 1998 submarine is to enter service, and the years beyond.
    Consequently, the committee recommended a modification to 
the Department's plan that avoids selecting the builder of the 
follow-on serial-production submarine design on the basis of 
administrative allocation or a competition based on paper bids, 
and that also supports the committee's objective of developing 
a submarine design for serial production that represents a 
substantial improvement in both affordability and capability 
over the current NAS design. The intent of the committee's 
action is to establish a national priority program that employs 
both a technological competition between the two submarine 
shipyards and the technical resources of the Advanced Research 
Projects Agency (ARPA) and the Department of Energy's (DOE) 
national laboratories.
    This program would provide Electric Boat and Newport News 
an opportunity to demonstrate their skills as innovative 
submarine designers and builders. It would also insure that the 
talents of both of these shipyards, as well as those of ARPA 
and the DOE laboratories, are fully focused on the high-
priority task of identifying advanced technologies for improved 
designs.
    Consequently, the committee does not authorize construction 
of the SSN-23. Rather than funding construction of a third 
Seawolf, which would be built to the same design as the first 
two submarines and would therefore not permit EB to demonstrate 
its talents as an innovative submarine designer and builder, 
the committee's plan funds the construction of two outfitted 
submarine hull sections.
    The first of these two sections will be fitted into the 
second Seawolf submarine (SSN-22) to create a lengthened, 
expanded-capability variant of the basic Seawolf design, while 
retaining its full weapons load. The second of these sections 
will be incorporated into the fiscal year 1998 submarine, to 
convert that submarine from the lead ship of a serial-
production class based on the current NAS design into an 
additional, one-of-a-kind, expanded-capability platform derived 
from the current NAS design. The Navy is authorized to contract 
separately for the construction of the hull section for the 
fiscal year 1998 submarine even though that submarine will not 
be fully funded until then. The committee authorizes $704.5 
million in advanced procurement funding, as requested by the 
Navy, for detailed design work and procurement of long-lead 
items for the fiscal year 1998 submarine. The design of this 
submarine shall be altered as necessary to accommodate the 
installation of the special hull section during the 
construction process.
    Electric Boat will design and build both of these sections 
so as to maintain a minimum core work force of skilled 
submarine construction workers. The hull sections may be 
optimized for special operations forces, mine warfare, land 
attack missiles, other missions or some combination, as 
determined by the Navy.
    The committee recommends a total of $1,554.5 million for 
this work--$550 million to design and build the hull section to 
be installed in SSN-22, $300 million for the hull section to be 
installed into the fiscal year 1998 submarine, and $704.5 
million in advanced procurement funding for the fiscal year 
1998 submarine. The committee recommends a provision (sec. 132) 
that would repeal the cost cap for SSN-22 in order to 
accommodate this approach. Unexpended prior-year funding 
available for SSN-23 construction may be used for contract 
termination liability and/or to maintain critical component 
sources.
    Rather than allowing Newport News' submarine design and 
construction skills to atrophy, the committee's plan provides 
it with an analogous opportunity to demonstrate its talents as 
an innovative submarine designer and builder. The committee 
directs the Navy to make Newport News a full consultant in the 
current submarine design effort at Electric Boat, so that 
Newport News can develop and maintain an equal understanding of 
the NAS design. To that end, the committee directs that $10 
million of the funds requested for NAS detailed design work 
shall be used only for establishing and maintaining a cadre of 
Newport News submarine designers at Electric Boat and for 
transfer of all NAS design data from Electric Boat's design 
data base to Newport News'.
    In addition, the committee recommends $150 million to be 
used only as initial funding for an effort at Newport News to 
design, develop, and build prototype versions of major 
submarine components which have the potential for achieving a 
follow-on submarine design for serial production that 
represents a substantial improvement in affordability and 
capability over the current NAS design. This effort, like the 
one at Electric Boat, shall take maximum advantage of 
technology available from ARPA and the national laboratories.
    ARPA and the national laboratories are directed to 
cooperate with both Electric Boat and Newport News in making 
available and assisting in the transition to both shipbuilders 
technologies--such as global quieting, hydrodynamic advances, 
and information and signature management--which show potential 
for achieving a follow-on submarine design for serial 
production that represents a substantial improvement in 
affordability and capability over the current NAS design.
    The committee anticipates that the efforts by both 
shipbuilders to demonstrate their skills as innovative 
submarine designers and builders will continue into fiscal year 
1997. The committee is determined to ensure that dramatic steps 
are taken to develop and deploy a highly capable and affordable 
submarine for the twenty-first century. The committee views 
such a submarine as a critical national asset. Accordingly, the 
committee directs the Navy to plan for and appropriately fund 
these efforts in its fiscal year 1997 budget request. Continued 
funding for the Newport News effort should be commensurate with 
the work proposed by the company. At the end of this two-year 
process, the results of the Electric Boat and Newport News 
efforts will provide the basis for a follow-on submarine design 
that can be competed for serial production. The committee 
recommends a provision (sec. 133) that would require this 
competition.

LPD-17

    The budget request contained no funds for construction of 
the lead ship (LPD-17) of a new amphibious transport dock 
class. The LPD program anticipates building 12 modern 
amphibious ships--critical to the support of Marine Corps lift 
requirements--to replace 41 older ships approaching 
obsolescence.
    While funding for the lead ship was planned in fiscal year 
1996, the program was slipped to fiscal year 1998 due to budget 
constraints. Since funding construction of LPD-17 in fiscal 
year 1996 makes possible a total program cost savings of 
approximately $828 million, the committee recommends 
authorization of $974 million for this purpose.

Fast patrol craft

    The budget request contained no funds for a fast patrol 
craft.
    With the Navy's new emphasis on expeditionary forces, 
coastal patrol, and interdiction, the committee is concerned 
that more emphasis should be placed on inexpensive fast patrol 
craft for use in littoral warfare, rather than placing high-
cost, high-technology capital ships in danger. The committee 
believes a high speed craft capable of carrying multiple anti-
surface missiles and significant command, control, 
communications and intelligence assets would provide a highly 
capable multimission adjunct to the service's current fleet.
    Accordingly, the committee authorizes $9.5 million for the 
procurement of a fast patrol craft.

                        Other Procurement, Navy


                                overview

    The budget request contained $2,396.1 million for Other 
Procurement, Navy in fiscal year 1996. The committee recommends 
authorization of $2,461.5 million for fiscal year 1996.
    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.
    Offset Folios 86 to 89 Insert Here



Trident navigation commonality program

    The budget request did not include funds for procuring a 
Trident strategic weapon system navigation commonality program 
shipset. The committee recommends an additional $31.5 million 
to procure a fifth such shipset. Further, the committee directs 
the Secretary of the Navy to ensure that the Navy's budget 
submission for fiscal year 1997 includes funds to procure the 
sixth shipset and to install the fifth and sixth shipsets.

MK-49 ring laser gyro

    The budget did not contain any funds for the MK-49 ring 
laser gyro (RLG).
    The commanders of the Pacific and Atlantic submarine fleets 
have expressed an urgent need to expedite the introduction and 
backfit of the MK-49 RLG ship navigator into their fleets. 
According to the fleet commanders, the high failure rate of the 
current twenty-year old electrically suspended gyro navigator 
(ESGN) cost the Navy in excess of $26 million in maintenance 
funds in fiscal year 1994 alone. The low cost and high 
reliability of the new MK-49 system dictates its earliest 
possible installation. The MK-49 RLG will more than pay for 
itself in less than three years through maintenance cost 
savings alone. Accordingly, the committee denies the Navy's 
request to upgrade the old ESGN system and instead authorizes 
$10 million for the procurement and installation of the MK-49 
RLG navigator.

AN/BPS-16 submarine radar

    The budget request did not contain any funds for the AN/
BPS-16 submarine radar.
    The Navy is experiencing high failure rates and high costs 
in maintaining the 1960s era AN/BPS-15 submarine navigation 
radar, which, since spare parts are no longer in production, is 
becoming insupportable. The committee is concerned with the 
Navy's not budgeting for backfit into the fleet of the AN/BPS-
16 radar, which was designed and selected as the follow-on 
system to the AN/BPS-15. Fleet safety is at risk without this 
reliable, all-weather, state-of-the-art radar when navigating 
in and out of port and during tactical operations at sea. Thus, 
the committee authorizes $9 million for procurement of AN/BPS-
16 radar systems and directs the Navy to submit an acquisition 
plan for procurement and installation of BPS-16 radars on 
existing submarines. The plan should provide for an efficient 
rate of production to enable the Navy to most cost-effectively 
procure these systems, while ensuring that the submarine radar 
industrial base is sustained.

Safety and survivability items

    The budget request did not contain any funds for safety and 
survivability items.
    The committee is aware that the Navy's Office of Safety and 
Survivability has performed operational assessments on non-
developmental items which will improve safety and survivability 
in the fleet and Marine Corps field forces and that several of 
those items have been identified as priorities for fleet-and 
force-wide procurement. However, the committee recognizes that 
the Navy and Marine Corps currently fund only a limited number 
of them on an ad-hoc basis, and is concerned that many critical 
items remain unfunded. Consequently, the committee recommends 
$20 million to purchase non-developmental life safety items 
which have been identified by the operational commands and the 
Office of Safety and Survivability as priorities for 
procurement.

Propeller shaft composite fairwaters

    The budget request did not contain any funds for propeller 
shaft composite fairwaters.
    The committee understands that the Navy is conducting fleet 
testing of propeller shaft composite fairwaters in order to 
reduce maintenance costs and enhance combat ship readiness. 
Inspection and replacement of noisy or damaged shaft bearings 
currently requires drydocking a ship and the cutting off, 
discarding, and welding on a new set of copper-nickel 
fairwaters. By contrast, composite fairwaters can be bolted on 
and unbolted underwater, are hydrodynamically shaped to reduce 
acoustic signature, are non-fouling, and are corrosion-
resistant. Therefore, the committee recommends an increase of 
$3 million to begin backfit of composite fairwaters during the 
next four regularly scheduled overhauls of CG-47 class 
cruisers. The committee strongly endorses a continued backfit 
program for these ships and encourages the Navy to initiate a 
similar program for the destroyer fleet.

                       Procurement, Marine Corps


                                overview

    The budget request contained $474.1 million for 
Procurement, Marine Corps in fiscal year 1996. The committee 
recommends authorization of $399.2 million for fiscal year 
1996.
    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.
    Offset Folios 96 to 97 Insert here



Lightweight reconnaissance/strike vehicles

    The budget request contained no funds for the lightweight 
reconnaissance/strike vehicles.
    The committee understands that there is a requirement for 
lightweight, high performance all-terrain vehicles for a number 
of critical missions, such as special operations and forward 
reconnaissance in conventional operations. Current vehicles for 
these missions are easily detected, have limited mobility, and 
are not easily transportable.
    Accordingly, the committee recommends $2 million for 
procurement of light reconnaissance vehicles for the Marine 
Corps and $6 million for procurement of light strike vehicles 
for the special operations forces.

Indoor simulated marksmanship trainer

    The budget request contained $17.8 million for Marine Corps 
training devices. This amount included $6.5 million for indoor 
simulated marksmanship trainers (ISMTs) which provide 
individual weapons proficiency training for active and reserve 
Marine forces while deployed at sea or away from live fire 
range facilities. The committee understands that the ISMT is a 
high priority program for the Marine Corps but is not being 
procured in sufficient quantities due to funding constraints.
    The committee is also informed that an option exists under 
the current contract to save over $13 million by procuring the 
final 181 ISMTs in fiscal year 1996. Accordingly, the committee 
recommends authorization of $51.8 million for training devices, 
and directs the Marine Corps to use $34 million of these funds 
to complete the procurement of 181 ISMTs.

                    Aircraft Procurement, Air Force


                                overview

    The budget request contained $6,183.9 million for Aircraft 
Procurement, Air Force in fiscal year 1996. The committee 
recommends authorization of $7,032 million for fiscal year 
1996.
    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. detail.
    Offset Folios 101 to 102 Insert here



Strategic airlift

    The budget request contained $2,402.5 million for 
procurement of eight C-17 aircraft in fiscal year 1996 and 
$183.8 million for advanced procurement for ``strategic 
airlift'' in fiscal year 1997. The committee notes that the use 
of the term ``strategic airlift'' permits procurement of either 
C-17 aircraft or a non-developmental airlift aircraft (NDAA). 
The committee further notes that consideration of an NDAA 
option was initiated originally out of concern that the C-17 
program was not performing well. However, the committee 
observes that there have been positive achievements of the C-17 
program within the past year. Recent deliveries of C-17s have 
been ahead of schedule, and both the quality and production 
performance have improved significantly. The committee's focus 
continues to be both on the performance of the C-17 aircraft, 
and on adequate airlift capacity for both the long and short 
term.
    The committee remains concerned with the need to modernize 
the Department's strategic airlift fleet and is pleased to note 
the continued emphasis on the importance of strategic airlift 
expressed by both theater commanders and other Department 
witnesses during committee hearings on this subject. The 
committee also notes that the requirement for strategic airlift 
modernization is further reinforced by the recently-released 
Mobility Requirements Study Bottom Up Review Update. While the 
Department has not yet determined its complete airlift 
modernization plans, the case for accelerating procurement of 
strategic airlift aircraft appears to be compelling.
    With the looming retirement of the C-141 fleet, the 
Department acknowledges a pending shortfall in strategic 
airlift capacity. The November 1995 review by the Defense 
Acquisition Board (DAB) is intended to decide the composition 
of the future strategic airlift fleet to mitigate this 
shortfall. It is not the committee's intent to prejudice or in 
any way influence the outcome of the review process. The 
committee believes that the Department's review process must 
adequately address and resolve the pending shortfall in airlift 
capacity. Air Force officials have verified that a competitive 
acquisition program for procurement of NDAA is underway, and 
could lead to procurement of aircraft in early 1996, should the 
Department opt for a mix of C-17 and NDAA to meet its future 
needs.
     The committee recommends authorization of $2,402.5 million 
for procurement of eight C-17s and $183.8 million for strategic 
airlift. Although the committee has been assured by Air Force 
officials that sufficient funds are contained within the C-17 
request, when combined with available NDAA funds from fiscal 
year 1994, to procure eight C-17s and to competitively procure 
some number of NDAA should the Department opt to do so, the 
committee is doubtful that such is the case.
    Therefore, the committee also recommends authorization of 
$70 million for NDAA, and permits the Air Force to merge these 
funds with $85 million remaining from fiscal year 1994 funds 
authorized for this purpose in order to procure at least one 
NDAA, if this option is supported by the DAB decision on 
strategic airlift later this year. If the Department's decision 
is to procure a C-17-only fleet, the funds identified for NDAA 
may be used for that purpose. The committee does not intend for 
these funds to be used to enter any lease-to-own NDAA program.
    The committee further directs that no funds for procurement 
of C-17 aircraft in fiscal year 1996 be obligated until the 
Secretary of Defense provides the congressional defense 
committees a specific plan for maintaining strategic lift 
capability for the next decade as nearly as possible to the 
current capability, while allowing for the scheduled retirement 
of the C-141 fleet. In developing this plan, the Department 
must give serious consideration to the implications that 
procurement of strategic airlift would have on the Civil 
Reserve Air Fleet.

Fighter aircraft

    The budget request contained no funds for procurement of 
new fighter aircraft for the Air Force.
    The committee notes that the production base for F-15Es and 
F-16s is currently sustained largely by foreign sales and that 
no additional U.S. procurement of these aircraft is forecast. 
However, senior Air Force officials have confirmed that both 
the F-15E and the F-16 will need to be retained in the 
inventory much longer than originally planned and have 
concluded that a need exists for additional F-15Es and F-16s to 
maintain minimum attrition reserve requirements to sustain a 
twenty fighter-wing-equivalent force structure. Also, industry 
witnesses have testified that at least a nominal U.S. 
production rate of current fighters should be sustained, absent 
any Administration effort to lift restrictive export policies 
which prohibit fighter aircraft manufacturers from competing 
for business worldwide, in order to preserve critical elements 
of the fighter aircraft industrial base.
    In order to address both the attrition reserve requirement 
and fighter aircraft industrial base concerns, the committee 
recommends authorization of $250 million for procurement of six 
F-15Es and $175 million for procurement of six F-16s. The 
committee observes that ongoing production of F-15Es and F-16s 
for foreign sales allows a limited opportunity to address these 
requirements at more affordable aircraft unit costs. The six F-
15Es are intended to fill training base shortfalls and can be 
procured without complete combat equipment packages, thereby 
further reducing the cost of each aircraft.

B-2 stealth bomber

    The budget request contained $279.9 million for continued 
production-related activities for the B-2 stealth bomber. The 
request did not include funds for long-lead materials necessary 
to produce additional aircraft beyond the twenty combat-capable 
aircraft previously approved by Congress.
    The committee does not support terminating the B-2 program 
at 20 aircraft. Numerous studies indicate that the United 
States will require more than 20 B-2 bombers to support the 
U.S. national military strategy. Most independent analyses 
identify a force of between 30-40 B-2 bombers as the minimum 
effective number necessary to prosecute two nearly simultaneous 
major regional contingencies (MRCs).
    The committee has received testimony from senior military 
leaders that the Department's so-called bomber ``swing'' 
strategy is untested and entails enormous risk. This strategy 
would have bombers swing from an initial MRC to a second MRC, 
while the first conflict was still underway. The committee 
rejects this ``swing'' strategy, which is dictated by the 
current, inadequate bomber force structure, as well as the 
Department's plans for having no bomber production capacity for 
the foreseeable future. Indeed, the committee is disturbed that 
the B-2 bomber industrial base is rapidly approaching final 
shutdown.
    For these reasons, the committee recommends an additional 
$553 million to begin the process of reestablishing those 
elements of the B-2 production line that have already been laid 
away and for procurement of long-lead items for additional 
aircraft. In addition, the committee directs that all funds 
remaining from the $125 million appropriated in the Department 
of Defense Appropriations Act for Fiscal Year 1995 (Public Law 
103-335) for the B-2 bomber industrial base preservation or 
next-generation bomber studies be merged with the $553 million 
and used for the same purposes.

B-1B repair and maintenance improvements

    The budget request contained $216 million for procurement 
of common aircraft ground equipment. As a result of prior 
congressional direction, the Air Force conducted an Operational 
Readiness Assessment (ORA) of the B-1B bomber to determine the 
extent to which the provision of planned spares, manpower, and 
logistics support would enable the B-1B force to achieve the 
planned mission capable rate (MCR) of 65 percent.
    Positive test results validated both the inherent 
capabilities of the B-1B aircraft and the Air Force's models 
and planning assumptions as to the spares, manpower, and 
support needed to sustain the B-1B force. However, as a result 
of the test, the Air Force identified several repair and 
maintenance improvements that should permit the B-1B's 
fleetwide MCR to reach 75 percent. The committee recommends an 
additional $11.1 million for this purpose, allocated as 
follows: $7.2 million for B-1 ORA modifications and $3.9 
million in operations and maintenance, Air Force.

                   Ammunition Procurement, Air Force


                                overview

    The budget request did not contain any funds for Ammunition 
Procurement, Air Force in fiscal year 1996. The committee 
recommends authorization of $321.3 million for fiscal year 
1996.
    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.
    Insert Table 109 RIGHT HERE



                     Missile Procurement, Air Force


                                overview

    The budget request contained $3,647.7 million for Missile 
Procurement, Air Force in fiscal year 1996. The committee 
recommends authorization of $3,430.1 million for fiscal year 
1996.
    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.
    Insert Table 111 thru 112 RIGHT HERE, also



Intercontinental ballistic missile guidance replacement program

    The budget request did not contain procurement funds for 
the intercontinental ballistic missile (ICBM) guidance 
replacement program. The committee recognizes the importance of 
maintaining a viable ICBM force of 450-500 missiles, as called 
for in the Department's Nuclear Posture Review. Accordingly, 
the committee recommends an additional $10 million to initiate 
production of this program.

Precision guided munitions

    The budget request contained no funds for procurement of 
AGM-130 powered GBU-15 laser guided bombs, AGM-86B conventional 
air launched cruise missiles (CALCMs), or AGM-142 HAVE NAP 
medium-range tactical missiles. The committee has great concern 
over the serious shortage of standoff precision-guided 
munitions (PGMs) currently available to the services. The force 
multiplier effect of PGMs was clearly demonstrated in Desert 
Storm, and the Department has relied heavily on this enhanced 
capability in determining that its modernized Bottom Up Review 
force can fight and win two nearly-simultaneous major regional 
contingencies (MRCs). Elsewhere in the report the committee has 
expressed its reservations with the Department's assertion that 
a smaller bomber force will be able to operationally support 
two MRCs. The committee notes that this assertion is without 
foundation based on both inadequate bomber force levels and 
lack of sufficient one-shot-one-kill standoff PGMs.
    The committee acknowledges the Department's efforts to 
accelerate acquisition of the Joint Direct Attack Munition and 
the Joint Standoff Weapon in the wake of the termination of the 
Tri-Service Standoff Attack Missile (TSSAM). Department 
officials also have begun discussions of a follow-on 
replacement for TSSAM. However, the committee notes that all of 
these weapons are still in the development stage and address 
but a portion of the services' requirements for standoff PGMs.
    Consequently, the committee recommends authorization of an 
additional $40 million for procurement of 100 AGM-130 powered 
GBU-15 laser guided bombs for the Air Force F-15 fighter. 
Additionally, the committee recommends authorization of $5 
million to be added to PE 64733F in Title II of this report in 
order to develop B-52H modifications which would enable a 
portion of the B-52 fleet to be armed with AGM-130s.
    The committee further recommends authorization of $27.2 
million for conversion of 200 AGM-86B nuclear-capable air 
launched cruise missiles to a conventional configuration and 
$39 million for procurement of 54 HAVE NAP electro-optical/
infrared guided missiles. These two standoff PGMs will provide 
near-term capability for the bomber fleet, while awaiting 
future Department decisions on standoff weapons.

                      Other Procurement, Air Force


                                overview

    The budget request contained $6,804.7 million for Other 
Procurement, Air Force in fiscal year 1996. The committee 
recommends authorization of $6,784.8 million for fiscal year 
1996.
    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.
    Offset Folios 116 to 118 Insert here



                       Procurement, Defense-Wide


                                overview

    The budget request contained $2,179.9 million for 
Procurement, Defense-Wide in fiscal year 1996. The committee 
recommends authorization of $2,205.9 million for fiscal year 
1996.
    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.
    Offset Folios 120 to 121 Insert here



Composite health care system

    The committee continues to support the acquisition of an 
automated system for the Department's health care facilities, 
but is concerned over delays to procure the Composite Health 
Care System (CHCS). The committee supports the Department's 
recent decision to increase the availability of technical 
alternatives, engineering talent and commercial off-the-shelf 
(COTS) products available to meet CHCS requirements by moving 
to a multiple contract approach. The committee encourages the 
integration of COTS products to accelerate completion of the 
automated system, to prevent unnecessary developmental 
expenditures and to meet the needs of the Department's health 
care facilities. The committee notes that the PACEMEDNET 
telecommunications testbed program is nearing completion and 
encourages the Department to consider the results of this 
effort in acquisition decisions for the CHCS.

Automated document conversion

    The budget request did not contain any funds for an 
automated document conversion system (ADCS).
    The National Defense Authorization Act for Fiscal Year 1994 
(Public Law 103-160) requires the Department to acquire and 
test an ADCS for the purpose of converting archival drawings 
and systems specifications into forms of data that support 
high-level intelligent usage. The Defense Logistics Agency was 
selected to coordinate the test, and the Defense Printing 
Service was selected to execute testing at field printing 
plants.
    The committee is very pleased with the results of the test. 
According to the test analysis report, the test confirmed that 
there is a ``genuine requirement for conversion of legacy 
engineering technical documents and drawings to revisable 
vector formats.'' In addition, the test confirmed that 
``potential savings in labor expenditures are available from 
the use of automation-assisted conversions of legacy raster 
engineering graphical data to formats suitable for a CAD 
environment.''
    Funds were appropriated in fiscal year 1995 to provide the 
necessary software to sites which have a need to convert raster 
files to an intelligent format. The committee is concerned 
because the Department has moved very slowly in spending these 
funds. The committee directs the Department to expedite the 
obligation of these funds. In addition, the committee 
authorizes $20 million in fiscal year 1996 to continue 
providing conversion software.

Air National Guard

    The committee notes the increased reliance of the Air Force 
on National Guard units and is concerned that the Guam Air 
National Guard should have a clearly defined role as part of 
the Air Force presence in the Western Pacific. Therefore, the 
committee requests that the Secretary of the Air Force report 
to the congressional defense committees on an enhanced role of 
the Guam Air National Guard for weather reconnaissance, 
airlift, and search and rescue missions.

                  National Guard and Reserve Equipment


                                overview

    The budget request did not contain any funds for National 
Guard and Reserve Equipment for fiscal year 1996. The committee 
recommends authorization of $770 million for fiscal year 1996.
    Offset Folio 126 Insert here



           Chemical Agents and Munitions Destruction, Defense


                                overview

    The budget request contained $746.7 million for Chemical 
Agents and Munitions Destruction, Defense for fiscal year 1996. 
The committee recommends authorization of $746.7 million for 
fiscal year 1996.
    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.
    Offset Folio 128 Insert here



  section 131--repeal of prohibition on backfit of trident submarines

    This section would repeal the provision of law that 
prohibits the backfit of Trident II (D-5) missiles into Trident 
I (C-4) missile-carrying submarines. The committee notes that 
the Department of Defense Nuclear Posture Review endorsed a 
strategic nuclear force structure that includes 14 strategic 
missile-carrying submarines, all outfitted with Trident II (D-
5) missiles. The committee endorses an all-D-5 submarine-
launched ballistic missile force.

                   section 141--repeal of limitations

    This section would repeal limitations on the total program 
cost of the B-2 stealth bomber program, the number of B-2 
aircraft, and the obligation of funds authorized for enhanced 
bomber capabilities.

   section 151--repeal of requirement to proceed expeditiously with 
 chemical demilitarization cryofracture facility at Tooele Army Depot, 
                                  Utah

    This section would repeal an obsolete provision of law that 
requires developing a chemical demilitarization cryofracture 
facility at Tooele Army Depot, Utah.

  section 152--sense of congress regarding cost growth in program for 
  destruction of the existing stockpile of lethal chemical agents and 
                               munitions

    This section expresses the sense of Congress regarding the 
growth in the estimated cost of demilitarizing the United 
States chemical munitions stockpile and other general concerns 
regarding the program. Prior to the conference between the 
defense authorizing committees on the Fiscal Year 1996 Defense 
Authorization Act (H.R. 1530) the committee intends to hold a 
hearing that would address the current status of the chemical 
demilitarization program and measures that could be considered 
to reduce overall cost, while minimizing total risk and 
ensuring the maximum protection for the environment, the 
general public, and the personnel involved in the destruction 
of lethal chemical agents and munitions. The committee could 
then address matters of interest raised at the hearing during 
the conference.

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


                                Overview

    The budget request for fiscal year 1996 for research, 
development, test, and evaluation (RDT&E;) included $34,331.953 
million. This represents a $1,737.724 million decrease from the 
amount authorized for fiscal year 1995.
    The committee recommends authorization of $35,934.447 
million, an increase of $1,602.494 million, for fiscal year 
1996.
    The committee recommendations for the fiscal year 1996 
RDT&E; program are identified in the table below. Major issues 
are discussed following the table.
    Offset Folio 134    insert here



                         Defense-Wide Programs


                         special considerations

Cruise missile defense

    Along with the threat posed by ballistic missiles, the 
committee is concerned about the growing threat posed by cruise 
missiles. Cruise missiles, particularly those capable of land-
attack roles, could quickly become as equally threatening to 
deployed U.S. forces as ballistic missiles.
    The committee believes that certain prudent steps should be 
taken to prepare for the day when U.S. and allied forces could 
face an enhanced cruise missile threat.
            Improving battle management command, control and 
                    communications (C3)
    The committee endorses the Defense Science Board's call for 
enhancing existing air defenses through improved connectivity 
among the military services' varied sensor and ``shooter'' 
assets. The committee directs the Secretary of Defense to 
insure such connectivity among the C3 capabilities of the Navy 
(Cooperative Engagement Capability), Air Force (Joint Tactical 
Information Distribution System/Link 16), and Army (``Digitized 
Battlefield''). The committee requests that the Secretary 
provide a report to the congressional defense committees on the 
Department's actions to insure connectivity in this area by May 
1, 1996.
            Selective upgrade of existing sensors and ``shooters''
    The committee recommends an increased authorization of $8 
million each to the Army, Navy, and Air Force in fiscal year 
1996. Details of this recommendation are contained in the 
classified annex.
            Long-range airborne surveillance
    Compared to a fixed-wing aircraft option, the committee 
understands that an aerostat solution may provide more 
endurance as a surveillance platform and be significantly less 
costly. The committee encourages the Department of Defense to 
evaluate the aerostat concept in an Advanced Concept Technology 
Demonstrator (ACTD) and recommends an additional $9 million in 
PE 63009A for aerostat ACTD risk reduction to be conducted 
jointly by the Advanced Research Projects Agency (ARPA) and the 
Army. The committee directs the Secretary of Defense to report 
back on progress towards funding such an ACTD by May 1, 1996. 
Further details of this recommendation are contained in the 
classified annex.
            Continued advanced research and development
    The impact of cruise missiles on the battlefield will 
likely grow with time. While the above efforts are excellent 
first steps to meet most first and second generation systems 
requirements and are ideal for regional contingencies, ARPA 
should continue its fundamental mission of pursuing advanced 
sensor and system concepts, as well as understanding and 
countering critical gaps through special studies. The committee 
recommends an additional $35 million in PE 63226E for these 
purposes.
            Consolidated management
    The committee is also aware of organizational problems in 
the area of cruise missile defense. Various organizations 
ranging from the military services to ARPA and the Office of 
the Under Secretary of Defense for Acquisition and Technology 
to the Ballistic Missile Defense Organization, are pursuing 
programs and have management responsibility for cruise missile 
defense. Such diffusion of effort clearly undermines the 
ability of the Department to achieve timely results in 
developing systems that are capable of countering the cruise 
missile threat.
    Therefore, the committee directs the Secretary of Defense 
to review the existing organizational and management structure 
for cruise missile defense-related activities to achieve 
program consolidation. The committee urges the Secretary to 
review the recommendations of the Defense Science Board 
regarding the appropriate management structure for pursuing an 
effective cruise missile program for the Department. The 
Secretary shall report the results of the review to the 
congressional defense committees not later than February 15, 
1996.

Dual-use technology programs

    The committee believes dual-use programs can be of great 
benefit to the core mission of the Department of Defense when 
they are used to leverage commercial technologies and processes 
to achieve specific military purposes. However, the committee 
notes that the fiscal year 1996 request for the Department's 
dual-use technology programs is approximately 90 percent 
greater than the fiscal year 1993 request and 12 percent higher 
than the fiscal year 1995 program. Given the major reductions 
that have been been made in many core research and development 
programs of the military services, the committee believes 
increases of this magnitude are excessive. While the committee 
supports competitive, cost-shared, partnership programs to the 
greatest extent possible, the committee has several concerns 
with regard to dual-use program management within the 
Department:
          (1) In too many cases ``dual-use'' has been pursued 
        as an end in itself, at the expense of adequately 
        funding national security programs. The Department's 
        fiscal year 1996 request for acquisition programs is $9 
        billion to $10 billion less than projected for fiscal 
        year 1996 when the Department provided the Congress its 
        fiscal year 1995 budget request. This reduction 
        resulted in a costly, inefficient restructuring of many 
        national security programs. Yet dual-use programs were 
        unaffected by these reductions. In fact, as previously 
        noted, the request for fiscal year 1996 for dual use 
        programs is 90 percent higher than the fiscal year 1993 
        request for such programs.
          (2) The Department's primary program for dual-use 
        projects, PE 63570E, Defense Reinvestment, provides the 
        Congress virtually no before-the-fact oversight of the 
        technologies to be pursued through dual-use efforts;
          (3) A significant amount of the funds for these 
        programs has gone toward technology initiatives of 
        marginal or questionable benefit to the military 
        services;
          (4) Dual-use programs are executed through a wide 
        variety of partnership structures and solicitation 
        processes, making it difficult for businesses of any 
        size, particularly those that have not routinely worked 
        with the Department of Defense, to understand how to 
        best respond to and apply for participation in dual-use 
        programs;
          (5) The scheduling of some dual-use solicitations and 
        evaluations is highly inefficient, particularly the 
        Technology Reinvestment Project (TRP); and
          (6) The process fails to provide an architectural 
        road map indicating long-term dual-use technology goals 
        and objectives for the Department.
    Therefore, the committee recommends no authorization for 
Defense Reinvestment for fiscal year 1996. Instead, the 
committee encourages the Department to:
          (1) Support a balanced dual-use program that reflects 
        overall military requirements. Major increases in dual-
        use program funding at the expense of proper execution 
        of on-going weapons development programs cannot be 
        justified;
          (2) Reorient the focus of dual-use programs to 
        primarily address military requirements, rather than as 
        an ancillary benefit;
          (3) Use the authorities provided in sections 2371, 
        2501, and 2511 of title 10, United States Code and the 
        funds authorized for specific technology programs 
        elsewhere in this title to continue meritorious dual-
        use projects of significant military benefit previously 
        funded through PE 63570E and through the Department's 
        other dual-use technology programs;
          (4) Establish a minimal number of partnership and 
        cost-shared processes through which solicitations are 
        made, evaluated and executed so that those businesses 
        seeking to participate in dual-use programs can better 
        focus on and invest in substance rather than process;
          (5) Leverage funding available for dual-use programs 
        by making cost sharing an element of solicitation 
        criteria to be considered in making project selections.
          (6) Incorporate dual-use solicitations into the 
        normal technology project solicitation process so their 
        evaluation and project implementation can be 
        accommodated without having to divert extraordinary 
        personnel resources for once- or twice-a-year 
        solicitation evaluations; and
          (7) Appoint an individual, reporting directly to the 
        Undersecretary of Defense for Acquisition and 
        Technology, to oversee all of the Department's dual-use 
        programs, including the military services, and conduct 
        outreach activities for communicating to the business 
        community those technologies and processes associated 
        with the Department's program.

Federally funded research and development centers (FFRDCs)

    The committee is disappointed that the recently released 
Defense Science Board (DSB) study on the role of FFRDCs failed 
to offer any innovative alternatives to redefine and rebalance 
the workload of the centers. The report noted however, that 
private sector capabilities in systems engineering (SE) and 
systems integration (SI) have grown dramatically and that there 
is general agreement, inside and outside of government, that 
current private sector capabilities in SE and SI are more than 
sufficient to meet the Department's needs for these services. 
Therefore, the committee believes that steps should be taken to 
phase out a significant portion of FFRDC activity through 
competitive contracting. The committee recommends a legislative 
provision (sec. 257) that would require the Department to 
subject future FFRDC SE and SI work to open competition.
    The committee also notes that the Department has decreased 
funding for FFRDCs that perform studies and analyses less than 
5 percent in actual funding since 1991. The committee believes 
the FFRDC capability must be rebalanced with additional 
efficiencies achieved in studies and analysis as well as a 
reevaluation of its FFRDC laboratory functions. The committee 
recognizes that the Lincoln Laboratory as well as other 
university affiliated research centers that serve the military 
under long-term ``FFRDC-like'' arrangements offer vital bridges 
from university discovery to potential military products. The 
committee recommends that this valuable FFRDC function be 
recognized for its important contribution and be factored into 
subsequent defense technology planning.
    The committee believes additional reductions can and should 
be made in certain FFRDCs and limits FFRDC funding by the 
Department in fiscal year 1996 to $1.15 billion, a reduction of 
$100 million from the projected requirement, of which $9.903 
million is for the Lincoln Laboratory research program in PE 
62234D.
    The committee directs that the Institute for Defense 
Analysis and the Software Engineering Institute level of 
funding shall not be reduced from the Department planned fiscal 
year 1996 activity.

Joint advanced strike technology (JAST) program

     The committee is disappointed that the Department has not 
been able to better define its plan for the future fighter/
attack aircraft force structure. Although approximately $3 
billion in additional funding is planned for the Joint Advanced 
Strike Technology (JAST) program through the Future Years' 
Defense Program (FYDP), there is no apparent willingness or 
commitment by the Department to examine future needs from a 
joint, affordable, and integrated warfighting perspective.
     The Department formed the JAST office to focus and 
rationalize the varying tactical aircraft requirements existing 
at the time among the military services. Yet, since 
organization of the JAST program, the Department seems willing 
to permit each military service to seek to justify its future 
needs without regard to the joint warfighting requirement or 
the ultimate cost, even though affordability is likely to be a 
major issue. The Department's senior leadership and the Joint 
Staff through the Joint Warfighting Capabilities Assessment and 
Joint Requirements Oversight Council process have failed to 
provide the JAST program manager the necessary support to make 
difficult choices. Instead of rationalizing competing 
requirements, the current approach seeks to accommodate all of 
the diverse, unrealistic, unaffordable, and unnecessary 
``requirements'' of each of the military services involved.
     The committee understands that there are a number of on 
going studies within the Department that should examine the 
aggregate or ``joint'' fighter and attack aircraft requirements 
for the two major regional contingency scenario. The committee 
is hopeful that these various assessments will address the 
committee's issues and concerns noted below. Therefore, the 
committee recommends a provision (sec. 216) that would direct 
the Secretary of Defense to address these issues in a report to 
the congressional defense committees and place a limitation on 
fiscal year 1996 JAST obligations until the report is provided.
     Over $250 million has been appropriated for the JAST-
ASTOVL program to date. Another $331.156 million is included in 
the budget request for fiscal year 1996, with a total of 
approximately $3 billion included in the FYDP. The stated 
intent of the program is for the initial JAST candidate 
aircraft to enter engineering and manufacturing development 
(EMD) in fiscal year 2000. The committee is concerned about the 
realism of the development funds requested for the JAST 
program. For example, the funding projected for the program for 
the latter years of the FYDP trends downward. This is 
inconsistent with historical experience for previous aircraft 
development programs entering EMD.
     In preparing the report required by section 216 of the 
bill, the Department should address the following issues:
          (1) What is the total joint requirement, under the 
        two major regional contingency (MRC) scenario, for 
        numbers of tactical combat aircraft and the 
        characteristics required of those aircraft in terms of 
        capabilities, range, and observability/stealthiness; 
        surface and air launched standoff precision guided 
        munitions; cruise missiles; and ground based systems 
        such as Extended Range-Multiple Launch Rocket System 
        and the Army Tactical Missile System (ATACMS) for joint 
        warfighting capability?
          (2) What are the MRC warning time assumptions and 
        what is the effect on future tactical fighter/attack 
        aircraft requirements using other warning time 
        assumptions?
          (3) What requirements exist for JAST that justify an 
        additional $3 billion development investment over the 
        FYDP that cannot be met by existing or modifications to 
        existing aircraft or by those aircraft in development?
          (4) What is the Department's long range plan for 
        rationalization of the current three approaches--STOVL, 
        helicopters, and fixed-wing aircraft--to providing 
        close air support for ground troops?
    Once the Department addresses these issues it may be able 
to address the committee's concerns, including:
          (1) The Department appears to be committed to a JAST 
        level-of-effort program without having determined what 
        the manned tactical aircraft component requirement is 
        to meet the total joint warfighting requirement for 
        tactical aircraft, cruise missiles, and air and ground 
        launched standoff precision guided munitions for the 
        deep strike, interdiction, and close air support 
        missions;
          (2) The JAST program is pursuing as its first 
        priority the least required warfighting capability: a 
        follow-on close air support (CAS) aircraft as a 
        replacement for the Marine Corps AV-8 Harrier. As 
        reflected in Desert Storm results and likely future 
        warfighting scenarios, the manned tactical fixed-wing 
        requirement to meet the CAS mission is relatively 
        small. This, combined with the ``From the Sea'' 
        maritime strategy, which allows the commitment of major 
        maritime-based aviation assets to the land battle, 
        makes even more aircraft available for this mission 
        area. In addition, it does not appear that Marine Corps 
        and Army attack helicopter force structure is being 
        adequately considered. Further, the ``Bottom Up 
        Review'' conducted by the Department of Defense 
        reflected these considerations, where it excluded the 
        AV-8 in its future tactical aircraft force requirements 
        and planning assumptions.
          (3) The Navy canceled the A-12 and later canceled the 
        A/F-X. The Navy currently states the requirement for 
        JAST is to perform as a first-day-survivable (FDS) 
        strike fighter. If there is no need to pursue an A-12 
        or A/F-X capability now, and if the Navy will do 
        without this capability for 10-15 years, why is the 
        capability required in 2005-2010? How many FDS strike 
        fighters would the Joint Forces Commanders require 
        prior to the achievement of air supremacy in the two 
        MRC scenario?
          (4) The Air Force claims it needs an F-16 replacement 
        yet is unable to demonstrate why additional F-16s 
        cannot affordably meet its requirement given the 
        capabilities the F-22, F-117, standoff precision guided 
        munitions, and cruise missiles would provide the Joint 
        Forces Commander.
          (5) Warning times assumed in MRC scenarios used to 
        justify ``requirements'' need to be realistically 
        established.
    The committee supports the focus that the JAST program 
management provides for the advanced technology demonstrations 
it is conducting and the need to place emphasis on the 
maturation of propulsion systems. But the committee believes 
that a number of other initiatives are premature since many 
relevant questions about what needs to be developed when, have 
not yet been addressed. The committee also believes that some 
portions of the development effort duplicate activities in 
other programs. Accordingly, the committee recommends a 
reduction in funding from the requested $331.156 million to 
$280.156 million, a reduction in PE 63800N and PE 63800F of 
$25.5 million each. The committee recommends the following 
specific adjustments to the ``JAST Program Fiscal Year 1996 
Investment Plan'': line 21, increase $10 million; line 29, 
decrease $6 million; line 32-35, decrease $20 million; and line 
40, decrease $35 million. The committee supports completion of 
the current phase of the ASTOVL development more out of concern 
for the industrial base than as an endorsement of the 
``requirement'' for such an aircraft.

Justification of estimates

     The committee has in past years noted the Department's 
lack of attention to detail and timeliness in providing its 
annual budget materials to the congressional defense 
committees. The committee notes that again this year that 
budget materials were not provided until two-to-three months 
after the President's budget was presented to the Congress. 
Once provided, the materials were found to be less than 
satisfactory. As an example, a great deal of the data provided 
in the Air Force RDT&E; budget materials was wrong and 
internally inconsistent. In addition, numerous program element 
numbers for all of the military services' requests fail to 
correctly describe the status of specific programs (e.g., the 
Air Force program element number for the Tri-Service Standoff 
Attack Missile (TSSAM) reflects the status of TSSAM as having 
been an operational system). The committee cannot emphasize too 
strongly to the Department the need to provide accurate and 
timely justification materials to the Congress if it expects 
full and favorable consideration of the Department's request.

Manufacturing technology (MANTEC)

    The committee is concerned that the military services are 
not focusing MANTEC research and development on key 
manufacturing cost drivers in weapon systems. The potential now 
exists through the use of the available talent pool in 
industry, academic and government consortia, or through the use 
of several centers of excellence to address manufacturing 
applications that could have significant cost reduction impact 
now and in the future.
    The committee directs the Secretary of Defense to place the 
highest priority of the manufacturing technology program 
(MANTEC) on funding areas that address near-term manufacturing 
problems and to maintain a lesser portion of the program aimed 
toward longer term technologies.
    The committee recommends transfer of the MANTEC program 
from advanced development to production support to accomplish 
this primary purpose. The committee directs a formal liaison 
with the Director, Defense Research and Engineering (DDR&E;) as 
the technology coordinator for infusion of advanced technology 
into the process.
    The committee reiterates the importance of industrial 
participation and competition in awarding grants and contracts. 
National industrial associations and consortia shall be 
considered by all services for participation in program 
activity.
    Finally, the committee believes that since the MANTEC 
program has been significantly reduced in funding over prior 
years, infrastructure savings (including new facility 
construction) can be achieved by consolidation of its centers 
of excellence and re-assigning future work activities within 
the remaining centers. The committee recommends that 25 percent 
of the program shall have cost sharing greater than two to one.
    The committee recommends the following program adjustments:
    PE 63771A--decrease $17.776 million.
    PE 78045A--increase $27.776 million ($6 million for 
composite technology for the instrumented factory for gear 
development, $4 million for PAN fibers), and $1.5 million of 
the core program shall be used for industrial--academic 
partnerships for repair technology development and insertion 
for rotary winged aircraft.
    PE 63771N--decrease $41.251 million.
    PE 78011N--increase $51.251 million ($10 million for the 
Navy to initiate partnerships with industry, government 
laboratories and other research organizations that will allow 
the development of manufacturing technologies which support 
optoelectronic devices and components).
    PE 63771F--decrease $53.332 million.
    PE 78011F--increase of $53.332 million.
    PE 63771S--decrease $7.007 million.
    PE 78011S--increase $17.007 million ($10 million to conduct 
demonstrations and pre-production development for military sewn 
products and to continue the machine tool program).

Precision guided munitions

    The Department is spending billions of dollars to acquire 
sophisticated precision guided munitions (PGMs). These weapons 
are expected to impact future force levels and number of 
platforms required to defeat battlefield threats.
    The General Accounting Office (GAO) recently reviewed all 
military services PGM programs and determined that the 
Department has procured or plans to develop and procure 33 
types of PGMs. The military services estimate they will have 
spent about $58.7 billion for these PGMs, $30.4 billion for 19 
munition types they now have in limited numbers in the 
inventory and about $28.3 billion for 14 munition types in 
development. These figures do not include the yet-to-be-defined 
program to replace the recently terminated Tri-Service Standoff 
Attack Missile (TSSAM). In addition, these costs do not include 
integration into platforms, or the electronic and mechanical 
interfaces required. The GAO found that:
          (1) The military services will have multiple PGM 
        options to counter targets in the same classes (when 
        current inventory deficiencies are corrected and 
        developmental programs are complete);
          (2) The military services may have additional 
        opportunities for joint procurement which are not being 
        pursued; and
          (3) Acquisition practices are inefficient.
    The committee questions: (1) how many PGM types the 
services need to be effective against different target classes, 
(2) what quantities are needed, (3) whether joint programs are 
feasible, and (4) whether PGMs in production and development 
are still cost effective?
    The committee directs the Secretary of Defense to perform 
an analysis of the full range of PGMs in production and in 
research, development, test, and evaluation to determine:
          (1) The numbers and types of PGMs needed to provide a 
        complementary capability in each target class;
          (2) The feasibility of developing and procuring 
        additional munition types jointly;
          (3) The feasibility of integrating a given weapon on 
        multiple service platforms; and
          (4) The economy and effectiveness of continuing 
        acquisition of munitions that are characterized as 
        ``interim'' or whose quantity requirements have 
        decreased significantly such that unit costs have 
        increased beyond 50 percent.
    The Secretary shall include a section in the report which 
details the process by which the Department approves the 
development of new PGMs, avoids service duplication and 
redundancy, retires less effective systems, establishes out-
year cost rationalization within the total out-year 
modernization planned funding, and identifies by name and 
function that person responsible for approving each new PGM 
permitted to enter the formal acquisition process.
    The report shall be provided to the congressional defense 
committees not later than February 1, 1996.

                               Army RDT&E;


                                overview

    The budget request for fiscal year 1996 included $4,444.175 
million for Army RDT&E.; The committee recommends authorization 
of $4,774.947 million, an increase of $330.772 million, for 
fiscal year 1996.
    The committee recommendations for the fiscal year 1996 Army 
RDT&E; program are identified in the table below. Major changes 
to the Army request are discussed following the table.
    Offset Folios 147 to 149 insert here



                       items of special interest

Army modernization shortfalls

    Through the course of its evaluation of the proposed 
Department of the Army budget, the committee has learned of a 
number of key fiscal year 1996 funding shortfalls that are 
vital to ensuring future Army readiness. The committee believes 
these shortfalls could be satisfied by redirecting or 
postponing longer-range programs to pay for near-term needs and 
requirements. As an example, the Army advanced concept 
demonstration for the rapid force projection initiative is 
assessed to be inadequately planned with reliance on weapons 
with marginal utility and should be postponed and its planned 
funding applied to higher priority needs in other Army RDT&E; 
accounts that have been fully certified by the Army as bona 
fide key modernization shortfalls. Therefore significant 
reductions to the missile and rocket advanced technology 
program element (PE 63313A) have been made in order to fund 
these other program elements within the Army RDT&E; account 
where shortfalls have been identified.
    The committee recommends the following funding adjustments:
    PE 64741A: +$10 million for tactical operation center.
    PE 63313A: +$5 million for Multiple Launch Rocket System 
(MLRS) low-cost guidance.
    PE 65712A: +$1.5 million for joint warfighter 
interoperability demonstration.
    PE 23740A: +$13 million for maneuver control system.
    PE 23726A: +$6.2 million for advanced field artillery 
tactical data system.
    PE 64768A: +$7 million for Army tactical missile system/
brilliant anti-armor submunition risk reduction.
    PE 63778A: +$3.7 million for MLRS improved launch 
mechanical system.
    PE 64804A: +$2 million for 3KW tactical quiet generator.
    PE 63001A: +$3.1 million for ammunition logistics 
packaging, safety and advanced technology.
    PE 64201A: +$11 million for prototype Army airborne command 
and control system for task force XXI.
    The committee reduces funding for the rapid force 
projection initiative in PE 63313A (not including project D496) 
as a partial offset.

Advanced artillery propellant development

    The budget request included $10.846 million in PE 63640A to 
continue development of an advanced solid propellant system and 
52-caliber cannon as a backup for the Crusader liquid 
propellant (LP) armament system and for potential use in other 
field artillery systems.
    As a hedge against potential failure of LP and to enhance 
existing systems, the committee recommends an increased 
authorization of $19.6 million to continue development of the 
XM297 advanced 52-caliber cannon for Crusader, including 
integration of a bolt-in/bolt-out gun mount for the M109A6 
Palladin and type classification of the advanced solid 
propellant in standard 39-caliber artillery cannons.

Advanced battery technology

    The committee recommends an additional $3 million for non-
metallic lithium and low cost reusable alkaline battery 
development in PE 62705A and $500,000 in PE 62314N for advanced 
seal delivery vehicle batteries.

Advanced individual weapon anti-armor technology

    The budget request included $5.114 million in PE 62623A and 
$4.487 million in PE 63607A for the Joint Service Small Arms 
Program. The committee strongly supports the development of 
technology for advanced individual weapon systems for the 21st 
Century as outlined in the Joint Services Small Arms Master 
Plan. The capability for defeating a wide range of armored 
fighting vehicles and other battlefield targets incorporated in 
an advanced individual weapon system could significantly 
increase the combat effectiveness of the individual soldier or 
marine on the modern battlefield. The committee recommends an 
increase of $2 million in PE 63607A for the advanced technology 
demonstration of lightweight, medium-caliber, multi-shot, anti-
armor weapon technology, and believes that a successful 
demonstration could lead to early application of the technology 
in a next-generation objective individual combat weapon system 
for the Army and the Marine Corps.

Advanced missile system-heavy (AMS-H)

    The budget request included $995,000 for a new anti-tank 
weapon program in PE 64325A. The committee denies the Army's 
request for new start funding for yet another tank killer 
program.

Advanced solid state dye lasers

    The committee recommends an additional $4 million in PE 
62307A for continued research into advanced solid state dye 
lasers.

Aircrew protection

    The committee recommends an additional $6 million in PE 
63801A for advanced common helmet development for helicopter 
aircrew members.

Armored systems modernization

    The committee recommends the following adjustments to the 
Department's budget request:
    PE 64645A/D413: armored gun system, increase $5.36 million.
    PE 63649A/DG24: CMS/Grizzly, increase $4.5 million.
    PE 64649A/DG25: CMS/Grizzly, increase $9.922 million.
    PE 64649A/DC26: CMS/Wolverine, increase $4.231 million.
    PE 23735A/D330: ABRAMS tank, increase $1.309 million.
    These additions shall be offset by a reduction in the 
procurement section of this act of $25.322 million from the 
ABRAMS tank modification line (BLIN #19/FA0770).

Automatic test equipment development

    The committee recommends an additional $10 million in PE 
64746A for continued development of software to support the 
integrated family of test equipment (IFTE).

Battlefield combat identification system (BCIS)

    The committee is pleased with the Army's successful testing 
to date of the Battlefield Combat Identification System (BCIS) 
which is designed to prevent friendly fire casualties through 
positive electronic interrogation and identification of 
potential targets as ``friend or foe.'' The committee considers 
inclusion of BCIS in the upcoming Army Task Force XXI test/
demonstration vital to validating the overall effectiveness and 
future production potential of this critical anti-fratricide 
system. Further, the committee directs the Army to ensure that 
a sufficient number of BCIS units are fielded for a realistic 
test of the system for Task Force XXI and to continue plans to 
fully equip a contingency force division as soon as soon as 
practicable.

Battlefield tissue replacement

    The committee recommends an additional $5 million in PE 
62787A for continuation of the combat care laser-biologic 
tissue fusion and replacement program.

Biotechnologies

    The committee continues to support the research and 
development efforts of the Departments of Defense and 
Agriculture conducted by the Army in PE 62720A. The committee 
expects the Director, Defense Research and Engineering to 
provide guidance to this important program. In particular, the 
committee strongly recommends efforts directed at development 
of advanced materials from renewable resources and the 
development and demonstration of cost-effective bioremediation 
technologies for contaminated soil and related resources.

Brilliant antiarmor submunition (BAT)

    The committee believes there is benefit to expanding the 
use of the Department of the Army's BAT submunition into other 
platforms and carriers. The committee directs the Secretaries 
of the Air Force and Navy in coordination with the Secretary of 
the Army to perform a cost and operational effectiveness 
analysis (COEA) of Air Force and Navy participation in the BAT 
development program for possible use in fixed wing and cruise 
missile carriers. The Secretaries shall submit the results of 
the COEA to the congressional defense committees not later than 
120 days after passage of this act.

Comanche helicopter (RAH-66)

    The committee agrees with the new philosophy of the RAH-66 
Comanche helicopter program which focuses on fielding multiple 
prototype aircraft for use by regular Army forces in the field 
to determine the full range of warfighting advantages offered 
by the system. The committee also believes that both 
reconnaissance and attack/weapons packages for the Comanche 
should be field tested as soon as possible in order to fully 
maximize the system's future combat potential.
    However, the committee is concerned over the apparent lack 
of full support within both the Army and Department of Defense 
to move more rapidly towards production and integration of the 
Comanche into the rapidly emerging digitized brigades. The 
committee reminds the Department that continual program 
reduction and restructuring is wasteful and demonstrates the 
Army's lack of commitment and the Department's lack of 
leadership in prioritizing and appropriately funding its higher 
priority modernization programs. These programs, like Comanche, 
fully employ emerging revolutionary technology, offer decisive 
force advantages, and drastically reduced operations and 
maintenance cost. The extended development periods caused by 
the continual restructuring of the Comanche program inflate 
development costs, stagnate industrial potential for full scale 
production, and leave the Army without a vital future combat 
capability.
    The committee remains concerned that, based upon recent 
events, including the loss of an unarmed, non-stealthy OH-58A 
scout helicopter over North Korea, the Army requirement for an 
advanced armed reconnaissance helicopter is more pressing than 
ever, and serious consideration should be given to accelerating 
rather than delaying the Army's choice to fulfill this 
requirement, the RAH-66 Comanche.
    The Secretary of Defense is reminded that the Comanche is 
the Department's only research and development program for 
helicopters and requires serious and dedicated management 
attention to ensure its success. The committee considers 
appropriate future funding, and an elevated Department 
priority, as essential to integrating this revolutionary weapon 
system into the modern battlefield as soon as possible.
    Further, the committee believes the Comanche should become 
and remain a prime candidate for any additional modernization 
funding that is made available to either the Department of 
Defense or the U.S. Army.
    The committee therefore recommends an increase of $100 
million in PE 64223A and directs the Secretary of Defense and 
the Secretary of the Army to immediately reconsider the 
priority given to the Comanche and to examine alternatives that 
would provide accelerated outyear funding profiles that 
challenge the industry to successfully conduct the prototype 
program and guarantee full scale production prior to 2004.

Ductile iron

    The committee recognizes the cost and weight savings of 
ductile iron and understands the benefits to the Army and the 
other military services if problems in welding and shaping can 
be solved. The committee encourages the Secretary of the Army 
to continue the ductile iron program. The committee also 
recommends that ductile iron be a part of the Advanced Research 
Projects Agency's specialty metals program, described in the 
Defense Agencies' section of this report.

Electric gun technology

    The committee continues to support electric gun technology 
development for potential future weapons applications, but 
recommends that the effort be re-focused on the most promising 
concepts. The committee recommends an additional $6 million in 
PE 62618A, project H-80, to complete data gathering and 
assessment by the research teams.

Enhanced fiber optic guided missile (EFOG-M)

    The committee is concerned that the Army is pursuing a 
weapon system which provides questionable value and possesses 
known fiscal risk. The EFOG-M was canceled by the Assistant 
Secretary of the Army, Research Development and Acquisition 
because of cost overruns and poor performance. The program was 
resurrected by proponents in the Army and in the Department in 
fiscal year 1995.
    The committee's primary concern for this program, above its 
apparent marginal need, is that planned funding for the EFOG-M 
may not match the development activity and product delivery of 
300 missiles and 12 fire units for planned test and evaluation. 
Therefore, the committee recommends a provision (sec. 215) that 
would require the Secretary of the Army to certify that a 
requirement exists for the EFOG-M. The provision also limits 
the expenditure of funds for the EFOG-M program to that 
identified in the current program plan only and denies 
continuation of the program beyond fiscal year 1998 if contract 
obligations are not met.

Environmental technology

    The committee recommends $4 million of the amount requested 
in PE 62720A for continued support for bioremediation education 
science and technology with applications only for defense-
related environmental problems.

Hardened materials

    The committee recommends an additional $4 million in PE 
62105A to continue the unfunded portions of the hardened 
materials program.

Heavy vehicle support

    The committee recommends an additional $1.9 million in PE 
64622A for water heater/chiller development for the Army's 
XM1098 water tank semitrailer and an additional $845,000 in PE 
64622A for a palletized loading system technology 
demonstration.

Intelligence fusion analysis demonstration

    The budget request included $2.937 million in PE 63745A for 
the Intelligence Fusion Analysis Demonstration program. The 
committee recommends an increase of $3 million for development 
and evaluation in Army Warfighter Experiments and the joint 
precision strike demonstration program of advanced large 
screen, automated graphical displays which would provide 
enhanced situational awareness for tactical commanders.

Joint precision strike demonstration program

    The budget request included $34.104 million in PE 63238A 
for the joint air-land-sea precision strike demonstration 
(JPSD) program. The committee is encouraged by the progress 
that the Army has made in addressing key issues for defeating 
time critical targets at extended ranges and in demonstrating 
concepts for joint capabilities. The committee strongly 
supports the objectives of the precision/rapid counter-multiple 
rocket launcher advanced concept and technology demonstration 
in the fiscal year 1996 program. The committee believes that in 
the future; increased participation by the other military 
services in the JPSD could capitalize on developments in the 
Warbreaker program and elsewhere and contribute to the 
development of joint procedures, tactics, and techniques to 
increase the effectiveness and capability of fixed wing 
aircraft and other systems in the attack of time critical 
targets. To this end, the committee directs that the JPSD 
program, which has been designated as Army lead, be expanded 
into a jointly manned program with full participation by all 
military services. The committee recommends an increase of $4 
million and requests a report on the status of implementing 
this requirement no later than June 30, 1996, and submission by 
September 30, 1996, of a five-year plan for executing a fully 
coordinated and jointly manned JPSD program.

Land mine neutralization program

    The committee believes there is a need for a central 
authority to plan, oversee, and coordinate the research, 
development, and acquisition of the technology applicable to 
area ordnance clearance. Accordingly, the committee directs the 
Secretary of Defense to submit a plan to the committee by 
February 15, 1996, that defines research and development 
priorities, program management and cooperative activity with 
international programs. Since the committee intended for the 
Department to institute a program that would lead to viable 
systems, the committee recommends continuing the effort in 
subsequent years. The committee recommends an additional $10 
million in PE 63606A.
    The Secretary of Defense shall provide an annual status 
report to the congressional defense committees by June 1, 1996 
on the program activity and plans.

Laser radar for obstacle avoidance

    The committee supports development of high accuracy laser 
radar obstacle avoidance system for low-flying helicopters in 
all-weather, night operations as well as laser warning 
equipment for combat vehicles. The committee recommends an 
additional $5 million in PE 63710A for testing and avionics 
integration for helicopter obstacle avoidance and $3.1 million 
in PE 64740A to develop laser warning equipment for combat 
vehicles.

Low cost autonomous attack submunition (LOCAAS)

    The committee believes there is cost saving potential in 
continuing research and advanced development in the Army and 
Air Force on LOCAAS. The committee recommends $2.5 million in 
PE 63313A, project D493, in the Army and $2.5 million in PE 
63601F in the Air Force.

MK 19 weapon system soft mount

    The committee recommends an additional $2.7 million in PE 
64802A to complete type classification of a soft mount for the 
MK19 weapon system initiated by congressional action in the 
National Defense Authorization Act for Fiscal Year 1995 (Public 
Law 103-337).

Objective individual combat weapon (OICW)

    The committee supports development of the OICW but is 
concerned that funds requested for fiscal year 1996 are 
inadequate to effectively conduct this advanced technology 
program. The committee encourages the Secretary of the Army to 
examine the current development strategy for OICW to support 
the joint small arms master plan and request a reprogramming of 
funds to adequately carry out the master plan.

Optoelectronics

    The committee recognizes the importance of optoelectronics 
technologies for modernization of its forces. Accordingly, the 
committee encourages the Army to maintain a strong technology 
base program that involves and strengthens this sector of the 
industrial base.

Passive millimeter camera

    The committee recommends an additional $6 million in PE 
62120A to complete development and field test both the first 
and second generation modular, concept validation cameras.

Personnel training

    The committee recognizes and supports the concept of 
transitioning technology resulting from DOD funded research for 
a specific purpose to applications in non-military areas. As an 
example, the lessons learned in aviation crew coordination 
training may have possible application to emergency medical 
team training. The Army is encouraged to investigate the 
potential for technology transfer in this area in a manner that 
does not divert defense resources from their principal purpose.

Projectile detection and cueing

    The committee supports the projectile detection and cueing 
program funded for Army evaluation in PE 62308A. The committee 
directs the Secretary of the Army to make available appropriate 
funding to support evaluation in the Army's ACT II program and 
to seek a reprogramming of funds where inadequacies exist.
    The committee further directs the Secretary of the Army to 
report to the congressional defense committees on the results 
of the projectile detection and cueing phase I demonstration 
tests together with the Army's planned course of action as a 
result of the tests. The report shall be provided not later 
than 120 days after the conclusion of the demonstration tests.

Space applications technology program

    The budget request included $16.819 million in PE 63006A 
for command, control, and communications advanced technology, 
including $498,000 for the Army's space application technology 
program. The committee is aware of the program's success in 
demonstrating global positioning system and Wrasse weather data 
receivers during Operation Desert Shield/Desert Storm and other 
space technology applications such as the location of high 
value targets using hyperspectral sensing techniques, high data 
rate satellite communications on the move, and down link 
weather satellite technology. The committee encourages the Army 
to consider reprogramming funds to provide additional support 
for the space applications technology program.

Starstreak air to air evaluation

    The committee reiterates and reinforces its desire to 
evaluate the Starstreak missile on the AH-64 Apache helicopter 
as authorized in the National Defense Authorization Act for 
Fiscal Year 1995 (Public Law 103-337). The committee believes 
the planned United States/United Kingdom evaluation program 
will provide a cost effective means to prove the feasibility of 
air-to-air defense capability for the Apache. The committee 
however directs that the test program include warhead lethality 
in realistic combat scenarios including incoming, crossing and 
maneuvering high speed targets in clear and adverse weather. 
The committee recommends an increase of $6.5 million in PE 
63003A for both phases of the program and understands that 
prior year funding is available to complete this program.

Stinger missile improvements

    The committee recommends an additional $9.8 million in PE 
23801A for sustaining and accelerating the block 2 Stinger 
program.

Tactical mobility

    The committee notes shortfalls in tactical mobility 
identified in testimony provided by the Army. The committee 
recommends an additional $10 million to initiate the 
development of technologies and concept designs in PE 63003A 
focused on replacement of the CH-47 heavy lift helicopter.

Weapons and munitions

    The committee recommends an additional $1.6 million in PE 
64802A to continue development of the 120mm full range practice 
cartridge XM-931 training round that will lead to a lower cost 
substitute for standard rounds.

Weapons and munitions advanced technology

    The committee recommends an additional $2 million in PE 
63004A for completion of the XM-982 155mm projectile 
development.

                               Navy RDT&E;


                                overview

    The budget request for fiscal year 1996 contained 
$8,204.530 million for Navy RDT&E.; The committee recommends 
authorization of $8,516.509 million, an increase of $311.979 
million, for fiscal year 1996.
    The committee recommendations for the fiscal year 1996 Navy 
RDT&E; program are identified in the table below. Major changes 
to the Navy request are discussed following the table.
    Offset Folios 165 to 167 insert here



                       items of special interest

Advanced amphibious assault vehicle

    The budget request included $32.366 million in PE 63611M 
for demonstration/validation of the advanced amphibious assault 
vehicle (AAAV). The committees understands that selection of 
the appropriate engine for the AAAV is a pacing item in the 
AAAV program and directs the Secretary of the Navy to ensure 
that the engine qualification test program previously mandated 
by the Congress is completed as currently planned. The 
committee understands that decisions made during final 
development of the budget request resulted in a slip of 
approximately 26 months in the initial operating capability of 
the AAAV and directs the Secretary of the Navy to identify the 
additional funding required to restore the original schedule 
with the submission of the fiscal year 1997 budget request. The 
committee recommends an increase of $6 million to the fiscal 
year 1996 budget request for engine development and system 
technical risk reduction.

Advanced submarine technology development

    The budget request included $18.392 million in PE 62121N 
for exploratory development of submarine systems technology and 
$30.860 million in PE 63561N for advanced submarine system 
development. Coupled with the reduction in the budget request 
for the Advanced Research Projects Agency's advanced submarine 
technology program (PE 63569E) to $7.473 million, the total 
request for development of advanced submarine technology 
represents a reduction of almost $57 million from the fiscal 
year 1995 level. The committee is deeply concerned about the 
Navy's commitment to the long-term submarine research and 
development required to assure that current and future 
submarine designs take advantage of advanced technology. The 
committee understands that near term requirements for the New 
Attack Submarine (NAS) have led the Navy to place increased 
emphasis on the maturation of advanced technologies that could 
be incorporated in that submarine. Nevertheless, the sharp 
reduction in funding for advanced submarine technology, 
particularly at the advanced development level, raises serious 
concerns about the modular approach to design of the NAS and 
the Navy's stated intent to incorporate advanced technologies 
into subsequent hulls of the NAS as the technology is matured.
    The committee believes that the overall reduction in 
submarine research and development funding reflected in the 
president's budget is inadequate to support the type of long-
term research necessary for future submarine design. If this 
long term investment is not made, the Navy cannot be in a 
position to assure the availability of advanced technologies 
for use in a future submarine, or that the next submarine 
design will be the best and most economical design capable of 
maintaining the superior technological capability that has 
characterized the U.S. submarine force. The committee directs 
the Secretary of Defense to develop a plan for long term 
submarine research and development aimed at ensuring U.S. 
technological superiority and report this plan to the 
congressional defense committees with the submission of the 
fiscal year 1997 budget request.
    The committee recommends an increase of $10 million in PE 
62121N and $20 million in PE 63561N to maintain the Navy's 
advanced submarine technology program at approximately the 
fiscal year 1995 level. Of the additional amount provided in PE 
62121N, $7 million is to continue the transfer to the Navy of 
the technology for actively controlling machinery platforms 
demonstrated in the ARPA Project M.

Advanced tactical air command central

    The budget request included $8.349 million in PE 64719M to 
continue development of the advanced tactical air command 
central (ATACC) for the Marine Corps. Marked growth in program 
costs for fiscal year 1996 and succeeding years, changes in the 
acquisition strategy, and significant revisions in the program 
schedule lead the committee to question whether the operational 
requirement is well defined and the system should continue in 
engineering and manufacturing systems development, or whether a 
demonstration-validation program is more appropriate. 
Accordingly, the committee recommends a reduction of $5 million 
in the budget request and directs that the details of the 
operational requirement and revised program plan be provided 
with the fiscal year 1997 budget request.

AEGIS combat systems engineering

    The fiscal year 1996 budget request included $90.026 
million in PE 64307N for continued development of improvements 
in the AEGIS combat system, an increase of $25.168 million over 
that projected for fiscal year 1996 when the fiscal year 1995 
budget request was submitted. The committee understands that 
among the reasons for the increase was the deferred release of 
$15.8 million in fiscal year 1995 funding. To compensate for 
the deferral, the Navy increased the budget request and has 
embarked on a phased strategy for development of the AEGIS 
baseline 6 which will increase development concurrency and 
program risk. The committee does not believe that this is a 
prudent strategy, particularly when considering other ongoing 
developments to the AEGIS program such as the cooperative 
engagement capability and Navy theater ballistic missile 
defense. Accordingly, the committee recommends a reduction of 
$15.8 million to the budget request.

AH-1W integrated weapons system upgrade

    The budget request included $14.908 million in PE 64212N 
for engineering and manufacturing development of upgrades to 
the AH-1W Cobra attack helicopter for the Marine Corps. The 
committee understands that the Marine Corps has decided to 
suspend development of the integrated weapon system, which is a 
part of the upgrade, pending a further review of the 
requirements for the helicopter. Accordingly, the committee 
recommends a reduction of $11.628 million in the budget 
request.

Aircrew adaptive automation technology

    The budget request included $74.849 million in PE 62233N 
for exploratory development to support Navy advanced weapon and 
platform system concepts and needs in the areas of materials, 
electronics, and computer technology. The committee recommends 
an increase of $2.7 million to continue development of 
adaptable automation technology for management of air crew 
workloads.

Aircrew protective clothing and devices

    The budget request included $1.719 million in PE 63216N for 
demonstration and validation of aircrew protective clothing and 
devices. The committee recommends an increase of $7.4 million 
to the budget request to continue development of the advanced 
integrated life support system and for an advanced technology 
escape system for aircrews. The committee directs that the Navy 
provide to the congressional defense committees by March 2, 
1996 a report describing the program plan for these two 
programs and the coordination of each with programs which may 
be under consideration in the Air Force and the Army.

Air systems advanced technology development

    The Advanced Anti-Radiation Guided Missile (AARGM) that 
evolved from a Small Business Innovative Research program could 
provide a critical capability to meet Marine Corps suppression 
of enemy air defense requirements.
    The committee directs the Secretary of Defense to proceed 
with this development program and provides $35 million for 
fiscal year 1996 in PE 63217N to transition from a ``bread 
board'' missile seeker development program to an all-up level 
missile development program and $10 million in PE 27136F to 
leverage AARGM to define, design, and build a breadboard 
seeker, guidance and control unit for broader application of 
the technology for preemptive suppression of enemy air defenses 
(SEAD). This latter concept will provide an integrated 
targeting and weapon delivery system for an end-to-end solution 
for the SEAD program. The committee directs that use of these 
funds by the Navy and Air Force be limited to design reviews 
and support test and evaluation. The committee also encourages 
the Secretaries of the Navy and Air Force to fund the fiscal 
year 1997 requirement for these projects.

Aircrew systems development

    The budget request included $9.788 in PE 64264N for the 
aircrew systems development of aviation life support systems. 
The committee recommends an increase of $7.9 million to 
transition the Navy's Day/Night/All Weather Helmet Mounted 
Display to operational evaluation in F/A-18 and AV-8B aircraft; 
to upgrade current escape systems; and to develop crashworthy 
troop seats in the H-1, H-3, and H-46 helicopters.

AN/ALR-67(V) Electronic Warfare Program

    The committee notes the Department of Defense's clear and 
concise report related to the soundness of the Navy's AN/ALR-
67(V)3 acquisition strategy and the tests to determine the 
operational effectiveness and suitability of the system. Should 
the test results remain positive, the Department is encouraged 
to accelerate the acquisition and fielding of the system in 
order to correct deficiencies in the fleet at the earliest time 
possible. The Department should examine strategies for 
achieving economic quantity buys in order to ensure the cost 
effective acquisition of the AN/ALR-67(V)3.

Anti-submarine warfare program

    Recent events detailed in the classified annex raise the 
committee's concern that the reduction in anti-submarine 
warfare (ASW) program priority may have gone too far and that 
the Navy should place renewed emphasis on its ASW program.
    Elsewhere in this report, the committee has recommended 
several measures to improve U.S. ASW capabilities and to place 
higher priority on the development of advanced submarine 
technologies for the Navy. The committee directs the Secretary 
of Defense to assess the current and projected U.S. anti-
submarine warfare program and report to the congressional 
defense committees by July 1, 1996, the long range plan for 
improvement in U.S. anti-submarine warfare program capabilities 
against the emerging threat in both littoral and open ocean 
areas.

AV-8B Harrier weapon system improvements

    The budget request included $11.309 million in PE 64214N 
for integration and testing of weapons and aircraft 
improvements for the AV-8B Harrier aircraft. The committee 
understands that the AV-8B production memorandum of 
understanding between the United States, Spain, and Italy 
provides for the integration of the Advanced Medium Range Air-
to-Air Missile (AMRAAM), that the most cost-effective way to 
achieve this is the concurrent integration of the AMRAAM and 
the 1760 data bus, and that a shared funding plan has been 
developed. Incorporation of the 1760 data bus during 
remanufacture of the day-only AV-8As to the AV-8B radar 
configuration would also permit incorporation of the capability 
for the Joint Stand-off Weapon (JSOW) and Joint Direct Attack 
Munition (JDAM) systems on the AV-8B at a later date. The 
committee recommends an increase of $15.6 million to the budget 
request for the U.S. share of fiscal year 1996 integration 
costs with the understanding that the Marine Corps will budget 
for the balance of $11.7 million as a part of the fiscal year 
1997 budget request.

BOL chaff evaluation

    The committee is advised that the Navy has completed a 
successful evaluation of BOL chaff as a wing mounted electronic 
countermeasure on the F/A-18C/D aircraft. The committee 
encourages the Navy to evaluate the use of BOL chaff on the F/
A-18E/F at the appropriate point in the development of that 
aircraft.

Communications technology

    The budget request included $9.229 million in PE 62232N to 
continue development of key communications technologies for 
air, ship, and submarine platforms. The committee recommends an 
increase of $4 million for support of wireless and satellite 
communications research in the areas of integrated antenna 
systems, communications hardware design, communication 
algorithm development and high-frequency device modeling and 
measurements.

Cooperative engagement capability

    The budget request included $245.620 million in PE 63755N 
for ship self-defense advanced technology development, 
including $180.049 million for the cooperative engagement 
capability (CEC). The budget request is an increase of 
approximately $78 million over the projected fiscal year 1996 
amount contained in the fiscal year 1995 defense budget request 
and represents a decision on the part of the Department of 
Defense to accelerate demonstration and fielding of the CEC. 
The committee is aware of the very positive demonstration of 
the CEC deployed as a part of the Eisenhower Battle Group in 
the Atlantic and operational experience gained with the system 
gained in support of NATO operations in the Adriatic Sea off 
the former Yugoslavia.
    The committee believes strongly that when deployed with the 
fleet, the CEC must be operationally effective and suitable, 
must meet the required degree of mission accomplishment when 
operated by representative personnel in the expected 
operational environment, and must be supportable in the fleet. 
Based on a Department of Defense Inspector General report, 
``Hotline Complaint on Management of the Cooperative Engagement 
Capability Program,'' (DOD IG Report No. 95-143), the committee 
is concerned that the level of developmental testing and 
independent operational testing required to provide that 
assurance is not present in the CEC program, and cannot agree 
to the acceleration of the CEC program until such assurance is 
present. Therefore, of the fiscal year 1996 funds provided for 
the CEC program, the committee directs that not more than $102 
million may be obligated until the Secretary of Defense 
notifies the congressional defense committees that the Test and 
Evaluation Master Plan providing for the performance of a 
dedicated, independent operational test and evaluation of the 
CEC program has been approved by the Director, Operational Test 
and Evaluation.

Cryptologic system trainer

    The budget request included $7.005 million in PE 24571N to 
continue development and evaluation of the Navy's Surface 
Tactical Team Trainer. The committee recommends an increase of 
$3 million for integration and evaluation of the cryptologic 
systems trainer in the Battle Force Tactical Training system 
and the development of related information warfare/command and 
control warfare shipboard training systems.

Embedded sensors

    The budget request included $74.849 million in PE 62234N 
for exploratory development in the areas of materials, 
electronics, and computer technology for support of Navy 
advanced weapon and platform systems. The committee recommends 
an increase of $3 million to complete the exploratory 
development of embedded, remotely queried micro-
electromechanical sensors in thick composites suitable for use 
in submarine, ships, and armored vehicles.

Enhanced modular signal processor

    The budget request included $8.342 million in PE 64507N for 
development and risk mitigation testing of the AN/UYS-2 
enhanced modular signal processor (EMSP) and software 
development, integration, testing, and critical engineering 
design support in the airborne low-frequency sonar (ALFS), 
surveillance towed array sensor system (SURTASS), AN/SQQ-89 
surface combat system, and AN/BSY-2 submarine combat system. 
The committee understands that the Navy is considering 
development of a commercial-off-the-shelf (COTS) variant of the 
EMSP. If adopted, this action would maximize the benefit 
received from investment in the development of the AN/UYS-2 and 
would significantly reduce program life cycle costs. The 
committee further understands that the Navy is considering 
accomplishing the development from currently programmed funds 
and does not require any additional funding in fiscal year 1996 
for this purpose. The committee encourages the Navy to identify 
any additional funds required for the EMSP COTS development in 
its fiscal year 1997 budget request.

Fixed Distributed System--Deployable (FDS-D)

    The budget request included $93.507 million in PE 64784N 
for the Fixed Distributed Surveillance System. The committee 
recommends an increase of $10 million to refurbish and extend 
the capability of the FDS-D prototype and provide an interim 
deployable undersea surveillance capability until the Advanced 
Deployable System becomes available.

Flat panel, helmet-mounted display

    The budget request included $7.020 million in PE 62122N for 
exploratory development of air vehicle technology. The 
committee recommends an increase of $2.5 million to continue 
development of flat panel, helmet-mounted displays for aircrew 
helmets.

Geosat follow-on program

    Section 258 of the Department of Defense Authorization Act 
for Fiscal Year 1995 (Public Law 103-337) required NASA and the 
Navy to report their findings regarding Geosat Follow-On (GFO) 
TOPEX/Poseidon Follow-On (TPFO) convergence issues by February 
15, 1995. When the two agencies failed to meet that deadline, 
it was extended until April 14. Both agencies failed to meet 
this deadline as well. Although a draft report is in 
circulation, the report still has not been formally transmitted 
to the committee. Given the lack of reliable information about 
convergence and its impact on defense requirements, the 
committee directs that no DOD funds may be obligated or 
expended for activities associated with TPFO during fiscal year 
1996.

Intercooled recuperated gas turbine

    In the budget request, the Department has transferred the 
program for development of the intercooled recuperated (ICR) 
gas turbine engine (the engine for the next generation naval 
surface combatant and for late construction DDG-51) from the 
Advanced Surface Machinery (ASM) demonstration/validation 
program to PE 63508N in the technology base. The committee is 
concerned that the transfer destroys the relationship between 
the program for development of the new engine and other 
elements of the ASM program and raises the issue of whether or 
not a new, fuel-efficient power plant will ever be developed 
for the Navy. The committee directs the transfer of $25.558 
million requested in PE 63508N for ICR development to PE 63573N 
to restore the integrity of the ASM program. The committee 
recommends an increase of $21.5 million to support conduct of 
ICR engine test at the Navy's land-based test site and directs 
that the Navy proceed with a second 500 hour engine system test 
and other testing at the site as projected in the revised ICR 
development plan.

Joint air-to-surface stand-off missile

    The Bottom-Up Review identified advanced precision guided 
weapons as a key enabler required for U.S. forces to execute 
the national military strategy. The regional warfighting 
commanders-in-chief repeatedly endorsed the requirement during 
their testimony before the committee. Although the Navy and the 
Air Force are jointly developing the shorter range Joint Direct 
Attack Munition (JDAM) and Joint Stand-Off Weapon (JSOW), the 
recent cancellation of the Tri-Service Stand-off Attack Missile 
(TSSAM) forfeits the major joint program for development of 
long range, air-delivered stand-off precision guided weapons 
and severely limits the future capability of U.S. bomber and 
attack fighter forces for stand-off attack. The committee 
considers this a critical deficiency that must be addressed 
immediately by the Department of Defense.
    The budget request included $40.517 million in PE 64603N 
for development of the Stand-off Land Attack Missile--Enhanced 
Response (SLAM-ER) by the Navy as an interim replacement for 
the canceled TSSAM. The committee understands that the TSSAM 
cancellation occurred too late in the budget cycle for the Air 
Force to address the requirement for a TSSAM replacement in the 
fiscal year 1996 budget request, but that a proposed joint 
requirement is under review and that such a program is being 
considered for fiscal year 1997 as a separate Air Force 
program.
    The committee believes that the Department must establish a 
joint program in the Navy and the Air Force for development of 
an interim replacement for the canceled TSSAM at the earliest 
possible date. In establishing the joint program maximum use 
should be sought from the lessons learned in the TSSAM program 
with regard to the joint service operational requirement and 
the program development plan, including issues relating to low 
and very low observability/stealth. Performance criteria 
specified in the operational requirement must be evaluated in 
terms of the urgency of fielding a near term replacement for 
TSSAM. In the committee's opinion, development of separate 
systems by the Navy and the Air Force is probably not the most 
cost-effective or operationally prudent solution.
    The committee is aware that there are a number of candidate 
weapon system and sub-munition concepts which could contribute 
to the TSSAM replacement desired by both services. The 
committee believes that the variety of missile mainframe, 
components, and sub-munition systems available provides the 
opportunity to select the most promising system concepts and 
then develop and demonstrate such a joint capability on an 
accelerated basis.
    The committee recommends the budget request of $40.517 
million for the SLAM-ER program, but directs that of this 
amount no more than $10 million may be obligated without 
specific approval by the congressional defense authorizing 
committees. The committee directs the Secretary of Defense to 
immediately establish a joint program for accelerated 
development and evaluation of candidate joint air-to-surface 
stand-off missile (JASSM) systems as a near-term replacement 
for TSSAM, and recommends an additional authorization of $37.5 
million in PE 64312N and $37.5 million in PE 27160F for this 
purpose. The committee further directs the Secretary of Defense 
to report to the congressional defense committees within 60 
days of the enactment of this Act, the Department's plan to 
address near term Navy and Air Force requirements for an 
interim TSSAM replacement and how the Department plans to 
satisfy these requirements, and the long term plan for 
development of a TSSAM replacement that will satisfy the 
requirements of both military services.

Light strike/light reconnaissance vehicle

    The budget request included $3.915 million in PE 26624M for 
improvements in Marine Corps combat service support equipment 
and $101.602 million in PE 1160404BB for special operations 
tactical systems development. The committee recommends an 
additional $3 million in PE 26624M and $1.5 million in PE 
1160404BB to initiate a program for development of a follow-on 
all-terrain reconnaissance/light strike vehicle, capable of 
meeting the requirements of the light strike/light 
reconnaissance mission for the Marine Corps, special 
operations, and other light forces, and as a replacement of 
all-terrain reconnaissance/light strike systems now in service 
in selected special operations capable units.

Light-weight 155mm howitzer

    The budget request included $10.9 million in PE 63635M for 
the light-weight 155mm howitzer, a joint Army-Marine Corps 
program for development of an advanced, light-weight towed 
howitzer with increased tactical and strategic mobility as a 
replacement for the M198 howitzer. The committee recommends an 
increase of $4.2 million to the budget request to accelerate 
required technical testing; assess reliability; availability 
and maintainability; growth potential; and for advanced fire 
control requirements analysis and development.

Long-range guided projectile technology

    In the statement of managers (H.Rept. 103-701) accompanying 
the conference report on the National Defense Authorization Act 
for Fiscal Year 1995 (Public Law 103-337), the conferees 
endorsed the importance of advanced, long-range precision 
guided munitions in meeting the requirements for range, 
accuracy, and payload for Navy surface fire support and Army 
long-range artillery and expressed the belief that the Army and 
the Navy should jointly capitalize on the development of 
technologies for this purpose.
    The committee is aware of rapid progress that is being 
demonstrated in the development of advanced global positioning 
system/inertial navigation system (GPS/INS) technology in the 
low cost competent munition and other programs and the promise 
this technology holds for significant improvements in the 
accuracy of existing and future gun-fired projectiles, 
missiles, and rockets. The committee is also aware of the 
potential for the establishment of a cooperative technology 
program between Departments of the Army and the Navy for 
development and demonstration of these technologies at the 
component and system level and recommends that such a program 
be established. In order to capitalize on ongoing programs 
within the Army and the Navy and what the committee believes is 
an excellent opportunity to accelerate the development and 
demonstration of these technologies, the committee recommends 
the following increases in the program elements indicated:

                        [In millions of dollars]

Army
    PE 62618A increase............................................     1
    PE 62624A increase............................................     2
Navy
    PE 62111N increase............................................     2
    PE 62131M increase............................................     1
    PE 63792N increase............................................     3

Low-low frequency acoustics (LLFA)

    The Congress has supported the assessment of LLFA 
technology for the detection of submarines operating in both 
open ocean and littoral regions. The committee understands that 
of the funds authorized and appropriated in fiscal years 1994 
and 1995 for the LLFA technology program, approximately $30 
million remain available and are sufficient to continue the 
program through fiscal year 1996. The committee also 
understands that the fiscal year 1996 program will focus on 
issues raised relative to the concept of operations, technical 
performance, command and control, environmental considerations, 
and transition of the technology to existing fleet platforms. 
Pending the results of these efforts, the committee defers 
consideration of additional funding for LLFA technology program 
until the fiscal year 1997 budget request.

Maritime avionics subsystems and technology program

    The budget request did not include specific funding for the 
maritime avionics subsystems and technology (MAST) program, a 
fiscal year 1995 new start, which focuses on the development of 
scaleable, open, fault-tolerant and common avionics 
architectures. The committee encourages the Navy and the Air 
Force to pursue the technology objectives of the MAST program 
under their respective avionics technology development programs 
(PE 62122N, PE 62204F, and PE 63253F) and under the Joint 
Advanced Strike Technology (JAST) program (PE 63800N and PE 
63800F), and to consider requirements for additional funding 
for the MAST program as a part of the fiscal year 1997 budget 
request.

Medium tactical vehicle remanufacture

    The budget request included $3.915 million in PE 26624M for 
the Marine Corps's Medium Tactical Vehicle Remanufacture (MTVR) 
program. The program will provide multi-purpose medium tactical 
trucks capable of meeting the logistical and tactical 
requirements of Marine forces and will replace the current 
medium tactical vehicle fleet which reaches its maximum life 
beginning in fiscal year 2001. The committee understands that 
the program will also be coordinated with the Army's plans for 
development of a five-ton truck remanufacture program. The 
committee recommends an increase of $9.4 million for evaluation 
of additional MTVR program variants for potential use by the 
Marine Corps and the Army.

Mine counter-measures program

    The budget request included a total of approximately $191 
million for the Navy's mine counter-measures program, an 
increase of approximately $51 million above that requested in 
fiscal year 1995. The committee notes that the Joint 
Countermine advanced concept technology demonstration will 
integrate Army, Navy, and Marine Corps technology developments 
and fielded systems in an evaluation of the capability for 
conducting seamless amphibious MCM operations from the sea to 
the land. The committee expresses its strong support for this 
demonstration and for the maintenance of a robust MCM 
acquisition program. The Navy must continue to place a high 
priority on the MCM program and ensure the development and 
fielding of enhanced MCM systems at the earliest possible date.

MK 66 rocket motor improvements

    The committee remains concerned about the shipboard safety 
of the current inventory of MK 66 rocket motors. Although the 
Army is the lead service for 2.75 inch rockets, it has placed 
insufficient priority on providing the military services with 
insensitive munition (IM) compatible rocket motors. 
Accordingly, the committee recommends a total increase of $3 
million in PE 25601N, project W2211, $1.5 million to shorten 
the development time of IM motors, and $1.5 million for IM 
upgrades to existing 2.75 warheads that are compatible among 
all military services to provide earlier ``system level'' 
safety compliance.

Mobile off-shore base (MOBS)

    The budget request includes $14.743 million in PE 63238N 
for engineering studies of the mobile off-shore base (MOBS) 
concept. MOBS would be a floating island composed of six 
aircraft carrier sized modules and capable of storing an 
armored division's equipment set, which could be moved to the 
potential site of a crisis to provide an off-shore, 
prepositioned storage site in areas where the United States 
does not have land basing rights. Approximately $35 million has 
been provided to date for investigation of the MOBS concept. 
The next potential step being considered in the MOBS program is 
an advanced concept technology demonstration that could total 
$700 million. The potential cost of a single MOBS system has 
been estimated at approximately $2 billion.
    In the statement of managers (H. Rept. 103-701) 
accompanying the conference report on S. 2182, the National 
Defense Authorization Act for Fiscal Year 1995 (Public Law 103-
337), the conferees directed that no further funds beyond 
fiscal year 1995 could be expended for either the MOBS project 
or the Landing Ship Quay/Causeway (LSQ/C) until the Joint 
Requirements Oversight Council validated the operational 
requirement for MOBS, the Defense Science Board had reviewed 
the program for technological feasibility, and the Secretary of 
Defense had certified that a funded program had been 
established for MOBS. The committee notes that the Department 
has failed to comply with this guidance. Accordingly, the 
committee directs that fiscal year 1996 funds which are 
authorized and appropriated for MOBS or for LSQ/C may not be 
obligated until the Department provides the reports and 
certification previously directed by the Congress.

Molecular design research

    The committee recommends an additional $6 million in PE 
61153N for continuation of the molecular design program 
initiated in fiscal year 1994 and urges the Secretary of the 
Navy to include sustainment of this critical research activity, 
until concluded, in subsequent annual requests.

Naval surface fire support

    During its review of the budget request for fiscal year 
1996, the committee was briefed on a revised naval surface fire 
support (NSFS) program, which focuses on near term improvements 
to NSFS systems: demonstration and development of a long range 
guided projectile which would incorporate advanced, low cost 
global positioning system/inertial navigation system (GPS/INS) 
guidance technology; improvements in the existing Mk 45 5-inch 
naval gun; and demonstration of the Army's tactical missile 
system (ATACMS) and other missile systems for NSFS 
applications.
    The committee was disappointed to learn that funding for 
the NSFS program was sharply reduced during the Navy's budget 
formulation process, understands that the revised near-term 
program is underfunded by over $160 million, and that far-term 
requirements for advanced NSFS weapon systems have been 
addressed inadequately, if at all.
    As noted elsewhere in this report, the committee has 
recommended increases to the Army, Navy, and Marine Corps 
technology base to accelerate the development and demonstration 
of GPS/INS technology for long-range guided projectiles and for 
current munitions. The committee recommends an increase of $25 
million in PE 63795N and notes the need for the Navy to put 
increased emphasis on satisfying long term requirements for 
advanced gun systems in addition to the near term focus on 
modification of the Mark 45 five inch gun. The committee 
understands that the overall program shortfall will be 
addressed by the Department of the Navy during its Program 
Review 97 process.

Non-acoustic antisubmarine warfare program

    The budget request included $25.923 million in PE 63714D 
for the advanced sensor applications program in support of the 
Department of Defense program in non-acoustic anti-submarine 
warfare (NAASW) technology. The committee has repeatedly 
asserted and supported the need for two viable, independent, 
but coordinated NAASW programs, one in the Navy and one in the 
Office of the Secretary of Defense (OSD), which complemented 
one another and which shared information on program plans and 
research results. The committee notes, however, that no funds 
were requested for the Navy's NAASW program, PE 63528N, in the 
fiscal year 1996 budget request. As discussed in the classified 
annex, the committee strongly believes that the Navy's shift 
from open ocean to littoral operations and the potential threat 
posed by submarine operations in the shallower seas of the 
world's littoral regions places a renewed emphasis on the need 
for both the Navy and the OSD NAASW programs. The committee 
recommends an authorization of $23.2 million in PE 63528N to 
reestablish the Navy's NAASW program as a separate program on 
par with the OSD advanced sensor applications program.

P-3 sensor integration

    The budget request of $1.945 million in PE 64221N for the 
P-3 modernization program represents a reduction of $12 million 
from that projected for fiscal year 1996 in the fiscal year 
1995 budget request. This redirection results in a program cost 
increase and a delay of three years in the initial operational 
capability for integration of Improved Extended Echo Ranging 
(IEER) in the P-3C maritime patrol aircraft. Coupled with the 
anti-submarine warfare improvement program (AIP) and the P-3 
Update III improvements to active and reserve maritime patrol 
aircraft (MPA), these enhanced capabilities would mitigate the 
shortfall in the Navy's ability to meet regional warfighting 
MPA requirements, resulting from the planned reduction in the 
number of active and reserve MPA squadrons, and would provide 
an enhanced capability for Anti Submarine Warfare (ASW) 
operations in littoral regions. Accordingly, the committee 
recommends an increase of $12 million for the P-3 sensor 
integration program to restore the schedule for integration of 
IEER and AIP capabilities and $3 million for upgrade of P-3 
stores management to permit integration of advanced weapon 
system. The committee expects the Navy to include the increased 
funding necessary to complete these efforts in future budget 
submissions, and to prove sufficient quantities of the AIP and 
update III kits to appropriately outfit the active and reserve 
MPA force.

Polar Ozone Aerosol Monitor III

    Polar Ozone Aerosol Monitor (POAM) III continues a program 
for measurement and monitoring of the earth's polar atmosphere. 
For fiscal year 1994, the Congress provided $5 million to begin 
fabrication of the POAM III payload and interface and 
integration of the payload with the SPOT 4 spacecraft. The 
committee recommends an increase of $5 million in PE 62435N to 
complete engineering, integration and test of the POAM III 
payload on the SPOT 4, leading to system launch in 1997.

Power control electronics

    The committee recommends an additional $6 million in PE 
62121N for power electronics building block (PE2B) development 
based on metal oxide semiconductor (MOS) control thyristors for 
high speed switching of high power systems. The committee 
recommends academic participation to ensure that the wide range 
of advanced technology required for the PE2B development is 
assured.

Rapid acquisition of manufactured parts

    The budget request included $12 million for the rapid 
acquisition of manufactured parts (RAMP) program, $2 million in 
PE 63712N and $10 million in Navy operations and maintenance. 
The RAMP program continues to demonstrate and validate flexible 
manufacturing technology that provides all of the military 
services required out of production parts at greatly reduced 
leadtime to deliveries. The committee recommends an additional 
$12 million in PE 63712N to further the Department's strategy 
of rapidly transitioning this capability to the commercial 
sector.

Remote controlled minehunting systems

    The budget request included $7.605 million in PE 63502N for 
development and demonstration of improvements in minehunting 
sonars and remotely controlled minehunting systems. The 
committee is aware of the mine detection and location 
capability demonstrated by the remote minehunting operational 
prototype (RMOP) during a recent exercise and recommends an 
increase of $1.65 million to accelerate the RMOP development 
program and provide an interim operational capability to the 
fleet.

S-3B Project Gray Wolf

    Project Gray Wolf is a proof-of-concept demonstration of 
the ability of an S-3B aircraft equipped with a multi-mode 
synthetic aperture radar to provide real time stand-off 
surveillance, targeting, and strike support for littoral 
operations. The committee is aware of the success that has been 
achieved in limited demonstration of the system's capability in 
fleet exercises and in the ``Roving Sands'' experiment at White 
Sands Missile Range. The committee recommends an increase of 
$15 million in PE 64217N for continued evaluation of the system 
and potential establishment of advanced concept technology 
demonstration for the system.

Safety and survivability enhancements

    The Secretary of the Navy's Office of Safety and 
Survivability (OSS) non-developmental item (NDI) program was 
begun to permit procurement of limited numbers of off-the-shelf 
NDI items for operational assessment. This program has yielded 
significant savings and provided life saving equipment for the 
fleet much faster than would have otherwise been the case. 
Further, the Advanced Research and Projects Agency (ARPA) has 
identified high leverage technologies for fire fighting and 
personnel protection. Accordingly, the committee recommends an 
additional $2 million in PE 65864N for the OSS to supplement 
on-going operational assessments of NDI and $2 million in PE 
63226E for the ARPA program. The committee also strongly 
encourages the Departments of the Army and Air Force to 
establish similar offices to pursue NDI programs to address 
operational safety requirements.

Sensor integration and decision support systems

    The budget request included $1.074 million in PE 63707N for 
air human factors engineering. The committee recommends an 
increase of $1.5 million to the budget request for development 
and evaluation of intelligent multi-source, multi-platform 
sensor integration and cockpit decision support systems.

Ship self-defense program

    The budget request included $165.997 million in PE 64755N 
for the ship self defense program. The defense authorizing 
committees have strongly supported the program and repeatedly 
emphasized the need for both ship self defense and the 
cooperative engagement capability program to be managed as 
major defense acquisitions with program baselines established 
for each class of ship and for stable and realistic funding to 
be provided by the Navy (H. Rept. 103-200 and H. Rept. 103-
357). The committee notes that it has yet to receive any 
information in its annual review of the ship self defense 
program that provides a performance and management baseline 
against which program progress can be measured.
    The fiscal year 1996 budget did not include funding to 
continue development of either the IRST system or the ``Nulka'' 
decoy, despite the apparently high priority given to these 
programs by the Navy in the past. The committee is concerned 
that the lack of an analytical rationale for the deletion of 
these programs, despite their previous support by the Navy 
leadership, raises further questions about the existence of 
program management baselines in the ship self defense program.
    The committee directs the Secretary of the Navy to provide 
to the congressional defense committees as a part of the annual 
update of the ``Ship Anti-Air Warfare (AAW) Defense Report,'' 
an assessment of progress in establishing program baselines for 
the ship self defense program and the degree to which these 
baselines are being met.

SSBN security and survivability program

    The budget request of $25.078 million in PE 11224N 
represents a reduction of $4.7 million from the SSBN security 
and survivability program from that was projected for fiscal 
year 1996 in the fiscal year 1995 defense budget request and a 
reduction of over $50 million from the fiscal year 1993 
program. Program reductions have forced cancellation of major 
experiments and evaluation of anti-submarine warfare 
technologies that could pose a threat to SSBN security. The 
committee recommends an increase of $9.5 million to the budget 
request and directs the Secretary of the Navy to provide to the 
congressional defense committees within 60 days of the 
enactment of this Act with an assessment of the potential 
threat to the U.S. SSBN force and analysis of the required SSBN 
security program to counter that threat.

Submarine combat system

    The budget request included $43.302 million in PE 64524N 
for development of the AN/BSY-2 submarine combat system. The 
committee recommends a reduction of $6.151 million, the amount 
requested for delivery of the BSY-2 system for the SSN-23.

Submarine tactical warfare system

    The budget request included $38.479 million in PE 64562N 
for development of improvements in submarine tactical warfare 
control systems. The request represents an increase of $17.992 
million over that projected for the fiscal year 1996 program in 
the fiscal year 1995 budget request. Based upon its review of 
the program, the committee does not understand the reason for 
the growth in the program and recommends a reduction of $17.992 
million.

Telemedicine

    The committee commends the Navy for its efforts to 
incorporate asyncronous transfer mode (ATM) telemedicine 
technology into its medical program to deliver better health 
care at an affordable cost to its military personnel. The 
committee encourages the Navy to make use of commercially 
available ATM telemedicine technology to provide this 
capability to the maximum number of medical sites when it can 
be demonstrated that cost effective benefits can be achieved. 
The Navy will ensure that all ATM telemedicine research and 
development is coordinated with the ARPA program.

                            Air Force RDT&E;


                                overview

    The budget request for fiscal year 1996 contained 
$12,598.439 million for Air Force RDT&E.; The committee 
recommends authorization of $13,184.102 million, an increase of 
$585.663 million, for fiscal year 1996.
    The committee recommendations for the fiscal year 1996 Air 
Force RDT&E; program are identified in the table below. Major 
changes to the Air Force request are discussed following the 
table.
    Offset Folios 193 to 195 insert here



                       items of special interest

Adaptive optics

    The committee recommends an additional $5 million in PE 
61102F for adaptive optics research.

Aerospace propulsion

    The committee recognizes the promising results demonstrated 
in on-going research on thermally stable jet fuels derived from 
carbonized phyto-feedstocks which permit higher engine 
operating temperatures without forming damaging carbon 
deposits, while reducing engine stress and improving engine 
reliability. Accordingly, the committee recommends an 
additional $3 million in PE 62203F to further this effort on 
thermally stable jet fuels.

Aircraft ejection seats

    The committee is concerned that inadequate emphasis is 
being placed on aircrew protection for light-weight crew 
members and for ejections at higher air speeds. The committee 
is also concerned about the sustainment of the U.S. aircraft 
ejection seat industrial base during this period of virtually 
no aircraft procurement.
    The committee therefore provides an additional $3 million 
in PE 63231F and directs the Air Force to conduct tests on 
existing Navy, USMC, and Air Force front-line trainer and 
tactical aircraft ejection seats for the purpose of verifying 
their predicted performance and identifying problems and 
required corrective action. Testing should be conducted at the 
most economical and readily available government or commercial 
test facility. In conducting these tests, high priority shall 
be given to the sustainment of the U.S. ejection seat 
industrial base.
    Testing should be completed prior to October 1, 1996 with a 
report being provided to the congressional defense committees 
no later than March 1, 1997.

B-1B bomber

    The budget request contained $173.8 million in PE 64226F 
for research and development of the B-1B bomber. The committee 
continues to strongly support a modern, capable long-range 
bomber force, and recognizes that the B-1B will serve as the 
workhorse of such a force well into the 21st century. In order 
to enhance the warfighting capabilities of the B-1B, the 
committee recommends an additional $21 million to initiate a B-
1B ``Virtual Umbilical'' program to provide an interim, near-
precision munitions capability using existing Mark 82 bombs.

Command, control, and communications technology

    The budget request included $98.477 million in PE 62702F 
for exploratory development of new concepts, feasibility 
demonstrations, and advanced technology for Air Force command, 
control, and communications. The committee recommends a 
reduction of $5 million to the budget request, and strongly 
recommends that the Air Force put increased emphasis on the 
development of information technologies for real-time battle 
management and command and control for time-critical air 
operations in support of the joint force commander.

Computer security

    The committee recommends an additional $3 million in PE 
62702F to evaluate voice recognition security systems to 
enhance the security of the Department's command and control 
system. The technology should be user-friendly, inexpensive, 
tolerant to environmental changes, provide a high degree of 
accuracy, and use commercial standards.

Intercontinental ballistic missile (ICBM) demonstration/validation

    The budget request included $20.265 million in PE 63851F 
for projects designed to address concerns identified in the 
Nuclear Posture Review (NPR) and to study means to implement 
arms control provisions. However, the request for ICBM Command 
Control, project 1024, did not include pre-milestone 0 study 
funds for the command signal decoder/missile or for the 
modified miniature receive terminal for launch control centers, 
as directed by the NPR. The committee recommends an additional 
$2 million to begin these two studies.
    The request for ICBM Reentry Vehicle Applications, project 
1022, did not include milestone 0 study funds to complete the 
acquisition phase 0 studies necessary for the safety enhanced 
reentry vehicle effort. The committee directs that these 
studies be completed expeditiously and strongly urges the 
Secretary of Defense to promptly decide to equip some or all of 
the Minuteman III force with Mark 21 reentry vehicles. The 
committee recommends an additional $2.2 million to complete the 
safety enhanced reentry vehicle phase 0 efforts and 
documentation.
    The request for ICBM Guidance Applications, project 1020, 
did not include pre-milestone 0 study funds for inertial 
measurement modifications. The committee recommends the 
addition of $1 million to complete these studies and initiate 
acquisition phase 0 studies. The committee also recommends the 
addition of $9.3 million to conduct missile guidance technology 
experiments.
    The committee is concerned that pre-milestone 0 and 
acquisition phase 0 studies are not being adequately planned 
and funded. This could result in the inappropriate and 
unauthorized use of funds to conduct the necessary studies. The 
committee directs the Secretary of the Air Force to submit a 
report to the congressional defense committees identifying all 
pre-milestone 1 ICBM acquisition programs currently funded or 
planned to begin by 2001. The report should identify the effort 
by name, list all approved requirements and acquisition 
documents, identify all planned requirements and acquisition 
documents for a milestone 1 acquisition decision, and provide 
the office of primary responsibility, estimated cost, and 
estimated completion dates for all documentation necessary for 
the milestone 1 decision. The report shall be due not later 
than February 1, 1996.

Intercontinental ballistic missile (ICBM) engineering and manufacturing 
        development

     The budget request included $192.719 million in PE 64851F 
to complete the Rapid Execution and Combat Targeting Program 
and to continue the Propulsion and Guidance Replacement 
Programs. However, the Guidance Replacement Program request 
fails to fund the initial design and test of the capability to 
integrate the Mark 21 warhead on the new Minuteman guidance 
set. In a March 23, 1995 report to Congress, the Under 
Secretary of Defense for Acquisition and Technology wrote, 
``The use of Mark 21 on Minuteman III is feasible and 
operationally effective, and it would be fully compliant with 
arms control treaties and initiatives.'' The committee 
recommends an additional $8 million to fund the initial design 
and test of the capability to integrate the Mark 21 warhead on 
the new guidance set.

Low-cost expendable launch vehicles

    The committee believes technologies being developed by 
small expendable launch vehicle companies hold promise for low-
cost launch of small commercial payloads and military tactical 
satellites. The committee recommends $7.5 million in PE 63401F, 
to be used only for evaluation of low cost expendable launch 
vehicle concept hardware.

NATO air-ground surveillance system

    NATO recently established an air-ground surveillance office 
to evaluate potential candidates to provide the alliance an 
airborne ground surveillance capability to complement the NATO 
Airborne Warning and Control System (AWACS). The committee 
recommends an additional $14 million in PE 64770F to support 
the U.S. contingent in the NATO office.

National polar-orbitting operational environmental satellite system

    The budget request included $23.9 million in PE 63434F for 
the National Polar-orbitting Operational Environmental 
Satellite System (NPOESS). Based on a slower than expected 
start-up of the program office and a delay in the planned dates 
of the demonstration and validation phase of NPOESS, funding is 
reduced by $5 million.

Range tracking and safety

    The committee recommends an additional $5.7 million in PE 
63311F for suborbital flight testing of Minuteman class range 
tracking and safety equipment based on existing global 
positioning system equipment developments.

Reusable launch vehicles

    The committee is surprised to note that given the 
administration's support for dual-use technologies, the 
Department has failed to adequately support the potential 
``triple-use'' benefit of reusable launch vehicles to the 
military, civil, and commercial space launch capability and 
associated sectors of the U.S. industrial base. The committee 
supports a NASA-DOD-industry team effort for a reusable launch 
vehicle program by recommending an additional $100 million in 
PE 63401F for fiscal year 1996.

Robotics corrosion inspection system

    The committee understands that there are technologies 
available for dual-use, non-contact robotic corrosion 
inspection of aircraft that could save the Department hundreds 
of millions of dollars and reduce environmental problems 
associated with current inspection procedures. The committee 
recommends an additional $8 million in PE 62102F to conduct a 
competitive program to demonstrate the feasibility of non-
contact robotic aircraft inspection for the detection of hidden 
corrosion and metal fatigue. The objective is to demonstrate 
the feasibility to reduce cargo and fighter aircraft inspection 
and repair costs by 25 percent annually. The Air Force shall 
coordinate this effort with the other miliary services, direct 
Air Combat Command to conduct the program, consider dual-use 
and private-government cost sharing in making a competitive 
selection and use commercial business practices in the conduct 
of this demonstration.

Rocket propulsion technology

    The budget request included $47.531 million for rocket 
propulsion technology in support of the Integrated High Payoff 
Rocket Technology Initiative Program. The committee recommends 
an additional $13 million to be authorized as follows: $6 
million for PE 62601F, project 1011; $5 million for PE 63302F, 
project 4373; and $2 million for PE 62111N. This initiative 
would involve the Department of Defense, NASA, and the space 
launch industry in joint, cost shared, coordinated research and 
development to meet national requirements for rocket propulsion 
technology. The additional authorization shall only be used for 
direct support costs of these technology projects.

Space-based infrared system

    The budget request included $130.744 million in PE 63441F 
for Space-Based Infrared System (SBIRS) demonstration/
validation, and $152.219 million in PE 64441F for SBIRS High 
Element engineering and manufacturing development (EMD).
    The committee reaffirms its strong support for fielding an 
improved capability to provide the nation's political and 
military leaders with timely and effective missile warning 
information. The committee recommends several actions intended 
to accelerate the Department's plans for fielding such a 
system. With respect to PE 63441F:
          (1) $249.8 million is recommended for the Space and 
        Missile Tracking System (SMTS), an increase of $135 
        million, and $15.9 million, the requested amount, is 
        recommended for the ``Cobra Brass'' space experiment;
          (2) the schedule for launching the SMTS flight 
        demonstration satellites should be accelerated as much 
        as practical;
          (3) deployment of SMTS operational satellites shall 
        begin not later than the fourth quarter of fiscal year 
        2003; and
          (4) a long-wave infrared (LWIR) sensor shall be 
        tested on at least one of the two flight demonstration 
        satellites.
    In PE 64441F, $9.4 million is recommended for the Miniature 
Sensor Technology Integration and $152.8 million, an increase 
of $10 million, for the SBIRS High Element EMD. The committee 
encourages the Department, in light of efforts to accelerate 
SMTS, to review the appropriate mix of capabilities between the 
high and low earth orbit components of SBIRS and to communicate 
the results of this analysis to the congressional defense 
committees by no later than September 1, 1995.
    The committee commends the Air Force for adopting 
innovative acquisition streamlining measures for the SBIRS 
program, and urges that these processes and procedures remain 
in effect for the duration of the program.

Ultra high frequency satellite communications

    The budget request included $15.6 million in PE 33606F for 
engineering and manufacturing development of the Ultra High 
Frequency (UHF) Satellite Communications (SATCOM) program. 
Based on a reduction in the number of contracts for the 
development of the network control stations from two to one, 
funding is reduced by $2.5 million.

                            DEFENSE AGENCIES


                                overview

    The budget request for fiscal year 1996 contained 
$9,084.809 million for Defense Agencies RDT&E.; The committee 
recommends authorization of $9,548.986 million, an increase of 
$464.177 million, for fiscal year 1996.
    The committee recommendations for the fiscal year 1996 
Defense Agencies RDT&E; program are identified in the table 
below. Major changes to the Defense Agencies request are 
discussed following the table.
    OFFSET FOLIOS 204 to 207 INSERT HERE



             overview of ballistic missile defense programs

    The budget request contained $2,442.2 million in research, 
development, test, and evaluation, $453.7 million for 
procurement, and $17.009 million for military construction, for 
a total budget request of $2,912.9 million for ballistic 
missile defense (BMD).
    The proliferation of ballistic missiles and weapons of mass 
destruction poses a significant threat to the United States, 
U.S. military forces, and U.S. global interests. The committee 
is concerned, however, that current Department of Defense 
policies and programs are not aggressive enough in responding 
to this threat.
    For example, although the Secretary of Defense's February 
1995 ``Annual Report to the President and the Congress'' noted 
that ``ballistic missiles are clearly becoming a common 
battlefield weapon,'' the President's budget request for 
theater missile defense (TMD) is approximately thirty percent 
less than spending levels recommended by the previous 
Administration. As a result, several of the most promising TMD 
concepts, such as the Navy's ``Upper Tier'' program and the 
Army's Theater High Altitude Area Defense (THAAD) system, have 
been delayed.
    The Administration's program for national missile defense--
a defense of the American homeland--is even more worrisome. 
There is currently no commitment to deploy a national missile 
defense. In fact, the Department presently plans to spend over 
eighty percent less for national missile defense programs than 
the previous Administration--approximately $500 million per 
year over the next five years.
    The Administration's decision to abandon plans to deploy a 
national missile defense is particularly disturbing in light of 
the range of present and potential missile threats to the 
United States. Both Russia and China today maintain and are 
aggressively modernizing nuclear forces capable of destroying 
American cities. For Russia this includes production of follow-
ons to the SS-25 intercontinental ballistic missile (ICBM) and 
SS-N-20 sea-launched ballistic missile (SLBM). China is 
producing two types of long-range ICBMs with ranges of 
approximately 7,000 kilometers and 10,000 kilometers 
respectively, as well as other strategic systems. Moreover, 
various ``rogue regimes'' are seeking a capability to attack 
the United States using ballistic missiles.
    According to senior U.S. intelligence officials, it may not 
take long for an outlaw regime to acquire such a capability. 
For instance, on January 10, 1995, the Defense Intelligence 
Agency Director, Lieutenant General James Clapper, testified 
that North Korean missiles now under development probably have 
sufficient range to reach targets in Alaska. On January 18, 
1995, the then-Acting Director of Central Intelligence, Admiral 
William Studeman, testified that the proliferation of 
technology will lead to missiles ``that can reach the United 
States toward the end of this decade and the beginning of [the 
next] century. ``Former Director of Central Intelligence R. 
James Woolsey has testified that the covert purchase of 
missiles would provide a ``shortcut approach'' that may lessen 
the time it takes to place the United States directly at risk. 
In addition, he stated that ``the acquisition of key production 
technologies and technical expertise would speed up ICBM 
development.''
    Today, more than 25 countries have or are developing 
weapons of mass destruction, including nuclear, chemical, and 
biological weapons. More than 15 countries now possess 
ballistic missiles, which can be used to deliver these weapons 
to their targets hundreds or thousands of miles away.
    Because of their perceived military and political 
importance, ballistic missiles are also becoming a valuable 
export commodity. It is reasonable to assume that the desire to 
acquire ballistic missiles has been enhanced by the inability 
to defend against them. Effective theater and national 
ballistic missile defenses can raise the cost and lower the 
attraction of ballistic missiles to a would-be proliferant by 
reducing their effectiveness. Missile defenses also provide a 
hedge against the use of such weapons in the event traditional 
nonproliferation efforts (e.g., arms control, export controls, 
sanctions) fail to prevent proliferation. By providing an 
``insurance policy'' against the use of these weapons, missile 
defenses could dampen incentives to act (or react) 
precipitously in a crisis and could promote the formation of 
regional defensive alliances that reduce the risk that 
individual member states will be ``held hostage'' to the threat 
of attack.
    In addition, the committee is concerned about the possible 
indigenous development or sale to third parties of space launch 
vehicles, which can be rapidly converted with little or no 
warning and minor modifications to ICBMs capable of delivering 
nuclear, chemical or biological warheads against American 
cities. According to a 1992 statement by Lawrence Gershwin, CIA 
national intelligence officer for strategic programs, ``India, 
Israel, and Japan have developed space launch vehicles that, if 
converted to surface-to-surface missiles, are capable of 
reaching targets in the United States.''
    Any booster with the capability to lift a payload into 
orbit can also be used to deliver weapons of mass destruction 
on targets thousands of miles away. Through the purchase of 
space launch vehicles, a nation can acquire a threatening 
ballistic missile capability under the guise of peaceful 
activity. In this regard, the committee notes with concern 
continuing reports that Russia is attempting to market its 
``Start-1'' and ``Start-2'' systems, which are modified 
versions of the SS-25 ICBM, as space launch vehicles. The 
purchase of space launch vehicles is one route by which 
proliferant states may seek to circumvent existing controls on 
the transfer of missile technology.
    Given the growing ballistic missile threat, the committee 
is convinced that deployment of affordable, effective theater 
and national missile defense systems is an essential objective 
of a defense modernization program that adequately supports the 
requirements of the national military strategy. The committee's 
views on missile defense as an element of broader U.S. 
counterproliferation policy, and ballistic missile defense and 
strategic stability are contained in section 236 of the bill.
    In response to the concerns outlined above, the committee 
recommends several provisions, as well as the following 
guidance, to strengthen the U.S. response to the missile 
proliferation threat.

Funding

    The committee supports increased investment in BMD in order 
to deal with present and postulated ballistic missile threats 
in a more timely manner. Specifically, the committee recommends 
a total of $3,540.9 million for activities of the Ballistic 
Missile Defense Organization (BMDO) in fiscal year 1996, an 
increase of $628 million over the request of $2,912.9 million.

Missile defense and acquisition reform

    In order to ensure the timely and affordable development 
and deployment of effective U.S. missile defense capabilities, 
the committee directs the Secretary to implement streamlined 
acquisition processes and procedures for the following programs 
and projects: National Missile Defense (NMD), THAAD, Navy Upper 
and Lower Tier systems, and Patriot. The Under Secretary of 
Defense for Acquisition and Technology is directed to prepare 
and submit a report to the congressional defense committees 
describing the steps taken to meet this requirement, along with 
the estimated cost savings and schedule accelerations that 
would result from these measures. The report shall be due not 
later than February 1, 1996.

Theater missile defense

    The committee supports accelerating development and 
deployment of advanced TMD systems. For this reason, the 
committee recommends a provision (sec. 232) that would 
establish policy for the deployment of advanced TMD systems.
    The committee is concerned about the long-term 
affordability of U.S. TMD programs and projects. Therefore, the 
committee directs the Secretary of Defense and Chairman of the 
Joint Chiefs of Staff to jointly review U.S. TMD plans, 
programs, and budgets, and to report to the Congressional 
defense committees by March 15, 1996, on the long-term 
affordability and need for the various TMD programs currently 
being pursued. In particular, the Secretary and Chairman should 
provide a prioritized listing of TMD systems and should make 
recommendations on down-selecting among competing TMD systems. 
Additional TMD program-specific guidance is provided below.

Thaad

    The committee notes and reaffirms the previous 
Congressional endorsement of the User Operational Evaluation 
System (UOES) concept, and urges that a THAAD UOES system be 
delivered no later than mid-FY 1998. In this regard, the 
committee endorses a decision to acquire 40 THAAD UOES 
demonstration/validation (dem/val) prototype missiles. The 
committee urges the Director of the BMDO to review the THAAD 
acquisition plan to ensure a smooth transition from the dem/val 
phase of development to the engineering and manufacturing 
development (EMD) and low-rate initial production (LRIP) 
phases. This review should also consider the merits of 
producing additional missiles for contingency use before the 
year 2000 and of initiating LRIP concurrently with the testing 
of EMD missiles once initial tests have verified that 
performance has not been degraded by any EMD design changes. 
The Director of BMDO is directed to prepare and submit a report 
to the committee not later than March 15, 1996, on the results 
of his review. Finally, the committee expects the Director of 
BMDO to initiate development of all battle management software 
for the THAAD system, including that necessary to receive cuing 
information from external sensors.

Navy upper tier

    The committee urges prompt completion of the Upper Tier 
cost and operational effectiveness analysis (COEA), but 
emphasizes that a fair and impartial assessment is imperative. 
The committee will closely scrutinize the COEA to ensure that 
all relevant technological approaches were considered.

Navy lower tier

    Given the importance of Navy Lower Tier to the Navy's 
ability to defend the fleet against cruise missile attacks, the 
committee directs the Secretary to review the management and 
funding responsibilities for Navy Lower Tier, including the 
possibility of transferring such responsibilities from BMDO to 
the Navy. The results of the Secretary's review should be 
communicated to the congressional defense committees not later 
than February 15, 1996.

Arrow

    The committee directs that none of the funds authorized for 
Arrow may be obligated until the Secretary has certified in 
writing to the congressional defense committees that a U.S.-
Israeli Memorandum of Agreement governing the next phase of 
U.S.-Israeli cooperation on missile defense has been signed. 
Along with such certification, the Secretary shall also include 
a report on the annual U.S. and Israeli funding necessary to 
implement, and any cost-sharing arrangements contained in the 
agreement.

Russian-american observational satellites (RAMOS)

    The committee commends the Department for providing 
increased funding in fiscal year 1995 for the RAMOS project. 
The committee continues to strongly support this cooperative 
research and development effort and recommends not more than 
$10 million for this program in fiscal year 1996 in PE 63173C.

Boost phase intercept (BPI)

    To maximize defense effectiveness, ballistic missiles armed 
with early-release submunitions need to be attacked early in 
their flight trajectory. This represents a significant 
challenge for the defense, however. While generally supportive 
of the concept of boost phase intercept, the committee notes 
that the BPI program is at present unfocussed, with no workable 
system design yet defined. As a result, the committee 
recommends a reduction of $20 million to the request.

National missile defense (NMD)

    The committee believes that the NMD program should be 
structured to support an initial deployment at the earliest 
practical date as a matter of national priority. The committee 
recommendation of an increase in funding for NMD of $450 
million, would provide a total authorization of $820.6 million 
for fiscal year 1996. This recommendation is intended to 
significantly accelerate the development and integrated testing 
of ``critical path'' elements of an objective NMD system, 
including the ground-based interceptor (GBI), the NMD-ground 
based radar (NMD-GBR), upgrades to existing early warning 
radars, and associated battle management, command control and 
communications (BMC3) in fiscal year 1996. The committee 
recognizes that the budget for the NMD-GBR has been cut 
dramatically in recent years, and therefore strongly urges the 
Director of the Ballistic Missile Defense Organization (BMDO) 
to provide sufficient funding to ensure significant 
acceleration of the NMD-GBR schedule. To reduce risk in the NMD 
program, the Director of BMDO is strongly urged to maintain 
competition in the development of an exoatmospheric kill 
vehicle (EKV) through flight testing. Furthermore, the 
committee expects that a significant fraction of the NMD budget 
will be used to accelerate research involving discrimination, 
phenomenology, component miniaturization, focal plane arrays, 
signal processing, countermeasures to submunitions, and kinetic 
kill vehicle (KKV) lethality activities.

Policy on anti-ballistic missile treaty compliance

    The committee is deeply concerned about the 
Administration's apparent efforts to turn the 1972 Anti-
Ballistic Missile (ABM) Treaty into a new, multilateral ``ABM-
TMD Treaty'' in its arms control talks with Russia and others. 
Current U.S. proposals would impose specific design limitations 
on U.S. systems and result in a significantly compromised U.S. 
TMD capability.
    The committee believes that U.S. forces overseas should be 
deployed with the most modern and capable systems available to 
protect them in the event of conflict. Theater missile defenses 
are no exception to this rule. Artificially constraining the 
capabilities of U.S. TMD systems risks more than good relations 
with the Russians--it risks American lives. The committee notes 
that the single greatest number of American deaths in the Gulf 
War resulted from the launch of one Iraqi Scud missile against 
a U.S. barracks in Saudi Arabia.
    The committee therefore recommends a provision (sec. 235) 
that would prohibit the obligation or expenditure of funds for 
the purpose of applying the ABM treaty, or any limitation or 
obligation under that Treaty, to the research, development, 
testing or deployment of a theater missile defense system, 
upgrade, or component. The standard used to define the 
demarcation between anti-ballistic missile defenses which are 
limited by the ABM Treaty, and theater missile defenses which 
are not, is similar to the one used by the Administration at 
the beginning of the negotiations among the United States, 
Russia, and other nations. This definition would provide that a 
missile defense system which is covered by the ABM Treaty is 
defined as one which has been flight-tested against a ballistic 
missile which, in that flight test, exceeded, first, a range of 
more than 3,500 kilometers, or, second, a maximum velocity of 
more than 5 kilometers per second. Put simply, if a missile 
defense system has not been flight-tested in an ABM mode--and 
therefore has not demonstrated a flight-tested capability to 
counter intercontinental ballistic missiles--it should not be 
limited in any way by the ABM Treaty.
    The committee also recommends a provision (sec. 236) that 
would strongly urge the President to pursue high-level 
discussions with Russia to amend the ABM Treaty, and to seek to 
foster international cooperation in the development, deployment 
and operation of BMD systems.
    Finally, it is the committee's understanding that all the 
elements of an NMD system architecture listed in section 233 
can be developed and deployed under the ABM Treaty. The Treaty 
limits only the number of ground-based interceptors and the 
number of ABM sites, and may affect the ability of sensors 
other than ABM radars to contribute efficiently to the 
performance of the overall NMD system.

                       items of special interest

Advanced electronic technologies

    The detailed descriptive material provided by the 
Department to support the budget request for PE 63739E, project 
MT-07, is inconsistent with the project name: ``advanced 
electronic technologies.'' The committee denies the $23.642 
million request.

Advanced SEAL delivery system

    The budget request included $24.607 million in PE 1160404BB 
to complete fabrication and integration of the first Advanced 
SEAL Delivery System and begin system-level testing. The 
committee recommends an increase of $4 million to complete 
evaluation of the ASDS employed from the SSN-688 class 
submarine.

Advanced sensor applications program

    The budget request included $17.382 million in PE 63714D 
for the advanced sensor applications program. The committee has 
monitored the pursuit by the Navy and the Office of the 
Secretary of Defense Advanced Sensor Applications Program (OSD 
ASAP) of different approaches to laser radar anti-submarine 
warfare (LIDAR ASW) systems--the former as an operational 
prototype, the latter as an alternative system concept offering 
the potential for future improvements in LIDAR ASW. The 
committee recommends an increase of $5 million to develop a 
research prototype and an increase of $5 million for the Navy 
ATD-111 system. Comparative testing of the two approaches 
should provide a basis for establishing the requirement for a 
follow-on system. The committee requests the Navy and OSD to 
jointly develop at the earliest practicable date a plan for 
completing the testing of the two alternative approaches to 
LIDAR ASW and to provide the plan to the congressional defense 
committees by March 1, 1996.

Advanced submarine technology development

    The budget request included $7.473 million in PE 63569E for 
the Advanced Research Projects Agency's advanced submarine 
technology program. The Navy's research and development 
emphasis on development of the New Attack Submarine (NAS) is 
understandable; however, a longer-term view of advanced 
submarine research and development by the Department of Defense 
is required to enhance the operational capability of submarines 
operating in the littoral against proliferating quiet diesel 
submarines and other anti-submarine warfare threats. As 
discussed in the classified annex, the committee believes that 
the planned investment in submarine research and development is 
below that required to maintain technological superiority. 
Accordingly, the committee recommends an additional $23 million 
for the Advanced Submarine Technology Program managed by the 
Advanced Research Projects Agency to pursue innovative 
technologies for submarine operations in littoral regions, 
continue work in new concepts for structural acoustics and 
management of submarine signatures, and enhancement of multi-
mission capability.

Aeronautical research and test capabilities assessment

    The committee is aware that the Department has conducted or 
participated in numerous prior studies associated with 
aeronautical facilities for research, development, test and 
evaluation. However, the committee remains concerned over the 
viability of the Department's role in this area and its part in 
shaping the overall vision and framework that will serve U.S. 
national security and international competitive interests in 
military and civil aeronautics over the long term. Accordingly, 
the committee recommends a provision (sec. 260) which would 
direct the Secretary of Defense to conduct a comprehensive 
review of aeronautical research and test capabilities to 
identify appropriate long-term options for developing and 
sustaining such capabilities, to include actions which can be 
taken within the Department and in concert with other federal 
agencies, academic institutions, and private industry. The 
committee further expects that the Department's action plan 
would specifically emphasize current and proposed future wind 
tunnel facilities, to include subsonic and transonic wind 
tunnels. In developing its report and action plan, the 
committee encourages the Department to consult with the 
Aeronautics and Space Engineering Board of the National 
Research Council.

AIRMS application program

    The committee recognizes the technical success achieved by 
the Advanced Research Project Agency's (ARPA) Airborne Infrared 
Measurement System (AIRMS) in investigation of the capabilities 
of infrared sensors for long range surveillance, detection, 
targeting, and pointing. The committee understands that the 
ARPA AIRMS experiment is coming to an end and is concerned that 
the technical capability represented by the system not be lost. 
The committee believes that the system is a national asset and 
has a number of potential applications in surveillance, anti-
submarine warfare, surface mine countermeasures, cruise 
missile, theater air defense, and naval fire support. The 
committee understands that discussions are underway in which 
the airplane, sensor, and all support services and funding to 
support the program through March 31, 1996, would transition 
from ARPA to the Defense Airborne Reconnaissance Office, or 
some other defense agency, for further investigation of 
potential applications of the technical capability. The 
committee wishes to see the significant investment in this 
program returned in successful user applications and would 
encourage a request for reprogramming by the receiving agency 
to continue support for the program in fiscal year 1996.

Computing system and communication technology

    The committee has received the final report from the 
National Academy of Sciences on the High Performance Computing 
and Communications Initiative (HPCCI) study required by the 
National Defense Authorization Act for Fiscal Year 1994 (Public 
Law 103-160). The committee directs the Director, Advanced 
Research Projects Agency to submit to the congressional defense 
committees of the Senate and House of Representatives 120 days 
after enactment of this act, a report on what steps have been 
taken to implement the recommendations of that study. Further, 
the committee notes an unsubstantiated growth in this program 
and directs prioritizing and control over the large number of 
program facets. The committee reduces PE 62301E by $25 million. 
This reduction shall not apply to software engineering 
technology (project ST-22).

Cruise missile defense advanced concept technology demonstration

    The budget request included $7 million in PE 63750D for 
support of the cruise missile defense advanced concept and 
technology demonstration (ACTD). The committee understands that 
the Department of Defense has increased the priority of cruise 
missile defense in order to develop and deploy cruise missile 
defenses as a complement to ballistic missile defenses in an 
integrated theater air defense architecture. The committee 
recommends an increase of $8 million for simulation and 
analysis of cruise missile defense options being demonstrated 
in this ACTD in support of the Joint Staff and Office of the 
Secretary of Defense tradeoff examinations of how best to 
defend deployed U.S. forces against cruise missile attack.

Cryogenic electronics

    The committee is aware of recent breakthrough technologies 
in higher transition temperature superconducting materials as 
well as the potential pay off in electrical circuit efficiency, 
size and capacity if low temperature circuits such as precision 
band pass filters can be cost-effectively developed, 
manufactured, and operated.
    The committee recommends an additional $5 million in PE 
62712E, project MPT-06, for this purpose.

Defense experimental program to stimulate competitive research 
        (DEPSCoR)

    The committee recommends continuation of the DEPSCoR 
program to strengthen infrastructure, enhance research, and 
develop human resources to assist the EPSCoR states to become 
more competitive for regular research and training grants. The 
committee recommends an additional $20 million in PE 61103D.

Defense laboratory partnership program

    The budget request included $16.106 million in PE 63570D to 
support unspecified technologies and a dual-use process. The 
committee views this program as redundant to defense laboratory 
cooperative research and development agreements and an 
unnecessary layering of dual-use processes. The committee 
recommends no authorization for fiscal year 1996.

Defense research science

    The committee recommends a reduction to the defense 
research sciences of $5 million in PE 61101E, projects CCS-02 
and ES-01.

Demilitarization of conventional munitions and explosives

    The budget request included $16.799 million in PE 63225D 
for the joint DOD-DOE munition technology development program. 
The committee recommends an increase of $15 million only for 
the cooperative development and demonstration by the Department 
of Defense and the Department of Energy of environmentally-
compliant processes for the demilitarization and disposal of 
unserviceable, obsolete, or non-treaty-compliant munitions, 
rocket motors, and explosives. The committee believes there are 
a number of potential technologies that could be considered, 
including (but not limited to) super-critical water oxidation, 
molten metal pyrolisis, plasma arc, catalytic fluidized-bed 
oxidation, molten salt oxidation, incineration, and underground 
contained burning. The committee believes that the Department 
of Defense must develop a plan to address the growing backlog 
of conventional munitions and explosives awaiting 
demilitarization and disposal, and directs that the Secretary 
of Defense provide a report on the requirements for such a 
conventional munitions and explosives demilitarization program 
to the congressional defense committees by July 1, 1996.

Electronics manufacturing and packaging technology

    The committee continues to seek ways to substantially 
reduce the cost and increase the performance of advanced 
military electronics systems. Seamless high off-chip 
connectivity (SHOCC) provides an innovative opportunity to 
achieve these goals through increased manufacturing yields of 
highly complex electronic circuits. Likewise, the use of non-
woven aramide fibers for printed circuit boards will provide 
three dimensional packaging that will provide reduced weight, 
reduced defects and compactness. The committee recommends an 
additional $7.5 million and $10 million for SHOCC and non-woven 
aramide fiber packaging, respectively, in PE 62712E to 
investigate these technologies.

Electro-thermal gun technology

    The budget request included $10.5 million in PE 62715H for 
development of electric armaments technology. The committee 
recommends an increase to the budget request of $4 million for 
the development of electrothermal gun technology in support of 
Navy surface fire support and Army advanced gun propulsion 
technology development programs.

Framing sensors

    The committee is encouraged by the successes of electro 
optical (EO) framing sensors with on-chip forward motion 
compensation (FMC) and recognizes the unique characteristics of 
EO framing technology. The committee recommends continued 
development and evaluation of EO framing sensor and the 
development of infrared and multi-spectral framing technology, 
both with on-chip FMC for precision targeting.

Free Electron Laser

    The committee directs that the Advanced Research Projects 
Agency evaluate continuous wave, superconducting radio 
frequency free electron laser (FEL) technology for defense 
utility and potential for dual use program funding. The 
Director, Advanced Research Projects Agency shall report his 
findings and recommendations to the congressional defense 
committees no later than March 1, 1996.

Fuel cells

    Of the funds authorized to be appropriated in PE 63226E, 
the committee directs the Advanced Research Projects Agency to 
complete the two megawatt direct fuel cell power plant for 
fixed military base applications.

Global command and control architecture

    The committee notes the progress achieved in development of 
the global command and control system (GCCS) architecture and 
strongly encourages the Secretary of Defense to eliminate 
routine bureaucratic constraints, take advantage of streamlined 
program management, and expedite the development and deployment 
of GCCS without delay. The antiquated and costly world-wide 
military command and control system (WWMCCS) should be phased 
out and shut down as soon as possible so that the Department 
can realize the savings and combat efficiencies of the GCCS. 
The committee recommends that WWMCCS savings be used for 
continued evolution of GCCS and insure its worldwide deployment 
without delay.
    There are existing and developmental command and control 
systems in the Department of Defense which presently are not or 
will not be fully compatible with the common operating 
environment of the GCCS. Some of these systems presently have 
no clear migration strategy to achieve the necessary level of 
compatibility or interoperability for use in joint operations. 
These systems should be identified and modified to achieve 
compatibility or interoperability at the earliest possible 
time. The committee further believes that GCCS is the proper 
way to accomplish goal.

Global grid communications

    The budget request included $45.188 million in PE 63226E 
for the Global Grid Communications program. The program is 
developing and demonstrating the advanced communications and 
information processing technologies needed for defense and 
intelligence operations in a geographically dispersed staff--
technologies that will be used in future versions of the Global 
Command and Control System. The committee recommends an 
increase of $5 million to accelerate the program for 
development and demonstration of more robust system services in 
an object based joint task force reference architecture.

High altitude endurance unmanned aerial vehicle

    The Department originally had intended that two contractor 
teams would be funded in a phase two development effort for the 
Tier II-plus unmanned aerial vehicle, leading to a flight 
demonstration competitive fly-off after the 27-month 
development effort. The current plan calls for only one 
contractor team to enter the 27-month development effort. The 
committee believes that to maintain a competitive program two 
contractor teams must be retained in phase two through at least 
critical design review and recommends an additional $60 million 
in PE 35154D for this purpose.

High growth rate diamond materials

    The committee continues its interest in synthetic diamond 
materials for high density electronic packaging applications. 
The committee recommends an additional $3 million for chemical 
vapor deposition (CVD) and an additional $2 million for 
chemical vapor composite (CVC) deposition in PE 62712E. The 
Director, Advanced Research Projects Agency shall determine the 
most promising process for continued out year funding.

High modulus polcrylonitrile (PAN) carbon fiber

    High modulus polycrylonitrile (PAN) carbon fiber is a 
critical component of the Theater High Altitude Air Defense 
(THAAD) system's kinetic kill interceptor. The committee 
understands that, currently only one company in the world, 
located in Japan, will be able to meet THAAD production 
requirements. The committee believes that the United States 
should not be totally dependent on a foreign producer for this 
critical THAAD component. Accordingly, the committee has 
included an additional total of $4 million in PE 78045A to 
support the development of a domestic source for this material.

High performance computing modernization (HPCM) program

    The committee approves the HPCM program and directs the 
Secretary of Defense to ensure that system software is being 
developed within the science and technology program that allows 
full and immediate utilization of HPCM hardware being made 
available to Department users. In addition, software for common 
user support applications shall be a paramount activity in the 
HPCM program even at the expense of postponing new hardware 
acquisitions for deliveries to new sites. The Director, Defense 
Research and Engineering shall take direct and immediate action 
to realign the program to accommodate this activity. In 
addition, the Secretary is reminded that the HPCM program is a 
Department of Defense activity and no hardware system shall be 
placed in activities other than the Department of Defense.

Historically black colleges and universities and minority institutions

    The committee recognizes the contributions of historically 
black colleges and universities and minority institutions 
(HBCU&MIs;) in enabling persons from under-represented 
backgrounds in the sciences and engineering profession to 
obtain graduate degrees. The committee supports continued focus 
on science and engineering programs and encourages the 
Department to use the authorized funding of $15.095 million to 
support within the HBCU&MI; system, programs which encourage 
students to pursue combined studies in critical languages and 
international affairs and advanced science and engineering 
degrees.

Integrated bridge system for MK V special operations craft

    The budget request included $13.288 million in PE 1160402BB 
for special operations advanced technology development. The 
committee recommends an increase of $1.5 million for 
development of a prototype maritime integrated bridge system 
for the MK V special operations craft to demonstrate the 
potential for advanced display and control technologies to 
enhance mission performance.

Joint technology insertion program

    The budget request included $4.976 million in PE 63726D for 
a new three-year program to build a conceptual computer model 
of the joint mission space for all DOD operational missions. 
The committee believes that if this program is of sufficient 
priority within the Department it can be accommodated within 
the $23.3 million requested increase in fiscal year 1996 for 
Joint Simulation Management in PE 63832D. Accordingly, the 
committee recommends no authorization for fiscal year 1996.

Lithography

    The committee is concerned that efforts on the part of the 
Congress to establish a realistic program in lithography are 
not fiscally supported by the Department. The committee reminds 
the Department of its obligation to conduct a goal oriented 
program as detailed in section 216 of the National Defense 
Authorization Act for Fiscal Year 1995 (Public Law 103-337).
    The committee recommends an increase to PE 63739E of $25 
million, of which $15 million shall be used for technologies 
leading to feature sizes below 100 nanometers and shall 
include, but not be limited to, mask-less and resist-less 
technologies, extreme ultraviolet (EVU) lithography, and 
support nanometer metrologies. In addition, the committee also 
expects continuation of investigation to show the potential of 
ion beam lithography and continuation of the laser plasma point 
source x-ray demonstration. The committee recommends that the 
balance of any funding required by the Advanced Research 
Projects Agency to conduct the codified program cited above, be 
divested from the Department's contribution to the SEMATECH 
program. The committee is concerned that the Department of 
Defense investment strategy for the Advanced Lithography 
program preferred by the Advanced Research Projects Agency 
(ARPA) may be in conflict with the industrial road-maps 
proposed and recommendations made by the Semiconductor 
Industries Association (SIA) and/or the Semiconductor 
Technology Council (STC) for funding advanced lithography.
    Therefore, the committee recommends a provision (sec. 214) 
that would permit the Director, Advanced Research Projects 
Agency to consider the SIA and STC recommendations as advisory 
only.

Littoral undersea tactical reconnaissance

    The budget request included $16.502 million in PE 63226E 
for development and demonstration of advanced technologies for 
littoral anti-submarine warfare operations. Newly developed and 
maturing multi-static acoustic, electro-magnetic, and electro-
optic technologies, integrated into existing aircraft, ship, 
and submarine platforms, could provide a means of countering 
the wide range of littoral undersea threats ranging in size 
from mines to submarines. The committee believes that ARPA and 
the Navy should begin an assessment of how to combine existing 
and emerging sensors and platforms so as to provide the joint 
amphibious operational commander an integrated picture of the 
littoral maritime environment. The committee recommends an 
increase of $7 million to begin a program to assess the 
effectiveness of such an integrated system of sensors. The 
committee believes that as the system concept matures an 
evaluation in an advanced concept and technology demonstration 
could complement the ongoing mine countermeasures ACTD and 
should be considered in the development of future budget 
requests.

Maneuver variant unmanned aerial vehicle

    The budget request included $36.8 million in PE 35154D for 
the Maneuver Variant Unmanned Aerial Vehicle (MVUAV). No funds 
were authorized for this program in fiscal years 1994 or 1995 
because the Department failed to provide a joint operational 
requirements document (JORD) or cost and operational 
effectiveness analysis (COEA). Availability of both of these 
documents to the congressional defense committees had been 
promised in August 1994. Yet neither has been provided. In 
addition, the Department has failed to provide the plan for the 
contribution the multitude of unmanned aerial vehicles is 
intended to provide the warfighter. The committee recommends no 
authorization for this program for fiscal year 1996.

Mobile detection assessment response systems (MDARS)

    The committee recommends an increase of $7 million in PE 
63228D, physical security equipment, and an additional $10 
million in PE 63709D, the advanced robotics program, to avoid 
delays in the MDARS development.

Multiple-object tracking sensor system (MOTSS)

    The committee believes accurate tracking of submunitions 
being dispensed from missiles and projectiles requires an 
accurate observation of the kinematic performance to resolve 
submunition collision problems and evaluate disbursement 
patterns. In addition, defensive weapon intercept problems also 
require accurate tracking. These requirements currently exceed 
test range capabilities. Therefore, the committee recommends an 
additional $7 million in PE 62702E for a high resolution, 
mobile multiple-object tracking system.

Multi-function self aligned gate technology

    The committee recommends an additional $12 million in PE 
35154D to complete development and flight test of the multi-
function self aligned gate (MSAG) technology for unmanned 
aerial vehicles.

Nuclear detection systems

    The committee believes it is imperative that the 
development of improved nuclear detection and forensic analysis 
capabilities be accelerated because of increased international 
terrorism as well as attempted acquisition of weapons-grade 
nuclear materials by criminal groups. Accordingly, the 
committee recommends an additional $11 million in PE 62301E, 
project ST 23, for such purposes.

Operations other than war

    The committee does not understand the need for the Advanced 
Research Projects Agency to conduct simulation and modeling 
studies for operations other than war. The Secretary shall 
redirect this activity for coordination and development within 
the military services, which will perform those functions.
    The committee recommends a reduction of $4.3 million in PE 
62702E, project T-04.

Quiet Knight advanced concept and technology demonstration

    The budget request included $101.602 million in PE 
1160404BB for Special Operations tactical systems development. 
The committee understands that of this amount the Special 
Operations Command has planned $10 million to support Phase I 
(component development and demonstration) of an advanced 
concept technology demonstration of Quiet Knight for both fixed 
and rotary wing aircraft, and considers this amount sufficient 
to support the program during fiscal year 1996. The committee 
strongly supports this effort and its continuation to a Phase 
II full scale demonstration and flight test of the integrated 
Quiet Knight capability. The committee expects that the Special 
Operations Command and the Office of the Secretary of Defense 
will address funding requirements for completion of the Phase 
II Quiet Knight advanced concept and technology demonstration 
in the fiscal year 1997 budget request.

Research goals for historically black colleges, universities and 
        minority institutions (HBUC/MI)

    Section 2323 of title 10, United States Code, sets forth 
goals for the Department for contracts and grants with HBCU/M 
institutions. The committee believes that clarification is 
necessary on how goal achievement shall be determined for the 
Department's research program. Those departments or entities in 
the Department of Defense which conduct research programs 
through grants, contracts or other official arrangements shall 
determine goal achievement for HBCU/MI by calculation of the 
entire contract value in sum for that department or entity 
only. For example, programs in 6.1 (research) shall compute the 
HBCU/MI goal based upon the total academic research obligations 
in the 6.1 (research) program only.

Senior year electro-optical reconnaissance sensor program

    The committee recommends an additional $14 million in PE 
35154D to upgrade all Senior Year Electro-optical 
reconnaissance sensor program sensors to the newest 
configuration, upgrade existing ground stations, and effect 
preplanned product geolocational accuracy improvements.

Specialty metals

    The committee is pleased to see that the Advanced Research 
Projects Agency has budgeted for specialty metals development 
such as beryllium-aluminum alloys, ductile iron, and titanium 
through advanced material partnerships and other technology 
development arrangements. The committee understands that not 
less than $20 million is planned for specialty metals in PE 
62712E.

Strategic Environmental Research and Development Program (SERDP)

    The committee recommends a reduction in the request for the 
SERDP program of $3 million for the joint Department of 
Defense-Department of Energy atmospheric remote sensing and 
assessment program for global climate change, a reduction of 
$500,000 for low energy model installation, and a reduction of 
$780,000 for energy conservation/renewable resources activities 
for a total reduction in PE 63716D of $4.28 million. The 
committee recognizes the benefit to the Navy from the Acoustic 
Thermometry of Ocean Climate (ATOC) and recommends continuation 
of the U.S./Russian Arctic component in cooperation with the 
Office of Naval Research.

Synthetic theater of war

    The budget request included $79.065 million in PE 63226E 
for the Advanced Distributed Simulation program. The committee 
is aware of reductions in fiscal year 1995 funding for the 
program which would adversely affect the ability to demonstrate 
and transition the Joint Synthetic Theater of War (STOW) in the 
STOW-97 advanced concept technology demonstration. Accordingly, 
the committee recommends an increase of $6.8 million to the 
budget request to maintain the STOW-97 demonstration program.

Tactical landing system

    The committee recommends an additional $7 million in PE 
62702E to complete the current development and testing of a 
tactical landing system (previously know as the advanced 
landing system), integrate and evaluate miniaturization and 
other technology to meet military requirements, and 
manufacture, install and test prototypes.

Tactical technology

    The committee is aware of the rapid developments in 
simulation based design and the importance of electronic 
linkages to reduce design to product time and cost. The 
committee supports the electronic commerce resource centers 
programs that facilitate the design and manufacturing processes 
in the defense industry. The committee approves the 
Department's request for these programs.

Warbreaker/attack of critical mobile targets

    The budget request included $117.759 million in PE 63226E, 
Experimental Evaluation of Major Innovative Technologies, for 
the Advanced Research Project Agency's WAR BREAKER program to 
develop and demonstrate advanced technologies and systems to 
enable the detection, identification and prosecution of a wide 
range of high value, time-critical fixed and mobile targets. 
The committee has strongly supported the WAR BREAKER project 
from the focus of its predecessor programs on advanced 
technologies that addressed the problem of the mobile SCUD 
threat experienced during Operation Desert Storm to the present 
program which deals with a much more comprehensive target set. 
The committee notes, however, that as the target set has 
expanded, the focus of the project has been defused; the 
original objective of dealing with the mobile SCUD threat has 
been largely set aside; and the WAR BREAKER project has become 
more general with the objective of maturing and integrating a 
wide range of advanced technologies and developing and 
demonstrating systems concepts for prosecuting a range of 
targets. While there are tasks and experiments under the 
overall WAR BREAKER umbrella that have specifically 
identifiable payoffs and pose potential solutions to individual 
and joint service requirements, the overall WAR BREAKER program 
appears to have become open-ended, with a funding level growing 
to $148 million by fiscal year 2001, and having no perceivable 
end.
    The committee understands that the Director, ARPA intends 
to review the WAR BREAKER program and other programs within the 
overall Experimental Evaluation of Major Innovative 
Technologies program element with a view to sharpening program 
focus, relevance to service requirements, and the application 
of advanced technology to meeting those requirements. The 
committee endorses and looks forward to the results of this 
review. The committee believes that those ARPA programs have 
been most successful in transitioning advanced technology and 
system concepts to the military services that had clearly 
defined objectives aimed at satisfying service requirements, 
close association between the potential user and ARPA program 
management, and successful development and demonstration over a 
relatively limited period of time.

                         Legislative Provisions


  section 203--modifications to strategic environmental research and 
                          development program

    This section would make a number of modifications to 
chapter 172 of title 10, United States Code, which governs the 
Strategic Environmental Research and Development Program. These 
changes, which are designed to streamline and simplify program 
activities, would reorient the program's focus toward the 
identification and support of basic and applied research, 
development and demonstration in technologies useful for the 
Department of Defense and Department of Energy defense 
facilities, eliminate the annual report on the five-year 
strategic environmental research development plan, and place 
control of the program more squarely within the responsibility 
of the Secretary of Defense.

                section 211--space launch modernization

    This section would provide $100 million for the Air Force 
for reusable rocket technology and $7.5 million for evaluation 
of prototype hardware of low cost expendable launch vehicles. 
Obligation of the funds for the reusable launch vehicle program 
would be limited to no more than that allocated for the 
reusable launch vehicle technology program for the National 
Aeronautics and Space Administration.

         section 212--maneuver variant unmanned aerial vehicle

    This section would prohibit the obligation of funds for the 
research, development, test, or evaluation of the maneuver 
variant unmanned aerial vehicle.

              section 213--tactical manned reconnaissance

    This section would prohibit the obligation of funds by the 
Secretary of the Air Force for research, development, test, or 
evaluation for a replacement aircraft, pod, or sensor payload 
for the tactical reconnaissance mission.

               section 214--advanced lithography program

    This section would permit the Director, Advanced Research 
Projects Agency to consider the SIA and STC recommendations as 
advisory and would allow him to establish priorities and 
funding levels consistent with the best interests of national 
security.

       section 215--enhanced fiber optic guided missile (EFOG-M)

    This section would limit funding for the enhanced fiber 
optic guided missile (EFOG-M) program if test and operational 
missiles and associated fire units are not delivered on time 
and within current cost estimates.

         section 216--joint advanced strike technology program

    This section would reduce the fiscal year authorization 
request for the Joint Advanced Strike Technology program by $51 
million and require a report by the Secretary of Defense 
detailing the architecture for tactical combat aircraft, cruise 
missiles, standoff precision guided missiles, and surface to 
surface precision guided munitions. The provision would further 
limit fiscal year 1996 expenditures until 30 days after the 
submission of the required report.

           Subtitle C--Ballistic Missile Defense Act of 1995


                        section 231--short title

    This section would designate this subtitle as the ``Missile 
Defense Act of 1995.''

   section 232--ballistic missile defense policy of the united states

    This section would establish the ballistic missile defense 
policy of the United States.

                 section 233--implementation of policy

    This section would direct the Secretary of Defense to take 
certain actions to implement the policy established in section 
232, and to issue a report to Congress setting forth the 
Secretary's plan for implementing that guidance. Further, the 
section would direct that the report include a revised five-
year funding plan for National Missile Defense (NMD), 
consistent with the guidance contained in the provision. The 
Secretary's report would specify projected time-lines and costs 
for deploying advanced Theater Missile Defense (TMD) systems 
and an NMD system. Furthermore, the report would state whether 
or when ABM Treaty constraints would have the effect of 
constraining the deployment and efficient operation of a 
highly-effective NMD system.

      section 234--follow-on technologies research and development

    This section would direct the Secretary of Defense to 
pursue research and development of follow-on technologies and 
systems for national and theater missile defense, and state an 
exclusion from the initial deployment architecture.

         section 235--policy on compliance with the abm treaty

    This section would establish policy concerning systems 
subject to the ABM Treaty, state certain prohibitions, and 
define an ABM-qualifying flight test.

     section 236--ballistic missile defense program accountability

    This section would require an annual report describing 
technical milestones, schedules, and cost of various Ballistic 
Missile Defense (BMD) programs.

                    section 237--abm treaty defined

    This section would define the term ``ABM Treaty''.

           section 238--repeal of missile defense act of 1991

    This section would repeal the Missile Defense Act of 1991.

         Subtitle D--Other Ballistic Missile Defense Provisions


  section 241--ballistic missile defense funding for fiscal year 1996

    This section would authorize funding for ballistic missile 
defense research, development, testing, and evaluation 
activities for fiscal year 1996.

        section 242--policy concerning ballistic missile defense

    This section would state congressional views on the 
relationship between U.S. ballistic missile defense and counter 
proliferation activities and U.S. ballistic missile defense 
activities and strategic stability, and urge the President to 
initiate discussions with other nations on various subjects 
related to ballistic missile defense.

      section 243--testing of theater missile defense interceptors

    This section would amend section 237 of the National 
Defense Authorization Act for Fiscal Year 1994 (Public Law 103-
160) regarding testing of theater missile defense interceptors.

           section 244--repeal of missile defense provisions

    This section would repeal six provisions of law with 
respect to missile defense.

 section 251--allocation of funds for medical countermeasures against 
                           biowarfare threats

    This section would amend section 2370a of title 10, United 
States Code to permit up to 50 percent of the funds provided 
for the medical component of the Biological Defense Research 
Program of the Department of Defense to be used for product 
development or for research, development, test, or evaluation 
of medical countermeasures against mid-term or far-term 
validated biowarfare threat agents. The potential for 
proliferation of biological warfare capabilities (including 
their potential use in terrorist attacks) and for development 
of new agents through genetic engineering dictates that 
increased attention should be given to research and development 
of medical countermeasures to potential mid-term or far-term 
biowarfare threat agents.

                      section 252--basic research

    This section directs the Secretary of Defense to provide 
the equivalent of a cost and operational effectiveness study 
for the consolidation of the individual services' basic 
research accounts to determine potential infrastructure 
savings.

      section 253--awards of grants and contracts to colleges and 
               universities: requirements of competition

    This section would amend section 2361 of title 10, United 
States Code to change the annual reporting requirements on the 
use of competitive procedures for awards of research and 
development contracts, and the award of construction contracts, 
to colleges and universities from each preceding ``calendar'' 
year to each preceding ``fiscal'' year.

      section 254--university research initiative support program

    This section would amend section 802 of the National 
Defense Authorization Act for Fiscal Year 1994 (Public Law 103-
160) to change the university research initiative support 
program from a mandatory program to a voluntary program and 
provide for improved review procedures. The purpose of this 
amendment is to provide flexibility in administering the 
university research initiative program and to better ensure 
defense relevance.

        section 255--advanced field artillery system (crusader)

    This section would impose spending authority limitations on 
the Secretary of the Army unless certain technical performance 
is achieved by August 1, 1996 in the Crusader program. The 
provision would permit the Secretary to significantly alter the 
Crusader acquisition plan for the cannon propellant if it is 
required to achieve the objectives of the Advanced Field 
Artillery System (AFAS), provided notification is given to the 
defense committees of the Senate and House of Representative.
    The provision would also require that an assessment of AFAS 
technology maturity to meet the Army requirements be provided 
to the defense committees of the Senate and House of 
Representatives by March 30, 1996.

    section 256--command, control, communications, and intelligence 
                            interoperability

    This section would require the Secretary of Defense to 
request the National Research Council of the National Academy 
of Science to conduct a comprehensive study of defense-wide 
communications, and intelligence systems. The committee is 
concerned that the substantial investment in these systems may 
not have appropriate management control to ensure compatibility 
and interoperability of hardware and software associated with 
the command, control, communication, computers and intelligence 
(C4I) systems in inventory and in acquisition, and that 
sufficient justification information exists on which to gauge 
the validity of the Department's annual request.

     section 257--federally funded research and development centers

    This section would require the Secretary of Defense and the 
Secretaries of the Army, Navy, and Air Force to reevaluate the 
functions of Federally Funded Research and Development Centers 
(FFRDCs) and to achieve certain reductions, consolidations and 
management goals. The provision would limit FFRDC funding to 
$1.15 billion. This provision would also reduce FFRDC funding 
by $90.097 million.

             section 258--manufacturing technology program

    This section would reflect changes to the manufacturing 
science and technology program by eliminating the technology 
base focus on the program and providing new emphasis on near 
term cost reduction applications. In addition, the provision 
would require larger non-federal government cost share for 25 
percent of the program appropriation and eliminate cost share 
for academic institutions.

       section 259--laboratory test and evaluation strategic plan

    This section would require the Secretary of Defense to 
prepare a five year strategic plan to consolidate and 
restructure the Department's Research and Development 
laboratories and test and evaluation centers.

  section 260--aeronautical research and test capabilities assessment

    This section would require that the Secretary of Defense 
assess aeronautical research and test facilities and 
capabilities of the United States and provide a report to the 
congressional defense committees and detail the findings and 
recommendations of the review.

                   section 261--t-38 avionics upgrade

    This section would require that the Department of the Air 
Force only consider foreign companies for the award of the 
contract for the T-38 avionics upgrade if such companies are 
headquartered in countries that allow equal access to U.S. 
companies for such contracts.

               section 262--dual-use technology programs

    This section would cross reference sections 2358(a)(2)(B) 
and 2371(a) with section 2501 of title 10, United States Code, 
to encourage the use of dual-use technology programs in defense 
research and technology programs.

                  TITLE III--OPERATION AND MAINTENANCE


                                Overview

    Through careful study, hearings, and analysis, the 
committee has determined that the readiness problems 
experienced by the military services in fiscal year 1994, and 
most acutely in the fourth quarter of fiscal year 1994, were 
the inevitable result of declining defense budgets, a 
significantly reduced force structure, and an increased pace of 
contingency operations.
    During 1994, training was canceled or deferred, planned and 
funded maintenance of weapons, equipment and real property was 
not accomplished, purchases of critical spare parts stopped and 
the quality of life for service members suffered. Many Army 
divisions reported degraded readiness levels and Navy surface 
combatant training readiness declined from the previous year. 
Navy and Marine Corps aviation squadrons had to be grounded 
with planes ``bagged,'' or placed in temporary storage, the 
first time in memory of many senior Navy personnel that such an 
action was taken. In the Air Force, crews in 13 of 21 of its 
flying weapons systems exceeded the Air Force standard of 120 
days on temporary duty away from their home base.
    The United States armed forces are the best trained and 
equipped force in the world. Nevertheless, readiness is a 
perishable commodity which demands constant vigilance. 
Accurately measuring readiness is a complex task. In addition 
to tank miles, flying hours and steaming days, there are many 
other factors which impact on overall readiness--personnel 
tempo, maintenance backlogs, troop morale, quality of life 
programs, base operations support, equipment modernization, 
recruiting and retention.
    In recognition of the complexity of addressing these 
challenges, the committee's strategy for maintaining readiness 
has five main components: (1) providing the necessary resources 
to ensure that the problems experienced in fiscal year 1994 are 
not repeated; (2) increased scrutiny over the disposition of 
those funds; (3) increased oversight on force readiness 
assessments; (4) the establishment of improved mechanisms to 
fund contingency operations, both planned and unplanned, so 
that funds are not diverted from critical readiness accounts; 
and (5) infrastructure reforms to free additional resources for 
critical readiness activities and force modernization--the key 
to future readiness.

                       Items of Special Interest


                          assessing readiness

    The committee remains concerned over the admission late 
last year that three Army divisions were at a low readiness 
condition. This revelation came only weeks after a senior DOD 
official declared ``* * * that the readiness of the forces as 
[sic] high as they have ever been--higher * * * than they were 
in 1991 when we were worrying about Iraq the first time.'' 
Congress and the American people must have confidence that 
military force readiness is and will be up to standards. The 
traditional system for measuring readiness is inadequate. It is 
narrowly focused, too subjective and inconsistently applied. 
More importantly, it represents only a snapshot in time, 
providing no predictive value of future force readiness. What 
is needed is a comprehensive readiness assessment system based 
on relevant and reliable indicators that measure force 
readiness today and provide early warning of future readiness 
problems.
    The committee was encouraged to learn during testimony that 
the Department has a number of initiatives underway to improve 
readiness assessments. The committee supports these efforts and 
believes it is critical to maintain the momentum which 
currently exists. Therefore, the committee directs the 
Secretary of the Defense to complete and report to the 
Committee on Armed Services of the Senate and the Committee on 
National Security of the House of Representatives actions 
agreed to by the Department of Defense in response to 
recommendations made by the General Accounting Office in its 
October 1994 report, ``Military Readiness: DOD Needs to Develop 
a More Comprehensive Measurement System'' (GAO/NSIAD-95-29), 
including:
          (1) Selection of indicators identified as being 
        critical to predicting readiness and most relevant to a 
        more comprehensive readiness assessment;
          (2) Development of criteria to evaluate the selected 
        indicators;
          (3) Prescription of how often the selected indicators 
        will be reported to supplement Status of Resources and 
        Training System (SORTS) data;
          (4) Ensuring that comparable data is maintained by 
        all the military services to allow the development of 
        trends in the selected indicators.
    Additionally, the Secretary of Defense shall include in 
this report steps being taken to ensure that the various 
initiatives underway are coordinated to prevent duplication of 
effort and to ensure a sharing of lessons learned.
    Finally, the committee recommends a provision (sec. 371) 
that directs the Secretary of Defense to report quarterly to 
the congressional defense committees on force readiness based 
on regularized readiness briefings provided to senior DOD 
military and civilian leadership as part of their readiness 
oversight responsibility. Currently, such briefings include the 
monthly readiness briefings provided to the Senior Readiness 
Oversight Council and as part of the Joint Monthly Readiness 
Review. The reports should focus specifically on identified 
problems or deficiencies and planned remedial actions, and 
should include the key indicators and other relevant data 
related to the identified problem area or deficiency.

                           readiness funding

    The President's budget request for fiscal year 1996 clearly 
recognizes the critical shortfalls in readiness identified in 
fiscal year 1994. Nevertheless, the committee believes that 
additional funding is warranted in key areas. The committee 
recommends funding increases of $2.8 billion above the 
President's request of $91.6 billion for a total of $94.4 
billion. The committee's recommended increase includes $1 
billion for real property maintenance, $440 million for depot 
maintenance, $425 million for base operations support, $100 
million for reserve component readiness, and $100 million for 
mobility enhancements.
    It is the committee's strong view that resources provided 
for training, operations and maintenance be used for those 
intended purposes. The committee remains concerned, however, 
over the extent to which resources provided for training and 
maintenance are diverted for other uses and the effects on 
readiness of such diversions. Therefore, the committee 
recommends a provision (sec. 373) that would amend an existing 
reporting requirement by the Secretary of Defense requiring 
semi-annual reports on transfers of funds to and from certain 
identified readiness accounts and an explanation of the reason 
for the transfer.
    Offset Folio 240 Insert here



                       real property maintenance

    The committee is seriously concerned over the backlog 
associated with maintenance and repair of existing facilities. 
The present replacement cycles for facilities in the inventory 
of each of the military services has grown dangerously lengthy. 
Given current levels of funding, shortening the replacement 
cycles for those facilities is unlikely in the near-term. The 
committee recognizes that accelerated levels of funding for 
repair and maintenance are urgently required to begin to reduce 
the backlog of maintenance and repair that is critical to 
military readiness and the safety of military and civilian 
personnel.
    The fiscal year 1996 budget request for real property 
maintenance (RPM) was $5,053,000,000. The committee recommends 
an increase of one billion dollars, for a total of 
$6,053,000,000. The committee further recommends that the 
increase be distributed as follows:

                        [In millions of dollars]

Army.............................................................. 350.0
Army National Guard...............................................  21.0
Army Reserve......................................................  17.0
Navy.............................................................. 150.0
Navy Reserve......................................................  12.0
Marine Corps...................................................... 100.0
Marine Corps Reserves.............................................   1.5
Air Force......................................................... 320.0
Air National Guard................................................  15.0
Air Force Reserve.................................................  13.5
                                                                  ______
      Total increase.............................................1,000.0

    The committee directs the military services to apply the 
recommended increase in funding for RPM to required repair and 
maintenance of barracks and dormitories, critical health and 
safety deficiencies, and mission critical operational 
deficiencies, including the repair and maintenance of training 
ranges, airfields, railheads, and piers.

                           reserve readiness

    The recent increased use of reserve forces to augment 
active duty units experiencing excessive commitments is 
expected to continue in the years ahead. However, the budget 
contains insufficient resources for properly training, 
maintaining, and resourcing Army National Guard and Army 
Reserve units to accept equipment flowing from the active 
component. In the operating tempo (OPTEMPO) area, the budget 
request funds National Guard and Army Reserve ground OPTEMPO at 
75% of the requirement versus 96% of the requirement in fiscal 
year 1995. Therefore, the committee recommends an increase of 
$60 million to the Army National Guard and $40 million to the 
Army Reserve in operations and maintenance funding to alleviate 
these shortfalls.
    The committee has become aware that the Army National Guard 
faces possible funding shortfalls for support of six fixed-wing 
Short Take-Off and Landing (STOL) aircraft due to be delivered 
late in fiscal year 1996. The committee urges that adequate 
funding be provided to the Guard for the purposes of meeting 
this identified shortfall.

                  mobility infrastructure enhancement

    The committee recommends $100 million to improve deployment 
capability and enhance mobility through investment in en-route 
infrastructure, including runway ramp space, preservation of 
en-route base availability, and ammunition loading. The funding 
is authorized in the operation and maintenance, defense-wide 
activities account for application to high priority projects 
with the potential for multiple mobility improvements. The 
Secretary of Defense is directed to report on the expenditure 
of these funds to the congressional defense committees prior to 
allocation of these funds and should seek the view of the 
Commander in Chief, U.S. Transportation Command, in determining 
the application of these resources. The committee encourages 
the inclusion within this program of funding for the Center for 
Commercial Deployment of Transportation Technologies (CCDOTT).

                B1-B repair and maintenance improvements

    The committee recommends an additional $3.98 million for 
repairs and maintenance associated with the B1-B bomber. 
Additional details on this action may be found in Title I of 
this report.

                   chemical and biological terrorism

    The use of chemical weapons in the 1995 terrorist attacks 
in Japan underscored the volatility of the chemical and 
biological terrorist threat and the need for the United States 
to be prepared to respond to a similar attack on U.S. 
territory.
    Therefore, the committee recommends a provision (sec. 383) 
that would require the Secretary of Defense to make available, 
upon request and on a reimbursable basis, training facilities, 
sensors, protective clothing, antidotes and other materials and 
expertise as needed to emergency response and federal and local 
law enforcement agencies.

                        joint warfighting center

    The committee has been encouraged by the establishment and 
applied utility of the Joint Warfighting Center in its mission 
of assisting the chairman of the Joint Chiefs of Staff, 
combatant commanders and service chiefs in preparing for joint 
and multinational operations. The Center is not being used to 
its greatest potential, in part because of cultural and 
bureaucratic inhibitions on the part of some of the CINCs. The 
Joint Warfighting Center is an important asset in improving 
joint training. Consequently, the Secretary of Defense and the 
JCS Chairman should work with the CINCs to make them fully 
aware of the Center's utility in improving CINC training 
efforts.
    The committee urges the chairman of the Joint Chiefs of 
Staff to require coordination and validation by the Joint 
Warfighting Center of all preparations for major joint and 
multinational operations.

               joint deployment and transportation center

    The National Security Strategy emphasizes power projection. 
Currently, there is no Department of Defense-wide center 
dedicated to the education and training for transportation of 
personnel and material supporting joint deployments. The 
Department of Defense should proceed with the establishment of 
its proposed Joint Deployment and Transportation Center (JDTC) 
to develop better ways to deploy and sustain forces, especially 
for joint deployments and missions.

         conversion of military positions to civilian positions

    The high pace of operations and high personnel tempo is 
highlighting shortages in certain critical high demand, low 
density units such as military police, air defense artillery 
and Airborne Warning and Control System (AWACS). At the same 
time, thousands of military personnel are performing functions 
in areas such as personnel management and data processing which 
do not require military skills and could be performed by 
civilians. Military endstrength is declining, while the pace of 
operations is increasing. It is critical that military 
personnel be assigned to billets which contribute directly to 
combat readiness.
    The National Defense Authorization Act for Fiscal Year 1995 
(Public Law 103-337) required the Secretary of Defense to 
submit a report on his efforts to identify positions to which 
continued assignment of military personnel is no longer 
justified under current circumstances and assign Department of 
Defense civilian employees to replace military personnel in 
those positions. The report provided to the committee was 
unresponsive. It concluded that ``No major civilianization 
effort should be undertaken until the Defense workforce begins 
to stabilize . . .'' The committee disagrees. It is at just 
such a time of workforce restructuring that the opportunity 
should be taken to identify positions held by military 
personnel for which civilian personnel would be better suited.
    Therefore, the committee recommends a provision (sec. 333) 
that would direct the Secretary of Defense to convert not less 
than 10,000 military positions to federal civilian positions in 
fiscal year 1996. The Secretary is also directed to report to 
the Committee on Armed Services of the Senate and the Committee 
on National Security of the House of Representatives no later 
than March 31, 1996 on his plan for effecting the conversions, 
and opportunities for further conversions.

                       uh-1 refurbishment policy

    The committee report on H.R. 4301, the National Defense 
Authorization Act for Fiscal Year 1995, (H. Rept. 103-499), 
directed that any UH-1 helicopters sold to foreign nations be 
done so only in a refurbished condition. The committee 
reiterates that any UH-1 helicopters provided to a foreign 
nation--either by sale or other means--be done so only in a 
refurbished condition and at no cost to U.S. taxpayers.

                       condition of M1 tank fleet

    The committee is concerned about the absence of a 
procurement program for modernization of the main battle tank 
beyond upgrades of existing tank models, and the committee is 
aware of reports regarding new tank threats that are appearing 
worldwide. Also, senior military officials have testified 
before the committee that the Army currently has no long-term 
plan for maintenance of the M1 Abrams tank. In light of these 
facts, the committee questions whether current funding levels 
allow the M1 tank fleet to maintain a readiness level to meet 
the warfighting requirements of the national security strategy.
    The committee therefore requests the General Accounting 
Office (GAO) to undertake a review of the current condition and 
future projected readiness of the M1 tank fleet to respond to a 
future national security emergency and report its findings to 
the committee within 60 days of enactment of this Act. The 
review should include the condition and state of readiness of 
prepositioned tank stocks; the reliability of all maintenance 
performed on the M1 fleet, including field-, intermediate- and 
depot-level maintenance; the number of operating hours on the 
current tank fleet; and the operational ability of the tanks 
used at the National Training Center to engage soldiers in 
training situations that are realistic to battlefield 
conditions. GAO should include in its review the potential of 
programs linking the depot maintenance system with private 
industry to extend the life of the current tank fleet.
    During its review GAO should examine the impact of DBOF-
driven rates on field commanders' maintenance options and on 
the commanders' operations and support costs, and the resulting 
impact of those factors on tank readiness. GAO should also 
examine whether existing depot capabilities are being 
duplicated at the field level and at what cost.

             strategic command ``bulwark bronze'' exercise

    The commander-in-chief, U.S. Strategic Command, recently 
initiated a series of training exercises known as ``Bulwark 
Bronze,'' involving U.S. strategic forces and personnel. The 
first such exercise occurred in 1994 and revealed a number of 
issues and shortcomings that need to be resolved. The committee 
endorses the conduct of one or more ``Bulwark Bronze'' 
exercises in fiscal year 1996, and urges the Secretary of 
Defense and the Chairman of the Joint Chiefs of Staff to review 
the results of these exercises and to consider expanding upon 
them as a means of bolstering nuclear deterrence.

                        Depot Maintenance Issues


                       core logistics capability

    It is the committee's strong view that a robust government 
depot capability is necessary for national security reasons. It 
is the committee's belief that eliminating the 60/40 
restrictions (as stated in sec. 2466 of title 10, United States 
Code) is not necessarily inconsistent with maintaining a strong 
depot infrastructure. Therefore, the committee recommends a 
provision (sec. 395) that would:
          (1) repeal the 60/40 restriction for depot 
        maintenance and repair effective December 31, 1996;
          (2) establish a policy for maintaining depot-level 
        maintenance and repair core logistics capability to 
        provide a ready and controlled source of technical 
        competence and resources necessary to meet DOD 
        requirements and define core logistics capabilities to 
        be maintained in Department of Defense (DOD) depots;
          (3) require the Secretary of Defense to establish 
        procedures to determine core capability requirements;
          (4) require that depot-level maintenance and repair 
        core capability requirements be identified and that 
        requisite workloads be accomplished in DOD depots to 
        maintain core capabilities and allow for movement of 
        such workloads among all of the DOD depots as may be 
        necessary and appropriate, but call for merit-based 
        criteria to be used when making such moves;
          (5) provide for performing in the private sector, 
        through competitive awards, workloads in excess of 
        those necessary to maintain core logistics capabilities 
        and provide authority for DOD depots to compete with 
        private firms when there are less than two qualified 
        bidders for the workload;
          (6) require accurate disclosure of all costs that are 
        germane to competitions and that such costs be 
        determined in compliance with applicable laws, policies 
        and standards and that any cost calculations of the 
        organic depot will be based on an estimate of the most 
        efficient and cost effective manner of accomplishing 
        the workload by the depot;
          (7) establish initial and annual core capability and 
        related planned workload reporting requirements;
          (8) repeal section 2469 of title 10, United States 
        Code, effective December 31, 1996, which requires a 
        competition for the movement of an existing workload 
        above $3 million from a depot.
    The committee believes that this new core logistics 
initiative will provide an adequate in-house capacity for the 
repair and maintenance of military equipment necessary to 
ensure the readiness of all military combat units. The 
committee will carefully review and monitor the Department's 
changes for the accomplishment of depot-level maintenance and 
repair, and fully intends to reassess this program if the 
Department fails to revise its procedures consistent with the 
direction provided by the committee.

                  depot maintenance workload carryover

    The committee directs the Secretary of Defense to ensure 
that the fiscal year 1997 budget request does not include 
funding for any workload unless there is reasonable assurance 
the work will be accomplished in fiscal year 1997, or the 
workload is required in order to ensure a steady flow of work 
at the end of the fiscal year.

                             navy ordnance

    The Navy ordnance business area has lost $208 million since 
fiscal year 1992, with four of the five weapon stations losing 
money. The current Navy ordnance management structure consists 
of a headquarters operation and two divisions to manage five 
weapon stations. Considering the fiscal difficulties facing 
this operation, the committee considers this management 
structure excessive. This point is illustrated by the fact that 
general and administrative (G&A;) costs represents on average 
about 37 percent of the total weapon stations fiscal year 1995 
stabilized prices. For some weapon stations, the G&A; costs 
exceeds 50 percent of the stabilized price. Further, excessive 
overhead costs have had the effect of requiring reductions in 
critical maintenance and safety areas. The committee recommends 
ten million dollars to ensure that these critical areas are 
protected from reductions.
    The committee is also concerned about reports that the Navy 
may have military material handling teams at the weapons 
stations. The committee is concerned that this practice could 
lead to increased costs due to the requirement to continually 
train military personnel to perform these critical tasks and 
believes that many of the functions that are being converted to 
military personnel are more conducive to a stable, qualified 
civilian workforce. The committee directs the Navy to develop a 
plan to show weapon stations costs, especially the headquarters 
and divisional costs. This plan should be provided to the 
committee by December 15, 1995.

                       ship repair subcontractors

    The committee is concerned over continuing reports that 
Navy ship repair subcontractors are not being paid in a timely 
fashion, and in some cases not being paid at all, by prime 
contractors for work completed in the repair and maintenance of 
Navy vessels. The committee is concerned that this problem 
could increase in severity during this period of contraction in 
Navy fleet maintenance activity.
    A 1993 General Accounting Office report recommended that 
the Secretary of Defense identify circumstances under which 
contracting officers should take action to provide payment 
protection for subcontracts and also implement appropriate 
payment protection techniques. The committee believes the 
Department should pursue remedies necessary to ensure that the 
subcontractor community will be able to support the U.S. Navy 
fleet.

                        DOD Financial Management

    Over the past several years, numerous reports by the 
General Accounting Office (GAO), congressional committees, and 
the DOD Inspector General, have been critical of the Department 
of Defense's inability to provide adequate stewardship over 
hundreds of billions of dollars of public funds.
    The DOD Comptroller has also stated that the Department's 
finance and accounting system today is a ``burned-out wreckage 
of outdated and cumbersome systems.'' Severe shortcomings in 
financial operations currently preclude the Department from 
having basic accountability over vast sums of money. 
Consequently, senior DOD management and the Congress lack the 
information needed to run the Department in an efficient and 
effective manner.
    The committee believes that the Department's recognition of 
the financial management problems it faces represents a marked 
and welcome change in management philosophy. The Department 
must now take action to fix the problem and hold responsible 
individuals more directly accountable.
    According to an October 1994 GAO report, as of June 1994 
DOD's records contained at least $24.8 billion of problem 
disbursements. This amount increased to about $30 billion, as 
of February 1995. This marks an increase of nearly one quarter 
in problem disbursement transactions over an eight month 
period. Further, over $5 billion of this amount is in old 
canceled accounts, most of which were previously known as ``M'' 
accounts.
    Records in one accounting system, known as Mechanization of 
Contract Administration Services (MOCAS), at the Defense 
Finance and Accounting Service-Columbus, showed that for 2,551 
contracts, DOD had paid contractors about $1 billion more than 
the amount of the contracts. Second, hundreds of contractors 
voluntarily returned almost 4,000 checks totaling $751 million 
to DFAS-Columbus, including $305 million of overpayments. To 
correct this disbursement problem, the Department has a number 
of initiatives planned and underway.
    Accordingly, the committee directs the Secretary of Defense 
to provide an annual report on the disbursement problem 
beginning on September 30, 1995. The report should show 
disbursement problems for the following categories: (1) 
negative unliquidated obligations, (2) unmatched disbursements, 
(3) intransit disbursements, and (4) undistributed 
disbursements. Further, the report should provide an 
explanation if the amount of the disbursement problem (for an 
individual category at the DFAS-Center) is not being reduced. 
The explanation should include why the balances are not 
decreasing and what actions DOD is taking to correct the 
problem, including the amount of funds being spent on the 
action.

                            cash management

    Since the Defense Business Operating Fund (DBOF) was 
established, its cash balance has been centrally managed by the 
Office of the Comptroller. On February 1, 1995, the Department 
of Defense returned the management of the DBOF's cash and 
related Anti-Deficiency Act (Public Law 97-258) limitations to 
the military service and DOD component level. This policy 
change is a major departure from the single cash balance 
objective the Department cited in establishing DBOF. By 
consolidating the cash balances of the old industrial and stock 
funds, DOD reduced by several billions of dollars DBOF's cash 
requirement needs. However, the policy change placing the 
management of cash at the military services and DOD component 
level could result in DBOF's cash requirements increasing by 
over $1 billion. According to the General Accounting Office 
(GAO), the change in the cash policy has resulted in the amount 
of advance billing increasing from about $3 billion to about $5 
billion.
    The committee disagrees with the Department's decision to 
place the cash management responsibility for DBOF cash back in 
the hands of the military services and DOD components. The 
management of cash at the central OSD level has proven that the 
overall cash balance can be reduced. Therefore, the committee 
recommends a provision (sec. 312) that would require the Office 
of the Secretary of Defense (Comptroller) to immediately 
reverse its February 1995, decision and to centrally manage 
DBOF's cash.
    Further, the committee directs the GAO to perform a review 
of the Fund's cash management practices. The report should be 
submitted to the committee no later than March 15, 1996.

                           prior year losses

    According to the Department's pricing policy, prices 
charged DBOF customers should be increased to recover losses. 
The committee agrees with GAO that this policy is inconsistent 
with the basic tenet of DBOF--that prices should reflect the 
actual cost incurred in providing goods and services in the 
current fiscal year. Prices that reflect only the cost expected 
to be incurred for that period would enable DOD and the 
Congress to determine the cost of each year's operations and 
measure the performance of DBOF's various business areas for 
that period.
    Most of DBOF's losses pertain to the Navy. While the Army, 
Air Force, and DOD-wide components have tried to comply with 
the DBOF concept and operate on a break-even basis, the Navy 
has incurred substantial losses totalling over $1 billion. To 
finance these losses, the Navy has included $695 million in its 
fiscal year 1996 operation and maintenance budget request that 
it plans to transfer to DBOF. However, DBOF prices already have 
been increased in fiscal year 1994 and 1995 to recover losses 
incurred during fiscal years 1992 and 1993.
    Section 314 of the bill would require future budgets to 
include the amount necessary to cover prior year losses.

                           financial systems

    The Defense Business Operations Fund (DBOF) currently uses 
80 disparate, unlinked financial systems and approximately 200 
ancillary systems that provide financial data. Consequently, 
DBOF accounting data is often not complete, timely, or useful.
    The committee directs the Secretary of Defense to provide a 
report to the congressional defense committees identifying the 
total estimated cost to improve DBOF's information systems. 
This estimate should include the following significant costs: 
(1) improvements needed to meet the minimum technical 
requirements, (2) data conversion from the existing systems to 
the interim migratory system, (3) development of interfaces 
with nonfinancial systems, such as logistics and personnel, (4) 
training of personnel who will operate and enter data into the 
interim migratory system, and (5) replacement of the 63 
existing systems with the interim migratory systems. This 
report should be presented no later than March 1, 1996.

     dbof prices should include the full cost of military personnel

    The current DBOF policy provides that the cost of military 
personnel will be assessed at the civilian equivalent rate, not 
the actual cost of military personnel. This practice 
understates the total military personnel costs resulting from 
the 27,000 military personnel working in DBOF operations.
    Section 313 of the bill would require the use of actual 
military costs in developing DBOF's fiscal year 1997 prices 
that will be charged to the customers. The military personnel 
accounts would be reimbursed based on the levels contained in 
the budget request or authorized by Congress. This policy would 
apply only to those military personnel who are included in the 
rates charged by the industrially funded activities. This 
policy would not apply in the event that personnel are working 
in the industrial activities in a training or other capacity 
wherein it is not normally required to have their pay 
reimbursed to the industrial funds from operation and 
maintenance funds.

                             capital assets

    DOD managers continue to receive inaccurate data on DBOF's 
annual $1.4 billion capital asset program. Specifically, 
financial data on the amount of revenue earmarked for purchases 
of capital assets, capital asset obligations, and capital asset 
outlays is questionable. DBOF business areas only obligated 
about 58 percent of the capital asset authority provided to 
them. A review of the fiscal year 1994 financial reports show 
that DBOF obligated 80 percent of the 1994 capital asset 
program. This data indicates that the Department is either not 
executing the capital asset program or the data is inaccurate. 
Consequently, it is extremely difficult, if not impossible, for 
DOD management and the Congress to ascertain if the capital 
asset program is being executed in accordance with the budget 
presented to the Congress.
    Since the Department has not convinced this committee that 
it has gained sufficient control over the capital asset 
program, the committee directs the Secretary to apply the 
allocation of capital budgets to higher priority areas within 
the capital asset account and report on the reallocation by 
March 1, 1996.

                  overpayment collection demonstration

    The committee recommends a provision (sec. 363) that would 
authorize the Department of Defense to undertake a 
demonstration project to pay up to $5 million to a commercial 
firm to identify money due to the government because of 
underdeductions and overpayments made to vendors. Commercial 
sector data processing techniques would be used to compare 
purchase documents and agreements with vendor invoices to 
identify discrepancies in allowances, pricing, discounts, 
billback allowances, backhaul allowances, and freight routing 
instructions. The review would also search for duplicate 
payments and unauthorized invoice charges. Fees would be on a 
contingency basis at a rate of not more than 25 percent of the 
actual recoveries.

                         offsetting collections

    The Department of Defense is presently authorized to 
provide goods and services to non-federal entities, including 
individuals, businesses, political subdivisions, and foreign 
governments on a cost reimbursable basis. Monies collected from 
these non-federal sources and credited to expenditure accounts 
are referred to in the budget as ``offsetting collections from 
non-federal sources.'' As such, these amounts are deducted from 
gross budget authority and outlays in arriving at the 
Department's topline budget numbers. In recent years, these 
collections have been averaging $8 to $11 billion per year.
    The committee has a number of concerns over the potential 
for these collections to erode accountability and oversight of 
fiscal resources made available to the Department's military 
accounts. For example:
          (1) The amounts collected could be significantly 
        different from the cost incurred by DOD. Where 
        collections, or prices charged, are less than the 
        Department's true cost, DOD is effectively giving away 
        federal resources. Where collections are in excess of 
        cost, these transactions provide resources that are 
        outside congressional oversight and control.
          (2) Discrepancies in excess of $1 billion have 
        occurred in recent years between the budgeted amount of 
        offsetting collections anticipated and the actual 
        amount collected. These discrepancies raise doubts that 
        the level of actual resources available to the 
        Department is consistent with the intent of Congress.
    To address these concerns, the committee directs the 
Department of Defense to submit a report to the Congress no 
later than March 31, 1996 that addresses: (1) the extent to 
which reimbursements equal the Department's cost, (2) the 
accuracy with which the budget is able to predict actual 
offsetting collections, (3) the amounts collected by object of 
sale and purchaser, and (4) recommendations to improve or 
remedy the condition.

                  emergency and extraordinary expenses

    As part of the agreed framework reached between the United 
States and North Korea in October 1994, the U.S. agreed to 
purchase and deliver heavy oil to North Korea. This shipment of 
oil for North Korea cost approximately $5 million and was 
financed out of the Department of Defense's budget. The 
committee finds the use of scarce DOD resources for the purpose 
of providing fuel oil or other assistance to North Korea, at a 
time when severe funding shortfalls are adversely impacting 
force readiness and modernization, difficult to understand.
    The funds used for this purpose were drawn from authority 
granted under section 127 of title 10, United States Code to 
the Secretary of Defense and the Secretaries of the military 
departments to use appropriated funds for emergency and 
extraordinary expenses for ``any emergency or extraordinary 
expense which cannot be anticipated or classified.'' The 
committee views the use of this authority for the purpose of 
providing fuel oil to North Korea as inappropriate. 
Consequently, the committee recommends a provision (sec. 372) 
that would require prior notification by the Secretary of 
Defense, or the Secretary of a military department, to the 
congressional defense committees before any funds available to 
the Department of Defense for emergency and extraordinary 
expenses may be obligated or expended in an amount of 
$1,000,000 or more for any single transaction. Under current 
law, the Secretary of Defense submits a quarterly report when 
funds are expended under this authority.

                         Information Technology


                          performance measures

    Congress requested the Department of Defense to establish 
performance measures and management controls to ensure the 
maximum benefit from its automated information systems (AISs).
    The committee believes that the Department is making an 
effort to improve its performance measures and management 
controls. However, the report required by section 381 of the 
National Defense Authorization Act for Fiscal Year 1995 (Public 
Law 103-337) does not convince the committee that DOD is fully 
committed to either measuring the benefit or ensuring maximum 
benefit from developing, modernizing, operating, and 
maintaining AISs. Consequently, the committee directs DOD to 
immediately re-evaluate the performance measures contained in 
its report, and develop acceptable, precise performance 
measures to effectively measure the benefits, in terms of 
dollars and contribution to mission performance, of 
implementing migration systems, establishing data standards, 
and improving processes. The committee directs the Secretary of 
Defense to submit the resulting new performance measures to 
Congress no later than January 15, 1996.
    The committee also directs the Secretary to report by 
January 15, 1996 on how the Department plans to manage AIS 
activities to ensure that maximum benefits are received. In 
particular, the report should: (1) elaborate on each step of 
the management control process, (2) explain how the Department 
proposes to ensure that its performance data is of high 
quality, and (3) describe controls to ensure accuracy and 
consistency among system costs reported through DOD's Planning, 
Programming and Budgeting System, to the Major Automated 
Information System Review Council, and to the Congress via the 
biennial budget estimates.

                         off-the-shelf systems

    The committee believes that certain Department of Defense 
functional processes lend themselves to the use of off-the-
shelf information technology. Two examples are functions 
performed by the Defense Printing Service and the armed 
services' public works centers. The committee directs that the 
Secretary of Defense conduct a review of using off-the-shelf 
systems for these functions and report to the committee by 
March 1, 1996 on other functional processes that can use 
existing private sector technology.

                    Defense Support Services Reform

    Over half of the defense budget--59 percent, or $160 
billion in 1994--goes to support services, including 
information technology, travel administration, financial 
management, supply, printing, maintenance and other functions. 
During this period of constrained resources, the committee is 
concerned that every dollar spent in this area be spent wisely 
and efficiently and believes that two principal areas require 
attention.
    First, while the military force structure has been reduced 
dramatically, reductions in funding for support services has 
not kept pace. For the period between fiscal years 1990 and 
1996, funding for support services will have been reduced 
approximately 13 percent, compared to a 28 percent decline in 
military end strength and a 59 percent reduction in procurement 
funding. Further reductions in support services are necessary.
    Second, many of the processes and systems for providing 
support services are outmoded. Administration of routine 
employee travel, for example, is over five times more expensive 
in the DOD than in private corporations. Private sector 
management practices need to be adopted, and in some cases 
services should be performed by the private sector rather than 
by DOD personnel.
    Reform is vitally necessary in both these areas in order to 
provide the best quality services at the lowest cost, and to 
free up funds for force modernization and readiness.

                      reengineering transportation

    Studies by DOD, various commissions, and the U.S. 
Transportation Command (USTRANSCOM) have reported that traffic 
management processes within the Department are fragmented and 
inefficient. These processes and automated systems were 
developed independently for each mode of transportation.
    USTRANSCOM finances over $5.4 billion of transportation 
expenses per year. The overhead structure supporting defense 
transportation has an annual cost of $1.9 billion--$659 million 
of which is for managing common user transportation funded 
through the Defense Business Operations Fund (DBOF). The 
current structure of separate component command headquarters 
and a worldwide field structure has remained essentially 
unchanged since the formation of USTRANSCOM.
    Transportation services that the military component 
commands have traditionally provided, such as port handling and 
intermodal transfers, are currently provided primarily by 
commercial carriers. Presently, about two-thirds of the 
Military Traffic and Management Command (MTMC) and the Military 
Sealift Command (MSC) common-user transportation personnel are 
located at headquarters and subordinate command offices 
performing primarily management support transportation 
functions. Less than one-third are located at port or terminal 
activities. Further, the MTMC offices, including headquarters, 
are co-located with or in close proximity to MSC offices whose 
shore-based staff add another 350 personnel to the overhead 
infrastructure. MTMC and MSC personnel typically do not handle 
cargo. Furthermore, the component commands frequently perform 
similar functions, albeit for the particular mode of 
transportation for which they are responsible. MTMC, MSC, and 
the Army Material Command (AMC) separately negotiate freight 
rates and process claims, often related to the same shipment. 
MTMC handles the truck or rail portion, MSC handles the ocean 
portion, and AMC handles the air portion. Duplication also 
exists among the administrative functions, such as general 
counsel, inspector general, public affairs, and civilian 
personnel.
    The overhead charged to customers through DBOF and passed 
on to customers for this defense transportation system is 
costly. For example, a military customer is charged $3,292 for 
a shipment from New Jersey to Rotterdam, Netherlands, yet a 
commercial carrier charges $1,553 for the same shipment.
    The committee believes immediate action is necessary to 
consolidate and streamline transportation operations in a 
manner that reduces the amount of transportation overhead 
passed on to transportation customers without adversely 
affecting mobilization capability. Therefore, the committee 
recommends a provision (sec. 315) that would reduce by $70 
million the amount requested from the transportation accounts 
of the Defense Business Operations Fund.

                     reengineering household moves

    Every year the Department of Defense spends $1.1 billion 
moving 650,000 shipments of servicemember household goods and 
personal property. These figures do not include the hundreds of 
millions in costs incurred to process endless paperwork and 
financial transactions, and time spent in legal review for 
claims. In addition, $100 million is spent annually for damage 
claims, a rate of 23 percent compared to the industry rate of 
below 14 percent.
    The committee is convinced that the DOD must pursue a 
higher level of service for the movement of household goods 
that begins to move toward greater reliance on commercial 
business practices. This approach must involve the use of 
simplified procedures and relieving the industry from 
government-unique terms, conditions and regulations. Despite 
the fact that military moves comprise the largest block of 
customers in the moving industry, DOD personnel continually 
receive second-class treatment.
    Accordingly, the committee directs the Department of 
Defense to undertake a pilot program to implement commercial 
business practices and standards of service for its movement of 
service household goods and report on the status of 
implementation by March 1, 1996.

                           travel processing

    The Department of Defense currently spends approximately $1 
billion each year to administer temporary duty travel. For 
fiscal year 1993, Department travel processing costs were at 
least 30 percent of the direct travel cost--well above the 6 
percent rate which is the industry benchmark.
    A DOD task force has recommended various ways to improve 
travel processing, including adopting industry best practices. 
The Department has developed a model travel regulation that 
consolidates the various forms and orders currently used into a 
single ``trip record,'' increases the threshold on requiring 
receipts for reimbursements from $25 to $75, and allows the 
traveler to hold the receipts. The Department also plans to use 
a contractor-based travel arrangement system to achieve cost-
savings goals (such as reduced per diem expenses for long-term 
travel) without inflexible regulatory requirements. The 
Department expects to begin agency-wide application of its new 
travel policies and processes in fiscal year 1996.
    Further, many of the regulatory changes needed to 
reengineer travel processing will require the concurrence or 
cooperation of other Federal agencies. The committee directs 
the Secretary of Defense to: (1) seek General Services 
Administration waivers to implement a variety of changes to 
civilian travel entitlements, including increasing the receipts 
threshold, (2) seek approval from the Internal Revenue Service 
to institute new rules on expenditure receipts, (3) seek a 
waiver from the Office of Personnel Management to allow DOD to 
determine appropriate per diem for long-term travel, and (4) 
solicit the General Accounting Office's views on whether the 
new travel policies and procedures will satisfy federal 
internal control standards.
    The committee urges these agencies to give prompt attention 
to these initiatives and make every effort to assist the 
Department in removing unnecessary and costly travel policies 
and procedures.
    The committee further directs the Secretary of Defense to 
ensure that DOD travel arrangements made by contractor 
personnel (such as travel agents) are in the best interest of 
the government. In this regard, the Department should not enter 
into contracts requiring payments based on the percentage of 
the Department's travel costs--such as travel agent commissions 
determined as a percentage of passenger fares.

                           outsourcing travel

    It is increasingly common for private industry to outsource 
its travel function, particularly travel services. DOD 
travelers want a simpler approval mechanism and a way to make 
travel arrangements less time consuming and settlement of their 
travel claim before they received their charge card bill.
    Therefore, the committee recommends a provision (sec. 365) 
that would establish a pilot program for evaluation of improved 
travel processing prototypes.

                     property disposal outsourcing

    The Defense Reutilization and Marketing Service (DRMS), a 
unit of the Defense Logistics Agency, has been identified by 
the Department of Defense as a non-core, non-inherent 
government function. The DRMS has, therefore, been nominated 
for outsourcing by the Department of Defense and the National 
Performance Review. Furthermore, several studies by the General 
Accounting Office and others demonstrate that the property 
disposal functions of DRMS could benefit significantly from the 
application of ``best commercial practices.'' These benefits 
would include higher reutilization rates, additional revenue 
from property sales, and reduced costs of operation.
    Therefore, the committee recommends a provision (sec. 361) 
that would direct the Secretary of Defense to outsource the 
DRMS function to a qualified commercial entity not later than 
July 1, 1996. The committee estimates that this action may 
yield savings from $50 million to $100 million per year if the 
similar experiences of the Department of Treasury, whose 
property disposal functions were outsourced in 1985, are 
realized.
    The Secretary is directed to provide the committee with a 
status report by January 15, 1996, on actions completed, 
underway, and planned.

                            contracting-out

    The current process used to determine the cost of DOD-
operated programs versus contracting out is cumbersome and 
inefficient. These procedures are set forth in Office of 
Management and Budget Circular A-76 and supplemented by 
internal DOD regulations. To achieve greater return on 
constrained DOD resources, the committee is convinced that this 
process must be streamlined. The committee requests that the 
Secretary of Defense examine the following: (1) providing 
authority to contract out at the installation level, (2) using 
an improved comparison process instead of the lengthy, 
expensive and formal process now used, (3) raising to at least 
50 the threshold for the number of employees affected that 
allows converting of employees to contract without placement, 
and (4) limiting the time available for administrative appeal. 
The Secretary of Defense should report to the committee by 
March 1, 1996 on the advisability of implementing these and 
other improvements to the contracting-out process.

                              inventories

    The Defense Logistics Agency (DLA) and service inventory 
control points are responsible with ensuring that items are 
available to the operating forces when and where needed. DLA 
and the military services maintain about 600 million cubic feet 
of warehouse space for this purpose. Two-thirds of this space 
is occupied by secondary inventory--spare and repair parts, 
clothing, medical supplies and other items that DOD uses to 
support operating forces.
    The General Accounting Office (GAO) reports that secondary 
inventory was responsible for an estimated volume of 218.8 
million cubic feet in 1994. Secondary inventory items 
accounting for 130.4 million cubic feet, or 60 percent of the 
218.8 million cubic feet, are not needed to satisfy current war 
reserve and operating requirements. While DOD has made 
significant progress in reducing secondary inventory, it still 
occupies about 360 million cubic feet and actual warehouse 
space of 420 millon cubic feet. Between fiscal years 1992 and 
1995, DOD's operation and maintenance spending for secondary 
inventory decreased a modest 2.6 percent. In contrast, military 
force structure supported by the inventory has experienced 
dramatic decreases.

                   inventory management consolidation

    Currently, DLA manages nearly four million items at three 
inventory control points, while the armed services use 18 
inventory control points to manage 600,000 items, spending 
approximately $900 million in labor costs to do so. Centralized 
purchasing of consumables could result in savings of ten to 15 
percent. Section 391 of the bill would request DOD to review 
the consolidation of all inventory control points for storage 
and handling of inventory. Additional savings could also be 
realized through broader procurement leverage.

                  depot level repairable consolidation

    Additionally, the services retain redundant capabilities 
for storing and managing repairable items. Each service has 
hundreds of millions of dollars worth of high-value depot level 
repairables in unit allowances as ``insurance stocks''. The 
national and international transportation and DLA 
infrastructure has evolved to the point where further 
consolidation of this function would result in further 
economies. Section 391 of the bill would also direct a review 
of consolidation of the depot level repairable inventory under 
the Defense Logistics Agency.

                            fuel management

    Current levels of fuel held in war reserve are excessive 
given the current National Military Strategy. During Operation 
Desert Storm, DOD did not significantly access these stocks. 
Significant changes in the management, purchasing and 
transportation of DOD fuel could allow use of war reserve 
stocks that would better take advantage of fluctuating oil 
prices. Section 392 would provide authority for DOD to access 
war reserve stocks and realize significant savings.

                              electricity

    The Department spends approximately $2 billion each year to 
purchase electricity. The potential exists for reducing these 
costs by nearly 20 percent through deregulation and management 
improvements. Section 357 of the bill would direct the 
Secretary of Defense to implement procedures to purchase 
electricity from the most efficient source.

                     contract management oversight

    The cost to conduct oversight of defense procurement is 
excessive with some estimates placing the cost at 15 to 20 
percent of the acquisition cost. The General Accounting Office 
is requested to conduct a review of these added costs and 
report to the committee by April 1, 1996 with suggestions for 
reducing these costs.

              general services administration added costs

    The General Services Administration (GSA) is the executive 
agency for purchase of many of the consumable commodities used 
by the Federal Government. Department of Defense requirements 
account for 70 percent of the purchases made by GSA. Section 
358 of the bill would authorize DOD to bypass GSA when it is 
more efficient to do so.

                         prime vendor delivery

    The Defense Logistics Agency (DLA) could achieve 
significant savings by more aggressively implementing best 
inventory practices used by the private sector. Leading private 
sector companies store very few items and rely on suppliers to 
manage inventory and to deliver parts when needed. Department 
of Defense prototypes demonstrate that significant savings can 
be realized in the purchase and distribution of personnel items 
such as clothing, food, and medical supplies. DLA should adopt 
similar improved practices for the $8 billion inventory of 
hardware items. Section 360 of the bill would require that the 
Secretary of Defense apply these prototypes nationwide and 
report to the committee on other areas where prime vendor 
delivery can achieve savings. The committee recommends a 
reduction of $180 million in anticipation of expected savings 
from reduced inventory purchase requirements.

               two-year operation and maintenance funding

    Because operation and maintenance funding expires at the 
end of the fiscal year, there are significant obligations in 
the fourth quarter of the year. The Department of Defense is 
requested to report to the congressional defense committees on 
areas where operation and maintenance funding should be 
authorized for two years in order to preclude this inefficient 
practice.

                           dfas consolidation

    The Defense Finance and Accounting Service (DFAS) is 
consolidating the Department of Defense's financial operations. 
While the consolidation is expected to significantly reduce the 
workforce and the number of operating locations, it would still 
result in a larger and more costly infrastructure than 
necessary. GAO's preliminary analysis indicates that DOD could 
save an additional $3 billion (net present value) over 20 years 
by building a more appropriate smaller infrastructure. The 
smaller infrastructure would require about 3,500 fewer 
personnel and significantly reduce military construction costs 
below the planned DFAS requirements of $200 million for fiscal 
years 1997 and 1998.
    DFAS is also standardizing its finance and accounting 
systems under the Corporate Information Management initiative. 
By selecting migration systems for development and enhancement, 
DFAS hopes to reduce its many legacy systems to a smaller 
number of standard systems by late 1996. However, DFAS is 
standardizing systems and consolidating its work locations 
without first reengineering its core business processes to 
eliminate non-value added activities and to improve others. 
This approach could perpetuate inefficient and unneeded 
processes, lock DFAS into automated ways of doing business that 
may not best serve future operations, and result in a larger, 
more costly information system infrastructure. In contrast, 
successful private and public organizations have first done 
extensive planning and analysis, benchmarked performance, 
eliminated non-value added activities, and changed business 
processes to fit future needs all prior to consolidating, 
developing, and installing new computer systems. Therefore, the 
committee recommends that DOD reassess its DFAS reorganization 
to better consider process reengineering and outsourcing 
opportunities.

                         logistics outsourcing

    The Army has employed the Logistics Civil Augmentation 
Program during deployments in support of peacekeeping and 
humanitarian missions. There is potential to replace some of 
the existing logistics infrastructure rendered redundant with 
the onset of contract operations for logistics support. The 
General Accounting Office is requested to provide a report by 
March 1, 1996 on those combat support and combat service 
support functions that can be performed using contracts and 
identify current organic logistics support functions that can 
be eliminated as a result of contract logistics.

                          outsourcing payroll

    Presently, the Department of Defense is paying considerably 
more for its payroll and accounting functions than comparable 
expenses incurred in the private sector. It has been estimated 
that whereas the Department pays on the order of $14 per pay 
event, industry ``best-in-class'' payroll costs are on the 
order of $2 per pay event. As a result, the DOD Comptroller, in 
coordination with the Defense Finance and Accounting Service 
(DFAS) has been studying the efficacy of outsourcing payroll 
and accounting functions.
    For example, in 1994 DFAS undertook a study of the 
nonappropriated fund (NAF) accounting and payroll activity at 
Red River Army Arsenal for the purpose of evaluating the 
feasibility of outsourcing this function. Currently, portions 
of payroll and accounting systems such as the Navy Exchange 
payroll and the Army's NAF time and attendance system are 
performed by the private sector. Section 368 of the bill would 
require the Secretary of Defense to conduct a pilot program on 
outsourcing for nonappropriated fund payroll. Section 362 of 
the bill would require the Secretary of Defense to submit a 
plan for outsourcing civilian payroll.

                        dod printing operations

    The Defense Printing Service (DPS) is the single manager 
for printing operations within the Department of Defense (DOD). 
The General Accounting Office reported that DPS has reduced its 
initial staffing by over 36 percent (3,694 to 2,343 personnel) 
and has eliminated nearly 100 of its original 350 printing-
related facilities in an effort to achieve increased 
efficiencies.
    DPS should continually review its operational efficiencies 
and retain only a minimal core capacity in-house to cover those 
printing-related requirements which cannot be satisfactorily or 
economically fulfilled by the private sector. Dollar savings 
for certain printing-related services are achievable through 
judicious use of commercial outsourcing, particularly for those 
printing and duplicating jobs exceeding $500.
    The committee supports DPS' efforts to achieve a minimal 
in-house core capacity and to increase its commercial 
procurement of printing-related services. DPS currently 
satisfies about 50 percent of its requirements through 
commercial procurement--the remainder of the work is produced 
in-house. The committee directs that DPS increase its 
commercial procurement percentage to 70 percent in fiscal year 
1996. Through the combination of downsizing and increased 
outsourcing, the committee recommends a $10 million reduction 
to the budget request for services of the DPS.

                        [In millions of dollars]

        Service                                                Reduction
Army..............................................................    $3
Navy..............................................................     4
Air Force.........................................................     3
                                                                  ______
      Total.......................................................    10

                          outsourcing printing

    Information technology has changed a great deal in the last 
decade and the laws governing all aspects of government 
printing have become outdated. Competition in the civilian 
marketplace is significant and this has created a clear 
``buyer's market'' with distinct opportunities for savings. 
Government agencies should be able to take advantage of this 
situation to procure printing and duplicating service for much 
less than is currently possible through the Government Printing 
Office. Under the current arrangement, government customers 
frequently pay for both the services of a contracted civilian 
printing vendor and the Government Printing Office overhead.
    Section 359 of the bill would allow executive branch 
organizations to purchase printing and duplicating services 
directly from local printing vendors without going through the 
Government Printing Office. This flexibility is primarily 
intended to be used for the smaller, localized field printing 
and duplicating services that are provided the least 
economically by the Government Printing Office.

                         outsourcing expertise

    The committee recommends $10 million for the development of 
a curriculum at appropriate defense educational institutions to 
improve skills for outsourcing infrastructure support functions 
of the Department of Defense.

                           Civilian Employees


                    dod civilian employee management

    The Department of Defense (DOD) has experienced 
considerable reductions in its civilian personnel workforce. In 
fact, the Department is bearing the brunt of the federal 
civilian workforce cuts. In fiscal year 1995, 98 percent of all 
federal government-wide civilian reductions will come from the 
DOD.
    The current Full-Time Equivalents (FTE) ceilings do not 
provide the DOD with the necessary flexibility to allocate work 
based upon national security requirements and available 
funding. Commanders at the base and installation level must be 
able to react to changes in the mission as directed by DOD, 
higher headquarters and the Congress. In certain areas this 
downsizing has begun to affect vital services and functions 
such as equipment repair and maintenance. The Army's fiscal 
year 1996 budget funds Army depot maintenance at 80% of the 
requirement. According to the Army, it would have difficulty 
executing additional depot maintenance workload because the FTE 
ceilings limits the number of workyears available to perform 
depot maintenance. For fiscal year 1995, Congress increased 
Marine Corps depot maintenance funding and while the Marine 
Corps is executing this workload, it is not doing so in the 
most cost effective or efficient manner due to FTE limitations. 
Employees at Marine Corps depots are working large amounts of 
overtime--up to 28% of overtime is planned for the year.
    FTE ceilings also are affecting the ability of installation 
commanders to perform functions and provide services. The 
practice of assigning military personnel to accomplish work 
previously performed by civilian employees--what is known as 
borrowed military manpower--is increasing. Such a practice 
adversely impacts on individual and unit training, and harms 
quality of life. The Army is reporting a small rise in the 
number of units reporting adverse effects on training resulting 
from the use of military personnel in work previously performed 
by civilian employees. However, anecdotal information indicates 
that the level of special duty (which includes borrowed 
military manpower and troop diversions) may be higher than 
reported.
    It is the committee's view that the size of the 
Department's civilian workforce should be based on funded 
workload, and not arbitrary personnel ceilings. Therefore, the 
committee recommends a provision (sec. 331) that would prohibit 
the use of full-time equivalent personnel ceilings in the 
management of DOD's civilian workforce, requiring instead that 
the Secretary of Defense make reductions in FTE positions only 
as a result of a reduction in funds available to the DOD. It 
also would require the Secretary of Defense to ensure that for 
each operation and maintenance budget activity, the necessary 
number, type and skill mix of personnel are employed by the DOD 
to carry out the functions funded within each budget activity.

                   army civilian personnel management

    Last year's report on H.R. 4301, the National Defense 
Authorization Act for Fiscal Year 1995 (H. Rept. 103-499), 
directed the Army to implement recommendations of the Army 
Audit Agency concerning the Army Materiel Command (AMC) and the 
use of workload requirement techniques, based on mission 
requirements and priorities, to determine staffing 
requirements. The committee has recently received an update by 
the Assistant Secretary of the Army (M&RA;) on the Army's 
implementation of these directions. The committee commends the 
Army on the progress that has been made in starting to 
implement a workload based management system for AMC.
    The committee believes that the Army should expand the 
workload based management system to all major commands and 
infrastructure functions. In addition, workload priorities and 
manpower requirements resulting from the application of 
workload based manpower requirements should be directly 
integrated with all phases of the Army's planning, programming, 
budgeting, resource allocation and accounting processes. 
Finally, annual budget submittals should be based on a total 
Army civilian workforce plan, using workload-based staffing 
level justifications that meet Army Audit Agency scrutiny. The 
committee expects the Secretary of the Army to report to the 
congressional defense committees with each year's budget 
submittal and the progress made in implementing these 
recommendations.

                          overseas allowances

    The committee is aware that differences in overseas living 
quarters allowance policy among the military departments 
resulted in disparate treatment of living quarters allowances 
for appropriated and nonappropriated fund (NAF) employees 
overseas.
    The DOD Inspector General has recommended that living 
quarters allowances for NAF employees be discontinued. It is 
estimated that these payments to NAF employees amount to over 
$18 million per year. Section 335 of the bill would require 
that the same procedures be used for living quarters allowances 
for appropriated fund civilians and NAF civilians. In the 
absence of this consistent policy, DOD should terminate the 
practice of paying living quarters allowances to NAF employees 
hired after the effective date of enactment of this Act and 
terminate payments for employees currently receiving this 
payment by October 1, 1996.

                             IG and Audits


                           inspectors general

    The committee report on H.R. 4301, the Fiscal Year 1995 
National Defense Authorization Act, (H. Rept. 103-499) noted 
major problems in the Navy Inspector General process and 
requested the DOD Inspector General to determine the 
effectiveness of the Air Force and Army inspectors general.
    The DOD IG found that Army IGs do not exercise their full 
investigative potential. Because Army policy restricts the use 
of IG work to support disciplinary action, significant 
allegations of noncriminal wrongdoing are usually investigated 
by Army officers outside the IG organization who lack the 
investigative training and experience of the IGs.
    The DOD IG also found that certain Air Force IG processes 
and organizations have inherent flaws that raised questions 
regarding the adequacy and impartiality of noncriminal 
investigations. The Air Force policy of ``dual-hatting'' the 
vice (or deputy) commander of an organization as the 
organization IG is of great concern to the committee. Assigning 
chain of command and IG roles to a single official raises 
conflict of interest and independence concerns that detract 
from the credibility of the Air Force IG system. Air Force 
service members hold strong negative perceptions of the ``dual-
hat'' arrangement and may, as a result, hesitate to disclose 
wrongdoing to Air Force IGs.
    Further, the Air Force IG practice of allowing 
organizations to examine allegations against themselves raises 
additional questions of investigative impartiality. 
Additionally, the Air Force IG reliance on ``augmentee'' (non-
IG) investigators to investigate noncriminal matters is 
inefficient and produces investigative work that requires 
extensive remedial effort.
    Despite statutory protection for whistleblowers, which is 
implemented by DOD and service regulations, the DOD IG found 
that Army and Air Force personnel continue to fear reprisal for 
communicating with an IG. The committee believes the services 
should strengthen efforts to educate service members and 
commanders regarding rights of and protection for those 
contacting an IG.
    The DOD Inspector General is requested to report to the 
committee not later than March 1, 1996 on actions taken to 
correct these identified shortcomings including shortcomings in 
the Navy IG process.

          consolidation of procurement fraud within the dod ig

    The consolidation of some or all of the elements of the 
Defense Criminal Investigative Organizations (DCIOs) into the 
Department of Defense, Inspector General (DOD IG) has been 
under consideration by this committee for several years. 
Currently, the Department has four DCIOs which include the Army 
Criminal Investigation Command (CID), the Naval Criminal 
Investigative Service (NCIS), the Air Force Office of Special 
Investigations (AFOSI), and the Inspector General Defense 
Criminal Investigative Service (DCIS).
    In January 1995, the Department, pursuant to the statement 
of managers language accompanying the conference report on H.R. 
5006, the National Defense Authorization Act for Fiscal Year 
1993 (House Report 102-966), issued its advisory board report 
entitled ``The Report of the Advisory Board of the 
Investigative Capability of the Department of Defense.'' That 
report recommended responsibility for procurement fraud be 
consolidated in the Office of the DOD Inspector General. The 
committee agrees with this recommendation.
    The committee believes that consolidation of the 
department's procurement fraud mission would:
          (1) Reduce costs and increase efficiency by 
        eliminating duplicative management and overhead 
        structure in accordance with the National and Defense 
        Performance Reviews.
          (2) Eliminate approximately 135 of the 473 personnel 
        spaces currently dedicated to, or in support of, the 
        Military Criminal Investigative Organizations (MCIOs) 
        major procurement fraud investigative mission at a cost 
        savings of $65 million over the next six fiscal years.
          (3) Eliminate redundancy in DOD operations by halting 
        unnecessary participation of multiple Defense Criminal 
        Investigative Organizations (DCIOs) in investigations.
          (4) Eliminate confusion for the Department of Justice 
        in coordinating investigative efforts by centralizing 
        the investigative responsibility within one DOD agency.
          (5) Save military personnel spaces by civilianizing 
        the entire major procurement fraud investigative 
        mission.
          (6) Allow the MCIOs to focus limited resources on 
        their primary missions--investigating general crimes, 
        countering drug trafficking and use, and conducting 
        installation level fraud operations, thus properly 
        supporting local commanders.
          (7) Ensure that all DOD interests are considered when 
        investigations involve multiple service and Defense 
        agency contracts.
    Accordingly, the committee recommends a provision (sec. 
382) that would direct the consolidation of the procurement 
fraud function of the MCIOs into the Office of the DOD 
Inspector General.

                           unnecessary audits

    The committee understands that $160 million is spent 
annually in conducting audits of the armed services. Many of 
these audits are not productive, yielding little savings and 
resulting in few major findings. The committee believes that 
the armed services' audit agencies should better prioritize 
their audit plans and limit their scope to high-return areas. 
Therefore, the committee recommends a reduction to the auditing 
functions of the military departments. Further, the committee 
directs the DOD Inspector General to conduct a review of the 
audit functions of the DOD in order to determine whether 
further reductions can be achieved by improvements in 
prioritizing audits, whether outsourcing can be achieved for 
major financial audits, and whether consolidation of audit 
functions can yield savings and improve effectiveness.

                    Environmental Issues of Concern

    The committee notes that the Department of Defense has 
recently begun implementing a ``relative risk'' approach to 
cleaning up its contaminated sites. Under this approach, 
contamination at sites at each installation is categorized 
according to its relative risk to human health and the 
environment. Sites are characterized as posing either high, 
medium or low relative risk. High risk sites contain 
contamination at levels at least 100 times greater than the 
applicable standard. Medium risk sites contain contamination at 
least twice the applicable standard, and contamination at low 
risk sites is less than twice the acceptable standard.
    This relative risk approach affords the Department of 
Defense several benefits. Classifying sites according to their 
relative risk allows the Department of Defense to prioritize 
among its sites so that cleanup action may be focused at the 
sites with the highest relative risk first. This approach also 
permits the department to give communities a sense of the 
relative priority of sites so that they may be better informed 
about when cleanup actions at which sites may be expected. Use 
of the relative risk approach enables the department to use a 
common, readily understandable method for categorizing 
contamination at sites across bases throughout the United 
States. Finally, the relative risk concept should assist the 
department in overcoming what has been one of the chief 
criticisms of the defense environmental restoration program--
that it suffers from a lack of priority in its cleanup 
operations so that the worst sites are not necessarily cleaned 
up first.
    With the significant reduction in funding for the Defense 
Environmental Restoration Account (DERA) that occurred in 
fiscal year 1995, and with further reductions foreseeable in 
the years ahead, the department's use of innovative approaches 
to cleanup activities is of critical importance. While 
recognizing that long term solutions lie largely in reforming 
the statutory scheme governing these activities, the committee 
applauds the department's use of the relative risk approach to 
environmental restoration and looks forward to reviewing the 
results of its implementation in the years ahead.

                 Morale, Welfare and Recreation Issues


                    px and commissary transportation

    The committee estimates that approximately $100 million may 
be saved each year if commissaries and exchanges are allowed to 
contract directly using the most cost effective carriers for 
transportation of products overseas. This estimate includes 
savings in overhead costs currently paid to the Military 
Traffic Management Command (MTMC), the Military Sealift Command 
(MSC) and the Military Airlift Command and the use of foreign 
flag carriers for non-warfighting related products. Therefore, 
the committee recommends a provision (sec. 345) that would 
provide this authority.
    In order to effect these changes, the committee recommends 
$35 million in additional funding be provided to military 
exchanges and commissaries to cover the costs of implementing 
these changes and a reduction of $50 million from the second 
destination transportation authorizations of the military 
exchanges and commissaries that are currently provided to MTMC 
and MSC. In order to effect this reduction, the committee 
directs that $17.5 million be transferred from the Defense 
Business Operations Fund cash balance to the Army operation and 
maintenance account and that $7.5 million be transferred from 
the Defense Business Operations Fund cash balance to the Navy 
operation and maintenance account. The $25 million in savings 
to the Defense Commissary Agency should be used for improving 
services to commissary patrons. The Army and Air Force exchange 
service should serve as executive agent for implementing this 
initiative.

                                 credit

    The Army and Air Force Exchange Service (AAFES), the Navy 
Exchange Services Command (NEXCOM) and the Marine Corps 
Exchange (MCX) have two credit programs. The Deferred Payment 
Plan is operated by AAFES and also used by the MCX. The NEXCARD 
credit program is operated by NEXCOM. In order to provide this 
credit, AAFES has borrowed nearly $1.2 billion from in-house 
sources and commercial banks, moving from a net invested 
position of $319 million to a net borrowed position of $731 
million, while NEXCOM has borrowed $112 million, increasing its 
net borrowed position to $125 million.
    The Department of Defense has taken positive action to 
ensure that there is proper financial oversight over this 
credit and that military patrons are not overextended in their 
amount of available credit. However, the committee believes 
that further action is required. The committee expects that, 
even with a reduced customer base, the morale, welfare and 
recreation (MWR) contribution must be maintained. To achieve 
this goal, a determined focus on maximizing the sale of goods 
and services to the exchange patron must be sustained. The 
committee is concerned that the extensive borrowing to finance 
the credit programs impedes the ability to offer a wider range 
of products and the capital required to modernize facilities.
    Section 348 of the bill would provide for a uniform 
deferred payment plan for military exchanges and would 
outsource the management and operation of these credit 
functions when the same advantages can be gained through 
private sector contracting.

                    unified resources demonstration

    Section 346 of the bill would authorize the Department of 
Defense to undertake a demonstration project to merge 
appropriated and nonappropriated funds used in support of 
morale, welfare and recreation (MWR) activities. The committee 
believes there is considerable potential to reduce costs in 
personnel, contracting, operations, and resource management by 
taking this action. Also, there is the potential to gain 
greater visibility of total program costs and greater stability 
of MWR funding over the year.

                        europe exchange drawdown

    The drawdown of U.S. forces in Europe resulted in $130 
million in costs to the Army and Air Force exchange service. 
Section 349 of the bill would provide $70 million to the Army 
and Air Force exchange service to cover these extraordinary 
expenses: $14.4 million in foreign national separation costs; 
$63 million in excess inventory; $40 million in accelerated 
depreciation; and $17 million in distribution expenses. 
Military exchanges already provide considerable offsets to 
appropriations that would otherwise have to be provided for 
military quality of life, contributing nearly $12 billion over 
the past ten years. Requiring military personnel and their 
families to pay the additional cost of the European withdrawal 
would be unfair. Without relief, military exchange patrons will 
be forced to pay higher prices for the expenses associated with 
the drawdown.

                  military resale and mwr efficiencies

    Several factors are affecting the military's resale and 
morale, welfare and recreation (MWR) programs that call for an 
examination of the potential for generating economies.
          (1) Studies have demonstrated hundreds of millions of 
        dollars can be saved by eliminating duplicate overhead 
        functions.
          (2) Force structure reductions and base closures are 
        diminishing the economies-of-scale of separate entities 
        that exist to manage the various business functions on 
        military bases.
          (3) Budget reduction alternatives could threaten the 
        levels of subsidy provided for these programs, even to 
        the extent of recommending privatization of major 
        aspects of this program. The Department of Defense 
        needs to demonstrate efficiency and insulate the 
        benefits from threats.
          (4) Private sector distribution systems and 
        advancements in information technology provide the 
        opportunity to link common functions to gain economies-
        of-scale. Also, the inception of off-base wholesalers 
        and discount clubs have diminished the savings margins 
        of these programs and action is needed to ensure that 
        these savings margins are maintained.
          (5) The resale and MWR entities perform many similar 
        business functions. However, construction, 
        distribution, employee benefits and data system 
        development systems are fragmented, duplicative and 
        wasteful. These entities pursue expensive separate and 
        incoherent parallel tracks on initiatives. And, they 
        continue to spend hundreds of millions of dollars on 
        these duplicative systems.
          (6) A number of studies have demonstrated the 
        potential to gain economies-of-scale that will maximize 
        revenue generating potential of this program that 
        currently generates annual sales of $17 billion 
        supported by approximately $2 billion in annual funding 
        authorizations, and has the potential to generate more 
        earnings to support quality of life programs.
    Section 350 of the bill would require the Secretary of 
Defense to report on efficiencies that can be gained in the 
operation of these military MWR entities through application of 
technology, increased interface and cooperation among entities 
to regain economies-of-scale that have been lost through force 
structure reductions.

                        commissary construction

    The Department of Defense Inspector General has found 
significant problems with the methods used to determine the 
scope and size of commissary stores. The committee directs the 
Defense Commissary Agency and the Inspector General to 
reconcile any differences between them and report to the 
committee by November 15, 1995 on procedures that will be used 
to validate commissary construction requirements. The Defense 
Commissary Agency should seek the services of an independent 
needs assessment firm such as that currently used by other 
entities of the DOD morale, welfare and recreation program to 
assist in validating construction requirements.

                     distilled spirits distribution

    Section 344 of the bill would require the computation of 
the full cost of the military exchanges in the distribution of 
distilled spirits. This should include but not be limited to 
product cost, freight, backhaul, credit, total handling, 
management, administration, depreciation, utilities, 
headquarters purchasing and logistics, inventory carrying, 
damages, store receiving and processing, accounting, quality 
assurance, safety and security, surcharges, and retail cost 
adjustments between receiver and shipper.

                      united services organization

    The United Services Organization (USO) which consists 
largely of volunteers, represents an efficient means by which 
to enhance the quality of life of U.S. servicemembers and their 
families, especially overseas. In 1994, at a cost of 
approximately $5.4 million of in-kind government assistance, 
the USO provided service programs in excess of $23 million, a 
multiplier of 4.3 in the application of private funds to public 
benefit. The committee encourages the Secretary of Defense to 
provide to the maximum extent the amount of in-kind assistance 
provided to the USO in the performance of its mission.

                              Other Issues


                     norway prepositioning program

    The Marine Corps maintains the Norway Airlanded Marine 
Expeditionary Brigade (NALMEB), which consists of prepositioned 
combat equipment and supplies located in six separate 
facilities in Norway constructed specifically for the storage 
of an expeditionary battalion's equipment. The purpose of this 
program is to significantly reduce strategic airlift 
requirements, decrease force closure time, and to provide 
strategic options to rapidly reinforce the North Atlantic 
Treaty Organization's (NATO) northern flank. The prepositioned 
items include rations, vehicles, engineer equipment, howitzers, 
medical supplies and equipment, repair parts and aviation 
ground support equipment. The value of the equipment and 
supplies is approximately $243 million and currently costs $9.4 
million in operations and maintenance funds.
    The committee believes that this program, although 
established and maintained to support a NATO requirement 
specified during the Cold War, may no longer be cost effective. 
The committee is concerned with the shortfalls in equipment 
throughout the Marine Corps and questions whether the equipment 
stored in the NALMEB could be used to alleviate these deficits. 
Therefore, the committee directs the Secretary of the Navy to 
conduct a study to determine the continued need to maintain the 
NALMEB and to what extent the current equipment stored in the 
NALMEB could be redistributed within the Marine Corps. This 
report should be provided to the congressional defense 
committees no later than December 31, 1995.

                               impact aid

    The Department of Education impact aid program provides 
supplementary funds to about 2,500 of 15,000 school districts 
nationwide. This aid is critical to the welfare of DOD families 
and the school districts that are affected by a major DOD 
presence. Proposals to eliminate impact aid payments or to 
restrict the categories of children who qualify a school 
district to receive school impact aid would have a major effect 
on the operating budgets of districts with a large number of 
eligible children.
    Section 394 of the bill would authorize $58 million for 
educational assistance to local educational agencies where the 
standard for the minimum level of education within the state 
could not be maintained because of the large number of military 
dependent students or the effects of base realignments and 
closures.

           military clothing sales stores, replacement sales

    The committee is aware that there are certain items of 
individual clothing and equipment for which service personnel 
are responsible to the government if the item is lost, damaged 
or destroyed. Such items include boots, canteens, shovels. 
Currently, the Army and Air Force have statutory authority 
under title 10, United States Code, to conduct in-kind 
replacement sales of individual equipment, but the Navy and 
Marines Corps have no such authority. Section 393 of the bill 
would provide the same statutory authority to the Navy and 
Marine Corps currently granted to the Army and Air Force, 
thereby creating parity throughout the Department of the 
Defense.

                      navy enlisted storage space

    The committee understands that Navy enlisted personnel in 
paygrades E-1 to E-6 assigned to surface ships are provided no 
barracks space when in home port and thus remain on ship in 
cramped berthing spaces with limited storage space. As a 
result, these sailors must go without the amounts of civilian 
clothing, personal belongings and recreational equipment other 
sailors not assigned ship-board duty may have available. One 
suggested solution is to provide these sailors with additional 
storage space on shore. The committee directs the Secretary of 
the Navy to report to the Committee on Armed Services of the 
Senate and the Committee on National Security of the House of 
Representatives by March 31, 1996, on recommendations for 
improving this quality of life problem for shipboard junior 
enlisted personnel. The report should specifically examine, but 
not limited to, providing additional storage space for sailors 
on shore, with specific cost estimates and plans for 
implementing these recommendations.

         pilot project to improve economic adjustment planning

    The committee is interested in the progress made to date, 
through previously authorized national pilot projects, in 
examining methods to improve the provision of economic 
adjustment and diversification assistance to adversely affected 
local governments. Five sites have already been selected and 
grants awarded to them. The committee believes that these 
efforts should continue and that worthwhile models can result 
from this initiative that will assist other communities in 
dealing with base closures or other defense economic 
dislocation. Therefore, the committee strongly urges the 
Secretary of Defense to ensure that adequate resources are 
extended to this effort so that it may yield the expected 
information to benefit other communities facing conversion and 
reuse planning challenges.

               contractor operated parts stores (copars)

    The Contractor Operated Parts Stores (COPARS) program was 
initiated in the 1960's to improve the efficiency and 
effectiveness of maintenance management, improve vehicle 
readiness, and relieve the military from maintaining large 
inventories. The COPARS contractors maintain a centralized 
parts store located on Army, Navy and Air Force bases, that 
provide off-the-shelf parts for new and rebuilt high demand 
items to the vehicle maintenance unit. In the statement of 
managers accompanying the conference report on H.R. 4650, the 
Fiscal Year 1995 Defense Appropriations Act (H. Rept. 103-747), 
the General Accounting Office (GAO) was directed to conduct a 
cost comparison study of the COPARS program and alternative 
programs being considered to replace COPARS. However, rather 
than await the results of GAO's independent study of both 
approaches, the Army and the Air Force have eliminated or 
initiated efforts to eliminate COPARS.
    Therefore, the committee recommends that pending completion 
of the independent GAO study and the evaluation of the results 
by Congress:
          (1) The Army and the other military services suspend 
        any and all efforts directed toward the elimination of 
        COPARS and undertake an economic analysis to determine 
        whether the conversions were economically justified.
          (2) The Secretary of Defense should establish a clear 
        and concise policy concerning COPARS.

              air force automated maintenance data systems

    The committee is disappointed that the Administration 
failed to fund the modernization of the Air Force automated 
maintenance data system. The migration from the Core Automated 
Maintenance System/Reliability and Maintainability Information 
System (CAMS/REMIS) and the Tactical Interim CAMS/REMIS 
(TICARRS) to the Integrated Maintenance Data System (IMDS), 
facilitated by the Base Level Systems Modernization (BLSM), is 
necessary to keep certain aircraft maintained at the most 
efficient and effective rate possible. Moreover, the 
Administration failed to fund TICARRS which supports F-15 and 
F-16 aircraft.
    Pending the implementation of the migration plan and 
replacement of CAMS/REMIS/TICARRS, these systems should be 
maintained at a level of sufficiency to ensure that aircraft 
readiness is not compromised. Accordingly, the committee 
recommends the addition to the Air Force operation and 
maintenance account of $8.7 million to adequately maintain 
TICARRS without any further enhancements.
    Offset folios 281 to 301 insert here



                         Legislative Provisions


     section 311--codification of defense business operations fund

    This section would specify funds and activities to be 
included in the operation of the Defense Business Operations 
Fund (DBOF); would require separate accounting, reporting, and 
auditing of funds and activities within DBOF; specify charges 
for goods and services provided through DBOF; and establish 
procedures for accumulation of funds in DBOF.

 section 312--retention of centralized management of defense business 
      operations fund and prohibition of further expansion of fund

    This section would require the continuation of the 
centralized management of the Defense Business Operations Fund 
and would prohibit any further expansion of activities which 
are not managed through the centralized fund.

 section 313--charges for goods and services provided through defense 
 business operations fund and termination of advance billing practices

    This section would require that charges for the use of 
Department of Defense employees in the provision of goods and 
services under the Defense Business Operations Fund will 
include the pay and allowances of any military personnel and 
would exclude the costs for military personnel in designated 
critical functional areas. The section would also terminate 
advance billing practices within the Defense Business 
Operations Fund.

 section 314--annual proposed budget for operation of defense business 
                            operations fund

    This section would require that the annual proposed budget 
for the Defense Business Operations Fund include the amounts 
necessary to cover any previous year operating losses.

 section 315--reduction in requests for transportation funded through 
                    defense business operations fund

    This section would require the reduction during, fiscal 
year 1996, of $70 million from the transportation accounts of 
the Defense Business Operations Fund below the level of these 
accounts in the budget request for fiscal year 1995.

    section 321--clarification of services and property that may be 
   exchanged to benefit the historical collection of the armed forces

    Section 2572(b) of title 10, United States Code, authorizes 
the service secretaries to exchange various items that are not 
needed by the military services, such as books, manuscripts, 
works of art, and historical artifacts, for similar items held 
by public or private individuals, institutions, or agencies for 
use in search, salvage, transportation, or restoration services 
which directly benefit the historical collection of the armed 
forces. This section would amend the statute to make clear that 
the full range of modern historic preservation activity is 
included. Thus, items received by the service secretaries in 
exchange for items not needed by the military could be used for 
restoration, conservation, or preservation services, or for 
educational programs benefitting the armed forces' historical 
collection.

 section 322--addition of amounts creditable to defense operations and 
                          maintenance accounts

    This section would permit the Secretary of Defense and the 
secretaries of the military departments to credit service 
operations and maintenance accounts with funds recovered from 
parties who are liable for a portion of the costs of 
environmental restoration activities (such as contractors, 
insurers, or sureties), regardless of the legal basis and 
source of the recovery.

    section 323--repeal of certain environmental education programs

    This section would repeal sections 1333 and 1334 of the 
National Defense Authorization Act for Fiscal Year 1994 (Public 
Law 103-160).

section 324--repeal of limitation on obligation of amounts transferred 
            from environmental restoration transfer account

    Section 2703(b) of title 10, United States Code, authorizes 
the Secretary of Defense to transfer funds in the Defense 
Environmental Restoration Account (DERA) to other accounts 
within the Department of Defense. However, current law requires 
that funds so transferred may only be obligated or expended for 
environmental restoration purposes. Section 324 would repeal 
this restriction on the use of funds transferred from the DERA 
account so that transferred funds could be used for other, 
higher priority defense purposes. In particular, the committee 
has elsewhere specifically provided that certain DERA funds 
could be available for transfer to fund contingency operations, 
provided that the Secretary of Defense submits a request for 
supplemental appropriations to replenish the account. In the 
case of other transfers of funds from the DERA account, the 
committee directs the secretary to submit to the congressional 
defense committees a formal reprogramming request for each such 
proposed transfer.

    section 325--elimination of authority for transfer amounts for 
                         toxicological profiles

    This section would amend section 2704 of title 10, United 
States Code, to preclude the Secretary of Defense from 
transferring funds from the Defense Environmental Restoration 
Account (DERA) to the Secretary of Health and Human Services 
and the Administrator of the Environmental Protection Agency 
for use in the preparation of certain toxicological profiles 
and health advisories. Under current law, the Secretary of 
Health and Human Services has the responsibility to prepare 
toxicological profiles with respect to hazardous substances 
identified by the Secretary of Defense on military 
installations, and the Administrator of the Environmental 
Protection Agency has the responsibility to prepare health 
advisories with respect to such hazardous substances. The 
Secretary of Defense's responsibility to furnish data and 
personnel to assist the Secretary of Health and Human Services 
and the Administrator of the Environmental Protection Agency in 
carrying out the duty to prepare toxicological profiles and 
health advisories respectively would remain intact.

     section 326--sense of congress regarding funding for defense 
                   environmental restoration account

    This section would express the sense of Congress that by 
the end of fiscal year 1997, the Secretary of Defense should 
make every effort to limit costs within the Defense 
Environmental Restoration Account (DERA) for administrative 
support and for studies and investigations of contaminated 
sites to no more than 20 percent of total funding for the 
account.
    The committee notes that DERA funding was significantly 
reduced from the level requested during fiscal year 1995. The 
committee recommends a further reduction in fiscal year 1996 of 
$200 million below the President's request of $1.6 billion. The 
prospect is that funding for this account will continue to 
decline in the years ahead. Therefore, it is imperative that 
the department find ways to optimize cleanup efforts and 
minimize overhead and funding for studies. This section would 
encourage such efforts.

  section 331--management of department of defense civilian personnel

    This section would prohibit the use of full-time equivalent 
personnel ceilings in the management of DOD's civilian 
workforce, and would allow the Secretary of Defense to make 
reductions in the number of full-time equivalent positions in 
the Department of Defense only as a result of a reduction of 
funds. The section would also require that the necessary 
number, type and skill mix of personnel are employed by the 
Department of Defense to carry out functions funded in each of 
the Operations and Maintenance budget activity groups.

               section 332--management of depot employees

    This section would prohibit the management of civilian 
employees of the Department of Defense involved in the depot-
level maintenance and repair of material by any end strength 
constraint or limitation.

section 333--conversion to performance by civilian employees of active-
                             duty positions

    This section would require the Secretary of Defense to 
convert not less than 10,000 military positions to performance 
by civilian employees of the Department of Defense.

 section 334--personnel actions involving employees of nonappropriated 
                         fund instrumentalities

    This section would clarify the definition of 
nonappropriated fund instrumentality employees and permit the 
direct reporting of violations by nonappropriated fund 
employees to the Department of Defense Inspector General.

  section 335--termination of overseas living quarters allowances for 
             nonappropriated fund instrumentality employees

    This section would terminate the allowance for overseas 
living quarters for nonappropriated fund employees as of 
September 30, 1998.

   section 336--overtime exemption for nonappropriated fund employees

    This section would provide the same overtime exemption for 
nonappropriated fund employees as applies to other civilian 
employees of the Department of Defense.

            section 337--continued health insurance coverage

    This section would extend continued health insurance 
coverage for certain employees affected by a force or 
realignment or installation closure under a base realignment 
and closure action.

 section 338--creditability of certain nafi service under the federal 
                      employees' retirement system

    This section would increase the number of employees 
eligible to transfer between nonappropriated fund and 
appropriated fund morale, welfare, recreation programs without 
any significant loss of benefits.

           section 341--operation of commissary store system

    This section would revise the operation of the commissary 
store system, allow contracts with other agencies, and revise 
payments to vendor agents.

     section 342--pricing policies for commissary store merchandise

    This section would reduce administrative costs in pricing 
commissary merchandise.

section 343--limited release of commissary stores sales information to 
manufacturers, distributors, and other vendors doing business with the 
                       defense commissary agency

    This section would amend the procedures for the release of 
commissary stores sales.

     section 344--economical distribution of distilled spirits by 
                 nonappropriated fund instrumentalities

    This section would amend the procedures for the 
determination of the economical distribution of distilled 
spirits.

 section 345--transportation by commissaries and exchanges to overseas 
                               locations

    This section would allow officials responsible for the 
operation of commissaries and military exchanges the authority 
to negotiate directly with private carriers for the most cost-
effective transportation of supplies by sea without relying on 
the Military Sealift Command or the Military Traffic Management 
Command.

   section 346--demonstration program for uniform funding of morale, 
  welfare, and recreation activities at certain military installations

    This section would require the Secretary of Defense to 
conduct a demonstration program at six military installations 
under which funds appropriated for the support of morale, 
welfare, and recreation programs at the installations are 
combined with nonappropriated funds available for these 
programs and treated as nonappropriated funds.

 section 347--continued operation of base exchange mart at fort worth 
  naval air station and authority to expand base exchange mart program

    This section would permit the continued operation of the 
base exchange mart at Fort Worth Naval Air Station, Texas and 
would allow for the expansion of the Base Exchange Mart 
Program.

 section 348--uniform deferred payments program for military exchanges

    This section would require the Secretary of Defense to use 
commercial banking institutions to fund and operate the 
deferred payment programs of the Army and Air Force Exchange 
Service and the Navy Exchange Service and to establish a 
uniform exchange credit program not later than January 1, 1997.

section 349--availability of funds to offset expenses incurred by army 
and air force exchange service on account of troop reductions in europe

    This section would require that the Secretary of Defense 
transfer not more than $70 million to the Army and Air Force 
Exchange Service to offset expenses incurred by the Army and 
Air Force Exchange Service on account of reductions in the 
number of military personnel in Europe.

  section 350--study regarding improving efficiencies in operation of 
military exchanges and other morale, welfare, and recreation activities 
                         and commissary stores

    This section would require the Secretary of Defense to 
conduct a study, and report to Congress by March 1, 1996, 
regarding the manner in which greater efficiencies can be 
achieved in the operation of military exchanges, commissary 
stores, and other morale, welfare, and recreation activities.

section 351--extension of deadline for conversion of navy ships' stores 
         to operation as nonappropriated fund instrumentalities

    This section would extend, to December 31, 1996, the 
deadline for the conversion of all Navy ships's stores to 
operate as nonappropriated fund activities.

  section 357--procurement of electricity from most economical source

    This section would require the Secretary of Defense to 
procure electricity for use on military installations from the 
most economical sources.

 section 358--procurement of certain commodities from most economical 
                                 source

    This section would permit the Secretary of Defense to 
procure supplies from sources other than the General Services 
Administration if that source can provide the supplies at a 
lower cost.

    section 359--increase in commercial procurement of printing and 
                         duplications services

    This section would allow the Defense Printing Service to 
use private printing sources for up to 70 percent of its 
printing and duplication services.

section 360--direct delivery of assorted consumable inventory items of 
                         department of defense

    This section would allow the Secretary of Defense to 
arrange for direct prime vendor delivery of food, clothing, 
medical and pharmaceutical supplies, automotive, electrical, 
fuel, and construction supplies for military installations 
throughout the United States.

 section 361--operation of defense reutilization and marketing service

    This section would require the Secretary of Defense to 
privatize the operation of the Defense Reutilization and 
Marketing Service not later than July 1, 1996.

 section 362--private operation of payroll functions of department of 
               defense for payment of civilian employees

    This section would require the Secretary of Defense to 
submit a plan to Congress not later than March 1, 1996 for the 
privatization of the payroll functions for civilian employees 
of the Department of Defense and to implement the plan not 
later than October 1, 1996.

  section 363--demonstration program to identify underdeductions and 
                      overpayments made to vendors

    This section would require the Secretary of Defense to 
conduct a demonstration program at the Defense Personnel 
Support Center, Philadelphia, Pennsylvania, to evaluate the 
feasibility of using private contractors to audit accounting 
and procurement records of the Department of Defense.

section 364--pilot program to evaluate potential for private operation 
                    of overseas dependents' schools

    This section would allow the Secretary of Defense to 
conduct a pilot program to assess the feasibility of using 
private contractors to operate overseas dependents' schools. 
The section would also require the Secretary to report to 
Congress the results of the pilot program and would include any 
recommendations as to which other schools in the defense 
dependents' education system should be operated by private 
contractors.

 section 365--pilot program for evaluation of improved defense travel 
                         processing prototypes

    This section would require the Secretary of Defense to 
conduct a pilot program including two prototype tests of 
commercial travel applications to improve management of the 
Department of Defense Travel System.

   section 366--pilot program for private operation of consolidated 
       information technology functions of department of defense

    This section would require the Secretary of Defense to 
conduct a pilot program to test and evaluate the cost savings 
and efficiencies of private operation of all information 
technology services for the Department of Defense. The 
consolidation of 194 data centers to 16 will result in an 
estimated $500 million cost reduction. The further 
consolidation to approximately 4 or 5, while providing further 
cost reduction, will not provide as dramatic a saving. The 
private sector has already undergone major information 
technology consolidation and has at its disposal data 
processing centers far larger and more capable than those of 
the DOD. The private sector could provide full services to the 
DOD at a lower cost than any government-owned and/or operated 
facility.

  section 367--report on efforts to contract out certain functions of 
                         department of defense

    This section would require the Secretary of Defense to 
submit to Congress a report describing the advantages and 
disadvantages of using contractor personnel rather than 
civilian employees of the Department of Defense to perform 
functions that are not essential to warfighting missions.

    section 368--pilot program for private operation of payroll and 
     accounting functions of nonappropriated fund instrumentalities

    This section would require the Secretary of Defense to 
conduct a pilot program to test and evaluate the cost savings 
and efficiencies of private operation of accounting and payroll 
functions of nonappropriated fund instrumentalities of the 
Department of Defense.

                section 371--quarterly readiness reports

    This section would require the Secretary of Defense to 
submit to Congress a quarterly report on military readiness.

section 372--reports required regarding expenditures for emergency and 
                         extraordinary expenses

    This section would require the Secretary of Defense to 
submit a report of expenditures for emergency and extraordinary 
expenses on a quarterly basis. The section would also require 
notification to Congress prior to an obligation or expenditure 
of $1 million or more for these purposes.

  section 373--restatement of requirement for semi-annual reports to 
   congress on transfers from high-priority readiness appropriations

    This section would require the Secretary of Defense to 
submit reports to Congress on transfers of appropriated funds 
from specified budget activities.

    section 374--modification of notification regarding use of core 
                       logistics functions waiver

    This section would modify section 1584 or title 10, United 
States Code concerning a notice to Congress of foreign national 
employee salary increases, and section 2464(b) of title 10, 
United States Code concerning a notification to Congress 
regarding the use of core logistics functions waiver.

 section 375--limitations on development or modernization of automated 
    information systems of the department of defense pending report

    This section would prohibit the use of operations and 
maintenance funds to continue the modernization or development 
of an automated information system until 60 days after the 
Secretary of Defense reports to Congress on the proposed 
actions.

   section 376--report regarding reduction of costs associated with 
                     contract management oversight

    This section would require the Comptroller General of the 
United States to submit a report to Congress identifying 
methods to reduce the cost to the Department of Defense for the 
management and oversight of contracts in connection with major 
defense acquisitions programs.

    section 381--prohibition on capital lease for defense business 
                         management university

    This section would prohibit the use of Department of 
Defense funds to enter into a capital lease for the Defense 
Business Management University's Center for Financial 
Management Education and Training (CFMET). The committee 
questions DOD's non-competitive selection of this site at a 
time when suitable alternatives may be found at existing 
federal installations. The committee directs the Secretary of 
Defense to conduct a competitive selection of the site for 
CFMET which includes both government and private facilities.

  section 382--authority of inspector general over investigations of 
                           procurement fraud

    This section would provide the Inspector General of the 
Department of Defense responsibility for all investigations of 
procurement fraud with the Department of Defense.

    section 383--provision of equipment and facilities to assist in 
                       emergency response actions

    This section would provide training facilities, sensors, 
protective clothing, antidotes, and other materials and 
expertise of the Department of Defense to appropriate use by a 
federal, state, or local law enforcement agency in preparing 
for an emergency involving chemical or biological agents.

      section 384--conversion of civilian marksmanship program to 
   nonappropriated fund instrumentality and activities under program

    This section would provide for the operation of the 
Civilian Marksmanship Program as a nonappropriated fund 
instrumentality after October, 1995.

  section 385--personnel services and logistical support for certain 
               activities held on military installations

    This section would allow the Department of Defense to 
provide additional services or logistical support in connection 
with preparing for, administering, and overseeing a jamboree at 
a military installation.

               section 386--retention of monetary awards

    This section would allow the Secretary of Defense to accept 
any monetary award given by a nongovernmental entity as an 
award in recognizing excellence or innovation in providing 
services or administering programs.

                  section 387--civil reserve air fleet

    This section would permit the Department of Defense to 
contract with Civil Air Reserve Air Fleet (CRAF) contractors to 
grant them limited use of military airfields at time less than 
full activation of the CRAF.

section 388--permanent authority regarding use of proceeds from sale of 
      lost, abandoned, and unclaimed personal property at certain 
                             installations

    This section would make permanent a demonstration program 
for the use of proceeds from the sale of lost, abandoned, and 
unclaimed personal property. These proceeds would be used to 
administer the sale of this property.

   section 389--transfer of excess personal property to support law 
                         enforcement activities

    This section would amend the transfer of excess personal 
property for the support of counter-drug activities to include 
law enforcement activities, including counter-drug activities.

 section 390--development and implementation of innovative process to 
                   improve operation and maintenance

    This section would direct that $350 million of operations 
and maintenance funding shall be available to the Secretary of 
Defense for the development or acquisition of information 
technologies and reengineered functional processes.

   section 391--review of use of defense logistics agency to perform 
                    certain defense-wide activities

    This section would require the Secretary of Defense to 
conduct a review of the consolidation of depot-level 
repairables programs of the military departments under the 
management of the Defense Logistics Agency.

   section 392--sale of 50 percent of current war reserve fuel stocks

    This section would require the Secretary of Defense to 
reduce current war reserve fuel stocks of the Department of 
Defense by 50 percent.

     section 393--military clothing sales stores, replacement sales

    This section would provide to Navy and Marine Corps 
personnel the same authority that Army and Air Force personnel 
currently have to purchase replacement subsistence and other 
supplies.

  section 394--assistance to local educational agencies that benefit 
  dependents of members of the armed forces and department of defense 
                               civilians

    This section would authorize the appropriation of $58 
million for local educational agencies assistance in areas 
where there is an impact to school systems caused by dependents 
of members of the armed forces and Department of Defense 
civilians.

   section 395--core logistics capabilities at department of defense 
                                 depots

    This section would, effective December 31, 1996, repeal 
sections 2466 and 2469 of title 10, United States Code and 
would require the identification of depot-level maintenance and 
repair capabilities within the Department of Defense, require 
the determination of core depot maintenance capabilities, and 
limit the performance of core workload in Department of Defense 
depots. The section would also provide that workload above core 
would be provided by the private sector and would require a 
competition between the public depots and the private sector 
for any above core workload that has less than two qualified 
sources in the private sector. In addition, the section would 
permit the movement of core workload between the military 
departments.

              TITLE IV--MILITARY PERSONNEL AUTHORIZATIONS


                       Subtitle A--Active Forces


              section 401--end strengths for active forces

    The following table summarizes the committee's actions with 
regard to active duty end strengths:

                                 ACTIVE FORCES END STRENGTH FOR FISCAL YEAR 1996
----------------------------------------------------------------------------------------------------------------
                                                                Fiscal year 1996--      Change from fiscal year--
                                              Fiscal year -----------------------------
                   Service                        1995                                 -------------------------
                                                program      Request    Recommendation      1996         1995
                                                                                          request      program
----------------------------------------------------------------------------------------------------------------
Army........................................      510,000      495,000        495,000             0     (15,000)
Navy........................................      439,200      428,000        428,000             0     (11,200)
Marine Corps................................      174,000      174,000        174,000             0           0
Air Force...................................      400,051      388,200        388,200             0     (11,851)
                                             -------------------------------------------------------------------
      Total.................................    1,523,251    1,485,200      1,485,200             0     (38,051)
----------------------------------------------------------------------------------------------------------------

  section 402--temporary variations in dopma authorized end strength 
  limitations for active duty navy and air force officers in certain 
                                 grades

    This section would authorize a temporary increase in the 
number of officers who can serve on active duty in the grade of 
major within the Air Force and in the grades of lieutenant 
commander, commander, and captain within the Navy until 
September 30, 1997. The committee fully expects the Secretary 
of Defense to provide a proposal to restructure the grade 
limits currently set in law for all the services in time for 
the committee to address a permanent solution in the Defense 
authorization bill for fiscal year 1997.

                       Subtitle B--Reserve Forces


            section 411--end strengths for selected reserve

    The following table summarizes the committee's actions with 
regard to selected reserve end strengths:

                               SELECTED RESERVE END STRENGTH FOR FISCAL YEAR 1996
----------------------------------------------------------------------------------------------------------------
                                                                Fiscal year 1996--      Change from fiscal year--
                                              Fiscal year -----------------------------
                   Service                        1995                                 -------------------------
                                                program      request       Committee        1995         1995
                                                                        recommendation    request      program
----------------------------------------------------------------------------------------------------------------
ARNG........................................      387,000      373,000        373,000             0     (14,000)
USAR........................................      242,000      230,000        230,000             0     (12,000)
USNR........................................      100,710       98,608         98,608             0      (2,102)
USMCR.......................................       41,000       42,000         42,000             0       1,000
ANG.........................................      115,581      109,458        109,458             0      (6,123)
USAFR.......................................       78,706       73,969         73,969             0      (4,737)
Coast Guard.................................        8,000        8,000          8,000             0           0
                                             -------------------------------------------------------------------
      Total.................................      972,997      935,035        935,035             0     (37,962)
----------------------------------------------------------------------------------------------------------------

 section 412--end strengths for reserves on active duty in support of 
                              the reserves

    The following table summarizes the committee's actions with 
regard to the end strengths of reserves on active duty in 
support of the reserves:

                               FULL TIME SUPPORT END STRENGTH FOR FISCAL YEAR 1996
----------------------------------------------------------------------------------------------------------------
                                                                Fiscal year 1996--      Change from fiscal year--
                                              Fiscal year -----------------------------
                   Service                        1995                                 -------------------------
                                                program      request       Committee        1996         1995
                                                                        recommendation    request      program
----------------------------------------------------------------------------------------------------------------
ARNG........................................       23,650       23,390         23,390             0        (260)
USAR........................................       11,940       11,575         11,575             0        (365)
USNR........................................       17,510       17,490         17,490             0         (20)
USMCR.......................................        2,285        2,285          2,285             0           0
ANG.........................................        9,098        9,817          9,817             0         719
USAFR.......................................          648          628            628             0         (20)
                                             -------------------------------------------------------------------
      Total.................................       65,131       65,185         65,185             0          54
----------------------------------------------------------------------------------------------------------------

section 413--counting of active component personnel assigned in support 
                     of reserve component training

    This section would clarify the requirement of section 
414(c) of the National Defense Authorization Act for Fiscal 
Years 1992 and 1993 (Public Law 102-190). That provision 
required the Secretary of the Army to assign at least 2,000 
active duty personnel as advisers in connection with 
organizing, administering, recruiting instructing or training 
to early deploying units of the selected reserve.
    The Army expressed concern that section 414(c) could be 
interpreted to require the direct assignment of active duty 
advisers to selected reserve units. To address the Army's 
concern, this section, as amended, would permit active duty 
personnel assigned to active duty units that had been and 
continue to be established for the principal purpose of 
providing dedicated training support to reserve component units 
to be counted toward the required number of advisers.

              Subtitle C--Military Training Student Loads


          section 421--authorization of training student loads

    The committee recommends approval of the training student 
loads contained in the President's budget.

              Subtitle D--Authorization of Appropriations


  section 431--authorization for appropriations for military personnel

    This section would authorize $68,951,663,000 to be 
appropriated for military personnel, an increase of 
$255,000,000 from the budget request.

 section 432--authorization for increases in active duty end strengths

    As discussed in section 521 of the bill, a provision to 
establish end strength floors for each of the armed services, 
the committee is concerned that declining defense budgets have 
caused military managers, both uniformed and civilian, to 
advocate end strength levels that are inadequate to fully meet 
national security requirements. The resulting force structure 
is consequently limited and unable to provide the full range of 
capability in sufficient depth to meet all the challenges 
confronting the nation. Commitment of U.S. forces to operations 
other than war over the last two years (including deployments 
to Iraq, Bosnia, Macedonia, Somalia, Rwanda, and Haiti) have 
caused operations tempo to increase for select units. When 
added to the operations and training routinely conducted during 
peacetime, there are elements of the force in each of the 
services that experience personnel tempo at a level that unduly 
stresses service members and families.
    For example, deployments within the 2d Marine Division were 
up 10.5 percent in 1994, and 60 percent of the division was 
deployed in August 1994. During 1994, it was routine for 50 
percent of the Navy to be at sea at any given point of time. 
Within the Air Force, 13 of 21 aircraft types exceeded the goal 
of limiting deployment to less than 120 days a year and both 
the A-10 and the Airborne Warning and Control System (AWACS) 
aircraft exceeded 180 days of deployment in 1994. Operations 
other than war resulted in increased stress on Army light 
infantry units and combat service support units with limited 
representation in the active force to include water 
purification and civil affairs units. The committee also notes 
that the Army is the only service that carries an operating 
strength deviation which would indicate a need for additional 
end strength to fulfill its minimum mission requirements.
    The committee believes that the armed services require 
authorization to apply additional end strength to select units 
and mission areas in an effort to reduce excessive personnel 
tempo rates. Accordingly, this section would authorize $112 
million in additional funds to be applied to increase military 
personnel end strengths within the Department of Defense above 
those levels requested by the President's budget. The committee 
expects the Secretary of Defense to prioritize end strength 
needs within the Department.

                   TITLE V--MILITARY PERSONNEL POLICY


                  Subtitle A--Officer Personnel Policy


    section 501--authority to extend transition period for officers 
                     selected for early retirement

    This section would authorize the Secretaries of the 
military departments to defer the date of retirement for 
officers selected for early retirement for up to 90 days to 
avoid personal hardship or for other humanitarian reasons.

           Subtitle B--Matters Relating to Reserve Components


section 511--military technician full-time support program for army and 
                      air force reserve components

    The committee believes that military technicians are 
critical to the training and readiness of the Army and Air 
Force reserve components, as well as being crucial to an 
increased reliance on the reserve components to substitute for 
active component units being stressed by high operations 
tempos. The committee also believes that recent broad, 
unfocused reductions in Department of Defense civilian manpower 
have had a severe impact on military technicians, and therefore 
on overall readiness.
    This section, therefore, would restore military technician 
end strength to nearly the fiscal year 1995 level and require 
that the Secretary of Defense, in the future, manage military 
technicians by annual end strength. This section would also 
prohibit military technicians in certain high priority units 
and activities, but not those in management-level headquarters, 
from being subject to broad civilian personnel reductions. In 
addition, this section would require the Secretary of Defense, 
within six months of enactment, initiate measures to 
consolidate and streamline management-level headquarters at the 
National, regional, and state level in the Air Force and Army 
Reserve and National Guard. The Secretary would be permitted to 
retain up to 95 percent of any military technician positions 
declared excess to the reorganized headquarters, if those 
positions were reallocated to certain high priority units. This 
section would also require that, after the date of enactment, 
only dual-status technicians be hired.

   section 512--military leave for military reserve technicians for 
                         certain duty overseas

    This section would authorize military civilian technicians 
an additional 44 workdays of leave without loss of pay and 
other benefits for periods the member is serving on active duty 
without pay while participating in noncombat operations outside 
the United States, its territories and possessions.

   section 513--revisions to army guard combat reform initiative to 
    include army reserve under certain provisions and make certain 
                               revisions

    This section would change the requirement of section 1111 
of the Army National Guard Combat Readiness Reform Act of 1992 
(title XI of Public Law 102-484). As revised, the section would 
require the Army to provide annually at least 150 officers and 
1,000 soldiers with at least two years prior active duty 
experience to national guard units. The committee expects the 
Army to permit approximately 225 officers to separate in 1996 
and 1997 and no less than 150 officers per year thereafter to 
serve in the Army National Guard.
    This section would also expand the requirements of sections 
1112(b), 1113, 1115, 1116, and 1120 of the Army National Guard 
Combat Readiness Reform Act of 1992 to the Army selected 
reserve.

         section 514--rotc scholarships for the national guard

    This section would authorize the Secretary of the Army to 
redesignate ongoing scholarships with the agreement of the ROTC 
cadet involved as scholarships provided to an individual to be 
appointed for service in the Army National Guard and make other 
technical changes.

  section 515--report on feasibility of providing education benefits 
protection insurance for service academy and rotc scholarship students 
                  who become medically unable to serve

    This section would require the Secretary of Defense to 
conduct a study on the need and feasibility of establishing a 
no cost to the government disability insurance plan for service 
academy and Reserve Officers' Training Corps scholarship 
students. Such a plan would provide continued financial 
assistance for tuition and other educational expenses after 
becoming medically disqualified for military service.

   section 516--active-duty officers detailed to rotc duty at senior 
 military colleges to serve as commandant and assistant commandant of 
                    cadets and as tactical officers

    This section would require that, upon the request of any of 
the six senior military colleges (Texas A&M; University, Norwich 
College, The Virginia Military Institute, The Citadel, Virginia 
Polytechnic Institute and State University and North Georgia 
College), the Secretary of Defense shall detail active duty 
officers to serve as the commandant or assistant commandant of 
cadets and as tactical officers at the institution.
    The committee takes this action in order to reinforce the 
longstanding special relationship that has existed between 
these schools, the Army and the other services. Recent 
modifications in policy by the Army suggest a change in that 
special relationship which is detrimental to the schools and 
the services. The committee feels strongly that active-duty 
officers serving as commandants and tactical officers not only 
provide role models for emulation by cadets, but they, as 
mentors and trainers, also directly influence in unique and 
positive ways the attitudes and ideas of cadets. The 
committee's belief in the value of an active duty officer 
serving as the commandant of cadets was reinforced by the 
testimony of the service's deputy chiefs of staff for 
personnel.

 section 517--mobilization income insurance program for members of the 
                             ready reserve

    The committee is aware of the many financial hardships 
endured by reserve members involuntarily called to active duty 
during the Persian Gulf War. The committee recognizes the need 
for income protection for mobilized reserve members.
    This section would establish an income protection insurance 
plan for ready reserve members. The plan would provide a 
$1,000-per-month base benefit to reservists involuntarily 
called to active duty in support of an operational mission 
during a period of war or national emergency as declared by the 
President. The plan would be financed by premiums paid by 
individual members. Members would be automatically enrolled for 
the base benefit unless the member declines to participate, 
selects a lower benefit of half the basic benefit, or selects a 
greater amount up to a maximum of $5,000 per month at 
additional cost.

              Subtitle C--Matters Relating to Force Levels


                  section 521--floor on end strengths

    The committee has observed with increasing alarm the 
drawdown of the armed forces since the Persian Gulf War and is 
now of the view that the current force structure is not 
adequate to fully support the national security strategy to 
fight and win two near simultaneous major regional 
contingencies as envisioned in the October 1993 Report on the 
Bottom Up Review. In addition to direct force-structure 
reductions of 30 percent to Army divisions, 32 percent to Navy 
battleforce ships, and 36 percent to Air Force attack/fighter 
aircraft, combat capability has been further eroded by 
declining defense budgets that have left funding for unit 
readiness wanting and equipment modernization wholly 
inadequate. Despite the testimony of numerous Department of 
Defense witnesses that the force cannot be reduced further, the 
committee continues to see evidence that the Secretary of 
Defense is contemplating additional force-structure reductions 
below the levels cited as the minimums necessary to support the 
strategy outlined in the Report on the Bottom Up Review. 
Accordingly, the committee believes that action must be taken 
to preempt any further reductions to the armed forces and 
thereby minimize further risk to the security of the nation.
    Therefore, this section would establish permanent end 
strength levels beginning in fiscal year 1996. The provision 
would preclude any reductions below the specified end strengths 
until the expiration of a six-month period beginning on the 
date of submission of notice of the desired lower end strengths 
and the justification for those levels. Because the committee 
considers the end strengths delineated in this section to be 
inadequate to fully meet the security interests of the nation, 
the committee recommends, in section 432 of this bill, 
additional funding to be used to increase end strength levels 
within the military departments.

                section 522--army officer manning levels

    This section would require that beginning in fiscal year 
1999 and thereafter, the annual Army end strength provide for 
sufficient officers to meet at least 90 per cent of active Army 
manpower requirements. The committee takes this action because 
it considers the 83 percent officer manning levels projected 
for fiscal year 1996 to be inadequate.

 section 523--comptroller general review of proposed army end strength 
                              allocations

    This section would require the comptroller general of the 
United States to determine the extent to which the Army is able 
to fully man the combat and support forces required to carry 
out the national security strategy and operations other than 
war for fiscal years 1996 through 2001. The committee takes 
this action because it has learned that only now, more than two 
years after the Secretary of Defense directed the Army to 
achieve the force levels specified in the Bottom Up Review 
(BUR), is the Army starting a formal analysis to structure the 
force constrained by a 495,000 active-component end strength to 
meet BUR requirements.
    In order that the committee fully understand the Army 
analytical process, known as the Total Army Analysis (TAA), the 
section would require that the Secretary of the Army provide 
the comptroller general full access to all materials used in 
the TAA even while the process is underway. In addition, 
because the committee understands that the Army has been 
directed to reduce end strength further to 475,000 by fiscal 
year 1998, the section would require the comptroller general to 
report to the committee the results of each TAA conducted 
through fiscal year 2001.

     section 524--manning status of highly deployable support units

    The General Accounting Office (GAO) identified in a March 
1995 report that the Army staffs support forces at 10 to 20 
percent below their authorized levels. The GAO expressed 
concern that the stress of peacetime operations has been 
exacerbated by the Army practice of increasing manning within 
support units with personnel from other units just prior to 
deployment to ensure minimum personnel readiness. This practice 
is referred to as cross-leveling. The committee is aware of 
similar cross-leveling practices within the Marine Corps and is 
concerned that other services may intentionally staff high-
priority support units at less than 100 percent of authorized 
strengths.
    Accordingly, this section would direct each of the 
Secretaries of the military departments to conduct a study to 
determine whether high-priority support units that would deploy 
early in a crisis are, as a matter of policy, manned at less 
than 100 percent of their authorized strengths. The provision 
would further require the Secretaries of the military 
departments to report not later than September 30, 1996 on the 
findings of their studies to include the number of high-
priority support units by type, the level of manning within 
those units, and either the justification for manning of less 
than 100 percent or the status of action to correct the manning 
deficiency.

    section 525--sense of congress concerning personnel tempo rates

    This section would express the Sense of Congress that the 
Secretary of Defense should continue to improve the 
Department's personnel tempo management techniques so that all 
personnel can expect a reasonable personnel tempo rate.

     Subtitle D--Amendments to the Uniform Code of Military Justice


      section 541--references to uniform code of military justice

    This section would clarify that amendments or repeals 
contained in this subtitle are to Chapter 47 of title 10, 
United States Code.

  section 542--forfeiture of pay and allowances during confinement by 
                       sentence of court-martial

    The committee is concerned that some military service 
members continue to receive active duty pay and allowances 
while serving extended prison sentences. This section would 
require forfeiture of pay and allowances during a period of 
confinement resulting from the sentence of a court-martial. The 
percentage of pay and allowances forfeited shall be the maximum 
percentage that the court-martial could have directed as part 
of the sentence. The provision would also authorize the 
convening authority to waive some or all of the forfeiture and 
provide such monies to dependents of the service member.

          section 543--refusal to testify before court-martial

    This section would amend section 847(b) of title 10, United 
States Code, by removing the limitation on punishments which 
may be imposed by a federal district court upon a civilian 
witness who refuses to appear or testify before a court-
martial.

                 section 544--flight from apprehension

    This section would amend section 895 of title 10, United 
States Code, to clarify that flight from apprehension is an 
offense cognizable under the Uniform Code of Military Justice.

                     section 545--carnal knowledge

    This section would make two minor changes to section 920 of 
title 10, United States Code. First, the section would make the 
crime of carnal knowledge gender neutral, bringing Article 120 
of the Uniform Code of Military Justice into conformity with 
the spirit of the Sexual Abuse Act of 1986 (Public Law 99-646). 
Second, this section would allow an accused charged with carnal 
knowledge to plead the affirmative defense of mistake of fact. 
This change would cause the military offense of carnal 
knowledge to more closely parallel the analogous federal 
civilian criminal statute.

   section 546--time after accession for initial instruction in the 
                    uniform code of military justice

    This section would amend section 937(a) of title 10, United 
States Code, by lengthening the time period within which 
training in the Uniform Code of Military Justice must be 
provided to new enlistees from six to fourteen days. The 
provision would thus afford the services greater flexibility in 
providing this important and necessary training.

 section 547--persons who may appear before the united states court of 
                      appeals for the armed forces

    This section would amend section 944 of title 10, United 
States Code, to provide that no person may appear before the 
Court of Appeals for the Armed Forces (whether on a brief or in 
person), unless that person is an attorney admitted to practice 
before the court, is authorized to appear before the court in a 
particular case, or is a third-year law student who has been 
certified for practice under a state rule for the practical 
training of law students. In the latter cases, such students 
would only be authorized to appear before the court as an 
amicus curiae.
    This provision responds to a recent case in which the Court 
of Appeals for the Armed Forces authorized undergraduate 
students to submit briefs and present oral argument before the 
court. Providing undergraduate students with educational 
experiences in the law is a laudable goal. However, the Court 
of Appeals for the Armed Forces is a federal court, and as such 
it must adhere to high judicial standards of practice and 
procedure that befit the court's stature and preserve its 
dignity. Allowing undergraduate students to appear before the 
court is inconsistent with these standards and sets an ill-
advised precedent. Section 547 would ensure that in the future 
only properly licensed attorneys and third-year law students 
who are in state-approved law school training programs may 
appear before the court.

   section 548--discretionary representation by government appellate 
  defense counsel in petitioning supreme court for writ of certiorari

    This section would amend section 870 of title 10, United 
States Code, to provide military appellate defense counsel with 
the discretion to assist an accused in the preparation of a 
petition for a writ of certiorari before the United States 
Supreme Court. Under current law, appellate defense counsel 
must represent an accused in petitioning the Supreme Court upon 
the accused's request, regardless of whether that person's case 
is free from legal error or whether the only errors are those 
specified by the accused. Appellate defense counsel are in the 
best position to make judgements about whether a case raises 
issues of sufficient import that a petition for a writ of 
certiorari is warranted, and section 548 would vest counsel 
with the discretion to submit such a petition.

 section 549--repeal of termination of authority for chief justice of 
the united states to designate article iii judges for temporary service 
                on court of appeals for the armed forces

    Section 1301 of the National Defense Authorization Act for 
Fiscal Years 1990 and 1991 (Public Law 101-189) revised the 
charter of the then Court of Military Appeals, now renamed the 
Court of Appeals for the Armed Forces. Among other things, that 
section provided that Article III judges could sit on the Court 
of Military Appeals when a judge of the court was temporarily 
unavailable. A five year ``sunset'' provision was included to 
ensure that the provision would operate in a manner consistent 
with the Article III judiciary and to allow for further formal 
review.
    Although the instances in which Article III judges have 
served on the Court of Appeals for the Armed Forces have been 
infrequent, their periodic service appears to have benefitted 
the court without unduly hindering the ability of these judges 
to fulfill their regular responsibilities. In recognition of 
this fact, section 549 would repeal the five year limitation on 
the authority of Article III judges to serve temporarily on the 
Court of Appeals for the Armed Forces, thus making this 
authority permanent.

                    section 550--technical amendment

    This section would amend section 866 of title 10, United 
States Code, to change an outdated reference to the Courts of 
Military Review to a proper reference to the Courts of Criminal 
Appeals.

                       Subtitle E--Other Matters


section 551--equalization of accrual of service credit for officers and 
                            enlisted members

    This section would bring the criteria for accrual of 
service credit for officers in line with the criteria set in 
law for enlisted members.

        section 552--extension of expiring personnel authorities

    This section would extend authorities that provide for the 
appointment, promotion, and retirement of reserve officers and 
the promotion of certain officers on active duty in the Navy.

section 553--increase in educational assistance allowance with respect 
  to skills or specialties for which there is a critical shortage of 
                               personnel

    This section would authorize increased rates of educational 
assistance allowance for reserve members in specialties or 
skills experiencing critical shortages.

      section 554--amendments to education loan repayment programs

    This section would authorize the repayment of loans that 
were made under the William D. Ford Federal Direct Loan 
Program.

section 555--recognition by states of living wills of members, certain 
                  former members, and their dependents

    This section would amend title 10, United States Code, to 
ensure that advance medical directives prepared by members of 
the armed forces, their spouses, or other persons eligible for 
legal assistance under section 1044 of title 10 are recognized 
as valid by states, even though a directive might not meet the 
precise requirements of the state where the service member, 
spouse, or other person is located at the time of 
incapacitation. Advance medical directives indicate a person's 
desire concerning medical care to be received if that person is 
incapable of making health care decisions or gives another 
person the authority to make those decisions under those 
circumstances.

 section 556--transition compensation for dependents of members of the 
               armed forces separated for dependent abuse

    This section would require the Secretary of Defense to 
retroactively provide compensation to certain eligible 
dependents inadvertently excluded from the program.

                   section 557--army ranger training

    The committee believes that a shortage of assigned officer 
personnel contributed to the deaths of four Ranger students in 
a tragic incident that occurred February 15-16, 1995, during 
the Florida phase of the Army Ranger course.
    While the Army's report of investigation into the deaths 
did not directly acknowledge the link, the report concluded 
that failure in supervision and judgement, lack of situational 
awareness and lack of control placed Ranger students in water 
too cold, too deep and for too long to allow for safe 
operations. In addition, the report, noting that only eight of 
the 26 required officer instructor/trainers were assigned to 
the Florida phase, concluded that no officer platoon trainer 
positions were filled; that officers only occasionally 
accompanied Ranger student training in the field; and that 
officer supervision of standards and policies was limited by 
officer strength.
    Subsequent to the release of the Army investigative report, 
the committee learned that at the time of the accident the Army 
had 45 officers assigned to the Ranger training brigade, just 
37 per cent of the 122 required. This significant disparity 
between officers required and assigned resulted from drastic 
Army-wide reductions from 1990 to 1995 in the number of 
officers authorized and available to support training and 
operations. As a result, despite the fact that the numbers of 
students being trained by the brigade remained relatively 
stable from 1990 to 1995, officers went from being able in 1990 
to accompany Ranger student patrols in the field daily, to a 
situation in 1995 where it was exceptional for an officer to be 
with student patrols.
    The committee is also aware that as early as June 1993, and 
several times subsequently, the commander of Fort Benning 
elevated his concerns to the commanding general, Training and 
Doctrine Command, linking officer shortages to increased risk 
to Ranger student safety. Although these efforts resulted in 
some adjustments to the number of officers assigned, the Army 
failed to take substantive efforts to redress the officer 
shortages. As a matter of Army-wide officer allocations policy, 
Fort Benning and the Ranger Training Brigade continued to take 
a so-called ``fair share'' of officer shortages. As a matter of 
fact, the corrective action recommended by the Army 
investigative report would have required the Fort Benning 
commander to have found from his already constrained resources 
additional officers to assign to the Ranger Training Brigade.
    The committee rejects that solution, believing strongly 
that such an approach to solving the officer shortages at the 
Ranger Training Brigade would only continue the shortsighted 
``fair share'' approach without significantly reducing student 
risk or increasing training safety in what all acknowledge to 
be a high stress, high risk training situation.
    For these reasons, the committee directs that the Secretary 
of the Army assign to the brigade all the manpower required, as 
established by Army manpower documents, to carry out the 
training mission safely and effectively. To accomplish this 
goal, this section would establish a baseline number of 
officers and enlisted personnel which would have to be assigned 
to the brigade and would give the Secretary of the Army one 
year to achieve that level. This section would also require 
training safety cells be established in each of the three major 
phases of the Ranger course to advise Ranger instructors with 
regard to the potential impact of local weather and other 
conditions on the students.

         section 558--repeal of certain civil-military programs

    This section would terminate four programs established by 
the National Defense Authorization Act for Fiscal Year 1993 
(Public Law 102-484), namely: the Civil-Military Cooperative 
Action Program, the National Guard Youth Opportunities Pilot 
Program, the pilot outreach program to reduce demand for 
illegal drugs, as well as department support for the Civilian 
Community Corps. At the time of establishment, the underlying 
premise of all these programs was that the end of the Cold War 
would bring about a reduced operational tempo so that 
Department of Defense resources could be turned to a secondary 
mission of helping to rebuild America.
    The committee believes that the original premise of these 
civil-military programs is no longer valid, especially given 
the repeated testimony to the committee that the Department is 
struggling to find sufficient resources to meet the 
unexpectedly high operations tempo of the post Cold-War world. 
In light of new operational realities, the committee rejects 
the President's budget request which sought more than $76 
million for the four civil military programs in fiscal year 
1996.
    To meet more critical readiness needs, the committee 
directs the Secretary of Defense to provide at least $29 
million in fiscal year 1996 to fill shortfalls in unit and 
organizational requirements for dual-status military technician 
positions, in the following priority:
          (1) first, to units of the selected reserve that are 
        scheduled to deploy no later than 90 days after 
        mobilization;
          (2) second, to units of the selected reserve that are 
        or will be deployed to relieve high rates of active-
        duty peacetime operations tempo; and
          (3) third, to those organizations which have the 
        primary mission of providing direct support surface and 
        aviation maintenance for the reserve components of the 
        Army and Air Force.
    The committee further directs that shortages of dual-status 
military technicians that exist in reserve component management 
headquarters, including national and state-level National Guard 
headquarters, in United States Property and Fiscal Offices, and 
in similar management level headquarters of the Army reserve 
and Air Force reserve, shall not be filled until after the 
first three priorities have been accomplished.
    The committee takes this action believing that funding 
military technicians contributes directly to overall National 
Guard and Reserve readiness, whereas the terminated civil-
military programs do not.

  section 559--eligibility for armed forces expeditionary medal based 
                      upon service in el salvador

    This section would designate the country of El Salvador 
during the period beginning January 1, 1981 and February 1, 
1992 as an area and a period of time in which members of the 
armed forces participated in operations in significant numbers 
and otherwise met the general requirements for award of the 
Armed Forces Expeditionary Medal.

   section 560--revision and codification of military family act and 
                        military child care act

    This section would codify in title 10, United States Code, 
updated provisions of two acts which were instrumental in 
focusing Department of Defense attention on the needs of 
military families and on the importance of effective child care 
programs. The two acts incorporated are: The Military Family 
Act of 1985 (title VII of Public Law 99-145), and The Military 
Child Care Act of 1989 (title XV, Public Law 101-189).

section 561--discharge of members of the armed forces who have the HIV-
                                1 virus

    This section would require the Secretary of Defense to 
separate or retire service members who are identified as HIV-
positive. Such members would be separated or retired within six 
months of testing HIV-positive unless the member is within a 
two year retirement sanctuary. Members within the two year 
retirement sanctuary would be retained until reaching 
retirement eligibility. The committee has elected to recommend 
the separation of HIV-positive service members who are 
permanently nondeployable because the retention of such 
personnel degrades unit readiness and fails to protect 
deployment equity among service members.

section 562--authority to appoint brigadier general charles e. yeager, 
united states air force (retired), to the grade of major general on the 
                              retired list

    This section would authorize the President to advance 
Brigadier General Charles E. Yeager (retired), to the grade of 
major general on the retired list. The appointment would 
require the advice and consent of the United States Senate and 
would have no effect on the member's retired pay or other 
benefits.

section 563--determination of whereabouts and status of missing persons

    This section would require the Secretary of Defense to 
centralize the oversight and policy responsibility for 
accounting for missing persons at the Department of Defense 
level. This section would codify and standardize procedures for 
accounting for members of the armed forces or civilian 
employees of the Department of Defense who become missing as a 
result of military operations. This section would also 
establish a procedure for review of cases of those who are 
missing as a result of military operations since January 1, 
1950. In addition, it would codify a process to protect the 
interests of families of missing service members. Further, it 
would provide a process to allow the concerns and questions of 
family members to be promptly addressed.
    For years, Congress has struggled to find ways to obtain 
the fullest possible accounting of American service members and 
civilians under the employment of the Department of Defense who 
were listed as missing in action or became prisoners of war. 
Under this section, a specified chain of reporting and a 
coordinated process of inquiry would be established from the 
time that a person is reported missing until the case is 
resolved. The process would protect the missing service member 
from being declared ``dead'' solely because of the passage of 
time.
    The regulated process will include a coordinated effort for 
the systematic, timely collection and analysis of all 
investigative information related to unresolved cases of 
missing personnel and prisoners of war. This information will 
be reviewed periodically by boards of inquiry. The inquiry 
process will include legal representation for the missing 
personnel and dissemination of inquiry results to immediate 
family members.
    This process will help to resolve perhaps the greatest 
recurring tragedy related to unresolved cases of missing 
service members whose families and next of kin have experienced 
both frustration and anguish in trying to obtain answers from 
an unresponsive bureaucracy.

section 564--nominations to service academies from commonwealth of the 
                        northern mariana islands

    This section would authorize the Resident Representative of 
the Commonwealth of the Northern Mariana Islands to nominate 
one cadet for attendance at each of the service academies.

                       Items of Special Interest


                    additional funds for recruiting

    The committee has observed that the recruiting environment 
has grown increasingly difficult. Recruiters within all the 
military departments are responding to the changing environment 
by developing new initiatives and applying additional manpower 
and funding. Accordingly, the committee recommends an increase 
of $35.5 million in recruiting advertising operations and 
maintenance funding.

                         enlistment propensity

    The committee is concerned that the propensity for 
enlistment-age men and women to consider military service has 
declined dramatically since 1991. The Department of Defense 
measures propensity annually by conducting a computer assisted 
telephone survey of 10,000 young men and women called the Youth 
Attitude Tracking Study (YATS). While the YATS survey has been 
useful in identifying trends in youth propensity, the 
Department has used focus groups to develop a better 
understanding of why attitudes have changed.
    While some generalized conclusions about the decline in 
propensity have been identified by the Department, the 
continued decline of the 16-21 year-old male propensity in just 
the last year remains conjecture. The Department has 
accordingly planned to conduct two series of focus groups 
during the summer of 1995. One series involves minority and 
non-minority adults who influence the career and lifestyle 
decisions of youth, and the second series involves high school 
seniors and recent graduates across the nation.
    The committee believes that the focus groups should explore 
a comprehensive range of potential causes for the decline in 
propensity and develop proposed solutions to be considered by 
the Department and the Congress to correct unfavorable trends. 
The committee directs the Secretary of Defense to submit a 
report to the Congress, not later than March 31, 1996, on the 
results from the focus groups and the proposed actions to 
correct unfavorable trends in enlistment propensity.

         family advocacy program and new parent support program

    The committee heard extensive testimony from Department of 
Defense witnesses regarding the strains placed on military 
families as a result of the high operations tempo being 
experienced by all services. These strains manifested 
themselves in many ways including child and spouse abuse. 
Concerns for military personnel and their families caused the 
Secretary of Defense to initiate a broad range of quality of 
life measures. The committee commends the Secretary for those 
long needed measures.
    On the other hand, while the committee understands that the 
President's fiscal year 1996 budget request increased the 
funding for the family advocacy program (FAP) over the fiscal 
year 1995 request, the FAP would still be resourced by the 
President's proposal at $29.8 million below that which was 
appropriated by Congress in fiscal year 1995. Even more 
disturbing to the committee is the fact that the budget request 
contains no money in fiscal year 1996 for the New Parent 
Support Program--funded at $20 million in fiscal year 1995.
    The committee considers both the FAP and the New Parent 
Support Program--programs designed either to prevent military 
family violence or to help the victims of it--to be crucial to 
readiness and retention of quality people. The committee, 
therefore, recommends an additional authorization in fiscal 
year 1996 of $30 million for the FAP, to be allocated among the 
services as the Secretary deems appropriate, and an additional 
$23.2 million for the New Parent Support Program, allocated as 
follows: $10 million for the Army, $3.6 million for the Air 
Force, $5.6 million for the Navy, and $4 million for the Marine 
Corps.

    recruiting equity for general education development certificates

    The committee is concerned that the Department of Defense 
does not offer the opportunity to enlist in the armed forces to 
many Americans because they possess General Education 
Development (GED) certificates and not high school diplomas. 
The committee wants to confirm that this preference is properly 
justified and that there is no alternative available to allow 
individual candidates with GED certificates to be accepted for 
enlistment on equal footing with high school graduates with 
diplomas.
    Accordingly, the committee directs the Secretary of Defense 
to submit a report to the Congress not later than March 31, 
1996 specifying the rationale for preferring high school 
graduates with diplomas over candidates with GED certificates 
and the supporting data. The report should also include an 
assessment by the Secretary of the potential for a process to 
be developed that would allow recruit candidates with GED 
certificates to be evaluated on an individual basis for 
enlistment consideration on equal footing with high school 
graduates with diplomas.

         air national guard fighter and airlift force structure

     The National Defense Authorization Act for Fiscal Year 
1995 (Public Law 103-337) directed the Secretary of Defense to 
review the findings of the Commission on Roles and Missions of 
the Armed Forces and report on the appropriate number of 
primary aircraft authorized (PAA) for Air National Guard 
general purpose fighter units. The provision reflected the 
concern that PAA was being reduced from 24 or 18 aircraft per 
squadron to 15.
    Even though that required report has not been rendered, the 
committee is disturbed to learn that the Department of Defense 
in fiscal year 1996 plans to further reduce the general purpose 
fighter PAA to 12 aircraft per squadron, as well as to further 
reduce the PAA of tactical airlift units. The committee 
believes that such reductions would be counterproductive to 
readiness and overall force capability. The committee, 
therefore, until it can receive and review the Secretary of 
Defense's report required by law on this issue, directs that 
the PAA of general purpose fighter units be maintained at 15 
aircraft per squadron, and that the PAA for tactical airlift 
units be maintained at current levels.

                  revitalization of the reserve forces

    The committee recognizes that the reserve components of the 
Armed Forces of the United States are a vital and integral 
element of the nation's defense. As such, the reserve 
components' roles, organization and leadership are important 
matters of national security and must be fully examined, 
especially in light of the increasing reliance being placed on 
the reserve components of the military forces.
    Among the issues which the committee believes should be 
examined are:
    1. The establishment of a separate reserve command for each 
of the armed services;
    2. The source and grade of the commander of each reserve 
command;
    3. The grade of the Vice Chief of the National Guard 
Bureau;
    4. Exemption of reserve component general/flag officer 
positions from active duty grade ceilings and restrictions;
    5. Requirements for full-time support personnel;
    6. The necessity to allow the President to activate reserve 
units to respond to natural disasters; and
    7. The necessity to encourage the employment of reserve 
component members by providing incentives to employers of 
reservists and to reserve component members.
    The committee will undertake an examination of these and 
other related issues as part of the fiscal year 1997 defense 
budget hearing cycle.

     army active component and reserve component offsite agreement

    The committee continues to recognize the unique 
contribution of the major restructuring of the Army's reserve 
components, known as the ``offsite agreement,'' announced by 
the Secretary of Defense in December 1993. This agreement 
between the active Army, the Army national guard and the Army 
reserve stabilized reserve component force structure and end 
strength through fiscal year 1999, thereby making it possible 
for the Total Army to move forward with efforts to increase 
reliance on the reserve components.
    The committee understands that the Secretary of Defense, in 
directing that the active Army end strength be reduced 20,000 
below the baseline established by the Bottom Up Review, has 
also required the Army to examine reductions of Army reserve 
component force structure and end strength below the ``offsite 
agreement'' levels. The committee fully understands the 
Department's need to study potential future reserve component 
restructuring. However, the committee remains committed to 
maintaining the ``offsite agreement'' through fiscal year 1999 
and would expect the Secretary of Defense to provide a 
compelling rationale to the committee before making substantive 
changes to the agreement.

   air national guard support to the united states antarctic program

    Beginning in fiscal year 1996, the Air National Guard 109th 
Airlift Group will begin a three-year transition that will 
result in the group assuming the mission of providing airlift 
support in the Antarctic for the National Science Foundation.
    The National Science Foundation, which has the overall 
management responsibility for the United States Antarctic 
Program (USAP), has obtained airlift support in the past by 
funding all personnel, operations and maintenance costs 
incurred by the Navy, the Department of Defense executive agent 
for USAP.
    The committee fully supports the shift in responsibility 
for USAP airlift support from the Navy to the Air National 
Guard, so long as the cost-reimbursement system currently used 
by the National Science Foundation for the Navy continues to 
directly reimburse the Air National Guard for all costs 
incurred in support of the USAP.
    The committee understands that to perform this new mission 
the 109th Airlift Group may need as many as 235 more full-time 
active guard and reserve personnel than are currently 
authorized. Preliminary assessments made in 1993 indicate that 
these additional personnel would be required in the following 
increments: fiscal year 1996, 56 personnel; fiscal year 1997, 
115 personnel; and fiscal year 1998, 54 to 64 personnel.
    Given the small number of additional personnel required by 
the Air National Guard in fiscal year 1996, the committee 
directs the Secretary of Defense to provide that additional end 
strength to the Air National Guard from the end strength 
variation made available to the secretary by section 411(b) of 
this bill. To support the additional end strength, the 
committee has recommended an additional $2 million for fiscal 
year 1996. The committee expects that the National Science 
Foundation will subsequently reimburse the department for these 
fiscal year 1996 transition costs, as well as for all 
transition costs incurred in subsequent years.
    The committee expects that the Secretary of Defense will 
include in the fiscal year 1997 Defense Authorization Act 
request a more refined requirement for end strength additions 
to support this new mission.

                    simultaneous membership program

    The committee is aware of a program that allows Reserve 
Officers' Training Corps (ROTC) cadets to serve simultaneously 
as a member of a selected reserve unit. Under current policy, 
such participation is denied to ROTC cadets who have been 
awarded scholarships. The committee believes the simultaneous 
membership program to be an important program that serves the 
best interest of the armed forces and the cadets.
    The committee directs the Secretary of Defense to report to 
the Congress, not later than March 31, 1996, on the propriety 
of authorizing ROTC cadets who have been awarded scholarships 
to participate in the simultaneous membership program. The 
report should also include a recommendation as to how cadets in 
the program should be paid for service as a member in the 
selected reserve.

          service academy admission acceptance decision point

    The committee is concerned that high quality officer 
candidates are being lost to the armed forces because the 
service academies are not completing their admissions process 
in a timely manner. The committee believes that administrators 
of Reserve Officers' Training Corps (ROTC) recruiting programs 
would benefit from a process that would provide a list of 
applicants not accepted for attendance at the service academies 
not later than April 1 of each year.
    The committee directs the Secretary of Defense to report to 
the Congress, not later than March 31, 1996, on the feasibility 
of a process that would provide ROTC administrators a list of 
applicants who have not been accepted for attendance at the 
service academies. The report should include a recommended date 
for the submission of the list, or a schedule for the 
submission of a series of partial lists, as appropriate. If the 
earliest recommended date is after April 1 of each year, the 
report should include an explanation as to why the submission 
of a partial list, as a minimum, is not possible by April 1.

                      decorations for heroic acts

    The committee frequently receives requests for legislation 
to award decorations for heroism. The acts of heroism cited 
appear to merit consideration but are often not evaluated by 
the armed services because the recommendations fail to meet the 
statutory or policy requirements for timely submission. This 
has been especially true during the last five years as the 
nation celebrated the fiftieth anniversary of World War II. The 
committee has observed increasing frustration among members of 
Congress who are unable to obtain evaluations by the military 
departments on the merits of individual cases. The committee 
understands the difficulty in evaluating cases with limited 
documentation dating from periods when the criteria for 
awarding decorations was very different from the criteria used 
today. However, the committee believes that a process could be 
developed for providing the Congress an assessment as to 
whether individual recommendations thought to be uniquely 
meritorious are deserving of award.
    Accordingly, the committee directs the Secretary of 
Defense, in cooperation with the Secretaries of the military 
departments, to report to the Congress, not later than March 
31, 1996, on the feasibility of developing a process by which 
the Secretary could provide the Congress assessments on the 
merit of individual recommendations for decorations submitted 
after established time limits.

          TITLE VI--COMPENSATION AND OTHER PERSONNEL BENEFITS


                     Subtitle A--Pay and Allowances


          section 601--military pay raise for fiscal year 1996

    This section would provide a 2.4 percent military pay raise 
as proposed in the President's budget. The committee has 
reservations about this level of raise because it would 
institutionally sanction a one-half of one percent lower level 
of increase than is expected within the private sector. The 
committee expects the ongoing Eighth Quadrennial Review of 
Military Compensation (QRMC) to evaluate the importance of the 
cumulative gap that exists between military and private sector 
pay levels and to reassess the process for determining the 
level of pay increases. The committee looks forward to 
receiving the recommendations of the QRMC for changes that will 
protect readiness and the ability of the armed services to 
recruit and retain quality personnel.
    The committee notes that the President's budget request 
included a provision designed to incrementally reduce the out-
of-pocket housing costs for service members, but that the 
proposal is inadequately funded to achieve the intended level 
of benefit. Accordingly, section 601 would provide a 5.2 
percent increase in the basic allowance for quarters which will 
fully fund the initiative to achieve the President's original 
objective to reduce out-of-pocket housing costs for service 
members to 19.5 percent.

section 602--limitation on basic allowance for subsistence for members 
           without dependents residing in government quarters

    This section would require the Secretaries of the military 
departments to allow no more than 12 percent of the service 
members without dependents residing in government quarters to 
receive basic allowance for subsistence (BAS). The Inspector 
General of the Department of Defense identified the process for 
authorizing BAS as requiring management attention in a 
September 1994 review.
    The provision would also require the Secretary of Defense, 
not later than March 31, 1996, to submit a report to the 
Congress confirming the current number of service members 
without dependents residing in government quarters who receive 
BAS and establishing a standard for the appropriate percentage 
of such personnel who should receive BAS. The committee 
believes that 12 percent is a proper interim standard for the 
Secretaries of the military departments to achieve until the 
report is received from the Secretary of Defense.

 section 603--authorization of payment of basic allowance for quarters 
               to additional members assigned to sea duty

    This section would authorize payment of basic allowance for 
quarters and variable housing allowance to single E-6 personnel 
assigned to shipboard sea duty.

   section 604--establishment of minimum amounts of variable housing 
  allowance for high housing cost areas and additional limitation on 
               reduction of allowance for certain members

    This section would authorize the Secretary of Defense to 
establish a minimum amount of variable housing allowance (VHA) 
to meet the cost of adequate housing in high cost areas. The 
provision would also prevent the amount of VHA paid to an 
individual from being reduced as long as the member retains 
uninterrupted eligibility to receive VHA in the housing area 
and the member's housing costs are not reduced.

     section 605--clarification of limitation on receipt of family 
                          separation allowance

     This section would authorize the payment of family 
separation allowance to service members on board a ship that is 
away from the homeport of the ship even though the service 
member has elected to remain unaccompanied by dependents at the 
permanent duty station.

           Subtitle B--Bonuses and Special and Incentive Pays


      section 611--extension of certain bonuses for reserve forces

     This section would extend the authority for the selected 
reserve reenlistment bonus, the selected reserve enlistment 
bonus, the selected reserve affiliation bonus, the ready 
reserve enlistment and reenlistment bonus, and the prior 
service enlistment bonus until September 30, 1998.

  section 612--extension of certain bonuses and special pay 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, 1998.

   section 613--extension of authority relating to payment of other 
                        bonuses and special pays

     This section would extend the authority for the aviation 
officer retention bonus, the reenlistment bonus for active 
members, enlistment bonuses for critical skills, special pay 
for enlisted members of the selected reserve assigned to 
certain high-priority units, special pay for nuclear-qualified 
officers extending the period of active service, and the 
nuclear career accession bonus until September 30, 1998. The 
provision would also extend the authority for repayment of 
education loans for certain health professionals who serve in 
the selected reserve and the nuclear career annual incentive 
bonus until October 1, 1998.

 section 614--codification and extension of special pay for critically 
       short wartime health specialists in the selected reserves

     This section would amend title 37, United States Code, to 
include authorization of special pay for critically short 
wartime health specialists in the selected reserves and extend 
the authority for the special pay until September 30, 1998.

section 615--change in eligibility requirements for continuous monthly 
                         aviation incentive pay

     This section would reduce the initial operational flying 
requirement for Aviation Career Incentive Pay from 9 of the 
first 12 years to eight of the first 12 years of aviation 
service.

 section 616--continuous entitlement to career sea pay for crewmembers 
                     of ships designated as tenders

     This section would authorize personnel assigned to tenders 
to receive career sea pay.

 section 617--increase in maximum rate of special duty assignment pay 
               for enlisted members serving as recruiters

     This section would authorize payment of additional special 
duty assignment pay to recruiters up to a maximum monthly rate 
of $375. The committee expects the Secretary of Defense and the 
Secretaries of the military departments to increase the special 
duty assignment pay proportionately for all recruiters to 
offset the concerns about financial hardships identified by 
recruiter surveys.

            Subtitle C--Travel and Transportation Allowances


   section 621--authorization of return to united states of formerly 
               dependent children who attain age overseas

     This section would authorize dependent children who lose 
eligibility as dependents for any reason while overseas to 
return to the United States at government expense prior to the 
sponsor receiving permanent-change-of-station orders.

   section 622--authorization of dislocation allowance for moves in 
             connection with base realignments and closures

     This section would authorize the payment of dislocation 
allowance for service members directed to move as a result of 
the closure or realignment of an installation.

                       Subtitle D--Other Matters


 section 631--elimination of unnecessary annual reporting requirements 
                     regarding compensation matters

     This section would eliminate a report on dependents 
accompanying members on alignments to overseas locations and 
simplify the requirement for the President to submit to the 
Congress recommendations on military pay matters.

  section 632--study of joint process for determining the location of 
                          recruiting stations

     A December 1994 General Accounting Office report (GAO/
NSIAD 95-22) determined that the military departments are 
maintaining recruiters in offices that are relatively 
unproductive. The report also found that further savings could 
be achieved through consolidation of recruiting functions to 
include market research and analysis. The committee believes 
that the military departments would save critical resources and 
increase recruiter efficiency by employing new techniques to 
maintain a presence in remote areas and developing a joint 
strategy for locating and manning recruiting stations based on 
joint market research and analysis. The committee believes that 
a method for measuring the success of individual recruiting 
stations is essential and that information resulting from such 
a method should be reported to the Congress on a continuing 
basis to ensure the efficient use of recruiting resources.
    Accordingly, this section would require the Secretary of 
Defense to conduct a study of the feasibility of a joint 
process for determining the location and manning of recruiting 
stations that would be based on market research and analysis 
conducted jointly by the military departments. The report 
resulting from the study should include a recommended method 
for measuring the efficiency of individual recruiting stations 
utilizing recruiting station cost per accession or other 
efficiency standard, as determined by the Secretary. The report 
would be submitted to the Congress not later than March 31, 
1996.

 section 633--fiscal year 1996 cost-of-living adjustment for military 
                                retirees

     This section would conform the military retired pay cost-
of-living adjustment (COLA) payment date with the payment date 
established for federal civilian retirees by making the 
military retired pay COLA payable on March 1996 rather than 
September 1996. The committee is disappointed that the 
President's initiative within the budget request to resolve the 
disparity between the two groups of retirees was proposed in 
such a manner as to compel the committee to once again use 
scarce discretionary funds to address a mandatory spending 
initiative. Because the committee has no ability to provide a 
mandatory offset for the Administration's COLA equity 
initiative within the 050 budget function and therefore avoid a 
``PAYGO'' problem, under the Budget Enforcement Act, the 
committee has authorized $403 million in the personnel account 
to restore equity in COLA payment dates. This decision once 
again demonstrates the committee's resolve to protect the 
purchasing power of military retired pay. However, the 
committee remains committed to seeking through the budget 
process a solution that does not require funding from 
discretionary accounts.

                   TITLE VII--HEALTH CARE PROVISIONS


                    Subtitle A--Health Care Services


 section 701--modification of requirements regarding routine physical 
              examinations and immunizations under champus

     This section would amend section 1079(a) of title 10, 
United States Code, by expanding ``well-baby visits'' and 
immunizations to dependents under the age of six, by 
authorizing immunizations at age six and above and by adding 
coverage of health promotion and disease prevention visits 
associated with immunizations, and pap smears and mammograms.
     The section would provide the Secretary of Defense the 
authority to determine the types and schedule of immunizations, 
the schedule of pap smears and mammograms, and the content of 
the associated health promotion/disease prevention visits.

 section 702--correction of inequities in medical and dental care and 
          death and disability benefits for certain reservists

     This section would authorize reservists the same death and 
disability benefits as active duty members, during off-duty 
periods between successive inactive duty training periods 
performed at locations outside the reasonable commuting 
distance from the member's residence.

   section 703--medical and dental care for members of the selected 
                                reserve

    The committee is committed to ensuring the readiness of 
reserve and national guard members. The experiences of 
Operations Desert Shield and Desert Storm highlighted a need to 
address medical and dental readiness of selected reserve and 
guard members.
    This section would require the Secretary of the Army to 
provide medical and dental screenings, physical exams for 
members over 40, and the dental care required to meet dental 
readiness standards to units scheduled for deployment within 75 
days of mobilization.
    This section would also require the Secretary of Defense to 
conduct a demonstration program to offer members of the 
selected reserve dental readiness insurance on a voluntary 
basis, at no cost to the Department of Defense. Payment of 
premiums should be allowed through direct allotment and 
attempts should be made to directly link the program to dental 
readiness. This could be done by providing program participants 
with a dental readiness verification form to be completed by 
their dental care provider on a specified basis, such as 
annually or semi-annually, as deemed appropriate by the 
Department for ensuring dental readiness.
    In addition, this section would require the Department to 
evaluate the success of such a program in improving the dental 
readiness of selected reserve and guard members.

                      Subtitle B--TRICARE Program


section 711--priority use of military treatment facilities for persons 
                  enrolled in managed care initiatives

    This section would amend title 10, United States Code, to 
require the Secretary of Defense, as an incentive for 
enrollment, to establish reasonable priorities for services in 
military treatment facilities for TRICARE-enrolled 
beneficiaries.
    The committee believes that a managed health care program 
provides the best opportunity for the Department of Defense to 
control health care costs. Offering priority treatment in 
military treatment facilities provides a strong incentive for 
military health care beneficiaries to enroll in the 
Department's managed-care program.

     section 712--staggered payment of enrollment fees for tricare

    Section 1097(e) of title 10, United States Code, authorizes 
the Secretary of Defense to prescribe a co-payment or other 
charge for health care provided through a managed health care 
program. This section would amend section 1097(e) of title 10 
to require the Secretary of Defense to allow beneficiaries to 
pay any required enrollment fees on a monthly or quarterly 
basis, at no additional cost to the beneficiary.

 section 713--requirement of budget neutrality for tricare to be based 
                           on entire program

    During recent hearings on the Department of Defense's 
TRICARE managed health care program, the Congressional Budget 
Office reported that the statutory requirement that the health 
maintenance organization (HMO) option of the TRICARE program by 
itself be budget neutral would limit the Department's ability 
to offer the HMO option in noncatchment areas--areas with no 
military medical treatment facilities within 40 miles. Health 
care costs to the Department in these areas are likely to be 
higher than the cost of care furnished in military facilities.
    In addition, the Congressional Budget Office reported that 
removing the requirement for the HMO option to be budget 
neutral and simply requiring the TRICARE system in its entirety 
to be budget neutral would offer the Department greater 
flexibility to provide all beneficiaries with a uniform triple-
option benefit structure. This section would reaffirm the 
committee's commitment to providing a uniform health benefit to 
all Department of Defense medical beneficiaries by giving the 
Department the tools to establish an HMO option in most areas 
of the country.

section 714--training in health care management and administration for 
                          tricare lead agents

    This section would direct the Secretary of Defense to 
ensure that military medical treatment facility commanders 
selected to serve as lead agents for the Department's managed 
health-care program, TRICARE, receive appropriate training in 
health-care management and administration.
    During recent hearings on the TRICARE program, both the 
General Accounting Office and the Congressional Budget Office 
expressed concerns over whether the training received by 
medical treatment facility commanders was adequate to prepare 
them to manage a health care system of the cost, size and 
complexity of the TRICARE managed system. The committee is 
committed to ensuring the effectiveness of the TRICARE program 
and believes that a formal education program would contribute 
materially to that objective.

      section 715--evaluation and report on tricare effectiveness

    This section would require the Secretary of Defense to 
obtain an ongoing independent evaluation of the TRICARE program 
by a federally funded research and development center and to 
provide an annual report to Congress on the results of the 
evaluation. The evaluation would seek to assess the 
effectiveness of the TRICARE program in achieving its goals of 
increasing access to and improving the quality of medical care 
provided to covered beneficiaries without increasing the total 
cost to the government or out-of-pocket costs to beneficiaries. 
Additionally, the evaluation should report on efforts to make 
TRICARE Prime, the HMO option, available in non-catchment and 
rural areas.

          Subtitle C--Uniformed Services Treatment Facilities


 section 721--limitation on expenditures to support uniformed services 
 treatment facilities and limitation on number of participants in ustf 
                           managed care plans

    This section would amend the Defense of Defense 
Authorization Act, 1984 (Public Law 98-94) to limit the amount 
authorized to be spent by the Department of Defense on the 
Uniformed Services Treatment Facilities (USTFs) managed care 
plan to $300,000,000--the amount appropriated for the USTFs in 
fiscal year 1995. In addition, this section would limit the 
number of beneficiaries enrolled in the USTF program to the 
number enrolled as of September 30, 1995.

     section 722--application of federal acquisition regulation to 
 participation agreements with uniformed services treatment facilities

    This section would amend the National Defense Authorization 
Act for Fiscal Year 1991 (Public Law 101-510) by repealing the 
exemption from the Federal Acquisition Regulation (FAR) granted 
the Uniformed Services Treatment Facilities (USTFs). The FAR 
was issued to promote competition and ensure that the federal 
government and its contractors are afforded the safeguards and 
controls necessary to ensure proper performance and prevent the 
fraud, waste and abuse of public revenues. This section would 
allow the Department of Defense to more effectively manage its 
military health-care system.

  section 723--development of plan for integrating uniformed services 
 treatment facilities in managed care programs of department of defense

    This section would amend section 718(c) of the National 
Defense Authorization Act for Fiscal Year 1991 (Public Law 101-
510) to require the Secretary of Defense to submit to Congress 
a plan under which the 10 Uniformed Services Treatment 
Facilities (USTFs) would be integrated into the Department of 
Defense's managed health-care program prior to September 30, 
1997.
    In addition, this section would require the Secretary to 
assess the feasibility of implementing a modified version of 
USTF option II. This option would permit the USTFs to become 
designated as Medicare-risk health maintenance organizations 
(HMOs) and to seek reimbursement from Medicare for Medicare-
covered services provided DOD beneficiaries enrolled in USTF 
health care programs. These beneficiaries also could use 
military treatment facilities for CHAMPUS-covered benefits that 
are not covered by Medicare, or the Department of Defense would 
reimburse the USTFs for these limited benefits.
    This section would express the committee's concern for 
ensuring the continued care in the military health services 
system for those beneficiaries currently enrolled in the USTF 
program.

     section 724--equitable implementation of uniform cost sharing 
        requirements for uniformed services treatment facilities

    This section would direct the Secretary of Defense to apply 
uniform cost shares to each of the 10 Uniformed Services 
Treatment Facilities (USTFs) only upon regional implementation 
of the TRICARE managed health care program in the USTF's 
service area.

   Subtitle D--Other Changes to Existing Laws Regarding Health Care 
                               Management


   section 731--maximum allowable payments to individual health care 
                        providers under champus

    This section would amend title 10, United States Code, to 
codify a provision of the Department of Defense Appropriations 
Act for Fiscal Year 1995 (Public Law 103-335) which establishes 
a process for gradually reducing CHAMPUS maximum payment 
amounts to those limits for similar services under Medicare, 
with special consideration given to preserving access to care 
and limiting balance billing by providers.
    This section would authorize the Secretary of Defense to 
transition from its current system of prevailing charges for 
professional services to payment limits similar to the Medicare 
fee schedule. It also would provide the Secretary with the 
authority to make exceptions to the fee schedule limits to 
ensure adequate care is provided to covered beneficiaries.

section 732--expansion of existing restriction on use of defense funds 
                             for abortions

    This section would amend section 1093 of title 10, United 
States Code, to include restricting the Department of Defense 
from using medical treatment facilities or other DOD 
facilities, as well as DOD funds, to perform abortions unless 
necessary to save the life of the mother.

 section 734--redesignation of military health care account as defense 
  health program account and two-year availability of certain account 
                                 funds

    This section would amend section 1100 of title 10, United 
States Code, to allow the Secretary of Defense to carry over 
three percent of the defense health plan annual operation and 
maintenance appropriations to the end of the next fiscal year.
    The purpose of a managed care strategy is to provide high-
quality and cost-effective health care to the Department's 
beneficiaries. The single-year nature of the defense health 
program appropriation is an impediment to the effectiveness of 
incentives that can presently be employed. In all cases, 
funding authority not used during the specified appropriation 
period is lost. This precludes the use of savings generated 
from current-year management efforts to be used for investments 
in the following fiscal year. As a result, there is an 
incentive for managers to spend these funds on lower-priority 
but easily-obligated requirements, avoiding higher-priority 
requirements that require greater lead time for obligations.

                       Subtitle E--Other Matters


   section 741--termination of program to train and utilize military 
          psychologists to prescribe psychotropic medications

    The Defense Appropriations Act for Fiscal Year 1989 (Public 
Law 101-511) directed the Department of Defense to conduct a 
pilot demonstration project to train military psychologists to 
prescribe psychotropic drugs. This section would direct the 
Department of Defense to terminate the pilot demonstration 
program and would withdraw from psychologists who participated 
in the demonstration program the authority to prescribe 
psychotropic drugs. The committee is concerned about the cost-
effectiveness of a program that does not meet a Department of 
Defense requirement and from which only 50 percent of entering 
candidates graduate.

section 742--waiver of collection of payments due from certain persons 
                 unaware of loss of champus eligibility

    This section would authorize the secretaries of Defense, 
Transportation and Health and Human Services to waive the 
collection of certain payments described for Civilian Health 
and Medical Program of the Uniformed Services (CHAMPUS) 
beneficiaries. This waiver would apply to CHAMPUS beneficiaries 
who lost their CHAMPUS eligibility when they became entitled to 
Medicare because of disability or end-stage renal disease, 
excluding those who become eligible upon attaining age 65.
    This waiver is necessary because these beneficiaries were 
not informed of their loss of CHAMPUS eligibility, continued to 
use CHAMPUS benefits and the CHAMPUS system continued to pay 
for care, sometimes for years. When the Department of Defense 
issues erroneous benefit payments to an individual not eligible 
for CHAMPUS, the payments are a debt owed to the government and 
are subject to recovery under the Federal Claims Collection Act 
of 1966, as amended by the Debt Collection Act of 1982.
    This section would authorize the administering secretaries 
to waive the recovery of these erroneous payments so that 
beneficiaries who, due to no fault of their own, continued to 
use certain benefits for which they were no longer eligible are 
not unfairly penalized. This section also would establish a 
termination date for the waiver authority so that beneficiaries 
would not be enticed to avoid Medicare Part B enrollment.

 section 743--notification of certain champus-covered beneficiaries of 
                      loss of champus eligibility

    This section would direct the administering secretaries to 
develop a mechanism for notifying beneficiaries of their 
ineligibility for CHAMPUS health benefits when they lose their 
CHAMPUS eligibility due to disability status.

section 744--demonstration program to train military medical personnel 
                     in civilian shock trauma units

    During committee hearings on the military health-care 
system, testimony was received that recommended the Department 
of Defense strengthen affiliations with civilian hospitals to 
provide better wartime training and to meet some of the 
requirements for caring for active-duty personnel.
    This section would require the Secretary of Defense to 
conduct a demonstration program to evaluate the feasibility of 
providing additional shock trauma training for military medical 
personnel through arrangements with civilian hospitals where 
military medical personnel would work and train together as a 
team.

section 745--study regarding department of defense efforts to determine 
         appropriate force levels of wartime medical personnel

    This section would direct the Comptroller General of the 
United States to evaluate the effectiveness of the modeling 
efforts of each of the three service surgeons general for 
determining the appropriate wartime military medical force-
level requirements and to submit to Congress a report on this 
evaluation not later than March 1, 1996. The report shall (1) 
assess the modeling techniques used by each service; (2) 
analyze the data used in the model to identify medical 
personnel requirements; (3) identify the ability of the models 
to integrate reserve component requirements; and (4) evaluate 
the Department of Defense's ability to integrate the modeling 
efforts into a comprehensive, coordinated plan for rightsizing 
the military medical establishment.

   section 746--study regarding expanded mental health services for 
                     certain covered beneficiaries

    This section would direct the Secretary of Defense to study 
the feasibility of expanding mental health services to include 
``wraparound'' services, and to report the results of the study 
to Congress by March 1, 1996.
    Wraparound services provide continued care for child and 
adolescent patients designed to support the effectiveness of 
residential treatment. The process builds support for the 
patient, allowing shorter inpatient stays through comprehensive 
and continued management of care, and reducing recidivism for 
the residential phase of treatment. During a test at Fort 
Riley, Kansas, wraparound services reduced costs for inpatient 
psychiatric and residential care from $3.9 million in fiscal 
year 1991 to $0.87 million in fiscal year 1994.
    The wraparound services program would require providers or 
residential treatment services to share financial risk through 
case-rate reimbursement and to work to prevent recidivism by 
providing residential treatment services which include planning 
and individualized wraparound services as part of the 
treatment.

  section 747--report on improved access to military health care for 
               covered beneficiaries entitled to medicare

    This section would require the Secretary of Defense to 
report on possible alternatives to improving access to the 
military health care system for those beneficiaries who are 
Medicare eligible and ineligible for the Civilian Health and 
Medical Program of the Uniformed Services (CHAMPUS).
    The committee remains concerned about the growing 
population of military retirees who are unable to access the 
military health care system largely as a result of the drawdown 
of the military and the closure of military medical treatment 
facilities. These retirees are feeling increasingly 
disenfranchised from a government they served and defended 
devotedly. Without Medicare reimbursement, the Department will 
be forced to provide less and less care to this population.
    The committee remains committed to identifying cost-
effective alternatives for providing medical care to all 
military medical beneficiaries.

                       Items of Special Interest


medicare reimbursement to the defense health program for care provided 
                   to medicare-eligible beneficiaries

    The committee believes that Medicare reimbursement to 
Department of Defense medical facilities for care provided to 
Medicare-eligible beneficiaries can produce savings to both the 
Department of Defense and the Department of Health and Human 
Services because military hospital care is generally less 
expensive than health care services purchased in the private 
sector.
    The Department's implementation of the TRICARE managed 
health care program nationwide over the next several years will 
offer a propitious opportunity to achieve government-wide 
savings through Medicare reimbursement. Unfortunately, the 
Congressional Budget Office scoring of this initiative as a 
$2.7 billion direct spending cost by the year 2000 limits the 
committee's ability to act on this important initiative. This 
direct spending impact is largely due to the fact that the 
Health Care Financing Agency does not budget for military 
Medicare-eligible beneficiaries. Further limiting the 
committee's ability to act on this issue is the fact that the 
President's budget does not propose Medicare reimbursement to 
the Department.
    The committee remains convinced that Medicare reimbursement 
is in the best interest of the military health care system and 
that such reimbursement will result in overall savings to the 
Federal Government. The committee remains committed to working 
with other committees and the President to achieve this 
worthwhile and necessary objective.

         formation of veteran's wing within naval hospital guam

    The committee is concerned about the need to continue 
providing quality health care services to thousands of 
beneficiaries as the Navy closes and realigns its facilities on 
Guam. The establishment of a veterans' wing within the Naval 
Hospital, Guam, could provide these beneficiaries with quality 
health care. Therefore, the committee directs the Secretary of 
the Navy to study a possible cooperative arrangement with the 
Department of Veterans Affairs to establish a VA wing within 
the Naval Hospital on Guam and to report to Congress on the 
results of this study by March 1, 1996.

 health-care sharing agreement between department of veterans affairs 
                       and department of defense

    The committee is aware that the Secretary of Defense and 
the Secretary of Veterans Affairs have long had the authority 
to make sharing agreements for the mutual use or exchange of 
medical resources. Title II of Public Law 102-585 provided the 
authority for the Department of Veterans Affairs (VA) to 
provide medical care to CHAMPUS eligible beneficiaries on a 
reimbursable basis. Such agreements can realize cost savings 
for the Department of Defense, while enabling Veterans Affairs 
to operate more efficiently and improve services to veterans.
    In a joint DOD/VA project implemented in early 1994 at the 
Asheville, North Carolina, VA Medical Center, Veterans Affairs 
provided services to more than 1,300 CHAMPUS patients at a 
discount from the CHAMPUS maximum allowable. Patient 
satisfaction has been very high and about 80 new registrants 
per month have requested services under the Asheville pilot 
project.
    Other VA health care facilities, which have worked closely 
with local military retirees and base commanders, are prepared 
to provide services to CHAMPUS eligibles under agreements 
similar to those established at Asheville. In many of these 
communities, TRICARE managed-care contracts are not scheduled 
to be implemented for nearly two years. The Asheville 
experience demonstrates the kind of service Veterans Affairs 
can provide in the interim. Therefore, the committee urges the 
Department to work with Veterans Affairs to expand the number 
of such agreements and to authorize VA facilities to serve as 
health care providers under the Department's TRICARE managed 
care system.

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


                         Legislative Provisions


         section 801--repeals of certain procurement provisions

    This section would repeal various provisions of law that: 
1) impose unique procurement integrity requirements on DOD 
personnel thereby placing them under the same standards applied 
to non-DOD federal employees; 2) require non-value added 
contract clauses; 3) impose archaic limitations on the 
delegation of secretarial authorities; and 4) limit sources for 
procurement of critical spare parts.

             section 802--fees for certain testing services

    This section would allow certain Department of Defense test 
facilities to recoup both direct and indirect costs when 
providing services to the private sector.

          section 803--testing of defense acquisition programs

    This section would clarify the applicable terminology used 
to test weapon systems and other hardware items.

    section 804--coordination and communication of defense research 
                               activities

    This section would make a technical change to allow 
additional flexibility in existing acquisition reporting 
requirements.

  section 805--addition of certain items to domestic source limitation

    This section would extend the current domestic source 
requirements for ball bearings and impose similar requirements 
for certain components of naval vessels.

        section 806--revisions to procurement notice provisions

    This section would conform the defense procurement notice 
posting threshold to the same threshold used by civilian 
government agencies.

               section 807--international competitiveness

    This section would amend the Arms Export Control Act to 
remove the current requirement that government-to-government 
sales of U.S. military equipment carry a requirement to charge 
for recoupment of non-recurring research and development costs. 
This policy has had the effect of encouraging U.S. aerospace 
companies to market military items abroad on a commercial 
basis, rather than through the preferred Foreign Military Sales 
(FMS) process. The committee does not believe this policy 
change will lead to an increase in the sales of military 
systems, but instead will allow American firms to compete on 
more equitable ground with foreign suppliers of military 
hardware.

         section 808--encouragement of use of leasing authority

    This section would encourage the Secretary of Defense to 
utilize leasing practices whenever practicable.

                       Items of Special Interest


       implementation of the federal acquisition streamlining act

    Congressional enactment of the Federal Acquisition 
Streamlining Act of 1994 (Public Law 103-355) last year was an 
important initial step in the direction of streamlining the 
laborious Federal procurement system. This legislation is aimed 
at reducing the costs associated with doing business with the 
government while maintaining the oversight necessary to protect 
the taxpayer's interests.
    The eventual success of the Federal Acquisition 
Streamlining Act (FASA), however, hinges on full and proper 
implementation of the law by the executive branch. In this 
regard, the committee commends the Department of Defense for 
moving rapidly to establish the necessary teams to develop 
regulations for public comment. On the other hand, the 
committee notes that action taken too quickly often does not 
achieve the intended results. Based on the committee's review 
of the proposed regulations, it appears that the draft FASA 
regulations fall into three categories: (1) those accomplishing 
what was intended; (2) those that miss the intent of the 
legislation; and (3) those that not only ignore the letter and 
spirit of the law but also impose new burdens not required by 
statute.
    In the first category--accomplishing what was intended--the 
draft commercial contracting regulations clearly were drawn on 
a clean slate, rather than just making patchwork changes to 
existing regulations. Rather than being risk adverse, this 
approach relies on the forces of the commercial marketplace for 
quality, terms, prices, and other critical factors. The 
committee is also encouraged to note that the list of 
subcontract flowdown waivers, as intended by Congress, is a 
relatively lengthy list.
    In the second category, the proposed regulations on 
contract financing, including commercial financing and 
performance based payments, are not only inconsistent with the 
legislative goals but would place enormous administrative 
burdens on the contracting officer and contractor. These 
burdens include: the requirements for commercial 
certifications, an either/or scenario for performance-based and 
progress payments, an arbitrary 75 percent reimbursement rate 
for performance-based payments and an automatic withholding of 
payments when one performance measure is missed or is in 
dispute. The proposed rule also permits agencies to issue their 
own regulations on commercial financing, in contravention of 
the legislation's intent to discourage nonstandard contract 
clauses.
    Finally, in the third category, the proposed regulations 
related to the Truth in Negotiations Act (TINA) appear to miss 
the opportunity to take advantage of the legislative authority 
to eliminate regulatory-based burdens. Based on a review of the 
proposed TINA regulations, the committee identifies a number of 
deficiencies, to include: 1) the failure to make the 
definitions and forms more user friendly in an environment 
where the Department and other agencies are seeking access to 
commercial products; 2) the expansion of the requirement for 
post-award audits to apply to procurements which qualify for a 
cost or pricing data exemption under TINA; and 3) maintaining 
and expanding the scope of the ``percentage of sales test'' 
where sales to the general public are compared to sales to the 
government for purposes of determining whether a product 
qualifies for a TINA exemption.
    The committee understands that these issues, as well as 
others, are undergoing substantial revision as part of the 
regulatory process. Therefore, while the committee remains 
concerned over the initial draft proposals, it withholds final 
judgment on how well the regulatory process fulfills the full 
letter and spirit of this important legislation until the final 
regulations are issued.

            management responsibility for acquisition policy

    The committee is concerned that the current organizational 
structure within the Department of Defense has unnecessarily 
bifurcated the functional responsibility for development and 
implementation of acquisition policy. That responsibility is 
now split between the Office of the Deputy Under Secretary of 
Defense for Acquisition Reform and the Office of the Director 
for Defense Procurement. This arrangement results in 
unnecessary duplication of effort, but more importantly, 
invariably hinders the coherent development and implementation 
of needed acquisition reform within the Department. The 
committee strongly encourages the Secretary to revisit this 
organizational arrangement and to institute the appropriate 
changes necessary to ensure that functional responsibility for 
development and implementation of acquisition policy within the 
Department is consolidated in one place.

                      machine tool industrial base

    The committee continues to be concerned over the viability 
of the United States machine tool industry which is a critical 
component of national defense technology and industrial base. 
Therefore, the committee urges defense companies to support 
this vital component of the defense industrial base by 
purchasing domestically manufactured machine tool equipment 
wherever possible.

      TITLE IX--DEPARTMENT OF DEFENSE ORGANIZATION AND MANAGEMENT


                         Legislative Provisions


   section 901--reorganization of office of the secretary of defense

    As an important element of its initiative to produce 
greater efficiencies within Department of Defense operations in 
order to fund modernization and operational readiness 
shortfalls, the committee has begun a review the organizational 
and personnel practices of the Office of the Secretary of 
Defense and associated support organizations. The committee is 
concerned by the incongruity in trends between significant 
growth in the Office of the Secretary of Defense (OSD) and 
drastic military force structure and defense budget reductions. 
During the ten year period from fiscal years 1985 to 1995, the 
number of civilian personnel assigned to OSD has increased by 
22 percent while combat force structure has been reduced by 40 
percent and real defense spending by 34 percent.
    While these statistics can only serve as a coarse measure 
of OSD's management efficiency, they do provide sufficient 
basis for the committee to direct certain corrective steps. 
Accordingly, the committee recommends a provision (sec. 901) 
that would direct the Secretary of Defense to reduce the number 
of personnel assigned to OSD by 25 percent over a four year 
period.
    The committee further understands that in addition to the 
official number of personnel assigned to OSD, the Department 
has informally expanded OSD to include an additional 4,000 
personnel through the creation of so-called ``direct support 
activities'' that effectively serve as an extended OSD staff. 
The provision recommended by the committee would require that 
direct support activities and similar functions be included in 
the mandated personnel reduction.
    Section 901 would also reduce the number of authorized 
assistant secretaries of defense by two, from the current level 
of eleven to nine. The committee rejects the Administration 
request to further increase the number of assistant secretaries 
to twelve and points out that the Administration already 
previously increased the total number of Presidentially-
appointed civilian officials by a considerable number to 
oversee a drastically reduced Department of Defense operation.
    In order to allow for an orderly transition to downsized 
and more efficient OSD operation, section 901 would also 
require that the Secretary of Defense provide Congress with a 
comprehensive reorganization plan for his office. This plan 
should include a detailed presentation of the steps the 
Secretary recommends to implement the 25 percent reduction. The 
plan should also actively examine a number of functional 
consolidation and management options to increase efficiency 
while reducing personnel resources.
    Finally, to provide the Secretary with the broadest 
possible range of organizational options to consider, section 
901 would repeal a number of the current statutorily mandated 
offices and positions within OSD. The committee notes that 
repeal of these provisions does not require and should not be 
interpreted to mean the elimination of any of the affected 
offices. The committee recommends this action without prejudice 
toward any of these offices and intends only to extend the 
Secretary the broadest possible latitude in pursuing 
reorganizational efforts free of legislatively-driven 
constraints. Accordingly, the committee fully expects the 
Secretary to reciprocate by taking advantage of the latitude 
provided by this provision through the aggressive exploration 
of all possible reorganization and streamlining opportunities.

    section 902--restructuring of department of defense acquisition 
                       organization and workforce

    The committee notes that almost half of the 867,000 
civilian personnel currently employed by the Department of 
Defense are assigned to defense acquisition organizations. The 
size and breadth of the current defense acquisition 
infrastructure consumes enormous budgetary resources that could 
otherwise be utilized to meet quality of life core readiness 
and modernization shortfalls.
    Accordingly, the committee recommends a provision (sec. 
902) that would require the Secretary of Defense to reduce the 
number of personnel assigned to defense acquisition 
organizations by 25 percent over a four year period. The 
provision would also require a reduction of 30,000 personnel be 
achieved during fiscal year 1996. In addition, the provision 
requires the Secretary to develop and submit a plan to Congress 
that:
          (1) reduces the number of personnel assigned to 
        defense acquisition organizations by 25 percent, 
        exempting certain depot-maintenance employees;
          (2) eliminates duplication of functions among 
        existing defense acquisition organizations;
          (3) maximizes opportunities to consolidate defense 
        acquisition organizations to reduce management 
        overhead;
          (4) takes full advantage of simplified procedures and 
        other procedural changes established by the Federal 
        Acquisition Streamlining Act of 1994 (Public Law 103-
        355) and other internal DOD initiatives;
          (5) assesses the consolidation of certain functions 
        of the Defense Contract Audit Agency and the Defense 
        Contract Management Command;
          (6) assesses outsourcing of a significant portion of 
        the workload performed by the Defense Contract Audit 
        Agency and other acquisition defense agencies; and
          (7) assesses consolidating or eliminating selected 
        defense acquisition organizations.
    The committee is determined to realize significant 
reductions and increased efficiencies from the defense 
acquisition infrastructure. However, the committee has 
deliberately chosen not to direct specific organizational 
actions yet in order to allow the Secretary the opportunity to 
evaluate all possible options and provide Congress with his 
plan to achieve this broad objective. If the Secretary's plan 
proves inadequate, the committee will involve itself more 
directly and in more detail with regard to streamlining the 
defense acquisition infrastructure.

 section 903--plan for incorporation of department of energy national 
              security functions in department of defense

    This section would require the Secretary of Defense to 
submit a report to Congress on the Secretary's plan for the 
incorporation into the Department of Defense of the national 
security programs of the Department of Energy which could be 
implemented if the Department of Energy is abolished and those 
programs are transferred to the Department of Defense.

 section 904--change in titles of certain marine corps general officer 
billets resulting from reorganization of the headquarters, marine corps

    This section would change references in current law to 
reflect the reorganization of Headquarters Marine Corps.

section 905--inclusion of the information resources management college 
                   in the national defense university

    This section would authorize the Secretary of Defense to 
establish a personnel system for the Information Resources 
Management College that is consistent with the personnel system 
for other institutions within the National Defense University.

  section 906--employment of civilians at the asia-pacific center for 
                            security studies

    This section would authorize the Secretary of Defense to 
establish a personnel system for the Asia-Pacific Center for 
Security Studies. The committee notes that the authority that 
would be granted under this provision is the same granted to 
the Secretary for the George C. Marshall European Center for 
Security Studies by section 923 of the National Defense 
Authorization Act for Fiscal Year 1994 (Public Law 103-160).

 section 907--continued operation of uniformed services university of 
                          the health sciences

    The President's budget request proposed a phased closure of 
the Uniformed Services University of the Health Sciences 
(USUHS).
    During committee hearings on military medical readiness, 
the General Accounting Office and the Congressional Budget 
Office reported on weaknesses in military wartime medical 
readiness. The service surgeons general, at these hearings, 
reported on the importance of USUHS in effectively training 
military physicians to meet both peacetime and wartime medical 
readiness requirements.
    This section would require the Secretary of Defense to 
budget for ongoing operations at USUHS. The committee believes 
that USUHS is an institution of professional education vital to 
the education and medical readiness training of significant 
numbers of uniformed services health-care providers.

    section 908--redesignation of advanced research projects agency

    In 1993, the Defense Advanced Research Projects Agency 
(DARPA) was renamed to the Advanced Research Projects Agency 
(ARPA) by dropping ``defense'' from the title. Accompanying the 
change, the agency was directed to assume significantly 
increased responsibilities for managing defense reinvestment 
programs. This change resulted in a doubling of the Agency's 
budget and a dilution in the focus the agency once provided to 
national security programs and priorities. The committee 
believes that this unwarranted shift of the agency away from 
its important national security mission is improper and has 
contributed to the diversion of scarce defense research and 
development resources from defense priorities to ill-defined 
dual-use and other civilian applications. Accordingly, the 
committee recommends a provision (sec. 908) that would direct 
that ARPA be redesignated as the Defense Advanced Research 
Projects Agency (DARPA) to properly reflect its mission and 
responsibilities as a combat support agency of the Department 
of Defense. The committee also recommends the Department 
consider transitioning the oversight and management of 
Department-wide defense reinvestment and dual-use programs to 
the Office of the Under Secretary of Defense for Acquisition 
and Technology. The committee recommends that, where practical, 
all existing ARPA letterhead, logo, and monogrammed expendable 
supplies shall be used until expended.

                           Items of Interest


                growth in legislative liaison operations

    The committee notes with concern the increasingly large 
number of legislative liaison operations and associated 
personnel within the Department of Defense. The committee notes 
that each of the regional Commanders-in-chief and many of the 
major service commands have independent legislative liaison 
offices in the Washington area. For example, the Army has 
separate Washington legislative liaison offices for Forces 
Command (FORSCOM), Training and Doctrine Command (TRADOC), U.S. 
Army in Europe, U.S. Forces in Korea, and Allied Command 
Europe. Similarly, the Navy's Naval Ocean Systems Center, Navy 
Weapons Center, Pacific Test Center and other similar 
organizations each have legislative liaison operations. During 
a period of downsizing and budget constraint, the committee 
finds it difficult to understand how such legislative liaison 
operations can be justified and wonders why this function 
cannot be more efficiently performed through the service 
secretary's legislative liaison operation.
    Therefore, the committee directs the Secretary of Defense 
to provide a report to the Congressional defense committees by 
January 1, 1996, identifying all legislative liaison offices 
operating in the National Capital Region as of January 1, 1995. 
The report should include the number of personnel assigned to 
each of the identified legislative liaison offices, either 
permanently assigned or on temporary duty. The report should 
also include an individual evaluation of whether the function 
performed by each individual service liaison operation could be 
more efficiently performed by the service secretary's office.

                      TITLE X--GENERAL 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 billion. Historically, the 
transfer authority authorized has changed as follows:
                                                                 Billion
FY85-88........................................................... $2.00
FY89-91...........................................................  3.00
FY92..............................................................  2.25
FY93..............................................................  1.50
FY94-95...........................................................  2.00

            section 1002--incorporation of classified annex

    This section would provide the language required to 
incorporate the Classified Annex prepared by the Committee on 
Armed Services into the National Defense Authorization Act.

  section 1003--improved funding mechanisms for unbudgeted operations

    The committee has observed with alarm, the continuing 
practice by the Administration of engaging in costly 
peacekeeping and humanitarian contingency operations without 
properly budgeting the necessary resources. U.S. military 
operations resulting from the aftermath of the Persian Gulf 
War, in Somalia, Bosnia, Rwanda, Haiti, Cuba and other locales 
have imposed significant fiscal burdens on the Department at a 
time of declining resources. Lacking the budgeted resources, 
the Department has resorted to the damaging practice of 
financing the cost of these operations from the military 
services' operational readiness accounts--leading to the 
cancellation or deferral of training exercises, necessary 
equipment maintenance, and other routine activities that 
directly and significantly degrade force readiness.
    Given that the Department of Defense budget has 
historically only provided for the equipping and training of 
U.S. military forces and not for the execution of operations, 
the challenges posed by paying for unplanned operations are not 
new. However, what is new is the severely constrained defense 
budget, the quasi-permanent nature of many of the current 
operations, and the increased frequency with which the 
Administration continues to deploy U.S. military forces in 
support of UN or other ``peace operations.'' With over six 
months before fiscal year 1996 commences, the Secretary of 
Defense has already estimated the unbudgeted fiscal year 1996 
costs to the Department for ongoing contingency operations to 
be $1.5 billion. The true costs will surely be higher.
    In recognition of this problem, the Administration's fiscal 
year 1996 legislative proposal did contain a request to grant 
the Secretary of Defense extraordinary authority to obligate 
funds absent appropriations under certain conditions associated 
with contingency operations. The committee rejects this 
proposal as an inadequate stop-gap measure that fails to 
address the broader policy issues involved. Instead, the 
committee recommends a provision (sec. 1003) that would more 
fully address this matter in two components: an interim funding 
mechanism for unforseen and unbudgeted contingency operations, 
and mandated procedures to properly budget for ongoing 
contingency operations.
    To address unforseen and unbudgeted operations, the 
provision would revise existing provisions of law to allow the 
Secretary of Defense to draw upon the Defense Business 
Operating Fund (DBOF) along with a targeted transfer authority 
of $200 million from non-readiness accounts, as interim 
financing mechanisms for operations while securing approval of 
a supplemental appropriations request which would be required 
to be submitted within 30 days of the commencement of an 
operation. The provision would require that any liabilities 
incurred by the DBOF or other accounts from which funds are 
transferred must be restored with the funds provided through 
supplemental appropriations legislation. The committee directs 
that any transfer of funds from the designated accounts 
identified by this provision follow established prior approval 
reprogramming procedures.
    To address ongoing but unbudgeted operations, the provision 
would require that, for any operation that is ongoing at the 
beginning of a given fiscal year, the President must submit 
with the next fiscal year's budget request a specific funding 
request for that operation. Should the President fail to 
fulfill this requirement, funding authority for that operation 
would be automatically denied when that next fiscal year 
commences.
    Through this provision, the committee intends to compel the 
Administration to properly budget for the costs of expected and 
ongoing operations up-front and to abandon the current practice 
of seeking Congressional approval for supplemental funds after-
the-fact. This provision would thus grant Congress the 
opportunity to properly evaluate the costs and merits of 
ongoing operations before the beginning of the fiscal year in 
question. While the provision would grant the President certain 
latitude in how the funding request for such operations should 
be submitted, the committee strongly believes that funding for 
such operations should not come from within the national 
defense budget function (050) discretionary spending caps.

 section 1004--designation and liability of disbursing and certifying 
                               officials

    This section would provide for the designation and 
appointment of disbursing and certifying officials within the 
Department of Defense.

 section 1005--authority for obligation of certain unauthorized fiscal 
                    year 1995 defense appropriations

    This section would authorize fiscal year 1995 programs that 
received appropriations but no authorization.

      section 1006--authorization of prior emergency supplemental 
                  appropriations for fiscal year 1995

    This section would extend authorization to those items 
appropriated by the Fiscal Year 1995 emergency supplemental 
appropriations legislation.

 section 1007--prohibition on incremental funding of procurement issues

    This section would impose a permanent prohibition on the 
use of partial or incremental funding of procurement items.

                Subtitle B--Naval Vessels and Shipyards


            section 1021--contract options for LMSR vessels

    This section recommends that the Secretary of the Navy 
negotiate a contract option price for a seventh LMSR at each of 
the two shipyards that have construction contracts.

   section 1022--vessels subject to repair under phased maintenance 
                               contracts

    This section would require the Secretary of the Navy to 
ensure that any existing contract for phased maintenance of any 
class or type of vessels will remain in effect without regard 
to any change of an operating command for these vessels.

  section 1023--clarification of requirements relating to repairs of 
                                vessels

    This section would permit the overhaul, repair, or 
maintenance of any vessel under the jurisdiction of the 
Secretary of the Navy to be performed in Guam.

                  section 1024--naming of naval vessel

    This section would express the sense of Congress that the 
Secretary of the Navy should name an appropriate Navy ship the 
U.S.S. Joseph Vittori in honor of Marine Corporal Joseph 
Vittori, who was posthumously awarded the Congressional Medal 
of Honor.

            section 1025--transfer of riverine patrol craft

    This section would permit the Secretary of the Navy to 
transfer a U.S.S. Swift-class riverine patrol craft to the 
Tidewater Community College, Portsmouth, Virginia, for 
scientific and educational purposes.

                       Subtitle C--Other Matters


  section 1031--termination and modification of authorities regarding 
national defense technology and industrial base, defense reinvestment, 
                    and defense conversion programs

    This section would repeal portions of chapter 148, title 
10, United States Code, that provide similar authorities for 
dual-use, cost-shared programs as provided elsewhere in law.

        section 1032--repeal of miscellaneous provisions of law

    This section would repeal miscellaneous provisions of law 
that have expired, are obsolete, are required to conform to 
other initiatives in the bill or have been suggested by the 
Administration and accepted by the Committee for repeal.

                       Items of Special Interest


                        counter-drug activities

Overview

    The fiscal year 1996 budget request for Department of 
Defense counter-drug activities is $680.4 million. This 
represents a net decrease of $40.9 million from the fiscal year 
1995 appropriated level of $721.3 million. The committee 
recommends authorization of the Department's request as 
follows:

 Drug Interdiction & Counter Drug Activities, Operation and Maintenance

                        [In thousands of dollars]

FY 96 Drug Interdiction & Counter-Drug Request................   680,400
    Source Nation Support.....................................   127,300
    Dismantling Cartels.......................................    64,300
    Detection and Monitoring..................................   111,700
    Law Enforcement Agency Support............................   279,300
    Demand Reduction:.........................................    97,800
Reductions:
    Community outreach programs...............................     8,236
Increases:
    Tethered Aerostat Radar System (PE 0102445F)..............     1,500
    Counterdrug Analysis (PE 0305889L)........................     1,200
    SouthCom Radars (Project #4419)...........................     1,500
    SOF CD Support (Project #6415)............................     2,536
    CARIBROC Comms (Project #3207)............................     1,500
Recommendation................................................   680,400

Counter-drug intelligence budget

    The committee commends the Department for responding to the 
concerns expressed last year regarding the increasing share of 
the DOD counter-drug budget that resides within the 
intelligence budget. The committee notes progress made in this 
area as reflected by the fiscal year 1996 budget request and 
urges the Department to continue the process of migrating those 
elements and functions in the counter-drug account currently 
classified as intelligence items to a non-intelligence 
designation.

Support for law enforcement

    The committee continues to support the Gulf States Counter-
drug Initiative and commends the Department of Defense and the 
Coordinator for Drug Enforcement Policy and Support for 
requesting funding for this program in the fiscal year 1996 
budget request. The committee urges the Department to continue 
to actively support this program in the future.

              chemical-biological warfare defense program

    The potential for the proliferation of weapons of mass 
destruction and the spread of chemical and biological weapons 
technology and delivery capabilities heighten committee 
concerns on the chemical and biological defense readiness of 
U.S. forces. In meeting the changing and evolving threat, the 
committee agrees that a strong chemical-biological defense 
program is an essential part of our national strategy, both for 
ensuring the capability of US military forces to fight on some 
future battlefield and as a major element of our 
counterproliferation program.
    The committee has reviewed the reports on the chemical and 
biological warfare defense program, required by title XVII of 
the National Defense Authorization Action for Fiscal Year 1994 
(Public Law 103-160), and is pleased to note the measures being 
taken by the Office of the Secretary of Defense and the 
military departments. Nevertheless, in light of the most likely 
threat scenarios, the committee continues to be concerned with 
the readiness of U.S. forces and with certain aspects of the 
chemical and biological defense program.
    The committee notes that the Department has made great 
strides in establishing a consolidated chemical-biological 
defense program with the Army as executive agent and with 
participation of all military services. The Department should 
exploit this initial success and continue efforts to ensure 
that an effective program management system drives the 
development of joint NBC defense doctrine, training, tactics, 
procedures and equipment, and the phasing out of service-unique 
programs. The committee is particularly concerned that the 
special training support at the Chemical and Biological Defense 
Command, the Army Chemical School, and the Live Agent Chemical 
Defense Training Facility in preparation for implementation of 
the Chemical Warfare Convention be maintained.
    The committee understands that the General Accounting 
Office is examining the ability of the military services to 
perform their missions in a chemical and biological warfare 
environment, and directs that the Comptroller General provide 
the committee by March 1, 1996, a report describing the 
Department's progress in addressing and solving shortfalls in 
chemical and biological warfare defense capabilities.
    The committee is concerned that the department lacks a 
joint, integrated system to maintain the visibility of chemical 
and biological defense equipment below the wholesale level and 
also lacks a standardized war reserve program for such 
equipment. The committee understands that an assessment of this 
problem is underway within the Department of Defense. The 
committee feels that there is potential for substantial costs 
savings if a serious effort is undertaken to consolidate the 
numerous chemical/biological depot supply and maintenance 
activities of the various services.
    The committee is disturbed by reports of deficiencies in 
the procurement and serviceability of protective masks and the 
lack of emphasis on the maintenance, training, and use of 
chemical-biological protective equipment. The committee directs 
the Secretary of Defense to take immediate action to ensure 
that protective masks and other individual chemical-biological 
protective equipment are serviceable, provide the level of 
protection required, and are properly maintained. The committee 
further directs that the Secretary of Defense, within 60 days 
of the enactment of this Act, provide a report to the 
congressional defense committees on the actions being taken to 
assess the situation and correct any deficiencies identified, 
additional actions under consideration, and additional 
resources and authority that may be required.
    The Department must place increased emphasis on chemical-
biological defense training both in units and in joint training 
of commanders and chemical specialists. The committee believes 
that the military services have not provided sufficient 
operations and maintenance funding for chemical and biological 
training and procurement. Consequently, the committee 
recommends an additional $50 million in operations and 
maintenance funding to remedy this deficiency as follows:
          Operations and Maintenance, Army (OMA) $10 million 
        each in Chemical Defense Training and Chemical Medical 
        Defense Training
          Operations and Maintenance Navy, Marine Corps and Air 
        Force (OMN, OMMC, and OMAF) $5 million each in Chemical 
        Defense Training and Chemical Medical Defense Training
    The committee views the program for providing adequate 
vaccines to protect US military forces as critical. In light of 
the threat, the committee believes that the biological defense 
program, including establishment of an effective vaccine 
development and production capability, should be among the 
Department's highest defense priorities. The committee directs 
the Secretary of Defense to address the establishment of this 
capability as an urgent matter and report the plan for 
providing such a capability within 60 days of the enactment of 
this Act.
    The Department has made significant improvements in the 
coordination and integration of service chemical and biological 
defense research, development, and acquisition. However, 
particular emphasis needs to be given to chemical and 
biological decontamination technology and the development and 
demonstration of advanced point and stand-off detection of 
chemical and biological agents. To address these and other 
concerns, the committee recommends increased authorizations to 
the budget request as indicated below:

                        [In millions of dollars]

PE 61384BP Basic research in advanced chemical biological sensor 
  and monitoring technology:
    Non-medical chemical biological defense.......................   3.0
    Medical chemical defense......................................   1.2
    Medical biological defense....................................   0.4
PE 62384BP--Exploratory development:
    Medical chemical defense......................................   1.2
    Medical biological defense....................................   0.2
    Non-medical chemical/biological defense:
        Enhanced chemical/biological detectors....................   2.9
        Enhanced individual protection............................   1.2
        High altitude/standoff remote chemical monitoring.........  18.0
PE 63384BP--Advanced development:
    Medical chemical defense life support.........................   1.1
    Medical biological defense vaccines...........................   0.4
    Chemical/biological defense advanced technology:
        Enhanced chemical and biological detection................  10.8
        Aircraft decontamination..................................   0.3
PE 63884BP Demonstration/validation:
    Light NBC defense reconnaissance system.......................   2.0
    Large scale area decontamination..............................   2.4
PE 64384BP Engineering & manufacturing development:
    Automated chemical agent detector.............................   2.0
    Aircrew eye/respiratory protection............................   1.0
    Chemical-biological protective shelter........................   3.0
    Multi-purpose integrated chemical agent detector..............   6.0

                        army experimental force

    The committee notes with approval the Army's designation of 
its Force XXI Experimental Force, and fully supports the intent 
to test new organizations, warfighting and operational 
concepts, training and equipment in order to enhance the 
lethality, survivability, sustainability, deployability and 
versatility of the future force.
    The committee believes that the Experimental Force can 
serve as an important tool for investigating the promise of the 
revolution in military affairs that may be possible through the 
rapid adaptation of information technologies to the 
battlefield. By contrast to simulations and various command-
post exercises, the Experimental Force is designed to put new 
technologies into the hands of soldiers so that they may seek 
practical solutions to the tactical challenges that confront 
them. Success in such efforts will allow the United States to 
retain the overwhelming advantage in conventional forces it now 
enjoys and which creates a pillar of national geopolitical 
strength. The committee particularly approves of the ``rolling 
baseline'' concept for quick integration of new concepts and 
technologies as appropriate.
    The committee also has a number of concerns regarding this 
promising effort. The Experimental Force must be given proper 
resources in order to carry out its mission in a timely 
fashion. The committee notes that many crucial items of 
equipment intended for the Experimental Force trials, such as 
advanced unmanned aerial vehicles, will not be available for 
years to come. Also, such practical experiments should be given 
due consideration by the Secretary of Defense in preparing 
future defense budgets, and the other services be encouraged to 
undertake such projects which combine technological, doctrinal 
and organizational experimentation, particularly in regard to 
the power projection missions that are central to the national 
security strategy.
    The committee encourages the Department of Defense to 
report regularly on the conduct of Experimental Force 
exercises, as well as related Force XXI events and exercises.

            integration of national security space programs

    The committee strongly endorses the Department's efforts to 
improve the coordination and integration of defense and 
intelligence space activities. The committee expects that the 
consolidation of defense space policy and acquisition oversight 
responsibilities and the establishment of a single focal point 
for space activities under the new Deputy Under Secretary of 
Defense for Space, reporting to the Under Secretary of Defense 
for Acquisition and Technology, will play a crucial role in 
achieving the normalization and integration of space activities 
within DOD.
    The committee believes that enhanced support for military 
operations and cost savings to the nation can be achieved by 
the consolidation of functions for defense and intelligence 
space architectures and acquisition management. In this regard, 
the committee strongly supports the statement of the 
President's nominee for Director of Central Intelligence 
regarding the intention ``to move immediately in coordination 
with the Secretary of Defense to a management structure that 
requires future systems to take account of the need, costs, and 
acquisition of both military and classified satellite systems 
in an integrated way.''
    The committee directs the Secretary of Defense to provide, 
no later than March 31, 1996, a report on national security 
space organization and management that addresses 
responsibilities and functions for: (1) development of an 
integrated national security space architecture; and (2) 
integrated acquisition of national security space programs.

  report on nuclear command, control, communications, and intelligence

    The committee is aware of an on-going study within the 
Office of the Secretary of Defense to examine nuclear command, 
control, communications, and intelligence (C3I) issues as a 
follow-up to the Nuclear Posture Review. The committee directs 
the Secretary of Defense to provide to the Congressional 
defense committees not later than February 15, 1996, a report 
on the study's findings, conclusions, and recommendations. The 
Secretary's report should also describe each of the 
programmatic and policy options considered, the cost and other 
implications of each of the options, and the reasons why the 
Department accepted or rejected each alternative.

              federal emergency management agency funding

    The committee believes that the civil defense activities of 
the Federal Emergency Management Agency (FEMA) no longer have a 
national security emphasis. Accordingly, the National Defense 
Authorization Act for Fiscal Year 1995 (Public Law 103-337) 
sought to move all of FEMA's civil defense activities out of 
the National Defense budget function. The committee is 
disappointed that the President's budget for fiscal year 1996 
does not appropriately reflect the transfer of all FEMA 
activities into other domestic budget accounts. Accordingly, 
the committee provides no authorization of appropriations for 
the civil defense activities of FEMA as part of the fiscal year 
1996 defense authorization budget.

TITLE XI--COOPERATIVE THREAT REDUCTION WITH STATES OF THE FORMER SOVIET 
                                 UNION


                                Overview

    The budget request contained $371 million for the 
Cooperative Threat Reduction (CTR) program to continue 
activities to dismantle weapons of mass destruction and reduce 
the threat of weapons proliferation in the New Independent 
States of the former Soviet Union. Of this total, $194 million 
was requested for destruction and dismantlement; $71.5 million 
for chain of custody and nonproliferation activities; $75 
million for demilitarization and defense conversion activities; 
and $30.5 million for other program support. The committee 
reiterates its strong support for the accelerated dismantlement 
and destruction of strategic offensive weapons in the states of 
the former Soviet Union.
    The committee recommends a total of $200 million for CTR 
activities in fiscal year 1996, a reduction of $171 million 
from the requested amount. The committee approves the request 
for all dismantlement, destruction and weapons security 
activities, with the exception of the $104 million request to 
begin construction of a Russian chemical weapons destruction 
facility. Other changes to the request include: denial of funds 
for the construction of a fissile material storage facility in 
Russia; denial of authorization for Demilitarization Enterprise 
Fund activities; and a reduction of $4 million for other 
program support activities, consistent with the overall 
reduction in the program's funding.
    The committee is concerned with the expansion of 
authorities in the CTR program to conduct a wide range of non-
dismantlement, non-destruction and non-weapons security 
activities. The committee is further concerned with Congress' 
ability to conduct effectively its oversight responsibilities 
of CTR activities once funds have been authorized and 
appropriated. In this context, the committee expresses its 
alarm over the fact that the Department of Defense has 
conducted only three audit and examination visits to verify the 
whereabouts and condition of U.S. assistance delivered to the 
states of the former Soviet Union since the program's inception 
over four years ago. This concern has been heightened by recent 
General Accounting Office (GAO) reports that CTR funds may have 
been provided to institutions and individuals in Russia who 
remain involved in ongoing work on weapons of mass destruction. 
Accordingly, the extent to which there is a direct causal 
relationship between the CTR program and on-going dismantlement 
and destruction activities in the states of the former Soviet 
Union is difficult to verify with certainty.

                 Chemical Weapons Destruction Facility

    In denying the request of $104.0 million for construction 
of a chemical weapons destruction facility, the committee 
expresses its belief that this project is premature for a 
number of reasons. First, Russia has refused to agree to 
destroy the most lethal and militarily useful stocks of 
chemical weapons in its inventory first. The committee believes 
that if the U.S. ultimately pays for Russian chemical weapons 
destruction, then Russia should destroy its militarily useful 
stocks first.
    Second, Russia has refused to accept U.S. plans to build an 
incinerator to burn its chemical weapons stocks and, instead, 
has insisted on proceeding with an unproven technology and 
process know as neutralization--a process which may create more 
hazardous materials than it destroys.
    Third, a recent GAO draft report commissioned by the 
committee noted, ``many issues need to be resolved before 
large-scale funding can be undertaken. Requirements for fiscal 
year 1996 funding appear to be contingent upon completion of 
several tasks--most importantly the joint evaluation of 
chemical weapons destruction technology. DoD's fiscal years 
1996 and 1997 budgets assume the results of the joint 
evaluation will be favorable and completed on schedule by March 
1996. Further delays during fiscal year 1995 and early into 
1996 could reduce the need and impact the justification for the 
budget requests. Also, to date, CTR program officials remain 
uncertain about specific requirements for fiscal year 1996 
funding and how much of the funding they will be able to 
obligate during the fiscal year.''
    Fourth, Russia has yet to ratify the Chemical Weapons 
Convention, has made no specific commitment to the U.S. to 
carry out the terms and conditions of the U.S.-Russia bilateral 
chemical weapons destruction agreement, signed in 1990, and may 
still be developing new chemical weapons.
    Finally, a comprehensive implementation plan has yet to be 
signed to govern these activities and the total U.S. financial 
obligation remains unknown. Until the above matters are 
resolved, the committee will not support funding for this 
project.

                   Fissile Material Storage Facility

    While the committee approved the request of $6 million for 
continued design activities associated with a fissile material 
storage facility in Russia, $23 million in requested 
construction funds are denied for the following reasons. First, 
according to U.S. intelligence sources, Russia may already 
possess sufficient fissile material storage capacity, 
particularly if Russian Ministry of Defense storage space for 
intact weapons or Russian deep underground bunkers are taken 
into account. If so, the obligation of funds for construction 
of a new storage facility would seem to be unnecessary.
    Second, Russia and the U.S. have yet to conclude agreements 
for additional design and construction funds and work out 
arrangements for the use of a U.S.-hired integrating 
contractor. Russia has also failed to provide a construction 
schedule and more detailed design information to allow the U.S. 
to define equipment requirements.
    Third, GAO has noted that the estimated costs of the 
facility have increased dramatically since November 1993, with 
estimates of the U.S. cost-share having escalated accordingly. 
At a minimum, the project must be baselined before any 
significant commitment of U.S. construction funding is made.

                    Demilitarization Enterprise Fund

    The committee denies the request for the Demilitarization 
Enterprise Fund in fiscal year 1996 and recommends a provision 
(sec. 1103) that would repeal authority for these activities.
    The committee remains skeptical of CTR funded activities 
intended to assist in the ``conversion'' of Russian military 
enterprises into non-military enterprises. Even if defense 
conversion in Russia is feasible, a debateable proposition, the 
committee believes that such activities more appropriately fall 
into the category of either foreign aid or economic assistance 
and should not be the funding responsibility of the Department 
of Defense or the CTR program.
    According to GAO, ``DOD focussed on initiating [defense 
conversion] projects at former Soviet Union firms and 
facilities that once produced weapons of mass destruction, but 
there is only one facility where an active production line is 
being converted to civilian use.'' Moreover, the committee is 
concerned that CTR activities in this area have not given 
adequate priority to privatization of Russian industrial 
enterprises. In fact, it could be argued that CTR conversion 
activities may be hindering privatization by subsidizing state-
run military enterprises. If so, this result would be in direct 
contradiction to the Department's assertions that CTR defense 
conversion activities have enhanced Russia's prospects for 
longer-term economic reform.
    The committee is also concerned with the potentially 
astronomical costs associated with U.S. efforts to convert any 
significant portion of the Russian defense industry to civilian 
production. Hundreds of billions of dollars and decades of 
spending will be required to accomplish this task. The 
committee does not endorse the perspective that the Department 
of Defense has a financial responsibility to pay for the 
transformation of Russia's highly militarized economy or for 
the retraining of the workers in the Russian military-
industrial complex. This is particularly true in view of the 
fact that Russia maintains an active, aggressive and well 
funded strategic modernization program to this day.
    Based on communication with the Department of Defense, it 
is the committee's understanding that none of the requested 
fiscal year 1996 CTR funding is intended to pay for Russian 
housing or environmental restoration activities. With this 
understanding, the committee has opted not to include any 
statutory prohibition on such expenditures.

                        Peacekeeping Activities

    The committee recommends a provision (sec. 1104) that would 
prohibit the obligation or expenditure of CTR funds for the 
purpose of conducting peacekeeping exercises or any 
peacekeeping-related activities with Russia during fiscal year 
1996. This provision results from the committee having been 
notified by the Assistant Secretary of Defense for 
International Security Policy in May 1994 that the Department 
used CTR funds during the last fiscal year to conduct several 
peacekeeping field training exercises. Such activities should 
not be funded out of the CTR program since they have little to 
do with nuclear dismantlement, destruction or weapons security 
or with halting the proliferation of weapons of mass 
destruction.

                           Improved Oversight

    To facilitate the committee's ability to better oversee 
permitted CTR activities, the committee recommends several 
provisions. First, the committee recommends a provision (sec. 
1107) that would require the Secretary of Defense to submit an 
annual report accounting for U.S. CTR assistance, as well as a 
provision (sec. 1106) that would require prior notification of 
the obligation of CTR program funds. The committee also 
recommends a provision (sec. 1105) that would modify the 
certification that the President currently must make in order 
to provide assistance under the CTR program. This section would 
require proposed recipients of CTR assistance to meet certain 
minimum eligibility standards, such as compliance with arms 
control agreements, and respecting the rights of minorities, 
and other related criteria.

              TITLE XII--MATTERS RELATING TO OTHER NATIONS


                  Subtitle A--Peacekeeping Provisions


section 1201--limitation on expenditure of department of defense funds 
for united states forces placed under united nations command or control

    Presidential Decision Directive 25 (PDD-25) signed by 
President Clinton in May of 1994 contains a number of policy 
initiatives intended to promote peacekeeping as an important 
instrument of the Administration's national security policy. 
Summary documents and extensive public and private briefings on 
this policy initiative, make clear to the committee that the 
Administration has adopted a policy of allowing the placement 
of U.S. armed forces under the operational control of foreign 
commanders when engaged in peacekeeping operations.
     The Administration continues to stress that the President 
will retain ``command'' of U.S. forces at all times. However, 
the usage of the term ``command'' in this context refers to the 
administrative control of military forces which has never been 
an issue of debate or contention. On the other hand, the 
practice of ceding ``operational control'' of U.S. military 
forces to non-U.S. commanders remains a highly controversial 
and troubling policy. While certain U.S. military units have 
operated under the operational control of other nations, these 
instances have been rare and usually as part of larger 
coalition military operations where the U.S. retains overall 
operational command of the theater of operation. Further, these 
instances occurred during traditional military operations that 
allowed a high degree of planning and coordination to minimize 
the inherent complications resulting from mixed command chains.
    By contrast, the concept of ceding operational control of 
U.S. forces to a United Nations peacekeeping command is a 
relatively recent practice that has thus far yielded decidedly 
mixed results. As demonstrated during the UNOSOM II operation 
in Somalia, peacekeeping operations place a high premium on the 
ability to rapidly employ effective military force in response 
to unplanned circumstances. The tactical demands of such 
operations tend to stress and exacerbate the limitations of 
mixed-nationality operations resulting from the usually 
significant cultural, language, doctrine, and training 
differences among the participating national contingents. While 
only U.S. logistics forces were placed under UN operational 
control during UNOSOM II, the unanimous view of U.S. commanders 
interviewed by the committee during its review of the Somalia 
operation was that UN mixed-nationality command chains are 
inappropriate for demanding UN operations.
    Therefore, the committee recommends a provision (sec. 1201) 
that would regulate the circumstances under which the President 
could commit U.S. forces under UN command or control. This 
provision would require that before U.S. forces may be deployed 
under the command or operational control of the UN, the 
President must first certify to the Congress that 1) such a 
command arrangement is necessary to protect U.S. national 
security interests, 2) the commander of the U.S. force involved 
will retain the right to report independently to U.S. military 
authorities and to decline to comply with orders judged to be 
illegal, military imprudent or beyond the mandate of the U.S. 
mission, 3) the U.S. force involved will remain under U.S. 
administrative command, and 4) the U.S. will retain the 
authority to withdraw the U.S. force involved and take action 
it considers necessary to protect this force if it is engaged.
     While this provision seeks to ensure that any deployment 
of U.S. forces under UN command or control is made with a clear 
and unambiguous understanding of the right of the United States 
to withdraw those forces at any time and to take any action 
considered necessary to protect such forces, the committee 
recognizes that any such decision to withdraw deployed U.S. 
forces should be made with due regard and consideration for the 
safety of U.S. and other national contingents deployed in any 
such given operation.
    The provision would further require the President to submit 
a report along with the aforementioned certification providing: 
1) a description of the national security interests that 
require such a command arrangement, 2) the mission of the U.S. 
forces involved, 3) the expected size and composition of the 
U.S. forces involved, 4) the incremental cost to the U.S. of 
participation in the operation, 5) the precise command and 
control relationship between the U.S. forces and the United 
Nations command structure, 6) the precise command and control 
relationship between the U.S. forces involved and the U.S. 
unified commander for the region in which the forces will be 
operating, 7) the extent to which the U.S. forces involved will 
be relying on non-U.S. forces for self protection, and 8) the 
timetable for the complete withdrawal of the U.S. forces 
involved.

  section 1202--limitation on use of department of defense funds for 
 united states share of costs of united nations peacekeeping activities

     Presidential Decision Directive 25 (PDD-25) proposes to 
change the manner in which the United States Government 
finances its annual assessed contribution to the UN for 
peacekeeping by having the Department of Defense pay for the 
U.S. costs of all Chapter VII operations and those Chapter VI 
operations involving U.S. troops. This so called ``shared 
responsibility'' arrangement was specifically rejected by the 
House Committee on Armed Services in the 103rd Congress during 
consideration of H.R. 4301, the National Defense Authorization 
Act for Fiscal Year 1995 and by the House of Representatives in 
adopting H.R. 7, the National Security Revitalization Act in 
February 1995.
     Therefore, the committee denies authorization for the $65 
million contained in the budget request for this purpose and 
recommends a provision (sec. 1202) that would specifically 
prohibit the expenditure of funds made available to the 
Department of Defense for voluntary or assessed financial 
contributions to the United Nations for the United States share 
of peacekeeping costs. The committee continues to strongly 
oppose the ``shared responsibility'' concept as it represents 
one more attempt to divert scarce defense resources toward a 
non-defense purpose.

              Subtitle B--Humanitarian Assistance Programs


 section 1211--overseas humanitarian, disaster, and civic aid programs

     This section would specify that all funding authorized by 
this Act for DOD humanitarian, disaster and overseas civic 
assistance programs shall be provided from the consolidated 
operations and maintenance Overseas, Humanitarian, Disaster, 
and Civic Aid (OHDACA) account established by title III of this 
bill. The committee recommends an authorization of $50 million 
for this account for fiscal year 1996.

                 section 1212--Humanitarian assistance

     This section would make technical corrections to existing 
provisions of law providing the Department of Defense to 
conduct humanitarian assistance activities. The provision would 
also repeal the authority to transfer DOD funds to the 
Secretary of State for the purpose of providing humanitarian 
assistance.

                section 1213--landmine clearance program

     This section would consolidate the current Department of 
Defense authority to conduct humanitarian demining activities 
into existing civic assistance authorities in title 10, United 
States Code.

                       Subtitle C--Other Matters


   section 1221--revision of definition of landmine for purposes of 
                       landmine export moratorium

     This section would amend the current definition of 
landmine to clarify that remotely operated devices are not 
included for the purposes of the landmine export moratorium.

     section 1222--extension and amendment of counterproliferation 
                              authorities

     This section would extend through fiscal year 1996 the 
authority for the Department of Defense to conduct the 
International Nonproliferation Initiative previously 
established in law. The provision would limit fiscal year 1996 
funding for Department support to international 
nonproliferation activities, including UNSCOM support, to 
$15,000,000.

  section 1223--prohibition on use of funds for activities associated 
    with the united states-people's republic of china joint defense 
                         conversion commission.

     The committee is aware of ongoing discussions as part of 
the United States-People's Republic of China Joint Defense 
Conversion Commission. Concerns have been expressed, however, 
about whether these talks, and agreements reached therein, 
serve United States national security goals and objectives. In 
particular, concern has been expressed that agreements reached 
through the commission have led to U.S. assistance to Chinese 
firms that have direct ties to the People's Liberation Army 
(PLA), resulting in possible subsidies to the PLA. Based on 
these and other concerns, the committee recommends a provision 
(sec. 1223) that would prohibit the use of Department of 
Defense funds provided by this Act for activities associated 
with the United States-People's Republic of China Joint Defense 
Conversion Commission.

              section 1224--defense export loan guarantees

    This section would create a defense export loan guarantee 
program which, at no cost to the taxpayer, would provide 
American defense firms the ability to offer financing as part 
of the financial package for arms sales to certain specified 
countries.

        section 1225--accounting for burdensharing contributions

    This section would authorize the United States to accept 
burdensharing contributions in the currency of the host nation 
or in dollars, and to manage it as a separate account, 
available until expended.

    section 1226--authority to accept contributions for expenses of 
  relocation within host nation of united states armed forces overseas

    This section would establish authority and procedures for 
the Secretary of Defense to accept contributions from host 
nations for the purposes of relocating United States armed 
forces within the host nation when such relocation is being 
accomplished at the convenience of the host nation and for the 
purpose of deploying United States troops to the host nation 
during contingency deployment.

        section 1227--sense of congress on abm treaty violations

    This section would express the Sense of Congress regarding 
violations of the ABM Treaty by the former Soviet Union.

                       Items of Special Interest


                 report on north korean military power

    The committee report on H.R. 4301, the National Defense 
Authorization Act for Fiscal Year 1995 (H. Rept. 103-499), 
directed the Secretary of Defense to task the Defense 
Intelligence Agency (DIA) to provide by January 1, 1995 an 
updated version of the unclassified report entitled ``North 
Korea: The Foundations of Military Power,'' published in 1991. 
The committee notes that the DIA has not yet fulfilled this 
request, and only recently received permission from the Office 
of the Secretary of Defense to begin this important project. 
This unacceptable delay is depriving the public of a valuable 
source of current, official, unclassified information at a 
crucial time in the debate over the future direction of United 
States national security policy toward North Korea. The 
committee once again directs the Secretary of Defense to 
provide to Congress as soon as possible, and no later than 
October 1, 1995, an updated version of the unclassified report 
in question.

                  african center for security studies

    To encourage a broader understanding on the African 
continent of military matters compatible with democratic 
principles and civilian control, the committee directs the 
Secretary of Defense to develop an African Center for 
Securities Studies patterned after the George C. Marshall 
Center for European Security Studies located in Germany. The 
Secretary should ensure that the center offers advanced study 
and training in civil-military relations, the building of 
democratic institutions, and related courses to members of the 
United States military and to the militaries and defense 
civilian personnel of African nations. The Secretary should 
provide the Congressional defense committees with a plan on 
implementing this direction by December 1, 1995.

            sharing of intelligence with the united nations

    The committee continues to be concerned regarding the 
development and implementation of proper safeguards governing 
the sharing of U.S. intelligence materials with United Nations 
personnel and organizations, particularly in the conduct of UN 
peace operations. During the withdrawal of UN forces from 
Somalia, American troops discovered a large, unsecured cache of 
materials with significant potential to disclose intelligence 
sources and methods.
    A review of these incidents by the Chairman of the Joint 
Chiefs of Staff concluded that U.S. documents found in the UN 
intelligence files should never have been provided to the UN, 
that U.S. information sanitization procedures were violated, 
and that UN security management and execution were 
unsatisfactory. Accordingly, the committee directs the 
Secretary of Defense to provide the Congressional defense 
committees with a report detailing: 1) the Secretary's plan to 
ensure that the breakdown in security procedures disclosed by 
UNOSOM II incident in Somalia is not repeated, 2) the status of 
corrective steps taken since the release of the U.S. Central 
Command review of this incident, 3) the status of efforts to 
develop standard UN guidance for information security 
(including, but not limited to receiving, handling, storing, 
and destroying sensitive information), and 4) the Secretary's 
assessment on the adequacy of UN intelligence information 
security for UN operations in Haiti and the former Yugoslavia.

            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 1996. As approved 
by the committee, Division B would authorize appropriations in 
the amount of $11,197,995 for construction in support of the 
active forces, reserve components, defense agencies, and the 
NATO security infrastructure fund for fiscal year 1996. A brief 
tabular summary of the authorizations provided in Division B 
for fiscal year 1996 follows:
    Offset Folio 392 Insert Here



                                overview

    The military construction authorization request for fiscal 
year 1996 was introduced as H.R.1529 on May 2, 1995.
    The Department of Defense requested authorization of 
appropriations of $6,579,073,000 for fiscal year 1996 for 
military construction and $4,125,221,000 for family housing 
construction and support. The committee recommends 
$6,878,840,000 for military construction and $4,319,155,000 for 
family housing construction and support for fiscal year 1996.

           Quality of Housing, Installations, and Facilities

    The committee is concerned about serious and critical 
shortfalls in the quality of military installations and 
facilities, including troop housing and military family 
housing. The committee notes that the construction and 
modernization of facilities and their upkeep and maintenance is 
a critical component of military readiness which has been 
underfunded in recent years. Shortfalls in the construction, 
repair and maintenance, and utilities accounts have exacerbated 
problems in the facilities infrastructure which has either 
deferred needed improvements or has diverted training and other 
operations and maintenance funds to pay for base maintenance 
and repair. Over the long-term, the cumulative effects of 
neglect have created a serious backlog in facilities 
construction and maintenance.
    The committee believes that the funding proposed by the 
Administration for fiscal year 1996 is not adequate to begin to 
reverse this backlog. Consequently, the committee recommends a 
significant investment of funds above the budget request for 
real property maintenance and the military construction 
accounts.
    The committee is pleased by the attention the Secretary of 
Defense has paid to the problems affecting military family 
housing, troop housing, and other quality of life improvements. 
The committee notes, however, that the limited request for 
funding of the military construction program led to difficult 
trade-offs which restricted funding for certain improvements, 
particularly troop housing.
    The committee proposes to address these shortfalls with 
both short-term improvements and legislative changes to the 
military construction program to enhance public-private 
partnerships in the development of military family housing. The 
committee recommends an increase of $472 million above the 
budget request for troop housing, military family housing, and 
other quality of life enhancements. The committee also 
recommends a series of legislative authorities to encourage 
private-sector involvement in the development of military 
family housing.

                      Base Closure and Realignment

    The Department of Defense requested authorization of 
appropriations of $3,897,892,000 for fiscal year 1996 for 
activities associated with base closure and realignment. The 
committee recommends $3,897,892,000.
    A tabular summary of the military construction projects 
included with the authorization of appropriations for fiscal 
year 1996 for the BRAC II and BRAC III accounts follows:
    Offset Folios 395 to 400 Insert here



                    NATO Security Investment Program

    The Department of Defense requested authorization of 
$179,000,000 for the NATO infrastructure fund for fiscal year 
1996. The committee recommends $161,000,000.

                AUTHORIZATION FOR MILITARY CONSTRUCTION

    The Department of Defense requested $6,579,073,000 for 
military construction and $4,125,221,000 for family housing for 
fiscal year 1996. Within the military construction request, 
$3,897,892,000 was requested for implementation of base closure 
and realignment actions.
    The committee recommends authorization of $6,878,840,000 
for military construction, including $3,897,892,000 for base 
closure implementation, and $4,319,155,000 for family housing.

                            TITLE XXI--ARMY


                                Summary

    The Army requested authorization of $472,724,000 for 
military construction and $1,381,096,000 for family housing for 
fiscal year 1996. The committee recommends authorization of 
$631,608,000 for military construction, $1,459,996,000 for 
family housing for fiscal year 1996, and $75,586,000 for the 
Homeowners Assistance Program.

                         Legislative Provisions


    section 2101--authorized army construction and land acquisition 
                                projects

    This section contains the list of authorized Army 
construction projects for fiscal year 1996. 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 
1996.

      section 2103--improvements to military family housing units

    This section would authorize improvements to existing units 
of family housing for fiscal year 1996.

          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 
1996. This section also provides an overall limit on the amount 
the Army may spend on military construction projects.

                       Items of Special Interest


                      repair and maintenance, army

    The committee is aware of serious safety and other 
deficiencies at Lake Tholocco Dam at Fort Rucker, Alabama. The 
committee is also aware of critical structural deficiencies of 
two bridges at Fort Knox, Kentucky. The committee urges the 
Army to initiate appropriate repair and maintenance at both 
installations.
    The committee is also aware of a serious repair and 
maintenance backlog at Corpus Christi Army Depot, Texas which 
requires an extensive infrastructure renovation to offset 
deterioration to major mechanical, electrical and other 
systems. Many major infrastructure systems at the depot have 
reached the end of their useful lives and require major 
renovation, repair and upgrade. The committee urges the Army to 
initiate appropriate repair and maintenance of various 
buildings within the Corpus Christi Army Depot complex.

                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 projects: 
$3,400,000 for Whole House Improvements at White Sands Missile 
Range, New Mexico; $10,000,000 for Whole Neighborhood 
Revitalization at Fort Bragg, North Carolina; and $19,000,000 
for Whole Neighborhood Revitalization at Fort Campbell, 
Kentucky.

                          fort dix, new jersey

    The committee notes that the Department has actively sought 
to locate certain non-Department of Defense activities on 
military installations when appropriate. These activities 
generally reimburse the Department for services provided by the 
host installation. This practice can help offset a portion of 
base operating expenses.
    While generally supportive of this policy, the committee is 
concerned that it may be overused at certain military 
installations. Such overuse may detract and diminish the 
effectiveness of an installation in fulfilling its mission. In 
this context, the committee notes with concern recent efforts 
to place a youthful offender boot camp at Fort Dix, New Jersey. 
If permitted to locate at Fort Dix, the boot camp would 
represent the fourth corrections or youth-service program at 
this installation. The committee is concerned about the 
possible effects of an additional non-defense activity located 
at Fort Dix and would view unfavorably a decision by the 
Department to permit the establishment of a youthful offender 
boot camp at the installation.

                            TITLE XXII--NAVY


                                Summary

    The Navy requested authorization of $492,936,000 for 
military construction and $1,514,084,000 for family housing for 
fiscal year 1996. The committee recommends authorization of 
$588,243,000 for military construction and $1,576,618,000 for 
family housing for fiscal year 1996.

                         Legislative Provisions


    section 2201--authorized navy construction and land acquisition 
                                projects

    This section contains the list of authorized Navy 
construction projects for fiscal year 1996. 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 
1996.

      section 2203--improvements to military family housing units

    This section would authorize improvements to existing units 
of family housing for fiscal year 1996.

          section 2204--authorization of appropriations, navy

    This section would authorize specific appropriations for 
each line item in the Navy's budget for fiscal year 1995. This 
section also provides an overall limit on the amount the Navy 
may spend on military construction projects.

                       Items of Special Interest


                      repair and maintenance, navy

    The committee is aware of major structural deficiencies in 
the fire suppression station at the Philadelphia Naval Base, 
Pennsylvania, and believes that modifications are required to 
provide a safe and efficient facility. The committee recognizes 
that the fire suppression station is required to continue 
providing firefighting and emergency response services for 
personnel who will remain at the facility after the closure of 
the Philadelphia Naval Shipyard. The committee urges the Navy 
to undertake a survey of the facility and to initiate 
appropriate repair and maintenance of the fire suppression 
station.

                     unspecified minor construction

    The committee recommends that, within authorized amounts 
for unspecified minor construction, the Secretary of the Navy 
execute the following projects: $950,000 for an alternate 
railway and $590,000 for relocation of a gas line at Marine 
Corps Logistics Base, Albany, Georgia.

                          planning and design

    The committee recommends that, within authorized amounts 
for planning and design, $2,340,000 be used to complete design 
work for wharf improvements at Naval Station Mayport, Florida. 
The recommended design work would support shore power and 
utility upgrades, structural and mooring improvements, 
environmental improvements, and other site improvements at 
wharfs C-2 and F. This design work is necessary to accommodate 
the growing number of activities situated and vessels 
homeported at Naval Station Mayport. The committee understands 
that the recommended design work will support both current 
activities at Naval Station Mayport as well as a possible 
upgrade of the installation to homeport a nuclear-powered 
aircraft carrier. In keeping with the latter interest, the 
committee urges that the specifications for this design work be 
consistent with those requisite to homeporting a nuclear-
powered aircraft carrier at Mayport.

                improvements of military family housing

    The committee recommends that, within authorized amounts 
for improvements of military family housing and facilities, the 
Secretary of the Navy execute the following projects: 
$14,575,000 for Whole House Revitalization at Naval Station 
Mayport, Florida; $15,300,000 for Whole House Revitalization, 
Phase I at Great Lakes Naval Training Center, Illinois; 
$8,795,000 for Whole House Improvements at Newport, Rhode 
Island; and $6,784,000 for Whole House Rehabilitation at Marine 
Corps Air Station, Beaufort, South Carolina.

             power plant upgrade, public works center, guam

    The committee understands that the Navy and the Guam Power 
Authority (GPA) have shared the operating cost and use of power 
plants to service the Guam island wide power system as agreed 
in the Power Pool Agreement of 1972. The committee also 
understands that the Navy may seek to terminate the Agreement 
and divest itself of all operating responsibilities of the 
power systems. The committee notes that, as stated in the 
Agreement, the Navy must upgrade the Piti Power Plant before it 
can withdraw from the Agreement and transfer the Piti units to 
GPA.

                        navy SEAL facility, guam

    The committee is encouraged by the cooperation of the Navy 
with the Government of Guam concerning the siting and 
construction timetable for Navy SEAL projects in Guam. The 
committee notes that the location of this facility in the inner 
harbor at Apra Harbor may restrict Guam's ability to develop 
its commercial port. The committee urges the Navy to continue 
to work cooperatively with the Government of Guam to examine 
alternative sites for the SEAL facility which consider Guam's 
economic needs.

    ordnance storage needs of marine corps air station yuma, arizona

    The committee remains concerned about ordnance storage at 
Marine Corps Air Station (MCAS) Yuma, Arizona and the effects 
on training and safety of current inadequate ordnance storage 
at the installation. The committee has reviewed the report of 
the Secretary of the Navy submitted on February 1, 1995 on this 
matter. The committee is pleased to note three of the seven 
military construction projects identified as requirements to 
remediate safety problems are programmed within the Future Year 
Defense Plan. The committee, however, is concerned that the 
remaining four military construction projects are unplanned. 
The committee urges the Secretary of the Navy to reassess the 
requirements to address safety and training problems at MCAS 
Yuma and also urges the Navy to accelerate military 
construction projects to remediate such problems.

                         TITLE XXIII--AIR FORCE


                                Summary

    The Air Force requested authorization of $497,104,000 for 
military construction and $1,098,216,000 for family housing for 
fiscal year 1996. The committee recommends authorization of 
$586,841,000 for military construction and $1,140,716,000 for 
family housing for fiscal year 1996.

                         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 1996. 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 1996.

      section 2303--improvements to military family housing units

    This section would authorize improvements to existing units 
of family housing for fiscal year 1996.

        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 1996. 
This section also would provide an overall limit on the amount 
the Air Force may spend on military construction projects.

  section 2305--retention of accrued interest on funds deposited for 
     construction of family housing, scott air force base, illinois

    This section would amend section 2310 of the Military 
Construction Authorization Act for fiscal year 1994 (division B 
of Public Law 103-760) to permit the retention of accrued 
interest on funds previously transferred to the County of St. 
Clair, Illinois, for the purpose of constructing military 
family housing at Scott Air Force Base. Upon the completion of 
construction all funds remaining, and any interest accrued 
thereon, shall be deposited in the general fund of the 
Treasury.

                       Items of Special Interest


                improvements of military family housing

    The committee recommends that, within authorized amounts 
for improvement of military family housing and facilities, the 
Secretary of the Air Force execute the following project: 
$5,900,000 for family housing improvements at Wright-Patterson 
Air Force Base, Ohio.

                    tyndall air force base, florida

    The committee is aware of deficiencies in the aircraft 
support equipment shop at Tyndall Air Force Base, Florida. The 
committee is concerned such deficiencies may jeopardize 
readiness and flight operations. The committee encourages the 
Air Force to examine the facility. If the Air Force determines 
that the facility can no longer support the required 
maintenance operation in an efficient and safe manner, the 
committee urges the Air Force to initiate design work on a 
replacement facility.

                      TITLE XXIV--DEFENSE AGENCIES


                                Summary

    The Defense agencies requested authorization of 
$857,405,000 for military construction and $56,239,000 for 
family housing for fiscal year 1996. The committee recommends 
authorization of $728,332,000 for military construction and 
$66,239,000 for family housing.

                         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 1996. 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--family housing private investment

    This section would authorize the Secretary of Defense to 
enter into agreements to construct, acquire, and improve family 
housing, for the purpose of encouraging private investment, in 
the amount of $22,000,000.

      section 2403--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 1996 in an amount not to exceed $3,772,000.

               section 2404--energy conservation projects

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

    section 2405--authorization of appropriations, defense agencies

    This section would authorize specific appropriations for 
each line item in the Defense Agencies' budget for fiscal year 
1996. This section also would provide an overall limit on the 
amount the Defense Agencies may spend on military construction 
projects.

 section 2406--modification of authority to carry out fiscal year 1995 
                                projects

    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) to provide for full 
authorization of projects to support chemical weapons and 
munitions destruction at Pine Bluff Arsenal, Arkansas, and 
Umatilla Army Depot, Oregon.

 section 2407--limitation on expenditures for construction project at 
                      umatilla army depot, oregon

    This section would prohibit the expenditure of funds for 
the construction of a chemical weapons and munitions 
incinerator facility at Umatilla Army Depot, Oregon until after 
March 1, 1996.

      TITLE XXV--NORTH ATLANTIC TREATY ORGANIZATION INFRASTRUCTURE


                                Summary

    The Department of Defense requested authorization of 
$179,000,000 for the NATO infrastructure fund for fiscal year 
1996. The committee recommends $161,000,000.

                         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 
infrastructure 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 $161,000,000 
as the U.S. contribution to the NATO infrastructure program.

            TITLE XXVI--GUARD AND RESERVE FORCES FACILITIES


                                Summary

    The Department of Defense requested a military construction 
authorization of $182,012,000 for fiscal year 1996 for guard 
and reserve facilities. The committee recommends authorization 
for fiscal year 1996 of $284,924,000 to be distributed as 
follows:

Army National Guard.....................................     $72,537,000
Army Reserve............................................      42,963,000
Naval and Marine Corps Reserve..........................      19,655,000
Air National Guard......................................     118,267,000
Air Force Reserve.......................................      31,502,000
                    --------------------------------------------------------
                    ____________________________________________________
Total...................................................     284,924,000

                         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 1996. The state list contained in this report is 
intended to be the binding list of the specific projects 
authorized at each location.

section 2602--correction in authorized uses of funds for army national 
                     guard projects in Mississippi

    This section would clarify that amounts authorized to be 
appropriated in section 2601(1)(A) of the Military Construction 
Authorization Act for Fiscal Year 1994 (division B of Public 
Law 103-360) for the addition or alteration of Army National 
Guard armories at various locations in the State of Mississippi 
shall be available for the addition, alteration, or new 
construction of armory facilities and an operations and 
maintenance shop facility, including the acquisition of land 
for such facilities at such locations.

        TITLE XXVII--EXPIRATION AND EXTENSION OF AUTHORIZATIONS


 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, 1998 or the date of enactment of an Act 
authorizing funds for military construction for fiscal year 
1999, whichever is later. This expiration would not apply to 
authorizations for which appropriated funds have been obligated 
before October 1, 1998 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 1993 
                                projects

    This section would provide for selected extension of 
certain fiscal year 1993 military construction authorizations 
until October 1, 1996, or the date of the enactment of an Act 
authorizing funds for military construction for fiscal year 
1997, whichever is later.

 section 2703--extension of authorizations of certain fiscal year 1992 
                                projects

    This section would provide for selected extension of 
certain fiscal year 1992 military construction authorizations 
until October 1, 1996, or the date of the enactment of the Act 
authorizing funds for military construction for fiscal year 
1997, 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, 
1995, or the date of the enactment of this Act, whichever is 
later.

                    TITLE XXVIII--GENERAL PROVISIONS


 Subtitle A--Military Construction Program and Military Family Housing 
                                Changes


   section 2801--alternative means of acquiring and improving family 
         housing and supporting facilities for the armed forces

    This section would authorize a series of authorities as 
alternative methods of acquiring and improving family housing 
and supporting facilities for the armed forces. Such 
authorities would include the ability to contract and lease 
family housing. The authorities would be targeted at 
installations where there is a shortage of suitable family 
housing. For housing acquired under the authorities provided in 
this section, the unit size and type limitations in current law 
would be waived to encourage private sector development of 
military family housing units. The Department of Defense would 
be authorized to contribute up to 35 percent of the investment 
cost in any project. Such investment could take a number of 
forms, including cash, current housing, and/or real property. 
This section would also establish the Defense Family Housing 
Improvement Fund which would be the sole source of funding for 
projects undertaken under the authorities provided in this 
section. This section would also provide a 21-day notice-and-
wait requirement for any contract entered into by the 
Department under the authorities in this section, and a 30-day 
notice-and-wait requirement on requests to transfer funds from 
the family housing construction accounts into the fund. Each of 
the authorities contained in this section would expire on 
September 30, 2000.

   section 2802--inclusion of other armed forces in navy program of 
   limited partnerships with private developers for military housing

    This section would expand the limited partnership authority 
authorized for the Department of the Navy in the Military 
Construction Authorization Act for Fiscal Year 1995 (division B 
of Public Law 103-337) to each of the military departments. The 
expanded limited partnership authority would expire on 
September 30, 2000.

  section 2803--special unspecified minor construction thresholds for 
     projects to correct life, health, and safety deficiencies and 
       clarification of unspecified minor construction authority

    This section would increase the thresholds for unspecified 
minor construction projects from $1,500,000 to $3,000,000 and 
the thresholds for projects funded with operations and 
maintenance funds from $300,000 to $1,000,000 solely for 
construction and maintenance projects to remediate serious 
life, health, and safety deficiencies. The provision would not 
increase the budgetary requirements of the Department of 
Defense.
    The section would also make a technical and clarifying 
change in the definition of a minor construction project in the 
applicable provisions of chapter 169, title 10, United States 
Code.

section 2804--disposition of amounts recovered as a result of damage to 
                             real property

    This section would authorize the military departments to 
retain the proceeds recovered as a result of damages to real 
property rather than depositing those proceeds into the 
miscellaneous receipts account in the Treasury. Such proceeds 
would be made available for repair or replacement of damages to 
real property.

      section 2805--rental of family housing in foreign countries

    This section would authorize an increase in the number of 
high-cost family housing units which may be leased in foreign 
countries.

section 2806--pilot program to provide interest rate buy down authority 
    on loans for housing within housing shortage areas at military 
                             installations

    This section would authorize a three-year pilot project to 
provide additional housing assistance to military personnel. 
Under the program, which would be administered by the Secretary 
of Veterans Affairs (VA), the VA would buy down the interest 
rate on VA home loans for qualified applicants. The Secretary 
of Defense would reimburse the VA for the costs of the interest 
rate buy down. Authorization of the program would be limited to 
$10 million and could only be utilized at military 
installations which the Secretary of Defense considers to have 
a military family housing deficit.

                       Items of Special Interest


            impediments to reform of military family housing

    The committee directs the Secretary of Defense to review 
current statutes and regulations affecting the acquisition and 
improvement of military family housing. The Secretary shall 
submit a report on the Department's findings, including any 
recommendations for changes to applicable statutes and 
regulations, to the congressional defense committees, no later 
than February 1, 1996.

                  measurement of housing deficiencies

    The committee notes that each of the military departments 
has developed different methodologies for measuring 
deficiencies in the availability of housing for military 
families and enlisted personnel in local housing markets 
surrounding military installations. The committee is concerned 
that the authorities authorized in this bill for alternative 
means of acquiring and improving family housing and supporting 
facilities for the armed forces be utilized in a consistent 
manner. The committee directs the Secretary of Defense to 
conduct a study of current deficiency measurement standards 
among the military departments and develop a common department-
wide standard for such measurements. The Secretary shall submit 
a report on the Department's progress to the congressional 
defense committees no later than February 1, 1996.

            Subtitle B--Defense Base Closure and Realignment


section 2811--authority to transfer property at military installations 
   to be closed to persons who construct or provide military family 
                                housing

    This section would authorize the Secretary of Defense to 
enter into an agreement to transfer property or facilities at 
an installation closed, or to be closed, under current law to a 
person who agrees to provide, in exchange for the property or 
facilities, housing units located at another military 
installation where there is a shortage of suitable housing. 
Under the provision, the Secretary would not be permitted to 
select property or facilities for transfer that have been 
identified in the redevelopment plan for the installation as 
essential for base reuse and development.

 section 2812--deposit of proceeds from leases of property located at 
            military installations being closed or realigned

    This section would authorize the deposit of proceeds from 
leases of property located at installations being closed or 
realigned into the relevant account established to administer 
matters related to base closure and realignment.

 section 2813--agreements for certain services at installations being 
                                 closed

    This section would clarify current law to authorize the 
Secretary of Defense to enter into agreements with local 
governments for the provision of police or security services, 
fire protection services, airfield operation services, or other 
community services provided by such governments at military 
installations scheduled to be closed.

                       Items of Special Interest


 management of excess military lands for certain recreational purposes

    The committee recognizes the demand for access to public 
lands, including lands managed by the Department of Defense, 
for outdoor recreational and sporting pursuits. The committee 
is aware of proposals to make land on military bases that are 
closed or are scheduled to be closed available to the States 
and open to the public for such activities. The Secretary is 
directed to conduct a study of the feasibility of conveying 
land excess to the military departments as a result of a base 
closure and which has no local development purpose to the 
States for designation as wildlife management areas to be 
managed for outdoor recreational and sporting pursuits. The 
Secretary shall submit a report on the Department's findings, 
including any recommendations, to the Congress no later than 
May 1, 1996.

                 Subtitle C--Land Conveyances Generally


    section 2821--transfer of jurisdiction, fort sam houston, texas

    This section would authorize the Secretary of the Army to 
transfer, without reimbursement, approximately 53 acres with 
improvements to the Secretary of Veterans Affairs. The property 
is to be conveyed for use as a national cemetery. The cost of 
any surveys necessary for the transfer of jurisdiction shall be 
borne by the Secretary of Veterans Affairs.

   section 2822--land acquisition or exchange, shaw air force base, 
                         sumter, south carolina

    This section would authorize the Secretary of the Air Force 
to acquire, by means of an exchange of property, acceptance as 
a gift, or other means that do not require the use of 
appropriated funds, all rights, title, and interest in a parcel 
of real property, with improvements, consisting of 
approximately 1,100 acres adjacent to Shaw Air Force Base, 
Sumter, South Carolina.

   section 2823--transfer of certain real property at naval weapons 
  industrial reserve plant, calverton, new york, for use as national 
                                cemetery

    This section would authorize the Secretary of the Navy to 
transfer, without reimbursement, approximately 150 acres to the 
Secretary of Veterans Affairs. The property is to be conveyed 
for use as a national cemetery. The cost of any surveys 
necessary for the transfer of jurisdiction shall be borne by 
the Secretary of Veterans Affairs.

          section 2824--land conveyance, fort ord, california

     This section would authorize the Secretary of the Army to 
convey a parcel of real property with improvements consisting 
of approximately 477 acres to the City of Seaside, California. 
The real property to be conveyed consists of the two Fort Ord 
golf courses and the Hayes housing facilities. As consideration 
for the conveyance of real property and improvements, the City 
shall pay an amount equal to the fair market value of the 
property to be conveyed. From the amount paid by the City as 
consideration for the conveyance, the Secretary shall deposit 
in the Morale, Welfare, and Recreation Fund account of the 
Department of the Army an amount equal to the fair market value 
of the golf courses conveyed under this section. The balance of 
the amount paid by the City shall be deposited in the 
Department of Defense Base Closure Account 1990.

     section 2825--land conveyance, indiana army ammunition plant, 
                          charlestown, indiana

     This section would authorize the Secretary of the Army to 
convey, without consideration, a parcel of real property, with 
improvements, consisting of approximately 1,125 acres to the 
State of Indiana. The property to be conveyed is to be used for 
recreational purposes. The cost of any surveys necessary for 
the conveyance of real property shall be borne by the State of 
Indiana.

  section 2826--land conveyance, naval air station, pensacola, florida

     This section would authorize the Secretary of the Navy to 
convey a parcel of unimproved real property consisting of 
approximately 135 acres to West Florida Developers, Inc. As 
consideration for the conveyance of real property, West Florida 
Developers, Inc. shall agree to restrict the use of all lands 
located within the Air Installation Compatible Zone of Naval 
Air Station Pensacola owned by West Florida Developers, Inc. 
The cost of any surveys necessary for the conveyance shall be 
borne by West Florida Developers, Inc.

  section 2827--land conveyance, avon park air force range, sebring, 
                                florida

     This section would authorize the Secretary of the Air 
Force to convey, without consideration, a parcel of real 
property, with improvements, within the boundaries of the Avon 
Park Air Force Range near Sebring, Florida. The property is to 
be conveyed for the operation of a juvenile or other 
correctional facility. The exact acreage of the real property 
to be conveyed shall be determined by a survey satisfactory to 
the Secretary, and the cost for such survey shall be born by 
Highland County, Florida.

  section 2828--land conveyance, parks reserve forces training area, 
                           dublin, california

     This section would authorize the Secretary of the Army to 
convey a parcel of real property, with improvements, consisting 
of approximately 31 acres to the County of Alameda, California. 
As consideration for the conveyance, the County would provide 
the Army with improvements and services at least equal to the 
appraised value of the real property conveyed. The improvements 
and services to be provided by the County would permit the 
relocation of the main gate of the Parks Reserve Forces 
Training Area, Dublin, California, and for the repair and 
replacement of deficient training area infrastructures. The 
exact acreage of the real property to be conveyed shall be 
determined by a survey satisfactory to the Secretary, and the 
cost for such survey shall be borne by the County.

  section 2829 land conveyance, holston army ammunition plant, mount 
                           carmel, tennessee

     This section would authorize the Secretary of the Army to 
convey, without reimbursement, a parcel of real property 
consisting of approximately 6.5 acres to the City of Mount 
Carmel, Tennessee. The property is to be conveyed for expansion 
of the existing Mount Carmel Cemetery. The cost of any surveys 
necessary for the conveyance of real property shall be borne by 
the City.

section 2830--land conveyance, naval weapons industrial reserve plant, 
                             mcgregor texas

     This section would authorize the Secretary of the Navy to 
convey, without consideration, to the City of McGregor, Texas, 
all rights, title, interest, and improvements thereon to a 
parcel of real property containing the Naval Weapons Industrial 
Reserve Plant. The Secretary would be authorized to convey 
other fixtures located on the property if such equipment can be 
reinstituted after the conveyance. Until the real property is 
conveyed by deed, the Secretary would be permitted to lease the 
facility to the City in exchange for security, fire protection, 
and maintenance. The conveyed property would be used for 
purposes of economic redevelopment. The exact acreage and legal 
description of the property are to be determined by a survey 
acceptable to the Secretary with the cost to be borne by the 
City. Finally, the Secretary would be authorized to set 
additional terms and conditions which protect the interests of 
the United States.

section 2831--transfer of jurisdiction and land conveyance, fort devens 
                  military reservation, massachusetts

     This section would require the Secretary of the Army to 
convey, without reimbursement, a portion of the Fort Devens 
Military Reservation, Massachusetts, to the Secretary of the 
Interior at any time after the date on which the property is 
determined to be excess to the needs of the Department of 
Defense. The property is to be conveyed for inclusion in the 
Oxbow National Wildlife Refuge. The cost of any surveys 
necessary for the conveyance shall be borne by the Secretary of 
the Interior.
    This section would also require the Secretary of the Army 
to convey, without reimbursement, a parcel of real property 
consisting of approximately 100 acres of the parcel available 
for transfer to the Secretary of the Interior to the Town of 
Lancaster, Massachusetts. The cost of any surveys necessary for 
the conveyance shall be borne by the Town.

    section 2832--land conveyance, elmendorf air force base, alaska

     This section would authorize the Secretary of the Air 
Force to sell to a private person a parcel of real property 
consisting of approximately 32 acres located at Elmendorf Air 
Force Base, Alaska. As consideration for the sale, the 
purchaser shall be subject to the condition to provide 
appropriate maintenance for the apartment complex located on 
the property to be conveyed and used by members of the armed 
forces and their dependents stationed at the Elmendorf Air 
Force Base. The cost of any surveys necessary for the sale of 
real property shall be borne by the purchaser.

section 2833--land conveyance alternative to existing lease authority, 
                naval supply center, oakland, california

     This section would amend section 2834(b) of the Military 
Construction Authorization Act for Fiscal Year 1993, (division 
B of Public Law 103-160), as amended, and section 2821 of the 
Military Construction Authorization Act for Fiscal Year 1995 
(division B of Public Law 103-337) to authorize the Secretary 
of the Navy without consideration to convey, in lieu of an 
existing lease, the property described to the City of Oakland, 
California, the Port of Oakland, California, or the City of 
Alameda, California, under such terms as the Secretary 
considers appropriate. The exact acreage of the real property 
which may be conveyed shall be determined by a survey 
satisfactory to the Secretary, and the cost for such survey 
shall be borne by the recipient of the property.

            Subtitle D--Land Conveyances Involving Utilities


 section 2841--conveyance of resource recovery facility, fort dix, new 
                                 jersey

     This section would authorize the Secretary of the Army to 
convey to Burlington County, New Jersey all rights, title, and 
interest of the United States in real property consisting of 
approximately two acres and containing a resource recovery 
facility. In consideration of the conveyance, Burlington County 
would accept the resource recovery facility in its existing 
condition and provide refuse and steam service to Fort Dix, New 
Jersey at a rate established by the appropriate State or 
Federal regulatory authority.

section 2842--conveyance of water and wastewater treatment plants, fort 
                            gordon, georgia

    This section would authorize the Secretary of the Army to 
convey to the City of Augusta, Georgia all rights, title, and 
interest of the United States in several parcels of real 
property consisting of approximately seven acres each and 
containing water and wastewater treatment plants and 
distribution and collection systems. In consideration of the 
conveyance, the City of Augusta would accept the water and 
wastewater treatment plants and distribution and collection 
systems in their existing condition and provide water and sewer 
service to Fort Gordon, Georgia at a rate established by the 
appropriate State or Federal regulatory authority.

section 2843--conveyance of electrical distribution system, fort irwin, 
                               california

    This section would authorize the Secretary of the Army to 
convey to the Southern California Edison Company, California 
all rights, title, and interest of the United States in the 
electrical distribution system located at Fort Irwin, 
California. In consideration of the conveyance, the Southern 
California Edison Company would accept the electrical 
distribution system in its existing condition and provide 
electrical service to Fort Irwin, California at a rate 
established by the appropriate State or Federal regulatory 
authority.

                       subtitle E--Other Matters


        section 2851--expansion of authority to sell electricity

    This section would amend section 2483(a) of title 10, 
United States Code, to expand the authority of the Department 
of Defense to permit the military departments to take advantage 
of changing electric power marketing conditions by increasing 
the available option to outsource for energy on military 
installations.

  section 2852--authority for mississippi state port authority to use 
    navy property at naval construction battalion center, gulfport, 
                              mississippi

    This section would authorize the Secretary of the Navy to 
enter into an agreement with the Port Authority of the State of 
Mississippi to permit joint use of real property and associated 
improvements comprising up to 50 acres located at the Naval 
Construction Battalion Center, Gulfport, Mississippi. The 
requirement would be for a period not to exceed 15 years, and 
the Port Authority would be required to pay fair market rental 
value as determined by the Secretary. The Secretary could not 
enter into any agreement until after the end of a 21-day period 
beginning on the date on which the Secretary submits a report 
to Congress explaining the terms of the proposed agreement and 
describing the consideration that the Secretary would expect to 
receive under the agreement.

  section 2853--prohibition on joint civil aviation use of naval air 
                      station miramar, california

    This section would prohibit the Secretary of the Navy from 
entering into any agreement that would provide for the regular 
use of Naval Air Station Miramar, California by civil aircraft.

section 2854--report regarding army water craft support facilities and 
                               activities

    This section would require a report by the Secretary of the 
Army regarding Army water craft support facilities and 
activities.

                       Items of Special Interest


                wargaming infrastructure and facilities

    The committee recognizes the importance of wargaming, 
simulation, and other analytical techniques to develop and 
evaluate advanced warfighting and campaign concepts and 
doctrine for future employment by the armed forces. The 
committee is aware of significant deficiencies in the 
infrastructure and facilities at several installations designed 
to support that purpose, including, but not limited to, the 
National Test Facility, Colorado; the Naval War College, Rhode 
Island; and the Armed Forces Staff College, Virginia. The 
committee directs the Secretary of Defense to conduct a 
comprehensive study of the wargaming capability and 
infrastructure of the military departments and the Department 
of Defense. The Secretary shall submit a report on the 
Department's findings, including any recommendations for 
improvements to such facilities, to the congressional defense 
committees, no later than March 1, 1996.
    Offset Folios 423 to 432 Insert here



 DIVISION C--DEPARTMENT OF ENERGY NATIONAL SECURITY AUTHORIZATIONS AND 
                          OTHER AUTHORIZATIONS


      TITLE XXXI--DEPARTMENT OF ENERGY NATIONAL SECURITY PROGRAMS


                                Purpose

    Title XXXI would authorize appropriations for the national 
security programs of the Department of Energy for fiscal year 
1996, including management and operation of programs for 
research, development, and production in support of the armed 
forces, the production of strategic and critical materials for 
the armed forces, the protection of critical materials, 
materials and information necessary for national defense, 
management of defense radioactive wastes; environmental 
management, naval nuclear propulsion, and other military 
applications of nuclear energy.

                            Overall Concerns

    The United States nuclear arsenal remains a critical 
component of U.S. defense policy. Although the number of U.S. 
nuclear weapons has already declined significantly, and will 
decline further as a result of arms control agreements, there 
is every reason to believe that nuclear weapons will remain a 
cornerstone of U.S. security for decades to come. As stated in 
the February, 1995 National Military Strategy document, ``The 
highest priority of our military strategy is to deter a nuclear 
attack against our Nation and allies. Our survival and the 
freedom of action that we need to protect extended national 
interests depend upon strategic and on strategic nuclear forces 
and their associated command, control, and communications.''
    Despite such pronouncements, the infrastructure necessary 
to design, produce, and maintain U.S. nuclear weapons has 
suffered significant erosion resulting from the Department's 
neglect over the past several years. If steps are not taken 
soon to reverse this decline in the U.S. nuclear 
infrastructure, U.S. political and military leaders will soon 
lose confidence in the safety, reliability, and effectiveness 
of U.S. nuclear weapons. Once that happens, America's ability 
to deter aggression--indeed, its credibility as a superpower--
will be significantly diminished.
    The committee's actions recommended in this bill are 
intended to serve as a first step in correcting the 
Administration's unacceptable neglect of the U.S. nuclear 
infrastructure.

          Subtitle A--National Security Program Authorizations


                      summary of committee changes

     The fiscal year 1996 budget request for DOE national 
security programs totaled $11,178,746,000. Of the total amount 
requested, $3,540,175,000 was for weapons activities, 
$6,008,002,000 was for defense environmental restoration and 
waste management, $1,432,159,000 was for materials support and 
other defense programs, and $198,400,000 was for defense 
nuclear waste disposal.
    The committee recommends a total of $10,818,555,000 
including $3,610,914,000 for weapons activities, $5,265,478,000 
for defense environmental restoration and waste management, 
$1,001,239 for other defense activities, and $198,400,000 for 
defense nuclear waste disposal.
     The following table summarizes the request and the 
committee recommendation.
    Offset folio 436 insert here



                    section 3101--weapons activities

     This section would authorize Department of Energy weapons 
activity funding for fiscal year 1996.

  section 3102--defense environmental restoration and waste management

     The budget request contained $6.0 billion for activities 
of the Department of Energy's Office of Environmental 
Restoration and Waste Management. The committee recommends 
reducing the requested amount by $742.5 million for a total 
authorized amount of $5,265,478,000.
    This reduction would be accomplished by reducing operations 
and maintenance accounts and by reducing the funds accumulated 
in prior year ``uncosted balance'' accounts. Uncosted balance 
accounts, in which repose funds that have been appropriated and 
obligated but not actually expended, have grown to unacceptably 
high levels, making prudent financial management and program 
execution difficult. The committee notes that the Department 
has, in its budget submission, recommended the use of over $275 
million in prior years balances to offset the new funding 
requirement. The committee believes that these accounts may be 
further reduced without jeopardizing the health or safety of 
workers or localities.
    The committee directs that the Department of Energy absorb 
the funding reductions that would be authorized by this Act by 
eliminating headquarters contract support staff, headquarters 
support contracts and subcontracts, and headquarters support 
functions. The committee notes that within the Department there 
is significant duplication of function between contractor 
support personnel and government employees. Moreover, a 
disproportionate amount of the funding for the Department of 
Energy's environmental management program is allocated to 
administrative oversight activities, as opposed to actual 
cleanup or operations at sites in the field.
     The committee further directs that the Department submit a 
report to the congressional defense committees, contemporaneous 
with its fiscal year 1997 budget request, containing the 
following: (1) a projection by program and appropriation of 
carryover balances (uncosted and unobligated balances) to be 
available at the end of the current fiscal year. For example, 
for its fiscal year 1997 submission, the report should project 
balances for the end of fiscal year 1996; (2) target carryover 
balances by program for the end of the current fiscal year. The 
target balances should be derived from a model that is designed 
to determine the minimum amount of carryover balances needed 
for program operations and continuity; (3) a comparison of the 
results of the above findings which shows for each program the 
difference between the projected and target carryover balances; 
(4) a justification, if one exists, for the difference between 
the projected and target carryover balances; and (5) the amount 
of carryover balances that the Department cannot justify based 
on the calculation in paragraph (4). The committee believes 
that these carryover balances should be applied to reduce the 
Department's authorization request for the next fiscal year.

                section 3103--payment of civil penalties

     This section would authorize the Secretary of Energy to 
pay for civil penalties assessed in accordance with a federal 
facility agreement and consent order against the Rocky Flats 
site in Colorado.

                 section 3104--other defense activities

     This section would authorize funds for other defense 
activities of the Department of Energy for fiscal year 1996.

              section--3105 defense nuclear waste disposal

     This section would authorize funds for defense nuclear 
waste disposal activities of the Department of Energy for 
fiscal year 1996.

                   Subtitle B--Legislative Provisions


                      section 3121--reprogramming

     This section would prohibit the reprogramming of funds in 
excess of 102 percent of the amount authorized for the program, 
or in excess of $1 million above the amount authorized for the 
program until the Secretary of Energy has notified the 
congressional defense committees and a period of 30 days has 
elapsed after the date on which the report is received. Should 
the Department demonstrate that it has improved its procedures 
for handling reprogramming requests, the committee would 
consider returning to a more flexible reprogramming statute in 
the future.

             section 3122--limits on general plant projects

     This section would limit the initiation of ``general plant 
projects'' authorized by the bill if the current estimated cost 
for any project exceeds $1.2 million. However, if the Secretary 
of Energy finds that the estimated cost of any project will 
exceed $1.2 million, the appropriate committees of Congress 
must be notified of the reasons for the cost variation.

             section 3123--limits on construction projects

     This section would permit any construction project to be 
initiated and continued only if the estimated cost for the 
project does not exceed 125 percent of the higher of: (1) the 
amount authorized for the project, or (2) the most recent total 
estimated cost presented to the Congress as justification for 
such project. To exceed such limits, the Secretary of Energy 
must report in detail to the appropriate committees of Congress 
and the report must be before the committees for 30 legislative 
days.
    This section would also specify that the 125 percent 
limitation would not apply to projects estimated to cost under 
$5 million.

                 section 3124--fund transfer authority

    This section would permit funds authorized to be 
appropriated by the bill to be transferred to other agencies of 
the government for performance of work for which the funds were 
authorized and appropriated. The provision would permit the 
merger of such funds with the authorizations of the agency to 
which they are transferred.
    This section would also limit to no more than five percent 
the amount of funds that may be transferred between 
authorizations in the Department of Energy that were authorized 
pursuant to this act.

     section 3125--authority for conceptual and construction design

    The committee recommends a new provision (sec. 3125) that 
would limit the Secretary of Energy's authority to request 
construction funding until the Secretary has certified a 
conceptual design. This section would provide an exception in 
the case of emergencies.

      section 3126--authority for emergency planning, design, and 
                        construction activities

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

section 3127--funds available for all national security programs of the 
                          department of energy

    This section would authorize, subject to the provisions of 
appropriation Acts and section 3121 of this bill, amounts 
appropriated pursuant to this bill for management and support 
activities and for general plant projects to be made available 
for use, when necessary, in connection with all national 
security programs of the Department of Energy.

                  section 3128--availability of funds

    This section would authorize, subject to a provision of an 
appropriation Act, amounts appropriated for operating expenses 
or for plant and capital equipment to remain available until 
expended.

   Subtitle C--Program Authorizations, Restrictions, and Limitations


    section 3131--authority to conduct program relating to fissile 
                               materials

    This section would authorize the Secretary of Energy to 
conduct programs designed to improve the protection, control, 
and accountability of fissile materials in Russia, and would 
require a notification to Congress prior to the obligation of 
funds under this authority.

                section 3132--national ignition facility

    This section would prohibit obligation of funds for the 
National Ignition Facility (NIF) until the Secretary of Energy 
concludes that construction of the NIF will not impede U.S. 
nuclear nonproliferation objectives and notifies Congress of 
that conclusion.

                    section 3133--tritium production

    The committee is deeply concerned about the lack of 
progress by the Department in establishing a long-term source 
of tritium, which is necessary to maintain the Nation's nuclear 
deterrent. Therefore, the committee recommends a total of $100 
million for tritium production, an increase of $50 million over 
the request.
    Although the Department has announced its intention to 
reach a Record of Decision in November 1995, the committee is 
concerned with the direction the Department appears to be 
heading. The Department seems determined to avoid full 
consideration of the reactor option and is proceeding with 
research and development on an accelerator for future tritium 
production even though the use of such technology for this 
mission will likely cost the federal government many billions 
of dollars more than the reactor option. Moreover, the unproven 
and theoretical nature of the accelerator for this production 
application could also jeopardize the Department's ability to 
satisfy tritium requirements on schedule.
    On March 1, 1995, the Department issued a draft 
Programmatic Environmental Impact Statement (PEIS) on tritium 
supply. It did not identify any unacceptable environmental 
consequences for either the reactor or the accelerator options. 
However, the Department has failed to release information on 
the costs, schedule, and uncertainties for implementing either 
of the approaches under consideration. It is the committee's 
view that the Advanced Light Water Reactor (ALWR) will provide 
the most proven technology at the least cost to the government 
(due in part to revenues from electricity generation) and is, 
therefore, the most logical choice. In addition, the most 
logical site for the tritium production mission would be the 
Savannah River Site (SRS) due to its existing tritium 
infrastructure. Therefore, the committee recommends a provision 
(sec. 3133) that would require that fiscal year 1996 funds for 
tritium production be used to proceed with multipurpose ALWR 
technology, including resumption of the light water reactor 
tritium-producing target program, as well as to continue on-
going research and development work on accelerator technology.
    The committee is interested in the proposal for a privately 
financed multipurpose reactor that could (1) produce tritium, 
(2) consume excess weapons plutonium, and (3) generate 
electricity as a means to reduce government costs. To date 
however, the Department has seemingly ignored this option. A 
Program Plan was submitted to the Department by private 
industry in March, 1994, to effect this option. In addition to 
saving the government billions of dollars in construction costs 
for a tritium production source, the private sector approach 
would also obviate the need for the Department to establish a 
separate, costly program to dispose of excess weapons 
plutonium. Accordingly, the committee directs the Department to 
begin implementation of the industry Program Plan and to make 
$14 million of fiscal year 1996 funds available to private 
industry for this purpose. If this program demonstrates that 
the privatized multipurpose reactor will indeed result in lower 
costs to the federal government for both plutonium disposition 
and tritium production, the committee expects the Department to 
proceed and to notify the committee of any enabling legislation 
that is required. If and when a reactor is constructed under 
this plan, the Department will ensure that any government funds 
provided for implementation of the industry's program plan be 
repaid out of future revenues from the facility's operation.
    Because accelerator technology may serve other important 
national security purposes, the Department should prepare a new 
program to demonstrate other potential applications of the 
technology. Because the Department already has accelerator 
research and development efforts under way, those efforts 
should continue while the new program plan is being prepared, 
but should focus upon activities that are expected to be 
beneficial to other nuclear defense applications. The committee 
recommends $40 million of the tritium production funds for the 
accelerator for this purpose. The committee requests that the 
Secretary of Energy prepare and submit a report to Congress 
describing the viable alternative nuclear defense missions for 
the accelerator and the funding and program plan needed to 
develop it. The report is due not later than 180 days after the 
date of enactment of this Act.
    The committee is also deeply concerned with the 
Department's inability to reach a decision on a plan for the 
disposition of excess weapons plutonium. It has taken the 
Department over a year and tens of millions of dollars to 
simply conclude that the January, 1994, recommendations of the 
National Academy of Sciences were correct. Meanwhile, the 
Department has increased its request for funding in fiscal year 
1996 above the fiscal year 1995 funding level and delayed 
issuance of a Record of Decision by several months to August 
1996. The committee believes that a multi-purpose reactor, 
under the Tritium Production Program, should be considered the 
preferred means of plutonium disposition, unless and until the 
Department is able to demonstrate a more visible alternative.
    On this basis, the committee directs the Department to 
provide sufficient funds for a complete analysis of the 
multipurpose ALWR in the performance of its PEIS on plutonium 
disposition. Furthermore, the committee recommends $5 million 
for the Pantex facility for evaluating engineering processes 
which are candidates for converting excess plutonium in its 
various forms into other fuel appropriate for use in the 
multipurpose reactor.

                       Subtitle D--Other Matters


           section 3141--report on foreign tritium purchases

    The committee is concerned that the Department of Energy 
has failed to consider the potential benefits associated with 
the foreign purchase of tritium as a means of ensuring an 
adequate supply of tritium for the U.S. nuclear weapons 
stockpile. Therefore, the committee recommends a provision 
(sec. 3141) that would require the President to prepare and 
submit a report on foreign tritium purchases.

         section 3142--study on nuclear test readiness postures

    The Department of Energy has proposed to shift from a six-
months test readiness posture to a three-year test readiness 
posture. The committee is concerned about the implications of 
such a change in policy. Therefore, the committee recommends a 
provision (sec. 3142) that would require the Secretary of 
Energy to prepare and submit a report on the implications of 
changes in U.S. policy with respect to nuclear test readiness.

    section 3143--master plan on warheads in the enduring stockpile

    The Department of Energy has failed to translate its plans 
for stockpile stewardship and management into a detailed plan 
for assuring the safety, reliability, and effectiveness of the 
warheads to remain in the enduring stockpile. Therefore, the 
committee recommends a provision (sec. 3143) that would require 
the President to prepare and submit a master plan that 
describes in detail how the government plans to demonstrate, by 
2002, the capability to refabricate and certify warheads in the 
enduring stockpile, and the capability to design, fabricate, 
and certify new warheads.

section 3144--prohibition on international inspections of department of 
  energy facilities unless protection of restricted data is certified

    The committee is concerned that the Department of Energy 
may be planning to permit inspections of U.S. nuclear weapons 
facilities by the International Atomic Energy Agency without 
adequately safeguarding sensitive nuclear weapons design 
information. Therefore, the committee recommends a provision 
(sec. 3144) that would prohibit such inspections unless 
protection of such sensitive data is certified by the 
Secretary.

                           items of interest

Enhanced surveillance

    Under the current plans, the enduring U.S. nuclear 
stockpile will be smaller and less diverse, and thus more 
vulnerable to single-point and common-mode failures. New 
surveillance technologies, coupled with enhanced predictive 
capabilities as to the effects of materials aging on component 
and weapons performance are needed. The committee directs the 
Department to initiate an enhanced surveillance program to 
transition current surveillance activities from the reactive to 
the predictive mode. The committee recommends an additional $40 
million to initiate this new program in fiscal year 1996. These 
funds should be used to support surveillance hydrotests, 
nondestructive tests, system level modeling, materials 
laboratory tests and nondestructive test evaluation, and 
development of new diagnostic technologies to predict component 
lifetimes.

Accelerated strategic computing initiative

    Computational capabilities underpin every aspect of nuclear 
weapon design, engineering, and evaluation. In the absence of 
underground testing, significant advances in the laboratories' 
computational capabilities are necessary to support the 
stockpile stewardship program activities. The committee 
recognizes the importance of this activity, and therefore 
directs the Department to: (1) initiate additional development 
projects for high-end hardware development; (2) pursue 
additional activities to enhance problem solving and software 
environments, including high performance classified and 
unclassified networks; (3) fully fund planned weapons 
applications development projects in three-dimensional and high 
fidelity codes; and (4) develop weapons-specific parallel 
computing tools. The committee recommends an increase of $40 
million for this initiative for a total program funding level 
of $85 million in fiscal year 1996.

Dual revalidation

    The enduring nuclear stockpile will be subject to 
environmental and aging problems, and will require increasing 
attention and scrutiny to ensure safety, reliability, and 
performance. A new process called dual revalidation has 
recently been formulated. The revalidation process will rely 
upon the formulation of two independent teams from the 
Department of Energy, in coordination with the Department of 
Defense, to establish a baseline assessment of each weapon type 
in the enduring nuclear stockpile. The teams will use the 
baseline assessments as a basis for measuring any future 
changes in the weapon system, and to perform future weapon 
system analyses in support of system revalidation. The 
committee recognizes the importance of establishing the 
revalidation process as quickly as possible, and therefore 
recommends a funding level of $20 million in fiscal year 1996 
to initiate the program. These funds should be used to support 
the independent teams in reviewing the design calculations for 
the original design of the weapon, to exchange and analyze 
current surveillance and other data, and to bring new 
calculational methods and improved models to bear. In addition, 
funds may be used to support additional hydrodynamic and 
environmental tests with advance diagnostics, as needed, to 
establish a modern basis for the analysis.

Advanced manufacturing

    In years past, a large nuclear weapons production complex 
provided the capability and capacity to rapidly produce new 
weapons and fix problems in the stockpile. While new weapons 
are not planned, the Department must maintain a production 
capability to support the weapons stockpile as it ages. A new 
approach is needed to ensure the safety and reliability of the 
enduring U.S. nuclear stockpile that eliminates the need for a 
large facilities and infrastructure. The Department has 
identified a new initiative to develop the tools needed to 
support future manufacturing needs. This initiative, called the 
Advanced Design and Production Technologies (ADAPT) will build 
upon core activities in materials and components research, and 
accelerate the development and deployment of cost effective, 
environmentally acceptable product realization technologies and 
processes in direct support of the nuclear weapons stockpile. 
The committee recommends an additional $80 million for this 
initiative to accelerate five development areas planned by the 
Department: (1) advanced processes for materials and 
components, (2) communications infrastructure to integrate 
labs, plants and industry, (3) accelerated design and 
engineering environments, (4) initiate development of advanced 
controls for prototype manufacturing and assembly facilities, 
and (5) solids models development for analysis of complex 
manufacturing processes, including assembly.

Stockpile management activities

    The committee recognizes the importance of maintaining the 
existing nuclear stockpile at high standards of safety and 
reliability. Accordingly, the committee recommends an increase 
of $40 million in the stockpile management account for fiscal 
year 1996. The committee is aware of the urgent need to 
stabilize plutonium stocks at defense programs sites and 
understands that the Department has recently completed a study 
to implement a plan for plutonium stabilization at the Lawrence 
Livermore National Laboratory. The committee therefore 
recommends that $30 million of the increased funding be made 
available to expedite the implementation of the plan.

Dual-axis radiographic hydrodynamic test facility

    The Dual-Axis Radiographic Test Facility (DARHT) at Los 
Alamos National Laboratory will provide substantial 
improvements in dynamic radiography and will be a major 
experimental tool for addressing weapon safety and reliability 
issues. The Department was forced by legal action to stop 
construction of DARHT in late January 1995 until completion of 
an environmental impact statement on the project. The draft 
environmental impact statement was released on May 12, 1995, 
for public comment and it is anticipated that the final 
document will be available in September of this year.
    In anticipation of a record of decision in early fiscal 
year 1996 determining that the project should be completed, the 
committee recommends an addition of $10 million to the request 
for operating funds and an additional $5 million for 
construction funds to restart the project and address the 
increased cost of construction due to the delays experienced. 
In addition, the committee fully supports beginning long-lead 
procurement associated with the second axis of the facility due 
to the critical nature of this project. An additional $5 
million is provided to begin this procurement in fiscal year 
1996 not fiscal year 1997 as anticipated by the Department.

Technology transfer

    The committee sees little benefit in pursuing technology 
transfer-related activities which have little or no relevance 
to the nuclear weapons mission. Therefore, the committee 
recommends authorization of not more than $25 million for 
technology transfer, a reduction of $220.4 million from the 
requested amount.

National resource center for plutonium

    The committee recommends authorization of $10 million, the 
requested amount, for the Amarillo National Resource Center for 
Plutonium, Amarillo, Texas. The committee strongly supports the 
continued activities of the center and urges the Secretary to 
request adequate funding for its continued operations in the 
fiscal year 1997 budget submission.

Emergency management

    In an effort to streamline the Department of Energy's 
emergency-related organizations and to eliminate redundancy, 
the committee recommends consolidating funding for emergency 
management which has previously been included in the weapons 
activities program direction account and funding for a separate 
emergency preparedness account. The fiscal year 1996 budget 
request for emergency management is $20.1 million and $8.2 
million for emergency preparedness. The committee recommends a 
total of $23.3 million for fiscal year 1996 for the combined 
programs. This reduction in funding from the budget request 
will require a reduction in the number of staff performing 
redundant functions and should lead to efficiencies in 
centralizing emergency planning and oversight.

Merger of capital equipment and general plant project funding

    The report of the Galvin Task Force reviewing Department of 
Energy laboratory operations highlighted instances where the 
current budget structure and congressional funding limitations 
may result in excessive administrative and procedural 
oversight. Micromanagement leads to increased costs and 
diminished productivity in the operation of the Department's 
laboratories and facilities. The committee recommends merging 
capital equipment and general plant projects funding with the 
operating funding to expedite the allocation of resources for 
operating, maintenance, and other infrastructure activities and 
to ensure the operation of the Department's laboratories and 
facilities in the most efficient and cost effective manner.
    Construction activity that exceeds the general plant 
project threshold of $2 million would continue to require 
specific authorization and appropriation by the Congress. Any 
construction activity that does not exceed the $2 million 
threshold would be included in the operation and maintenance 
account.
    The committee directs the Department, in implementing this 
change, to continue to reflect the capital equipment and 
general plant projects in the financial and accounting reports. 
The committee expects to be informed if there are major 
differences between the funding requested for capital equipment 
and general plant projects in the fiscal year 1996 budget 
request and the actual execution of the programs under these 
new guidelines. Also, specific details for planned capital 
equipment and general plant projects will continue to be 
reported in the annual budget justifications.

International center for applied research

    The International Center for Applied Research (ICAR) offers 
a unique approach to realize regional economic diversification 
through the application of science and technology. The 
committee is disappointed, however, that the Department's 
request did not include funds for ICAR. The committee strongly 
endorses this program and directs the Department to provide 
appropriate additional funds for ICAR in the Department's 
fiscal year 1997 budget submission.

Nevada test site

    The committee is concerned that the removal of Yucca 
Mountain support from the Nevada Test Site (NTS), or even a 
reduction in support, could adversely affect NTS readiness. 
Therefore, the committee directs the Nuclear Weapons Council to 
conduct a study of the impact of the elimination or reduction 
of Yucca Mountain support from NTS prior to any move by the 
Department to do so. The study should also examine options to 
reduce the cost of NTS services to Yucca Mountain if this is 
the primary rationale for removing or reducing NTS support. The 
committee recommends that the Department cease any effort to 
remove Yucca Mountain support prior to the Nuclear Weapons 
Council providing its study to the committee.

Reporting requirement for the total project costs for construction 
        activities

    The cost of construction projects for the Department of 
Energy includes activities funded from operating expenses as 
well as construction and capital equipment accounts. In 
addition to the preparation of the conceptual design report, 
project-related costs funded from operating expenses include 
items such as research and development, preparation of design 
criteria, safety analyses, and environmental documentation. As 
a result, the Department conducts activities related to 
construction projects prior to the authorization of the 
specific project by Congress.
    To ensure that all project-related activities funded by the 
operating expenses are identified and reviewed by Congress, the 
Department of Energy is directed to identify in the annual 
budget justification: (1) funding by project for all conceptual 
design reports where the cost of preparation will exceed $3 
million, and (2) funding by project for all project-related 
activities which will exceed $3 million on proposed 
construction projects which have a completed conceptual design 
report but for which specific construction project 
authorization has not been requested nor provided by Congress.

Commission on management of environmental restoration and waste 
        management program contracts at department of energy sites

    The committee is concerned that the vast sums of money 
authorized and appropriated each year to cleanup Department of 
Energy nuclear waste facilities are resulting in little 
measurable progress. A recent Government Accounting Office 
review of the environmental management program concluded that 
while ``DOE has received about $23 billion for environmental 
management since 1989, . . . little cleanup has resulted.'' 
Similarly, a recent congressional report prepared by Steven 
Blush and Thomas H. Heitman on the Hanford cleanup program in 
Richland, Washington found that in the six years since the 
Hanford cleanup has been funded at a cost of $7.5 billion, 
``very little cleanup has occurred.'' The Galvin Commission 
found that before any program could be successful, the 
Department of Energy must overcome ``disconnects'' in: (1) 
science/engineering and applications, (2) regulatory oversight 
and compliance, and (3) goals, objectives and means. . . .'' 
Current estimates are that the United States will spend between 
$350 billion dollars and $1 trillion before the remediation at 
all Department of Energy sites is complete.
    The committee believes that statutory and regulatory 
changes alone are inadequate to address the Department of 
Energy's cleanup problems. A new method of managing the 
environmental remediation contractual process is necessary. 
Real progress may be made only with the creation of a high-
level blue ribbon commission, similar to the Base Realignment 
and Closing Commission. This commission could assume ultimate 
control over which sites are remediated and to what degree, how 
much money is spent at each site, and the ultimate use for each 
site once remediation is complete. The commission could be 
composed of the most qualified and knowledgeable experts in the 
country. The committee further recommends that the Department 
of Energy's national laboratories be given a major role in 
advising the commission and in formulating a more efficient and 
cost effective environmental remediation contractual process.
    Among the initial objectives of such a commission would be 
to: (1) establish a risk standard for workers, the public and 
for environmental protection, and (2) establish cleanup 
standards that bear a reasonable relationship to the 
anticipated future use of the sites. The commission, in 
consultation with experts from the national laboratories, could 
then apply a ``triage'' cleanup concept at contaminated sites. 
Under this concept, the commission could provide guidance on, 
among the sites at a particular Department of Energy facility, 
which warrant immediate and intensive cleanup efforts and which 
should be cleaned up at a more moderate pace. Because of cost 
considerations or technology inadequacies, cleanup at other 
sites could be deferred. Once these decisions are made, the 
laboratories could then be assigned oversight responsibility 
for the execution of a cleanup plan at each site. If the 
laboratory with supervisory responsibility for managing the 
cleanup process at a site fails to achieve results, then the 
commission could intervene and remove the lab from the project 
or revise the cleanup plan for that site.
    The committee intends to work closely with the other House 
committees of jurisdiction over Department of Energy cleanup 
activities to further refine this commission concept and to 
develop statutory changes that may facilitate the cleanup 
process.
    Offset Folios 453 to 465 Insert here



   TITLE XXXII--DEFENSE NUCLEAR FACILITIES SAFETY BOARD AUTHORIZATION


                         Legislative Provision


                      section 3201--authorization

    Section 3201 would authorize $17 million for the Defense 
Nuclear Facilities Safety Board. The committee plans to conduct 
a thorough review of the activities and recommendations of the 
board during its consideration of the Department of Energy's 
fiscal year 1997 budget request.

                TITLE XXXIII--NATIONAL DEFENSE STOCKPILE


                   National Defense Stockpile Issues

    The committee continues to be concerned that the Department 
of Defense does not have a realistic or tangible plan that 
contributes to the planning guidance needed to maintain the 
National Defense Stockpile. The Strategic and Critical 
Materials Stock Piling Act (Public Law 103-337) requires the 
Secretary of Defense to submit a biennial report on stockpile 
requirements to include his recommendations with respect to 
stockpile requirements, and any revised national emergency 
planning assumptions used in determining the stockpile 
requirements. Even though the Department has had two years to 
prepare this required report, it has not been received to date 
by the committee. It is difficult for the committee to provide 
proper oversight on this important national security component 
absent the Department's required planning guidance.
    The Department has requested authority to transfer $150 
million from sales of materials from the stockpile to the 
services operations and maintenance accounts. Because the 
Department has not provided Congress with the statutorily 
required report on stockpile requirements, the committee has 
not considered the requested transfer authority for fiscal year 
1996. The committee has insufficient information upon which to 
base national security decisions concerning the stockpile.

                         Legislative Provisions


    section 3301--fiscal year 1996 authorized use of stockpile funds

    This section would authorize $77.1 million from the 
National Defense Stockpile Transaction Fund for the operations 
and maintenance of the National Defense Stockpile for fiscal 
year 1996. The section would also permit the use of additional 
funds for extraordinary or emergency conditions after a 
notification to Congress.

section 3302--preference for domestic upgraders in disposal of chromite 
 and manganese ores and chromium ferro and manganese metal electrolytic

    This section would require that in any disposal from the 
National Defense Stockpile of chromite and manganese ores of 
metallurgical grade or chromium ferro and manganese metal 
electrolytic, a right of first refusal shall be given to 
domestic ferroalloy upgraders.

       section 3303--restrictions on disposal of manganese ferro

    This section would preclude the disposal of high carbon 
manganese ferro in the National Defense Stockpile until 
completing the disposal of all manganese ferro that does not 
meet the National Defense Stockpile classification of Grade 
One, Specification 30(a), as revised on May 22, 1992.

   section 3304--titanium initiative to support battle tank upgrade 
                                program

    This section would direct the transfer of up to 250 short 
tons per year for the next eight years of titanium sponge from 
the National Defense Stockpile to the Secretary of the Army for 
use in the weight reduction portion of the main battle tank 
upgrade program. This transfer would be without charge except 
for transportation and other related costs.

                  TITLE XXXIV--NAVAL PETROLEUM RESERVE


                  Naval Petroleum & Oil Shale Reserves

    The Department of Energy (DOE) proposed in its fiscal year 
1996 budget request to reduce the funding for the Naval 
Petroleum and Oil Shale Reserves (NPOSR) to a ``caretaker'' 
status, that a government corporation be established for a 
period of two years, and then to sell the NPOSR. In testimony 
before the committee, DOE stated that the caretaker status for 
the NPOSR was an incentive for Congress to seriously consider 
the corporatization and then sale proposal. In a reversal of 
its budget proposal, DOE subsequently submitted a proposal to 
Congress to sell the NPOSR and, failing that, to corporatize 
the reserves.
    The committee is concerned that operating the NPOSR in a 
caretaker status may cause the considerable loss of revenue for 
these profitable resources and could reduce their value. The 
committee notes that the NPOSR have returned a net of over $13 
billion to the treasury since 1977 with many more years of 
profitable operations expected. The reduction of operating 
funds for the NPOSR for fiscal year 1996 will mean the loss of 
between $130 to $150 million.
    The committee believes that corporatization of the NPOSR 
for only two years makes no sense as there is no reason to 
believe that another government entity could operate the 
reserves any better. It is the committee's view that the 
federal government should not be in the commercial oil business 
and the NPOSR could never be managed in the most cost-efficient 
manner under federal government control. The committee also 
believes that it is possible for independent commercial oil 
field assessors to establish a fair market price, at least for 
NPR-1 and Elk Hills, and establish a minimum asking price.
    Therefore, the committee recommends a provision (sec. 3403) 
that would mandate that NPR-1 be sold within one year. This 
provision would provide several requirements for the Secretary 
of Energy to ensure an impartial and fair assessment. In 
addition, the provision would direct that DOE study the 
remaining NPOSR and provide recommendations by December 31, 
1995, on the most cost-effective future of these reserves 
considering the status quo, sale, lease, or the transfer to 
other federal agencies of any or part of the remaining 
reserves.
    Section 3403 would also intend to resolve the State of 
California's claim to two sections of land located in Naval 
Petroleum Reserve Numbered 1 (sections 16 and 36 of township 30 
south, range 23 east, Mount Diablo Principal Meridian, 
California) that have been the subject of a long-standing 
dispute between the State and the Federal government. In 
exchange for relinquishing its claim, the State will receive 
seven percent of the gross sales proceeds from the sale of the 
Reserve that remain after the direct expenses of the sale are 
taken into account. It is the intent of the committee that upon 
receipt of the proceeds from the sale by the Federal 
government, payment to the State of California of its share 
shall be made promptly.

                         Legislative Provisions


             section 3401--authorization of appropriations

    This section would authorize the appropriations of 
$101,028,000 for fiscal year 1996 for the Department of Energy 
for the operation of the Naval Petroleum Reserves.

  section 3402--price requirement on sale of certain petroleum during 
                            fiscal year 1996

    This section would require the Secretary of Energy to sell 
petroleum produced for the Naval Petroleum Reserves at 
established prices.

  section 3403--sale of naval petroleum reserve numbered 1 (elk hills)

    This section would require the Secretary of Energy to sell 
Naval Petroleum within one year. The section would also require 
that equity finalization between the unit partners at Elk Hills 
be completed five months after enactment.

section 3404--study regarding future of naval petroleum reserves (other 
                than naval petroleum reserve numbered 1)

    This section would require the Secretary of Energy to 
conduct a study to determine future options regarding the Naval 
Petroleum Reserves (except Elk Hills) that represents the most 
cost-effective option for the United States and report to the 
committee by December 31, 1995.

                  TITLE XXXV--PANAMA CANAL COMMISSION


              Subtitle A--Authorization of Appropriations

    On January 4, 1995, jurisdiction and responsibility in the 
House of Representatives for the annual authorization for the 
Panama Canal Commission (PCC) was transferred to the National 
Security Committee. The Commission operates as a government 
agency and is supervised by a nine member supervisory board, 
commonly referred to as the Panama Canal Commission Board of 
Directors.
    The Panama Canal Commission does not draw from U.S. 
taxpayer funds for operation of the Canal, but receives funding 
to cover its operating, administrative, and capital improvement 
expenses from tolls and other revenue collected. The Commission 
must receive an annual or semi-annual authorization to spend 
money it collects. The Commission must also receive an annual 
or semi-annual authorization for administrative expenditures. 
The Panama Canal Commission's total operating costs including 
depreciation and interest payments in Fiscal Year 1996 are 
estimated at $571 million. This subtitle grants the Commission 
authority to make expenditures from the Panama Canal Commission 
Resolving Fund within existing statutory limits for operating 
and maintenance expenses and sets a limit of $50,741,000 for 
administrative expenses.

   Subtitle B--Reconstitution of Commission as Government Corporation

    Section 3522 of the National Defense Authorization Act for 
Fiscal Year 1993 (Public Law 102-484) required that the 
President review and report on possible changes to the Panama 
Canal Commission to facilitate the operation of the Canal as an 
autonomous entity after it is transferred to Panama at the end 
of 1999. This report with recommendations was transmitted to 
the Congress on April 12, 1994. The major features of the 
Administration's proposed legislative changes to the Panama 
Canal Commission are: (1) convert the Commission to a 
government corporation, although it would still be classified 
as an agency of the United States. Private audit procedures 
would be adopted; (2) change the Board of Directors so that no 
sectoral representation would be required, and two non-voting 
``international advisors'' could be invited to Board meetings; 
(3) The role of the Department of Defense representative on the 
Board would not change; he or she would retain the directed 
vote; (4) Changes in tolls would no longer require approval by 
the President of the United States; (5) The Commission would 
still be part of the federal budget process, under the 
provisions of the Government Corporation Control Act. The 
Commission would no longer require appropriations authority for 
its administrative expenses, however, the Commission would 
still be subject to an annual authorization and appropriate 
oversight by the Congress. The committee accepted the 
recommendations of the Administration for changes to the 
composition and operation of the Commission with only minor 
clarifying changes. The Committee notes that an earlier study 
on the role of the Department of Defense in the Commission's 
structure had recommended that the DOD representative not have 
the directed vote. The committee examined this issue and 
accepted the Administration's recommendation that this change 
in the authority of the Department of Defense could negatively 
affect the transition coordination among U.S. Government 
agencies. The committee also largely accepted the remaining 
Administration recommendations on modifications to the 
composition and operation of the Commission, making only minor 
or clarifying changes.

                           DEPARTMENTAL DATA

    The Department of Defense requested legislation, in 
accordance with the program of the President, as illustrated by 
the correspondence set out below:

              DEPARTMENT OF DEFENSE AUTHORIZATION REQUEST

                             Department of Defense,
                                 Office of General Counsel,
                                    Washington, DC, April 20, 1995.
Hon. Newt Gingrich,
Speaker of the House of Representatives,
Washington, DC.
    Dear Mr. Speaker. The Department of Defense proposes the 
enclosed draft of legislation, ``To authorize appropriations 
for fiscal year 1996 for military activities of the Department 
of Defense, to prescribe military personnel strengths for 
fiscal year 1996, and for other purposes.''
    This legislative proposal is part of the Department of 
Defense legislative program for the 104th Congress and is 
needed to carry out the President's budget plans for fiscal 
year 1996. The Office of Management and Budget advises that 
there is no objection to the presentation of this proposal to 
the Congress and that its enactment would be in accord with the 
program of the President.
    This bill provides management authority for the Department 
of Defense in fiscal year 1996 and makes several changes to the 
authorities under which we operate. These changes are designed 
to permit a more efficient operation of the Department of 
Defense.
    Enactment of this legislation is of great importance to the 
Department of Defense and the Department urges its speedy and 
favorable consideration.
            Sincerely,
                                                   Judith A. Miller
    Enclosure.
                                ------                                


              MILITARY CONSTRUCTION AUTHORIZATION REQUEST

                             Department of Defense,
                                 Office of General Counsel,
                                    Washington, DC, April 24, 1995.
Hon. Newt Gingrich,
Speaker of the House of Representatives,
Washington, DC.
    Dear Mr. Speaker. The Department of Defense proposes the 
following draft of legislation that would authorize certain 
construction at military installations for Fiscal Year 1996, 
and for other purposes. The bill would be called the ``Military 
Construction Authorization Act for Fiscal Year 1996.'' This 
proposal is necessary to execute the President's Fiscal Year 
1996 budget plan. It is drafted to be a principle division of 
the departmental authorization legislation.
    The Office of Management and Budget advises that there is 
no objection to the presentation of this proposal to Congress, 
and that its enactment would be in accord with the program of 
the President.
    This proposal would authorize appropriations in Fiscal Year 
1996 for new construction and family housing support for the 
Active Forces, Defense Agencies, NATO Infrastructure Program, 
and Guard and Reserve Forces. The proposal establishes the 
effective dates for the program. The proposal includes 
construction projects resulting from base realignment and 
closure actions. Additionally, the Fiscal Year 1996 draft 
legislation includes General Provisions.
    Enactment of this legislation is of great importance to the 
Department of Defense and the Department urges its favorable 
consideration.
            Sincerely,
                                                  Judith A. Miller.
    Enclosure.
                                ------                                


                           COMMITTEE POSITION

    On May 24, 1995, the Committee on National Security, a 
quorum being present, approved H.R. 1530, as amended, by a vote 
of 48 to 3.

                  COMMUNICATIONS FROM OTHER COMMITTEES

                          House of Representatives,
                      Committee on International Relations,
                                      Washington, DC, May 31, 1995.
Hon. Floyd Spence,
Chairman, Committee on National Security, House of Representatives, 
        Washington, DC.
    Dear Mr. Chairman: I understand that on Wednesday, May 24, 
1995, the Committee on National Security ordered favorably 
reported H.R. 1530, the National Defense Authorization Act for 
Fiscal Year 1996. The bill includes a number of provisions that 
fall within the legislative jurisdiction of the Committee on 
International Relations pursuant to Rule X(k) of the House of 
Representatives.
    The specific provisions within our committee's jurisdiction 
are: (1) Title II, Subtitle C--Ballistic Missile Defense Act of 
1995 (except for Section 233--Implementation of Policy and 
Section 236--Ballistic Missile Defense Program Accountability); 
(2) Section 242--Policy Concerning Ballistic Missile Defense; 
(3) Section 244--Repeal of Missile Defense Provisions; (4) 
Section 389--Transfer of Excess Personal Property to Support 
Law Enforcement Activities; (5) Section 807--International 
Competitiveness; (6) Section 1032--Repeal of Miscellaneous 
Provisions of Law (Subsections (a) and (g); (7) Title XI--
Cooperative Threat Reduction With States of Former Soviet Union 
(Sections 1101-1107); (8) Title XII, Subtitle A--Peacekeeping 
Provisions (Sections 1201-1202); (9) Title XII, Subtitle B-- 
Humanitarian Assistance Programs (Sections 1211-1213); (10) 
Title XII, Subtitle C--Other Matters (Sections 1221-1227); and 
(11) Section 3131--Authority to Conduct Program Relating to 
Fissile Materials.
    Pursuant to Chairman Solomon's announcement that the 
Committee on Rules will move expeditiously to consider a rule 
for H.R. 1530 and your desire to have the bill considered on 
the House floor the week of June 12, 1995, and in recognition 
that both of our staffs have been consulting on these 
provisions, the Committee on International Relations will not 
seek a sequential referral of the bill as a result of including 
these provisions, without waiving or ceding now or in the 
future this committee's jurisdiction over the provisions in 
question. I will seek to have conferees appointed for these 
provisions during any House-Senate conference committee.
    I would appreciate your including this letter as a part of 
the report on H.R. 1530 and as part of the record during 
consideration of the bill by the House of Representatives.
    With best wishes,
            Sincerely,
                                      Benjamin A. Gilman, Chairman.
                                ------                                

                          House of Representatives,
                                     Committee on Commerce,
                                      Washington, DC, May 31, 1995.
Hon. Floyd Spence,
Chairman, Committee on National Security, House of Representatives, 
        Washington, DC.
    Dear Mr. Chairman: On May 24, 1995, the Committee on 
National Security ordered reported H.R. 1530, a bill to 
authorize appropriations for the Department of Defense for 
Fiscal Year 1996, and for other purposes.
    During the markup of this legislation, the Committee 
adopted the following provisions which fall within the 
jurisdiction of the Committee on Commerce:
    Section 325--Elimination of Authority to Transfer Amounts 
for Toxicological Profiles;
    Section 357--Procurement of Electricity from Most 
Economical Source;
    Section 601--Military Pay Raise for Fiscal Year 1995;
    Section 3103--Payment of Penalties;
    Section 3201--Authorization for the Defense Nuclear 
Facilities Safety Board;
    Section 3402--Price Requirement on Sale of Certain 
Petroleum During Fiscal Year 1996;
    Section 3403--Authorization to sell the Elk Hills Naval 
Petroleum Reserve; and
    Section 3404--Study Regarding Future of Naval Petroleum 
Reserves (Other than Naval Petroleum Reserve Numbered 1).
    In recognition of your Committee's desire to bring this 
legislation expeditiously before the House, the Commerce 
Committee will not seek sequential referral of the bill based 
on the provisions listed above. By agreeing not to seek a 
sequential referral of the bill, the Commerce Committee does 
not waive its jurisdiction over these provisions. In addition, 
the Commerce Committee reserves its authority to seek equal 
conferees on these and any other provisions of the bill that 
are within the Commerce Committee's jurisdiction during any 
House-Senate conference that may be convened on this 
legislation.
    I want to thank you and your staff for your assistance in 
providing the Commerce Committee with a fair opportunity to 
evaluate its jurisdictional interests in H.R. 1530.
    I would appreciate your including this letter as a part of 
the Committee's report on H.R. 1530 and as part of the record 
during consideration of this bill by the House.
    With best wishes,
            Sincerely,
                           Thomas J. Bliley, Jr., Chairman.
                                ------                                

                          House of Representatives,
              Committee on Economic and Educational
                                             Opportunities,
                                      Washington, DC, May 23, 1995.
Hon. Floyd Spence,
Chairman, Committee on National Security, House of Representatives, 
        Washington, DC.
     Dear Chairman Spence: Thank you for working with me in 
your development of a pilot program to assess the feasibility 
of using private contractors to operate schools under the 
Defense Dependents' Education Act of 1978 which you intend to 
adopt and report this week. As you know, these provisions are 
within the sole jurisdiction of the Economic and Educational 
Opportunities Committee.
    We do not intend to seek sequential referral of H.R. 1530 
containing this program. However, the Committee does hold an 
interest in preserving its future jurisdiction with respect to 
issues raised in the aforementioned program, and its 
jurisdictional prerogatives should the provisions of this bill 
or any Senate amendments thereto be considered in a conference 
with the Senate. We would expect to be appointed as conferees 
on these provisions should a conference with the Senate arise.
    Again, I thank you for working with me in developing the 
amendments to H.R. 1530 and look forward to working with you on 
these issues in the future.
            Sincerely,
                                           Bill Goodling, Chairman.
                                ------                                

                          House of representatives,
                            Committee on National Security,
                                      Washington, DC, May 30, 1995.
Hon. William F. Goodling,
Chairman, Committee on Economic and Educational Opportunities, U.S. 
        House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Committee on Armed Services has just 
completed mark-up of H.R. 1530, the National Defense 
Authorization Act for Fiscal Year 1996.
    A provision has been included in the bill involving the 
Defense Dependents' Education Act of 1978 that falls within the 
legislative jurisdiction of the Committee on Economic and 
Educational Opportunities.
    I appreciate your cooperation in not seeking sequential 
referral of the bill. I understand and agree that such action 
shall not be construed as a waiver of your committee's 
jurisdictional interest. Your letter and this reply will be 
included in the committee's report on H.R. 1530.
    Thank you for your cooperation in this matter.
            Sincerely,
                                         Floyd D. Spence, Chairman.

                              FISCAL DATA

    Pursuant to clause 7 of rule XIII of the Rules of the House 
of Representatives, the committee attempted to ascertain annual 
outlays resulting from the bill during fiscal year 1996 and the 
four following fiscal years. The results of such efforts are 
reflected in the cost estimate prepared by the Director of the 
Congressional Budget Office under section 403 of the 
Congressional Budget Act of 1974, which is included in this 
report pursuant to clause 2(l)(3)(C) of House rule XI.

                  Congressional Budget Office Estimate

    In compliance with clause 2(l)(3)(C) of rule XI of the 
Rules of the House of Representatives, the cost estimate 
prepared by the Congressional Budget Office and submitted 
pursuant to section 403 of the Congressional Budget Act of 1974 
is as follows:

                                     U.S. Congress,
                               Congressional Budget Office,
                                      Washington, DC, May 30, 1995.
Hon. Floyd Spence,
Chairman, Committee on National Security, House of Representatives, 
        Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the attached cost estimate for H.R. 1530, the National 
Defense Authorization Act for Fiscal Year 1996, as ordered 
reported by the House Committee on National Security on May 24, 
1995.
    The bill would affect direct spending and receipts, and 
thus would be subject to pay-as-you-go procedures under section 
252 of the Balanced Budget and Emergency Deficit Control Act.
    If you wish, we would be pleased to provide further details 
on the estimate.
             Sincerely,
                                                   June E. O'Neill.
Attachment.

                      Congressional Budget Office


                             Cost Estimate

    1. Bill number: H.R. 1530.
    2. Bill title: National Defense Authorization Act for 
Fiscal Year 1996.
    3. Bill status: As ordered reported by the House Committee 
on National Security on May 24, 1995.
    4. Bill purpose: This bill would authorize appropriations 
for 1996 for the military functions of the Department of 
Defense (DoD) and the Department of Energy (DoE). This bill 
also would prescribe personnel strengths for each active duty 
and selected reserve component.
    5. Estimated cost to the Federal Government: Table 1 
summarizes the budgetary effects of the bill. It shows the 
effects of the bill on direct spending, revenues, and asset 
sales and on authorizations of appropriations for 1996. 
Assuming appropriation of the amounts authorized, the bill 
would increase funding for discretionary programs in 1996 by 
$5.5 billion over the 1995 appropriated level, although outlays 
would decline by $3.2 billion.
    Table 2 shows the costs of provisions with the greatest 
direct spending and revenue impacts. Table 3 details the 
effects of Title XXXIV of the bill, which would provide for the 
sale of the Naval Petroleum Reserve at Elk Hills, California. 
Table 4 gives further details on authorizations of 
appropriations, including those affecting years after 1996.
    6. Basis of estimate: The estimate assumes that the bill 
will be enacted by October 1, 1995, and that the amounts 
authorized will be appropriated for 1996. Outlays are estimated 
according to historical spending patterns.
    Direct Spending, Revenues, and Asset Sales.--The bill 
contains several provisions that would affect direct spending 
or revenues, and thus would subject the bill to pay-as-you-go 
procedures under section 252 of the Balanced Budget and 
Emergency Deficit Control Act (see Table 2). The provisions 
involve selling the Naval Petroleum Reserve at Elk Hills, 
forgoing the recovery in foreign military sales of certain 
nonrecurring costs, spending proceeds from property 
transactions, and other matters related to compensation and 
retirement of certain personnel.

     TABLE 1.--BUDGETARY IMPACT OF H.R. 1530 AS ORDERED REPORTED BY THE HOUSE COMMITTEE ON NATIONAL SECURITY
                                    [By fiscal year, in millions of dollars]
----------------------------------------------------------------------------------------------------------------
                                                   1995       1996       1997       1998       1999       2000
----------------------------------------------------------------------------------------------------------------
                                   DIRECT SPENDING, REVENUES, AND ASSET SALES
Direct Spending:
    Estimated Budget Authority................          0        116        460        480        474        475
    Estimated Outlays.........................          0        113        458        479        473        475
Revenues......................................          0          4         17          0          0          0
Asset Sales:
    Estimated Budget Authority................          0     -1,502          0          0          0          0
    Estimated Outlays.........................          0     -1,502          0          0          0          0
 
                                    SPENDING SUBJECT TO APPROPRIATIONS ACTION
 
Spending Under Current Law:
    Budget Authority..........................    262,614          0          0          0          0          0
    Estimated Outlays.........................    269,943     91,575     39,320     17,893      8,784      3,825
Proposed Changes:
    Authorization Level.......................          0    268,131          0          0          0          0
    Estimated Outlays.........................          0    175,212     53,931     20,497      9,363      4,197
Spending Under H.R. 1530:
    Authorization Level \1\...................    262,614    268,131          0          0          0          0
    Estimated Outlays.........................    269,943    266,787     93,251     38,390     18,147      8,022
----------------------------------------------------------------------------------------------------------------
\1\ The 1995 figure is the amount appropriated for programs authorized by this bill.
 
Note: Costs of the bill would fall under budget function 050, National Defense, except for the sale of the Naval
  Petroleum Reserve (functions 270 and 950) and certain other items as noted.

    Naval Petroleum Reserve. Title XXXIV would require that the 
Department of Energy sell Reserve 1 (Elk Hills) of the Naval 
Petroleum Reserve under certain conditions and procedures, 
direct the department to conduct a study regarding the future 
of the reserves remaining under government ownership, and 
authorize the appropriation of $101 million for the operation 
of all of the reserves in fiscal year 1996.

                           TABLE 2.--DIRECT SPENDING AND REVENUE IMPACTS OF H.R. 1530
                                    [By fiscal year, in millions of dollars]
----------------------------------------------------------------------------------------------------------------
                                                                       1996     1997     1998     1999     2000
----------------------------------------------------------------------------------------------------------------
                                                 DIRECT SPENDING
Naval Petroleum Reserve............................................      105      450      444      418      397
Cost Recovery in Foreign Military Sales............................        0        0       25       48       70
Retirement Benefits for Civilians..................................        3        6        7        4        4
Property Transactions..............................................        1        2        3        3        4
Dependent Compensation.............................................        4        0        0        0        0
                                                                    --------------------------------------------
    Total Direct Spending..........................................      113      458      479      473      475
 
                                                    REVENUES
Retirement Benefits for Civilians..................................        4       17        0        0        0
----------------------------------------------------------------------------------------------------------------

    Under the provisions in this bill, the sale of the Elk 
Hills reserve would have three types of budgetary impacts over 
the 1996-2000 period (see Table 3). First, we estimate that 
selling the reserve would yield about $1.5 billion in 
nonroutine asset sale receipts by the end of fiscal year 1996. 
Although such receipts would reduce the deficit, they would not 
count as pay-as-you-go savings under the Balanced Budget and 
Emergency Deficit Control Act of 1985. For the purposes of this 
estimate, we assume that the government would be paid upon 
approval of the contracts of sale in fiscal year 1996. Under 
this bill, the costs associated with administering the sale, 
which are estimated to total less than $2 million, would be 
deducted from the proceeds. Second, paying seven percent of the 
net proceeds from the sale to the state of California would 
result in direct spending of an estimated $105 million in 1996, 
which would be counted for pay-as-you-go purposes. Third, 
beginning in 1997, the government would forgo the offsetting 
receipts that otherwise would have been collected from the sale 
of oil and related products from Elk Hills. These receipts, 
which are included in budget function 270, are projected to 
total about $400 million annually under current law through 
2000.

  TABLE 3.--BUDGETARY IMPACT OF TITLE XXXIV (NAVAL PETROLEUM RESERVES) OF H.R. 1530 AS ORDERED REPORTED BY THE
                                      HOUSE COMMITTEE ON NATIONAL SECURITY
                                    [By fiscal year, in millions of dollars]
----------------------------------------------------------------------------------------------------------------
                   Category                        1995       1996       1997       1998       1999       2000
----------------------------------------------------------------------------------------------------------------
                                    SPENDING SUBJECT TO APPROPRIATIONS ACTION
Projected Spending Under Current Law:
    Budget Authority \1\......................        187          0          0          0          0          0
    Estimated Outlays.........................        199         89         26          0          0          0
Proposed Changes
    Authorization Level.......................          0        101          0          0          0          0
    Estimated Outlays.........................          0         56         30         13          0          0
Projected Spending Under Title XXXIV
    Authorization Levela......................        187        101          0          0          0          0
    Estimated Outlays.........................        199        144         56         13          0          0
 
                                                 DIRECT SPENDING
Payment of Sale Proceeds to California
    Estimated Budget Authority................          0        105          0          0          0          0
    Estimated Outlays.........................          0        105          0          0          0          0
Forgone Offsetting Receipts from Elk Hills
    Estimated Budget Authority................          0          0        450        444        418        397
 
    Estimated Outlays.........................          0          0        450        444        418        397
                                               ASSET SALE RECEIPTS
Proceeds from the Sale of Elk Hills
    Estimated Budget Authority................          0     -1,500          0          0          0          0
    Estimated Outlays.........................          0     -1,500          0          0          0          0
----------------------------------------------------------------------------------------------------------------
\1\ The 1995 amount represents funds already appropriated.
 
Note: Under current law, forgone offsetting receipts would count as an increase in direct spending, which is
  subject to pay-as-you-go procedures, while nonroutine asset sale receipts do not count as deficit reduction
  for pay-as-you-go purposes. Authorization changes also have no pay-as-you-go implications; rather, they are
  subject to the discretionary spending caps.

    For the purposes of this estimate, CBO assumes that the 
$101 million authorized for fiscal year 1996 will be 
appropriated and will be spent at historical rates. 
Appropriation of this amount would represent a significant 
reduction relative to current levels of operational support and 
could result in a loss of receipts of up to $75 million in 
1996. Any loss of receipts resulting from lower appropriations 
would not be attributed to H.R. 1530. We also assume that the 
authorization for 1996 includes any amounts needed to fund 
DOE's study of the future of the other naval petroleum 
reserves. Based on information from DOE, we estimate that this 
study would cost about $400,000.
    Cost Recovery in Foreign Military Sales. Section 807 would 
strike the section of the Arms Export Control Act that requires 
government-to-government sales of major defense equipment to 
include a charge for the recovery of a proportionate amount of 
any nonrecurring cost of research, development, and production. 
This provision would apply to sales agreements signed after the 
date of enactment. Charges for nonrecurring costs are collected 
upon delivery; therefore the bill would not affect collections 
until 1998. CBO estimates that enactment of section 807 would 
lower Department of Defense receipts by $25 million in 1998, 
$48 million in 1999, and $70 million in 2000.
    Retirement Benefits for Civilians. Section 338 would allow 
certain federal workers who were employed by nonappropriated 
fund instrumentalities (NAFI), and who are currently employed 
by the Department of Defense or the legislative branch and who 
are covered under the Federal Employees Retirement System, to 
receive retirement credit for their NAFI service. Employees 
would have to contribute to the retirement trust fund for each 
year of service for which they wish to receive credit. The bill 
limits the number of people who can apply for service credit in 
three ways. First, only employees who converted from a 
nonappropriated fund positions to appropriated fund positions 
after 1986 may apply. Second, the bill does not cover employees 
who convert in the future--the application period ends six 
months after enactment of the bill. Lastly, employees would no 
longer be able to apply for service credit once the Office of 
Personnel Management (OPM) determines that the actuarial 
present value of all benefits payable as a result of the 
enactment of this section has reached $50 million. CBO assumes, 
however, that OPM would not be able to implement this 
requirement and keep people from applying for credit.
    CBO estimates that approximately 8,000 employees would 
choose to purchase additional retirement credit, increasing 
revenues in 1996 and 1997 by $4 million and $17 million, 
respectively. Additional spending for annuity payments would 
total $3 million in 1996, $6 million in 1997, $7 million in 
1998, $4 million in 1999, and $4 million in 2000.
    Property Transactions. Section 388 would provide permanent 
authority for DoD to sell certain property abandoned on 
military installations and use the proceeds for morale, 
welfare, and recreation activities. This provision would result 
in asset sales that would total less than $500,000 annually 
with direct spending of the same amount.
    Section 2824 would allow the Army to spend the proceeds 
from selling certain property at the former Fort Ord Military 
Complex on morale, welfare, and recreation (MWR) activities. 
Under current law, the proceeds would be used to meet the costs 
of closing bases. Under H.R. 1530, an increase in discretionary 
appropriations of about $15 million would be needed to meet the 
base closing costs.
    Section 2832 would authorize the Secretary of the Air Force 
to convey at fair market value a portion of Elmendorf Air Force 
Base in Anchorage, Alaska. The proceeds from this asset sale, 
which would total about $2 million, would be available for 
expenditure only if appropriated by the Congress.
    Section 2812 would allow DoD to deposit proceeds from 
certain leases into the account used to fund base closures. 
Once deposited, the proceeds would be available for 
expenditure. Under current law, the lease proceeds, which would 
total about $4 million annually, are unavailable for 
expenditure unless appropriated by the Congress. Under this 
provision, direct spending would total about $1 million in 1996 
and would increase to $4 million by 2000.
    Other Provisions. Section 551 would lower military 
retirement annuities for officers who are unable to perform 
their duties because of desertion, absence, confinement, or 
other such factors. A lower annuity would result because the 
lost time would not be credited toward their time of service. 
Although some officers would extend their service to make up 
for the lost time, others would not. The savings associated 
with this provision are expected to be insignificant.
    Section 556 would compensate dependents of military 
personnel who are victims of abuse by their military sponsor. 
Public Law 103-160 provided up to 36 months of payments to 
these dependents, but the regulations outlining how payments 
are to be made were not completed until six months following 
enactment. This provision would compel the Secretary of Defense 
to make payments to beneficiaries who became eligible for 
payments during that six-month period. Approximately 260 
families would receive retroactive payments totalling $4 
million.
    Section 517 would establish a program to insure reserve 
personnel against a loss of personal income during certain 
periods of active duty. Participants would pay premiums into a 
fund administered by the Secretary of the Treasury, and 
benefits would be paid out to eligible recipients subject to 
the availability of funds. CBO is unable to estimate the 
participation rate in such a program or the amount of premiums 
each individual would pay. Nevertheless, no net additional 
spending would occur as a result of this provision in the long 
run because the value of benefits would be limited to the 
assets of the fund.
    Section 742 would waive reimbursement to the government 
from individuals who received health care under the Civilian 
Health and Medical Program of the Uniformed Services (CHAMPUS) 
even though they are eligible for Medicare. According to DoD, 
last year it received about $140,000 from people who received 
care through CHAMPUS instead of Medicare. The five-year costs 
of this provision would be less than $1 million.

Authorizations of Appropriations

    The bill specifically authorizes appropriations of $199 
billion for 1996 for operation and maintenance, procurement, 
research, development, test and evaluation, nuclear weapons 
programs and other DoD programs. These authorizations fall 
under National Defense, budget function 050.
    In addition, the bill would authorize appropriations for 
other budget functions:
    The bill would authorize $101 million for operating the 
Naval Petroleum Reserve (function 270) in 1996.
    It would authorize appropriations of $59 million for the 
Armed Forces Retirement Home (function 700).
    Section 2806 of the bill would establish a pilot program to 
lower interest rates temporarily on veterans' housing loans in 
areas that the Secretary of Defense designates as having 
housing shortages. The section authorizes $3 million a year to 
be appropriated to cover administrative costs (function 700) 
and $10 million in 1996 to buy down loans (function 050). 
According to the Department of Veterans Affairs (VA), the 
average loan would be about $65,000. CBO estimates that the 
cost would be about $3,240 a loan and that about 3,100 
borrowers would benefit. This provision would also affect the 
Guaranty and Indemnity Fund program account to the extent that 
it increases participation in the VA loan program. If all of 
the new authority is used for additional loan originations, the 
estimated guaranty cost to the government would be at most $8 
million. However, the lack of available demographic data 
prevents a precise estimate of this cost.
    The bill also contains both specific and implicit 
authorizations of appropriations for other military programs, 
primarily for military personnel costs, some of which extend 
beyond 1996. Table 4 contains estimates for the amounts 
authorized and the related outlays. The following sections 
describe the estimated authorizations shown in Table 4 and 
provide information about CBO's cost estimates.
    Endstrength. The bill would authorize active and reserve 
component endstrengths for 1996 at a cost of almost $68 
billion. Endstrengths specifically stated in the bill for 
active-duty personnel would total about 1,485,000--the same as 
the Administration's request and about 38,000 below the level 
estimated for 1995. In addition, the bill would authorize 
appropriations in the amount of $112 million to be used to fund 
a higher endstrength. CBO estimates that approximately 7,600 
military personnel would be added as a result of this 
provision. Thus, the net effect on endstrength relative to the 
1995 level is a reduction of slightly more than 30,000 people.
    DoD's reserve endstrength would be authorized at about 
927,000 for 1996--the same as the Administration's request, but 
about 38,000 less than the level estimated for 1995. Also, the 
bill would authorize an endstrength of 8,000 in 1996 for the 
Coast Guard Reserve, which is the same as the Administration 
requested and the 1995 level; this authorization would cost 
about $65 million and would fall under budget function 400, 
Transportation.
    Compensation and Benefits. Section 601 would authorize a 
2.4 percent increase in the rates of basic pay and subsistence 
for military personnel, the same amount as contained in the 
Administration's budget. The cost of this increase relative to 
1995 rates of pay is about $1 billion.
    This section would also call for the basic allowance for 
quarters (BAQ) to increase by 5.2 percent. Under current law 
BAQ increases according to the military pay raise; 
consequently, the 2.4 percent pay raise authorized in this bill 
would raise BAQ by $83 million. The provisions that would raise 
BAQ the additional 2.8 percent would cost another $97 million. 
Thus, BAQ would increase by $180 million compared to 1995 
rates.
    Section 604 would make two changes that would increase 
Variable Housing Allowance (VHA) payments to servicemembers 
living in areas with high housing costs. The first change would 
increase the minimum payment to junior enlisted personnel at a 
cost of about $200 million annually. Because this provision 
would not take effect until July 1, 1996, costs in 1996 would 
be $50 million. The second change would protect members' VHA 
rates from being reduced during a tour of duty. VHA rates are 
calculated annually for different localities and may change 
depending on fluctuations in local housing costs. Most tours of 
duty last longer than one year, and VHA may be recalculated 
several times during that period. This provision would allow 
only increases in the payment, unless individual members were 
able to lower their housing expenses. The cost of this change 
is $18 million annually. Because the provision would not take 
effect until January 1, 1996, its first-year costs would total 
$13 million.
    Several sections would extend for two or more years certain 
payment authorities that are scheduled to expire at the end of 
1995 or 1996. Payment authorities for enlistment and 
reenlistment bonuses for active duty personnel would cost $137 
million in 1997. Extension of various bonus programs for 
Selected Reserve personnel would increase costs by $48 million 
in 1997. Authorities to make certain payments to medical 
professionals would also be extended--payments related to the 
pay grade of new physicians would cost about $1 million in 
1996, and special payments to others, including nurse officer 
candidates, registered nurses, and nurse anesthetists, would 
increase authorizations by $11.6 million in 1997 and 1998. 
Finally, extensions of special payments for aviators and 
nuclear-qualified personnel would total $15 million in 1996, 
$12 million in 1997, $21 million in 1998, and $8 million in 
1999 and 2000.
    Section 553 would establish a new education benefit for 
reserve personnel that would cost about $16 million in 1997 
rising to about $80 million in 2000. Reserve personnel in 
skills or specialties designated by the Secretary of Defense 
would be eligible for additional education benefits of as much 
as $350 a month. According to DoD, the program would begin as a 
pilot program. Assuming that preparing the program takes one 
year, there would be no significant costs until 1997, when 
about 10,000 reservists would be offered the benefit. 
Eligibility is expected to double by 2000.

 TABLE 4.--AUTHORIZATIONS OF APPROPRIATIONS IN THE NATIONAL DEFENSE AUTHORIZATION ACT, 1996 AS ORDERED REPORTED
                                   BY THE HOUSE COMMITTEE ON NATIONAL SECURITY
                                    [By fiscal year, in millions of dollars]
----------------------------------------------------------------------------------------------------------------
                         Category                             1996       1997       1998       1999       2000
----------------------------------------------------------------------------------------------------------------
Stated Authorizations....................................    198,760          3          3          3          3
Estimated Outlays........................................    109,053     50,503     20,601      9,432      4,227
Endstrengths:
    Function 050:
        Estimated Authorization Level....................     67,722          0          0          0          0
        Estimated Outlays................................     64,317      3,405          0          0          0
    Function 400:
        Estimated Authorization Level....................         65          0          0          0          0
        Estimated Outlays................................         59          7          0          0          0
Compensation and Benefits:
    Military Pay Raise:
        Estimated Authorization Level....................      1,036      1,359      1,346      1,343      1,343
        Estimated Outlays................................        984      1,343      1,347      1,343      1,343
    Basic Allowance for Quarters:
        Estimated Authorization Level....................         97        131        134        136        139
        Estimated Outlays................................         92        129        134        136        139
    Variable Housing Allowance:
        Estimated Authorization Level....................         63        220        224        229        236
        Estimated Outlays................................         60        212        224        229        236
    Expiring Authorities--Active Duty:
        Estimated Authorization Level....................          0        137        173         74         68
        Estimated Outlays................................          0        130        171         79         68
    Expiring Authorities--Reserves:
        Estimated Authorization Level....................          0         48         64         33         33
        Estimated Outlays................................          0         46         63         35         33
    Expiring Authorities--Medical:
        Estimated Authorization Level....................          1         12         12          0          0
        Estimated Outlays................................          1         11         12          1          0
    Expiring Authorities--Aviation & Nuclear:
        Estimated Authorization Level....................         15         12         21          8          8
        Estimated Outlays................................         14         12         21          9          8
    Education Benefits Reserve:
        Estimated Authorization Level....................          0         16         32         48         80
        Estimated Outlays................................          0         15         31         47         78
    Shipboard Housing Allowance:
        Estimated Authorization Level....................          4         20         24         24         25
        Estimated Outlays................................          4         19         24         24         25
    Basic Allowance for Subsistence:
        Estimated Authorization Level....................        -11        -22        -23        -23        -24
        Estimated Outlays................................        -10        -21        -23        -23        -24
    Special Pay for Recruiters:
        Estimated Authorization Level....................         14         19         19         19         19
        Estimated Outlays................................         13         19         19         19         19
    Sea Pay for Tender Crews:
        Estimated Authorization Level....................         10         10         10         10         10
        Estimated Outlays................................          9         10         10         10         10
    Pay Grade Limitations:
        Estimated Authorization Level....................          4          8          8          8          8
        Estimated Outlays................................          4          8          8          8          8
    Pay of Prisoners:
        Estimated Authorization Level....................         -6         -6         -6         -7         -7
        Estimated Outlays................................         -6         -6         -6         -7         -7
    1996 Retirement COLA:
        Estimated Authorization Level....................        403          0          0          0          0
        Estimated Outlays................................        403          0          0          0          0
Health Care Provisions:
    CHAMPUS Benefits:
        Estimated Authorization Level....................          a          9          9          8          8
        Estimated Outlays................................          a          7          9          8          8
    Medical/Dental for Selected Reserve:
        Estimated Authorization Level....................          a          5          6          6          6
        mated Outlays....................................          a          4          6          6          6
    TRIARE Evaluation/Report:
        Estimated Authorization Level....................          0          3          5          5          5
        Estimated Outlays................................          0          2          5          5          5
    Acquisition Work Force Reductions:
        Estimated Authorization Level....................      (\1\)       -284       -751     -1,423     -1,615
        Estimated Outlays................................      (\1\)       -279       -737     -1,397     -1,585
    War Reserve Stocks:
        Estimated Authorization Level....................      (\1\)       -150       -150        -90          0
        Estimated Outlays................................      (\1\)       -120       -150       -102        -18
    Total Authorizations of Appropriations:
        Estimated Authorization Level....................    268,131      1,550      1,160        411        346
        Estimated Outlays from Authorizations for 1996...    175,212     53,931     20,497      9,363      4,197
        Estimated Outlays from Authorizations for 1997-            0      1,483      1,170        432        356
         2000............................................
----------------------------------------------------------------------------------------------------------------
\1\ The 1996 impacts of these provisions are included in the amounts specifically authorized to be appropriated
  in the bill.

    Based on the experience of similar programs, CBO estimates 
that about 65 percent of those eligible would use their 
benefit. Because the program would not reach steady state 
before 2000, outlays would increase yearly throughout the five-
year period.
    Section 603 would authorize payment of housing allowances 
to certain personnel in pay grade E-6 who are assigned to 
shipboard sea duty. This change would eventually affect 4,200 
personnel, who would receive housing allowances averaging 
$5,700 annually. Payments would not immediately increase in 
every case, however, because individuals would have to show 
proof of housing expenses in order to qualify for the payment. 
The effective date of the change would be July 1, 1996. Total 
payments would increase by $4 million in 1996, $20 million in 
1997, and about $24 million annually in 1998 through 2000.
    Section 602 would lower costs for payments of the Basic 
Allowance for Subsistence (BAS). BAS is a cash allowance paid 
to military members who do not eat in government dining 
facilities, or mess halls. Most BAS recipients are married or 
live in private housing, away from dormitories and barracks 
with mess halls. Still, more than 17 percent of Navy and Air 
Force personnel living in dormitories currently receive 
payments. This provision would allow a maximum of 12 percent of 
dormitory residents of each military service to receive BAS 
payments. This change would stop payments of about $2,600 a 
year to about 8,500 people, for an annual savings of $22 
million. This estimate assumes the reduction would be phased in 
gradually during 1996, for a savings of $11 million in that 
year.
    Section 617 would provide for an increase of up to $100 per 
month in the rate of special pay for enlisted personnel who 
serve as recruiters. Approximately 17,000 recruiters would 
receive increases averaging just under $100 per month. This 
change would be effective January 1, 1996, and would increase 
costs by $14 million in that year and $19 million annually 
thereafter.
    Section 616 would authorize the payment of career sea pay 
for duty on board submarine and destroyer tenders. This change 
would result in additional payments averaging $2,000 per year 
to about 5,100 personnel, at a total annual cost of $10 
million.
    Section 402 would provide temporary relief from the 
limitations on the number of officers who may serve on active 
duty in certain pay grades. The effect of this provision would 
be to increase promotions from the next lower pay grade. This 
change would affect about 3,000 officers in the Navy and Air 
Force and increase pay costs by $4 million in 1996 and by $8 
million a year thereafter.
    Section 542 would cause military personnel who are confined 
by sentence of court-martial to forfeit their pay and 
allowances. The Department of Defense estimates that payments 
currently made to this group total $16 million annually, 
including contributions to the military retirement trust fund 
on their behalf. Forfeiture would not be required for personnel 
with dependents, probably about 60 percent of the total 
population. Thus, annual savings from stopping payments to the 
remainder would amount to $6 million annually.
    Military Retirement Cost-of-Living Allowance. Section 633 
would move the effective date of the cost-of-living allowance 
(COLA) for military retirement annuities from September 1996 to 
March 1996 to the extent provided in an appropriations act. The 
six-month advance in the COLA would cost $403 million in 1996 
and would have no budgetary impact in later years. Because the 
COLA would be subject to appropriations action, its cost would 
be charged against the discretionary caps and would not be 
subject to pay-as-you-go procedures.
    Health Care Provisions. Section 701 would increase the 
number of routine physical examinations and immunizations 
covered by the Civilian Health and Medical Program of the 
Uniformed Services (CHAMPUS). Currently CHAMPUS only covers 
immunizations for children less than two years old. This 
provision would expand coverage to include preventive visits 
and immunizations for children up to 19 years old, and it would 
allow CHAMPUS to cover routine office visits for pap smears and 
mammograms. These provisions would cost about $34 million over 
the 1997-2000 period.
    Section 703 would provide annual medical and dental 
screenings to members of the Selected Reserve of the Army who 
are assigned to units scheduled for deployment within 75 days 
after mobilization. The provision would also provide full 
physical examinations to reservists aged 40 and over once every 
two years. Dental care would be provided to ensure that members 
meet the dental standards required for deployment. According to 
DoD, this provision would apply to about 57,500 reservists. 
Because of geographical constraints, most of the medical care 
would be contracted out. The legislation would also direct the 
Secretary of Defense to conduct a demonstration program to 
offer other members of the Selected Reserve affordable dental 
care at no cost to the department. These provisions would cost 
about $23 million over the 1997-2000 period.
    Section 715 would require DoD to use a federally funded 
research and development center to evaluate the effectiveness 
of the TRICARE program. Based on the cost of similar reports, 
this provision would cost approximately $5 million annually 
after full program implementation by the end of 1997.
    The bill contains several provisions that would have little 
or no cost during the next five years:
          Section 733 would allow DoD to collect information 
        regarding insurance, medical service, or health plans 
        of third-party payers of beneficiaries it covers. Use 
        of the Health Care Financing Administration's database 
        for such purposes would require annual funding of less 
        than $500,000.
          Section 735 would expand the Financial Assistance 
        Program for health care professionals in reserve 
        components to include dental specialties. Based on 
        historical rates, the Department of Defense would 
        expect no more than five oral surgeons to be enrolled 
        in the program at any one time. The five-year cost 
        would total less than $1 million.
          Section 741 would terminate the Psychopharmacology 
        Demonstration Program. This provision would save about 
        $1.5 million over five years.
          Section 744 would direct DoD to implement a 
        demonstration program to evaluate the feasibility of 
        providing additional shock trauma training for military 
        medical personnel through the use of civilian 
        hospitals. According to DoD, the program participants 
        would be assigned to shock trauma units for three- to 
        six-month periods and the number of military medical 
        personnel participating in the demonstration program 
        would be small. The expected annual costs would be 
        minimal.
    Acquisition Workforce Reductions. Section 902 would require 
that the Secretary of Defense to reduce by the end of 1999 the 
number of civilians in positions related to acquisition 
programs to 75 percent of 1994 levels. This would reduce the 
number of acquisition workers by 110,000, or 30,000 more than 
under the Administration's current plan, assuming reductions in 
the acquisition workforce are proportional to those in the 
overall DoD workforce. This change would result in savings of 
more than $4 billion from 1997 to 2002.
    The Federal Work Force Restructuring Act of 1994 (Public 
Law 103-226) stipulates that the number of full-time-equivalent 
(FTE) positions in the executive branch be reduced to 1,882,000 
positions by 1999. It is likely that DoD will be required to 
help achieve this demand. Therefore, section 902 would result 
in savings only if FTEs are reduced below the levels in P.L. 
103-226.
    War Reserve Fuel Stocks. Section 392 would require DoD to 
reduce its stock of fuel for war reserves. DoD would meet this 
goal primarily by not replenishing its stocks after normal 
operations, although the bill would allow DoD to sell stocks at 
fair market value. Existing contracts and other operational 
considerations would postpone most of the budgetary impact 
until after 1996. The estimate assumes that the reductions 
would occur over four years and save a total of $520 million.
    Military Family Housing. Section 2801 would establish a new 
means of financing the construction of military family housing. 
It would authorize DoD to use direct loans, loan guarantees, 
long-term leases, rental guarantees, barter, direct government 
investment, and other financial arrangements to encourage 
private sector participation in building military housing.
    Appropriations of $22 million would be authorized in 1996 
for a new account, the Family Housing Improvement Fund, which 
would be available to fund the program. The fund would also 
receive transfers from other accounts, receipts from property 
sales and rents, returns on any capital, and other income from 
operations or transactions connected with the program. The 
amounts in the fund would be available to acquire housing using 
the various techniques mentioned above, but the total value of 
budget authority for all contracts and investments undertaken 
would be limited to $1 billion.
    CBO does not estimate any budgetary impact beyond the 
stated authorizations of appropriations in the bill--$22 
million for the new fund and other amounts in the accounts from 
which money could be transferred into the new fund. Some of the 
options available for use of the Family Housing Improvement 
Fund involve up-front commitments of government resources that 
would be spent over a long period of time. According to 
standard principles of federal accounting, obligations of the 
fund should reflect the full amount of the financial liability 
incurred when the government makes such a commitment. In the 
case of a long-term lease or rental guarantee, for example, 
obligations should equal the total amount of lease or rental 
payments over the life of the contract and appropriations to 
cover the full amount of such obligations should be available 
before entering into the lease or guarantee. Some commitments 
could take the form of lease-purchases, which would require the 
recording of both obligations and outlays up front. For a 
direct loan or loan guarantee, obligations should equal the 
estimated present value of federal transactions with the 
public, excluding receipts from other federal budget accounts 
that depend on the availability of future appropriations. If 
obligations were not recorded accurately, outlays could be 
substantially higher than this estimate assumes.
    Defense Export Guarantees. Section 1224 would authorize the 
Secretary of Defense to finance the export of defense articles 
and defense services through a new loan guarantee program. The 
authority to incur subsidy and administrative costs is limited 
to amounts provided in advance in appropriations acts. Because 
the bill is silent on the amount of the authorization, CBO 
assumes that it is open-ended. Nevertheless, CBO does not have 
an estimate for the budgetary impacts of the implicit 
authorization. Because some of the countries eligible for 
guarantees under the program have high credit risks, the 
subsidy costs could be significant.
    Panama Canal Commission. Title XXXV would authorize the 
Panama Canal Commission (PCC) to spend any sums available to it 
from operating revenues or Treasury borrowing for operation, 
maintenance, and improvement of the canal in fiscal year 1996. 
This title also would restructure the commission as a wholly 
owned government corporation. The PCC would continue to derive 
its financing for canal operations and other expenditures from 
the Panama Canal Revolving Fund. Spending from the fund would 
continue to be limited by the amounts received from tolls and 
other canal charges (estimated to be about $577 million in 
1995). PCC expenditures would remain subject to specific 
authorization by the Congress, but the bill would repeal an 
existing requirement that funding for administrative expenses 
be provided in appropriations acts.
    At present, spending from the Panama Canal Revolving Fund 
is considered discretionary because appropriations acts 
customarily limit the amount that may be obligated from it each 
year. Upon enactment of this legislation, however, outlays from 
the fund would be treated as mandatory spending. The change in 
spending category would have no impact on federal spending. 
Incorporating the commission could result in minor one-time 
costs, but such costs would be offset by either an increase in 
toll rates or a decrease in other spending from the fund. Other 
provisions of Title XXXV, including those that specify the 
commission's new authorities as a corporation and give it more 
direct authority over the basis and level of tolls, also would 
have no budgetary impact.
    CBO estimates collections in 1996 from tolls and other 
canal charges will be about $588 million, or about $12.5 
million more than outlays for the year.
    7. Pay-as-you-go considerations: Section 252 of the 
Balanced Budget and Emergency Deficit Control Act of 1985 sets 
up pay-as-you-go procedures for legislation affecting direct 
spending or receipts through 1998. Because this bill would 
affect direct spending, pay-as-you-go procedures would apply. 
These effects are summarized in the following table.

                                     [By fiscal years, in millions of dollars]
----------------------------------------------------------------------------------------------------------------
                                                                  1995         1996         1997         1998
----------------------------------------------------------------------------------------------------------------
Change in outlays...........................................            0          113          458          479
Change in receipts..........................................            0            4           17            0
----------------------------------------------------------------------------------------------------------------

    8. Estimated cost to State and local governments: The bill 
would affect the budgets of state and local governments through 
two provisions: one that would change the way distilled spirits 
are distributed on military installations and another that 
would sell the Naval Petroleum Reserve.
    Distribution of Distilled Spirits. The bill would require 
the Defense Department to use the most economical means of 
distributing distilled spirits to facilities that sell them on 
military installations. It would also prevent purchases from a 
private distributor if they were directly or indirectly subject 
to state taxation.
    The costs to all states of this provision could total a few 
million dollars annually. The Army and Air Force Exchange 
Service (AAFES) purchases about $71 million of distilled 
spirits from local distributors and another $68 million worth 
from its own distribution system. States would lose revenue 
from sales taxes to the extent that private distributors sold 
less to the Defense Department or if they made sales to the 
Department exempt from sales taxes.
    Naval Petroleum Reserve. Title XXXIV would allocate seven 
percent of the net proceeds from the sale of Elk Hills to the 
state of California if it agrees to release all claims against 
the United States by the State and the Teacher's Retirement 
Fund with respect to production and proceeds from the reserve. 
Our estimates suggest that California would receive about $105 
million at the end of fiscal year 1996 under these provisions.
    9. Estimate comparison: None.
    10. Previous CBO estimate: None.
    11. Estimate prepared by:
    Elizabeth Chambers, Kent Christensen, Victoria Fraider, and 
Amy Plapp prepared the estimates affecting the Department of 
Defense; Joseph Whitehill prepared the estimate for the foreign 
military sales and the export guarantee programs. Deborah Reis 
prepared the estimate for the Panama Canal Commission. Peter 
Fontaine and Kathy Gramp prepared the estimates for the Naval 
Petroleum Reserve; Wayne Boyington prepared the estimate for 
the costs of the retirement credits of employees of non-
appropriated fund instrumentalities.
    12. Estimate approved by: Paul N. Van de Water, Assistant 
Director for Budget Analysis.

                        Committee Cost Estimate

    The committee generally concurs with the estimate as 
contained in the report of the Congressional Budget Office.

                       Inflation Impact Statement

    Pursuant to clause 2(l)(4) of rule XI of the Rules of the 
House of Representatives, the committee concludes that the bill 
would have no significant inflationary impact.

                           Oversight Findings

    With reference to clause 2(l)(3)(A) of rule XI of the Rules 
of the House of Representatives, this legislation results from 
hearings and other oversight activities conducted by the 
committee pursuant to clause 2(b)(1) of rule X.
    With respect to clause 2(l)(3)(B) of rule XI of the Rules 
of the House of Representatives, this legislation does not 
include any new spending or credit authority, nor does it 
provide for any increase or decrease in tax revenues or 
expenditures. However, two sections of the bill may be 
construed to provide new budget authority. These sections are:
          (1) section 556--Transitional compensation for 
        dependents of members of the armed forces separated for 
        dependent abuse;
          (2) section 2812--Deposit of proceeds from leases of 
        property located at installations being closed or 
        realigned.
The requirements of section 308(a)(1) of the Congressional 
Budget Act of 1974 as that section pertains to the above cited 
provisions are addressed in the estimate prepared by the 
Director of the Congressional Budget Office under section 403 
of such Act and included in this report.
    With respect to clause 2(l)(3)(D) of rule XI of the Rules 
of the House of Representatives, the committee has not received 
a report from the Committee on Government Reform and Oversight 
pertaining to the subject matter of H.R. 1530.

                            Roll Call Votes

    In accordance with clause 2(l)(2)(B) of rule XI of the 
Rules of the House of Representatives, roll call and voice 
votes were taken with respect to H.R. 1530. These votes are 
attached to this report.
    H.R. 1530 was ordered favorably reported to the House, a 
quorum being present, by a vote of 48-3.
    Offset Folios 501 to 525 Insert here



         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3 of rule XIII of the Rules of the 
House of Representatives, changes in existing law made by the 
bill, as reported, are shown as follows (existing law proposed 
to be omitted is enclosed in black brackets, new matter is 
printed in italic, existing law in which no change is proposed 
is shown in roman):

NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 1995

           *       *       *       *       *       *       *



            DIVISION A--DEPARTMENT OF DEFENSE AUTHORIZATIONS

TITLE I--PROCUREMENT

           *       *       *       *       *       *       *


Subtitle C--Navy Programs

           *       *       *       *       *       *       *



[SEC. 122. SEAWOLF SUBMARINE PROGRAM.

  [(a) Limitation on Program Cost.--Except as provided in 
subsection (b), the total amount obligated on or expended for 
procurement of the SSN-21 and SSN-22 Seawolf submarines may not 
exceed $4,759,571,000.
  [(b) Automatic Increase of Limitation Amount.--The amount of 
the limitation set forth in subsection (a) is increased by the 
following amounts:
          [(1) The amounts of outfitting costs and post-
        delivery costs incurred for the submarines referred to 
        in such subsection.
          [(2) The amounts of increases in costs attributable 
        to economic inflation.
          [(3) The amounts of increases in costs attributable 
        to compliance with changes in Federal, State, or local 
        laws.]

           *       *       *       *       *       *       *


[SEC. 124. PROHIBITION ON TRIDENT II BACKFIT.

  [(a) Limitation.--The Secretary of the Navy may not modify 
any Trident I submarine to enable that submarine to be deployed 
with Trident II (D-5) missiles.
  [(b) Waiver Authority.--If the Secretary of Defense 
determines that adherence to the prohibition in subsection (a) 
would result in a significant national security risk to the 
United States, the Secretary may waive that prohibition. Such a 
waiver may not take effect until the Secretary submits to 
Congress a certification of that determination and of the 
reasons for that determination.]

           *       *       *       *       *       *       *


Subtitle D--Air Force Programs

           *       *       *       *       *       *       *


SEC. 133. HEAVY BOMBER FORCE REQUIREMENTS.

  (a)  * * *

           *       *       *       *       *       *       *

  [(e) Limitation on Fund.--None of the amount available for 
the Enhanced Bomber Capability Fund may be obligated for 
advance procurement of new B-2 aircraft (including long-lead 
items).]

           *       *       *       *       *       *       *


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

           *       *       *       *       *       *       *


Subtitle B--Program Requirements, Restrictions, and Limitations

           *       *       *       *       *       *       *


SEC. 216. ADVANCED LITHOGRAPHY PROGRAM.

  (a) Purpose.--The purpose of the Advanced Lithography Program 
(in this section referred to as the ``ALP'') is to fund goal-
oriented research and development to be conducted in both the 
public and private sectors [to help achieve a competitive 
position for American lithography tool manufacturers in the 
international market place.] to ensure that lithographic 
processes being developed by American-owned manufacturers 
operating in the United States will lead to superior 
performance electronics systems for the Department of Defense. 
For purposes of the preceding sentence, the term ``American-
owned manufacturers'' means a manufacturing company or other 
business entity the majority ownership or control of which is 
by United States citizens.
  (b) Conduct of Program.--(1)  * * *

           *       *       *       *       *       *       *

  (3) The Director of the Defense Advanced Research Projects 
Agency may set priorities and funding levels for various 
technologies being developed for the ALP and shall consider 
funding recommendations by the SIA as advisory.

           *       *       *       *       *       *       *


TITLE III--OPERATION AND MAINTENANCE

           *       *       *       *       *       *       *


              Subtitle B--Defense Business Operations Fund

SEC. 311. OVERSIGHT OF DEFENSE BUSINESS OPERATIONS FUND.

  (a)  * * *
  [(b) Purchase From Other Sources.--The Secretary of Defense 
or the Secretary of a military department may purchase goods 
and services that are available for purchase from the Defense 
Business Operations Fund from a source other than the Fund if 
the Secretary determines that such source offers a more 
competitive rate for the goods and services than the Fund 
offers.
  [(c) Limitation on Inclusion of Certain Costs in DBOF 
Charges.--A charge imposed for a good or service provided 
through the Fund may not include amounts necessary to cover 
costs incurred in connection with the closure or realignment of 
a military installation.
  [(d) Procedures for Accumulation of Funds.--The Secretary of 
Defense shall establish billing procedures to ensure that the 
balance in the Fund does not exceed the amount necessary to 
provide for the working capital requirements of the Fund, as 
determined by the Secretary.
  [(e) Annual Reports and Budget.--The Secretary of Defense 
shall annually submit to the congressional defense committees, 
at the same time that the President submits the budget under 
section 1105 of title 31, United States Code, the following:
          [(1) A detailed report that contains a statement of 
        all receipts and disbursements of the Fund (including 
        such a statement for each subaccount of the Fund) for 
        the year for which the report is submitted.
          [(2) A detailed proposed budget for the operation of 
        the Fund for the fiscal year for which the budget is 
        submitted.
          [(3) A comparison of the amounts actually expended 
        for the operation of the Fund for the previous fiscal 
        year with the amount proposed for the operation of the 
        Fund for that fiscal year in the budget.]

           *       *       *       *       *       *       *


               Subtitle G--Reviews, Studies, and Reports

[SEC. 361. REPORTS ON TRANSFERS OF CERTAIN OPERATION AND MAINTENANCE 
                    FUNDS.

  [(a) Annual Reports.--In each of 1995, 1996, and 1997, the 
Secretary of Defense shall submit to the congressional defense 
committees, not later than the date on which the President 
submits the budget pursuant to section 1105 of title 31, United 
States Code, in that year, a report on the following:
          [(1) Each transfer of amounts provided in an 
        appropriation Act to the Department of Defense for the 
        activities referred to in subsection (c) between 
        appropriations during the preceding fiscal year, 
        including the reason for the transfer.
          [(2) Each transfer of amounts provided in an 
        appropriation Act to the Department of Defense for an 
        activity referred to in subsection (c) within that 
        appropriation for any other such activity during the 
        preceding fiscal year, including the reason for the 
        transfer.
  [(b) Midyear Reports.--On May 1 of each of 1995, 1996, and 
1997, the Secretary of Defense shall submit to the 
congressional defense committees a report on the following:
          [(1) Each transfer during the first six months of the 
        fiscal year in which the report is submitted of amounts 
        provided in an appropriation Act to the Department of 
        Defense for the activities referred to in subsection 
        (c) between appropriations, including the reason for 
        the transfer.
          [(2) Each transfer during the first six months of the 
        fiscal year in which the report is submitted of amounts 
        provided in an appropriation Act to the Department of 
        Defense for an activity referred to in subsection (c) 
        within that appropriation for any other such activity, 
        including the reason for the transfer.
  [(c) Covered Activities.--The activities referred to in 
subsections (a) and (b) are the following:
          [(1) Activities for which amounts are appropriated 
        for the Army for operation and maintenance for 
        operating forces for (A) combat units, (B) tactical 
        support, (C) force-related training/special activities, 
        (D) depot maintenance, and (E) JCS exercises.
          [(2) Activities for which amounts are appropriated 
        for the Navy for operation and maintenance for 
        operating forces for (A) mission and other flight 
        operations, (B) mission and other ship operations, (C) 
        fleet air training, (D) ship operational support and 
        training, (E) aircraft depot maintenance, and (F) ship 
        depot maintenance.
          [(3) Activities for which amounts are appropriated 
        for the Air Force for operation and maintenance for 
        operating forces for (A) primary combat forces, (B) 
        primary combat weapons, (C) global and early warning, 
        (D) air operations training, (E) depot maintenance, and 
        (F) JCS exercises.
  [(d) Repeal.--Section 377 of the National Defense 
Authorization Act for Fiscal Year 1994 (Public Law 103-160; 107 
Stat. 1638) is hereby repealed.]

SEC. 361. SEMIANNUAL REPORTS TO CONGRESS ON TRANSFERS FROM HIGH-
                    PRIORITY READINESS APPROPRIATIONS.

  (a) Annual Reports.--(1) During 1996 and 1997, the Secretary 
of Defense shall submit to the congressional defense committees 
a report on transfers during the preceding fiscal year from 
funds available for the budget activities specified in 
subsection (d) (hereinafter in this section referred to as 
``covered budget activities''). The report each year shall be 
submitted not later than the date in that year on which the 
President submits the budget for the next fiscal year to 
Congress pursuant to section 1105 of title 31, United States 
Code.
  (2) Each such report shall include--
          (A) specific identification of each transfer during 
        the preceding fiscal year of funds available for any 
        covered budget activity, showing the amount of the 
        transfer, the covered budget activity from which the 
        transfer was made, and the budget activity to which the 
        transfer was made; and
          (B) with respect to each such transfer, a statement 
        of whether that transfer was made to a budget activity 
        within a different appropriation than the appropriation 
        containing the covered budget activity from which the 
        transfer was made or to a budget activity within the 
        same appropriation.
  (b) Midyear Reports.--On May 1 of each year specified in 
subsection (a), the Secretary of Defense shall submit to the 
congressional defense committees a report providing the same 
information, with respect to the first six months of the fiscal 
year in which the report is submitted, that is provided in 
reports under subsection (a) with respect to the preceding 
fiscal year.
  (c) Matters To Be Included.--In each report under this 
section, the Secretary shall include the following:
          (1) With respect to each transfer of funds identified 
        in the report, a statement of the specific reason for 
        the transfer.
          (2) For each covered budget activity--
                  (A) a statement, for the period covered by 
                the report, of--
                          (i) the total amount of transfers 
                        into funds available for that activity;
                          (ii) the total amount of transfers 
                        from funds available for that activity; 
                        and
                          (iii) the net amount of transfers 
                        into, or out of, funds available for 
                        that activity; and
                  (B) a detailed explanation of the transfers 
                into, and out of, funds available for that 
                activity during the period covered by the 
                report.
  (d) Covered Budget Activities.--The budget activities to 
which this section applies are the following:
          (1) The budget activity groups (known as 
        ``subactivities'') within the Operating Forces budget 
        activity of the annual Operation and Maintenance, Army, 
        appropriation that are designated as follows:
                  (A) Combat Units.
                  (B) Tactical Support.
                  (C) Force-Related Training/Special 
                Activities.
                  (D) Depot Maintenance.
                  (E) JCS Exercises.
          (2) The budget activity groups (known as 
        ``subactivities'') within the Operating Forces budget 
        activity of the annual Operation and Maintenance, Navy, 
        appropriation that are designated as follows:
                  (A) Mission and Other Flight Operations.
                  (B) Mission and Other Ship Operations.
                  (C) Fleet Air Training.
                  (D) Ship Operational Support and Training.
                  (E) Aircraft Depot Maintenance.
                  (F) Ship Depot Maintenance.
          (3) The budget activity groups (known as 
        ``subactivities''), or other activity, within the 
        Operating Forces budget activity of the annual 
        Operation and Maintenance, Air Force, appropriation 
        that are designated or otherwise identified as follows:
                  (A) Primary Combat Forces.
                  (B) Primary Combat Weapons.
                  (C) Global and Early Warning.
                  (D) Air Operations Training.
                  (E) Depot Maintenance.
                  (F) JCS Exercises.

           *       *       *       *       *       *       *


Subtitle H--Other Matters

           *       *       *       *       *       *       *


SEC. 375. OPERATION OF MILITARY EXCHANGE AND COMMISSARY STORE AT NAVAL 
                    AIR STATION FORT WORTH, JOINT RESERVE CENTER, 
                    CARSWELL FIELD.

  The Secretary of Defense shall provide for the operation by 
the Army and Air Force Exchange Service[, until December 31, 
1995,] of any military exchange and commissary store located at 
the Naval Air Station Fort Worth, Joint Reserve Center, 
Carswell Field.

           *       *       *       *       *       *       *


TITLE V--MILITARY PERSONNEL POLICY

           *       *       *       *       *       *       *


Subtitle E--Other Matters

           *       *       *       *       *       *       *


SEC. 556. ADMINISTRATION OF ATHLETICS PROGRAMS AT THE SERVICE 
                    ACADEMIES.

  (a)  * * *
  [(b) United States Naval Academy.--(1) Chapter 603 of such 
title is amended by adding at the end the following new 
section:

[``Sec. 6975. Athletics program: athletic director; nonappropriated 
                    fund account

  [``(a) The position of athletic director of the Naval Academy 
shall be a position in the civil service (as defined in section 
2101(1) of title 5). However, a member of the armed forces may 
fill that position as an active duty assignment.
  [``(b) Under regulations prescribed by the Secretary of the 
Navy, the Superintendent of the Naval Academy shall administer 
a nonappropriated fund account for the athletics program of the 
Naval Academy. The Superintendent shall credit to that account 
all revenue received from the conduct of the athletics program 
of the Naval Academy and all contributions received for that 
program.''.
  [(2) The table of sections at the beginning of such chapter 
is amended by adding at the end the following new item:

[``6975. Athletics program: athletic director; nonappropriated fund 
          account.''.

  [(3) The account referred to in subsection (b) of section 
6975 of title 10, United States Code, as added by paragraph 
(1), shall be established not later than the effective date set 
forth in subsection (e).]

           *       *       *       *       *       *       *


TITLE XIV--PEACE OPERATIONS AND HUMANITARIAN ASSISTANCE ACTIVITIES

           *       *       *       *       *       *       *


Subtitle B--Assistance Activities

           *       *       *       *       *       *       *


[SEC. 1413. HUMANITARIAN ASSISTANCE PROGRAM FOR CLEARING LANDMINES.

  [(a) Program Authorized.--The Secretary of Defense shall 
carry out a program for humanitarian purposes to provide 
assistance to other nations in the detection and clearance of 
landmines. Such assistance shall be provided through 
instruction, education, training, and advising of personnel of 
those nations in the various procedures that have been 
determined effective for detecting and clearing landmines.
  [(b) Forms of Assistance.--The Secretary may provide 
assistance under subsection (a) by--
          [(1) providing Department of Defense personnel to 
        conduct the instruction, education, or training or to 
        furnish advice; or
          [(2) providing financial assistance or in-kind 
        assistance in support of such instruction, education, 
        or training.
  [(c) Limitation on United States Military Personnel.--The 
Secretary of Defense shall ensure that no member of the Armed 
Forces of the United States--
          [(1) while providing assistance under subsection (a), 
        engages in the physical detection, lifting, or 
        destroying of landmines (unless the member does so for 
        the concurrent purpose of supporting a United States 
        military operation); or
          [(2) provides such assistance as part of a military 
        operation that does not involve the Armed Forces of the 
        United States.
  [(d) Use of Funds.--Of the amount authorized to be 
appropriated by section 301 for Overseas Humanitarian, 
Disaster, and Civic Aid (OHDACA) programs of the Department of 
Defense, not more than $20,000,000 shall be available for the 
program under subsection (a). Such amount may be used--
          [(1) for activities to support the clearing of 
        landmines for humanitarian purposes, including 
        activities relating to the furnishing of education, 
        training, and technical assistance;
          [(2) for the provision of equipment and technology by 
        transfer or lease to a foreign government that is 
        participating in a landmine clearing program under this 
        section; and
          [(3) for contributions to nongovernmental 
        organizations that have experience in the clearing of 
        landmines to support activities described in subsection 
        (a).
  [(e) Notice to Congress.--The Secretary of Defense shall 
provide notice to Congress of any activity carried out under 
this section.]

           *       *       *       *       *       *       *


                      TITLE XXIV--DEFENSE AGENCIES

SEC. 2401. AUTHORIZED DEFENSE AGENCIES CONSTRUCTION AND LAND 
                    ACQUISITION PROJECTS.

  Using amounts appropriated pursuant to the authorization of 
appropriations in section 2405(a)(1), the Secretary of Defense 
may acquire real property and carry out military construction 
projects for the installations and locations inside the United 
States, and in the amounts, set forth in the following table:

               Defense Agencies: Inside the United States
------------------------------------------------------------------------
           Agency              Installation or location       Amount
------------------------------------------------------------------------
 
Chemical Agents and           Anniston Army Depot,            $5,000,000
                              Pine Bluff Arsenal,           [$3,000,000]
                               Arkansas.................    $115,000,000
                              Tooele Army Depot, Utah...      $4,000,000
                              Umatilla Army Depot,         [$12,000,000]
                               Oregon...................    $186,000,000
 
      *         *         *         *         *         *         *
------------------------------------------------------------------------


                              ----------                              


   NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEARS 1990 AND 1991



           *       *       *       *       *       *       *
            DIVISION A--DEPARTMENT OF DEFENSE AUTHORIZATIONS

                          TITLE I--PROCUREMENT

Part A--Funding Authorizations

           *       *       *       *       *       *       *


Part B--B-2 Aircraft Program

           *       *       *       *       *       *       *


[SEC. 112. LIMITATION ON ANNUAL PRODUCTION OF B-2 BOMBER FOR FISCAL 
                    YEARS AFTER FISCAL YEAR 1990

  [(a) Required Annual Certification.--Funds appropriated to 
the Department of Defense for a fiscal year after fiscal year 
1990 may not be obligated or expended for procurement for new 
production aircraft under the B-2 bomber program unless and 
until the Secretary of Defense submits to the congressional 
defense committees the certification referred to in subsection 
(b) with respect to that fiscal year.
  [(b) Certification.--A certification referred to in 
subsection (a) for any fiscal year is a certification submitted 
by the Secretary of Defense to the congressional defense 
committees after the beginning of the fiscal year which is in 
writing and in unclassified form and in which the Secretary 
certifies each of the following:
          [(1) That the performance milestones for the B-2 
        aircraft for the previous fiscal year for both 
        developmental test and evaluation and operational test 
        and evaluation (as contained in the latest full 
        performance matrix for the B-2 aircraft program 
        established under section 232(a) of Public Law 100-456 
        and section 121 of Public Law 100-180) have been met.
          [(2) That the B-2 aircraft has a high probability of 
        being able to perform its intended missions.
          [(3) That any proposed modification to the 
        performance matrix referred to in paragraph (1) will be 
        provided in writing in advance to the congressional 
        defense committees.
          [(4) That the cost reduction initiatives established 
        for the B-2 program can be achieved (such certification 
        to be submitted together with details of the savings to 
        be realized).
          [(5) That the quality assurance practices and fiscal 
        management controls of the prime contractor and major 
        subcontractors associated with the B-2 program meet or 
        exceed accepted United States Government standards.]

           *       *       *       *       *       *       *


Part H--Chemical Munitions

           *       *       *       *       *       *       *



SEC. 173. CHEMICAL DEMILITARIZATION CRYOFRACTURE PROGRAM

  [(a) Program.--The Secretary of Defense, to the extent funds 
are available for the purpose, shall proceed as expeditiously 
as possible with the project to develop an operational 
cryofracture facility at the Tooele Army Depot, Utah.]

           *       *       *       *       *       *       *


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


Part A--Authorizations

           *       *       *       *       *       *       *



      Part B--Program Requirements, Restrictions, and Limitations


SEC. 211. BALANCED TECHNOLOGY INITIATIVE

  (a) * * *

           *       *       *       *       *       *       *

  [(e) Annual Report.--Not later than March 15 of each year, 
the Secretary of Defense shall submit to the congressional 
defense committees a report on the Balanced Technology 
Initiative and related matters. Each such report shall include 
the following:
          [(1) A current assessment of the extent to which 
        advanced technologies can be used to exploit potential 
        vulnerabilities of hostile threats to the national 
        security of the United States.
          [(2) Identification of each program, project, and 
        activity being pursued under the Balanced Technology 
        Initiative and, with respect to each such program, 
        project, and activity, the amount made available 
        pursuant to this section and the source of such amount.
          [(3) For each program, project, and activity for 
        which funds are made available pursuant to this 
        section, a five-year funding plan that (A) provides for 
        the allocation of sufficient resources to maintain 
        adequate progress in research and development under 
        such program, project, or activity, and (B) specifies 
        the major programmatic and technical milestones and the 
        schedule for achieving those milestones.
          [(4) The status of each program, project, and 
        activity being pursued under the Balanced Technology 
        Initiative.
          [(5) Identification of other on-going or potential 
        research and development programs, projects, and 
        activities not currently provided for under this 
        section that should be considered for inclusion under 
        the Balanced Technology Initiative in order to improve 
        conventional defense capabilities.
          [(6) Identification of the most critical technologies 
        for the successful development of existing or potential 
        Balanced Technology Initiative programs, projects, and 
        activities and an assessment of the current status of 
        those technologies.]

           *       *       *       *       *       *       *


TITLE XII--MILITARY DRUG INTERDICTION AND COUNTER-DRUG ACTIVITIES

           *       *       *       *       *       *       *



SEC. 1208. TRANSFER OF EXCESS PERSONAL PROPERTY

  (a) Transfer Authorized.--(1) Notwithstanding any other 
provision of law and subject to subsection (b), the Secretary 
of Defense may transfer to Federal and State agencies personal 
property of the Department of Defense, including small arms and 
ammunition, that the Secretary determines is--
          (A) suitable for use by such agencies in [counter-
        drug activities] law enforcement activities, including 
        counter-drug activities; and

           *       *       *       *       *       *       *


               TITLE XIII--MILITARY APPELLATE PROCEDURES


 H4  deg.SEC. 1301. COURT OF MILITARY APPEALS

  (a) * * *

           *       *       *       *       *       *       *

  [(i) Termination of Authority Relating to Service of Article 
III Judges After 5 Years.--The authority of the Chief Justice 
of the United States under section 942(f) of title 10, United 
States Code, as enacted by subsection (c), shall terminate on 
September 30, 1995.]

           *       *       *       *       *       *       *


                     [TITLE XV--MILITARY CHILD CARE


[SEC. 1501. SHORT TITLE; DEFINITIONS

  [(a) Short Title.--This title may be cited as the ``Military 
Child Care Act of 1989''.
  [(b) Definitions.--For purposes of this title:
          [(1) The term ``military child development center'' 
        means a facility on a military installation (or on 
        property under the jurisdiction of the commander of a 
        military installation) at which child care services are 
        provided for members of the Armed Forces or any other 
        facility at which such child care services are provided 
        that is operated by the Secretary of a military 
        department.
          [(2) The term ``family home day care'' means home-
        based child care services that are provided for members 
        of the Armed Forces by an individual who (A) is 
        certified by the Secretary of the military department 
        concerned as qualified to provide those services, and 
        (B) provides those services on a regular basis for 
        compensation.
          [(3) The term ``child care employee'' means a 
        civilian employee of the Department of Defense who is 
        employed to work in a military child development center 
        (regardless of whether the employee is paid from 
        appropriated funds or nonappropriated funds).
          [(4) The term ``child care fee receipts'' means those 
        nonappropriated funds that are derived from fees paid 
        by members of the Armed Forces for child care services 
        provided at military child development centers.

[SEC. 1502. FUNDING FOR MILITARY CHILD CARE FOR FISCAL YEAR 1990

  [(a) Fiscal Year 1990 Funding.--(1) It is the policy of 
Congress that the amount of appropriated funds available during 
fiscal year 1990 for operating expenses for military child 
development centers shall not be less than the amount of child 
care fee receipts that are estimated to be received by the 
Department of Defense during that fiscal year. Of the amount 
authorized to be appropriated for the Department of Defense for 
fiscal year 1990, $102,000,000 shall be available for operating 
expenses for military child development centers.
  [(2) In addition to the amount referred to in paragraph (1), 
$26,000,000 shall be available for child care and child-related 
services of the Department other than military child 
development centers.
  [(3) In using the funds referred to in paragraph (1), the 
Secretary shall give priority to--
          [(A) increasing the number of child care employees 
        who are directly involved in providing child care for 
        members of the Armed Forces; and
          [(B) expanding the availability of child care for 
        members of the Armed Forces.
  [(b) Funds Derived From Parent Fees To Be Used for Employee 
Compensation and Other Child Care Services.--(1) Except as 
provided in paragraph (2), child care fee receipts may be used 
during fiscal year 1990 only for compensation of child care 
employees who are directly involved in providing child care.
  [(2) If the Secretary of Defense determines that compliance 
with the limitation in paragraph (1) would result in an 
uneconomical and inefficient use of such fee receipts, the 
Secretary may (to the extent that such compliance would be 
uneconomical and inefficient) use such receipts--
          [(A) first, for the purchase of consumable or 
        disposable items for military child development 
        centers; and
          [(B) if the requirements of such centers for 
        consumable or disposable items for fiscal year 1990 
        have been met, for other expenses of those centers.
  [(c) Report.--(1) Not later than December 31, 1989, the 
Secretary of Defense shall submit to the Committees on Armed 
Services of the Senate and House of Representatives a report on 
how the Secretary intends to use the funds referred to in 
subsection (a), including how the Secretary intends to achieve 
the priorities specified in paragraph (3) of that subsection.
  [(2) If at the time such report is submitted the Secretary 
proposes to use the authority provided by subsection (b)(2), 
the Secretary shall include in the report under paragraph (1) a 
description of the use proposed to be made of that authority 
and a statement of the reasons why the Secretary determined 
that compliance with the limitation in subsection (b)(1) would 
result in an uneconomical and inefficient use of child care fee 
receipts, together with supporting cost information and other 
information justifying the determination.
  [(3) If the Secretary uses such authority after December 31, 
1989, the Secretary shall promptly inform the committees of the 
use of the authority and of the reasons for its use.

[SEC. 1503. CHILD CARE EMPLOYEES

  [(a) Required Training.--(1) The Secretary of Defense shall 
establish, and prescribe regulations to implement, a training 
program for child care employees. Those regulations shall apply 
uniformly among the military departments. Subject to paragraph 
(2), satisfactory completion of the training program shall be a 
condition of employment of any person as a child care employee.
  [(2) Under those regulations, the Secretary shall require 
that each child care employee complete the training program not 
later than six months after the date on which the employee is 
employed as a child care employee (except that, in the case of 
a child care employee hired before the date on which the 
training program is established, the Secretary shall require 
that the employee complete the program not later than six 
months after that date).
  [(3) The training program established under this subsection 
shall cover, at a minimum, training in the following:
          [(A) Early childhood development.
          [(B) Activities and disciplinary techniques 
        appropriate to children of different ages.
          [(C) Child abuse prevention and detection.
          [(D) Cardiopulmonary resuscitation and other 
        emergency medical procedures.
  [(b) Training and Curriculum Specialists.--(1) The Secretary 
of Defense shall require that at least one employee at each 
military child development center be a specialist in training 
and curriculum development. The Secretary shall ensure that 
such employees have appropriate credentials and experience.
  [(2) The duties of such employees shall include the 
following:
          [(A) Special teaching activities at the center.
          [(B) Daily oversight and instruction of other child 
        care employees at the center.
          [(C) Daily assistance in the preparation of lesson 
        plans.
          [(D) Assistance in the center's child abuse 
        prevention and detection program.
          [(E) Advising the director of the center on the 
        performance of other child care employees.
  [(3) Each employee referred to in paragraph (1) shall be an 
employee in a competitive service position.
  [(c) Program To Test Competitive Rates of Pay.--(1) For the 
purpose of improving the capability of the Department of 
Defense to provide military child development centers with a 
qualified and stable civilian workforce, the Secretary of 
Defense shall conduct a program as provided in this subsection 
to increase the compensation of child care employees. The 
Secretary shall begin the program not later than six months 
after the date of the enactment of this Act. The program shall 
be in effect for a period of at least two years.
  [(2) The program shall apply to all child care employees 
who--
          [(A) are directly involved in providing child care; 
        and
          [(B) are paid from nonappropriated funds.
  [(3) Under the program, child care employees at a military 
installation who are described in paragraph (2) shall be paid--
          [(A) in the case of entry-level employees, at rates 
        of pay competitive with the rates of pay paid to other 
        entry-level employees at that installation who are 
        drawn from the same labor pool; and
          [(B) in the case of other employees, at rates of pay 
        substantially equivalent to the rates of pay paid to 
        other employees at that installation with similar 
        training, seniority, and experience.
  [(d) Employment Preference Test Program for Military 
Spouses.--(1) The Secretary of Defense shall conduct a test 
program under which qualified spouses of members of the Armed 
Forces shall be given a preference in hiring for the position 
of child care employee in a position paid from nonappropriated 
funds if the spouse is among persons determined to be best 
qualified for the position. A spouse who is provided a 
preference under this subsection at a military child 
development center may not be precluded from obtaining another 
preference, in accordance with section 806 of the Military 
Family Act of 1985 (10 U.S.C. 113 note), in the same 
geographical area as the military child development center.
  [(2) The test program under this subsection shall run 
concurrently with the program under subsection (c).
  [(e) Report on Compensation and Spouse Employment Preference 
Programs.--Not later than March 1, 1991, the Secretary of 
Defense shall submit to the Committees on Armed Services of the 
Senate and House of Representatives a report on the programs 
under subsections (c) and (d). The report shall include the 
findings of the Secretary concerning the effect of each of the 
programs on the quality of child care provided in military 
child development centers and the effect of the spouse 
employment preference program on employee turnover at such 
centers.
  [(f) Additional Child Care Positions.--(1) The Secretary of 
Defense shall make available for child care programs of the 
Department of Defense, not later than September 30, 1990, at 
least 1,000 competitive service positions in addition to the 
number of competitive service positions in such programs as of 
September 30, 1989. During fiscal year 1991, the Secretary 
shall make available to child care programs of the Department 
additional competitive service positions so that the number of 
competitive service positions in such programs as of September 
30, 1991, is at least 3,700 greater than the number of 
competitive service positions in such programs as of September 
30, 1989.
  [(2) The Secretary may waive the increase otherwise required 
by the second sentence of paragraph (1) to the extent that the 
Secretary determines that such increase is not executable. If 
the Secretary issues such a waiver, the Secretary shall 
promptly submit to the Committees on Armed Services of the 
Senate and House of Representatives a report on the waiver. Any 
such report shall specify the number of such positions waived 
and the reasons for the waiver.
  [(3) The additional positions provided for in paragraph (1), 
and the workyears associated with those positions, that are 
used outside the United States shall not be counted for purpose 
of applying any limitation on the total number of positions or 
workyears, respectively, available to the Department of Defense 
outside the United States (or any limitation on the 
availability of appropriated funds for such positions or 
workyears for any fiscal year).
  [(g) Competitive Service Position Defined.--For purposes of 
this section, the term ``competitive service position'' means a 
position in the competitive service, as defined in section 
2102(a)(1) of title 5, United States Code.

[SEC. 1504. PARENT FEES

  [The Secretary of Defense shall prescribe regulations 
establishing fees to be charged parents for the attendance of 
children at military child development centers. Those 
regulations shall be uniform for the military departments and 
shall require that, in the case of children who attend the 
centers on a regular basis, the fees shall be based on family 
income.

[SEC. 1505. CHILD ABUSE PREVENTION AND SAFETY AT FACILITIES

  [(a) Child Abuse Task Force.--The Secretary of Defense shall 
establish and maintain a special task force to respond to 
allegations of widespread child abuse at a military 
installation. The task force shall be composed of personnel 
from appropriate disciplines, including, where appropriate, 
medicine, psychology, and childhood development. In the case of 
such allegations, the task force shall provide assistance to 
the commander of the installation, and to parents at the 
installation, in helping them to deal with such allegations.
  [(b) National Hotline.--(1) The Secretary of Defense shall 
establish and maintain a national telephone number for persons 
to use to report suspected child abuse or safety violations at 
a military child development center or family home day care 
site. The Secretary shall ensure that such reports may be made 
anonymously if so desired by the person making the report. The 
Secretary shall establish procedures for following up on 
complaints and information received over that number.
  [(2) The Secretary shall establish such national telephone 
number not later than 90 days after the date of the enactment 
of this Act and shall publicize the existence of the number.
  [(c) Assistance From Local Authorities.--The Secretary of 
Defense shall prescribe regulations requiring that, in a case 
of allegations of child abuse at a military child development 
center or family home day care site, the commander of the 
military installation or the head of the task force established 
under subsection (a) shall seek the assistance of local child 
protective authorities if such assistance is available.
  [(d) Safety Regulations.--The Secretary of Defense shall 
prescribe regulations on safety and operating procedures at 
military child development centers. Those regulations shall 
apply uniformly among the military departments.
  [(e) Inspections.--The Secretary of Defense shall require 
that each military child development center be inspected not 
less often than four times a year. Each such inspection shall 
be unannounced. At least one inspection a year shall be carried 
out by a representative of the installation served by the 
center, and one inspection a year shall be carried out by a 
representative of the major command under which that 
installation operates.
  [(f) Remedies for Violations.--(1) Except as provided in 
paragraph (2), any violation of a safety, health, or child 
welfare law or regulation (discovered at an inspection or 
otherwise) at a military child development center shall be 
remedied immediately.
  [(2) In the case of a violation that is not life threatening, 
the commander of the major command under which the installation 
concerned operates may waive the requirement that the violation 
be remedied immediately for a period of up to 90 days beginning 
on the date of the discovery of the violation. If the violation 
is not remedied as of the end of that 90-day period, the 
military child development center shall be closed until the 
violation is remedied. The Secretary of the military department 
concerned may waive the preceding sentence and authorize the 
center to remain open in a case in which the violation cannot 
reasonably be remedied within that 90-day period or in which 
major facility reconstruction is required.
  [(3) If a military child development center is closed under 
paragraph (2), the Secretary of the military department 
concerned shall promptly submit to the Committees on Armed 
Services of the Senate and House of Representatives a report 
notifying those committees of the closing. The report shall 
include--
          [(A) notice of the violation that resulted in the 
        closing and the cost of remedying the violation; and
          [(B) a statement of the reasons why the violation has 
        not been remedied as of the time of the report.
  [(g) Report on Cooperation With Department of Justice.--(1) 
The Secretary of Defense, in consultation with the Attorney 
General, shall study matters relating to military child care 
that are of concern to the Department of Justice. The matters 
studied shall include the following:
          [(A) Improving communication between the Department 
        of Defense and the Department of Justice in 
        investigations of child abuse in military programs and 
        in the coordination of the conduct of such 
        investigations.
          [(B) Eliminating overlapping responsibilities between 
        the two departments.
          [(C) Making better use of government and non-
        government experts in child abuse investigations and 
        prosecutions.
          [(D) Improving communication with affected families 
        by the Department of Defense, the Department of 
        Justice, and appropriate State and local agencies.
  [(2) Not later than six months after the date of the 
enactment of this Act, the Secretary of Defense shall submit to 
Congress a report on the study required by paragraph (1). The 
report shall include recommendations on methods for improving 
the matters studied.
  [(3) Not later than nine months after the date of the 
enactment of this Act, the Comptroller General of the United 
States shall submit to Congress a report evaluating the 
findings in the report submitted under paragraph (2).

[SEC. 1506. PARENT PARTNERSHIPS WITH CHILD DEVELOPMENT CENTERS

  [(a) Parent Boards.--The Secretary of Defense shall require 
that there be established at each military child development 
center a board of parents, to be composed of parents of 
children attending the center. The board shall meet 
periodically with staff of the center and the commander of the 
installation served by the center for the purpose of discussing 
problems and concerns. The board, together with the staff of 
the center, shall be responsible for coordinating the parent 
participation program described in subsection (b).
  [(b) Parent Participation Programs.--The Secretary of Defense 
shall require the establishment of a parent participation 
program at each military child development center. As part of 
such program, the Secretary of Defense may establish fees for 
attendance of children at such a center, in the case of parents 
who participate in the parent participation program at that 
center, at rates lower than the rates that otherwise apply.

[SEC. 1507. REPORT ON FIVE-YEAR DEMAND FOR CHILD CARE

  [(a) Report Required.--Not later than six months after the 
date of the enactment of this Act, the Secretary of Defense 
shall submit to Congress a report on the expected demand for 
child care by military and civilian personnel of the Department 
of Defense during fiscal years 1991 through 1995.
  [(b) Plan for Meeting Demand.--The report shall include--
          [(1) a plan for meeting the expected child care 
        demand identified in the report; and
          [(2) an estimate of the cost of implementing that 
        plan.
  [(c) Monitoring of Family Day Care Providers.--The report 
shall also include a description of methods for monitoring 
family home day care programs of the military departments.

 H4  deg.[SEC. 1508. SUBSIDIES FOR FAMILY HOME DAY CARE

  [The Secretary of Defense may use appropriated funds 
available for military child care purposes to provide 
assistance to family home day care providers so that family 
home day care services can be provided to members of the Armed 
Forces at a cost comparable to the cost of services provided by 
military child development centers. The Secretary shall 
prescribe regulations for the provision of such assistance.

 H4  deg.[SEC. 1509. EARLY CHILDHOOD EDUCATION DEMONSTRATION 
                    PROGRAM

  [(a) Demonstration Program for Accredited Centers.--(1) The 
Secretary of Defense shall carry out a program to demonstrate 
the effect on the development of preschool children of 
requiring that military child development centers meet 
standards of operation necessary for accreditation by an 
appropriate national early childhood programs accrediting body. 
To carry out such demonstration program, the Secretary shall 
ensure that not later than June 1, 1991, at least 50 military 
child development centers are accredited by such an appropriate 
national early childhood accrediting body.
  [(2) Each military child development center so accredited 
shall be designated as an early childhood education 
demonstration project and shall serve as a program model for 
other military child development centers and family home day 
care providers at military installations.
  [(b) Plan for Implementation.--Not later than April 1, 1990, 
the Secretary shall submit to the Committees on Armed Services 
of the Senate and House of Representatives a plan for carrying 
out the requirements of subsection (a).
  [(c) Evaluation.--The Secretary shall obtain an independent 
evaluation of the demonstration program carried out under 
subsection (a) to determine the extent to which the imposition 
of a requirement that military child development centers meet 
accreditation standards effectively promotes the development of 
preschool children of members of the Armed Forces. The 
Secretary shall report the results of the evaluation to 
Congress, together with such comments and recommendations as 
the Secretary considers appropriate, not later than July 15, 
1992.

[SEC. 1510. DEADLINE FOR REGULATIONS

  [Regulations required to be prescribed by this title shall be 
prescribed not later than 90 days after the date of the 
enactment of this Act.]

           *       *       *       *       *       *       *

                              ----------                              


NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 1993

           *       *       *       *       *       *       *


            DIVISION A--DEPARTMENT OF DEFENSE AUTHORIZATIONS

TITLE I--PROCUREMENT

           *       *       *       *       *       *       *


                     Subtitle F--Strategic Programs

SEC. 151. B-2 BOMBER AIRCRAFT PROGRAM.

  (a) * * *

           *       *       *       *       *       *       *

  [(c) Limitation on Number of B-2 Aircraft.--A total of not 
more than 20 deployable B-2 bomber aircraft plus one test 
aircraft may be procured.]

           *       *       *       *       *       *       *


TITLE III--OPERATION AND MAINTENANCE

           *       *       *       *       *       *       *


Subtitle D--Defense Business Operations Fund

           *       *       *       *       *       *       *


[SEC. 342. CAPITAL ASSET SUBACCOUNT.

  [(a) Use of Subaccount for Capital Assets Depreciation 
Charges.--Charges for goods and services provided through the 
Defense Business Operations Fund shall include amounts for 
depreciation of capital assets, set in accordance with 
generally accepted accounting principles. Amounts charged for 
depreciation shall be credited to a separate capital asset 
subaccount established within the Fund. The subaccount shall be 
available only for the payment of outlays for capital assets 
for the Fund.
  [(b) Award of Contracts.--The Secretary of Defense may award 
contracts for capital assets of the Fund in advance of the 
availability of funds in the subaccount, to the extent provided 
for in appropriations Acts.
  [(c) Annual Report.--The Secretary of Defense shall submit to 
the congressional defense committees each year, at the same 
time that the President submits the budget to the Congress 
under section 1105 of title 31, United States Code, a report 
that specifies--
          [(1) the opening balance of the subaccount as of the 
        beginning of the fiscal year in which the report is 
        submitted;
          [(2) the estimated amounts to be credited to the 
        subaccount in the fiscal year in which the report is 
        submitted;
          [(3) the estimated amounts of outlays to be paid out 
        of the subaccount in the fiscal year in which the 
        report is submitted;
          [(4) the estimated balance of the subaccount at the 
        end of the fiscal year in which the report is 
        submitted; and
          [(5) a statement of how much of the estimated balance 
        at the end of the fiscal year in which the report is 
        submitted will be needed to pay outlays in the 
        immediately following fiscal year that are in excess of 
        the amount to be credited to the subaccount in the 
        immediately following fiscal year.
  [(d) Authorization.--There is hereby authorized to be 
appropriated to the Fund subaccount for fiscal years 1993 and 
1994 such sums as may be necessary to pay, during fiscal year 
1993 and until April 15, 1994, outlays for capital assets in 
excess of the amount otherwise available in the subaccount.
  [(e) Definitions.--For purposes of this section:
          (1) The term ``capital assets'' means the following 
        capital assets that have a development or acquisition 
        cost of not less than $15,000:
                  [(A) Minor construction projects financed by 
                the Fund pursuant to section 2805(c)(1) of 
                title 10, United States Code.
                  [(B) Automatic data processing equipment, 
                software, other equipment, and other capital 
                improvements.
          [(2) The term ``Fund'' means the Defense Business 
        Operations Fund.]

           *       *       *       *       *       *       *


SEC. 386. ASSISTANCE TO LOCAL EDUCATIONAL AGENCIES THAT BENEFIT 
                    DEPENDENTS OF MEMBERS OF THE ARMED FORCES AND 
                    DEPARTMENT OF DEFENSE CIVILIAN EMPLOYEES.

  (a) * * *

           *       *       *       *       *       *       *

  (c) Eligible Local Educational Agencies.--A local educational 
agency is eligible for assistance under subsection (b) for a 
fiscal year if--
          (1) at least [30] 20 percent (as rounded to the 
        nearest whole percent) of the students in average daily 
        attendance in the schools of that agency in that fiscal 
        year are military dependent students [counted under 
        subsection (a) or (b) of section 3 of the Act of 
        September 30, 1950 (Public Law 874, Eighty-first 
        Congress; 20 U.S.C. 238)];

           *       *       *       *       *       *       *

  (d) Adjustment Payments Related to Base Closures and 
Realignments.--Subject to subsection (g), to assist communities 
in making adjustments resulting from reductions in the size of 
the Armed Forces, the Secretary of Defense shall transfer to 
the Secretary of Education funds to make payments to local 
educational agencies that are entitled to receive [under 
section 3 of the Act of September 30, 1950 (Public Law 874, 
Eighty-first Congress; 20 U.S.C. 238), payments adjusted in 
accordance with subsection (e) of such section by reason of 
conditions described in subparagraphs (A) through (C) of 
paragraph (1) of such subsection that result from] payments 
under section 8003(e) of the Elementary and Secondary Education 
Act of 1965 (20 U.S.C. 7703(e)) as a result of closures and 
realignments of military installations.
  (e) Report on Impact of Base Closures on Educational 
Agencies.--(1) Not later than February 15 of each of 1993, 
1994, [and 1995] 1995, and 1996, the Secretary of Defense, in 
consultation with the Secretary of Education, shall submit to 
Congress a report on the local educational agencies affected by 
the closures and realignment of military installations and by 
redeployments of members of the Armed Forces.
  (2) Each report shall contain the following:
          (A) * * *

           *       *       *       *       *       *       *

          (C) The amounts paid to the local educational 
        agencies during that year under the Act of September 
        30, 1950 (Public Law 874, Eighty-first Congress; 20 
        U.S.C. 236 et seq.), title VIII of the Elementary and 
        Secondary Education Act of 1965 (20 U.S.C. 7701 et 
        seq.), or any other provision of law authorizing the 
        payment of financial assistance to local communities or 
        local educational agencies on the basis of the presence 
        of dependent children of such members or employees in 
        such communities and in the schools of such agencies.
          (D) The projected transfers of such members and 
        employees in connection with closures, realignments, 
        and redeployments during the 12-month period beginning 
        on the date of the report, including--
                  (i) the installations to be closed or 
                realigned;
                  (ii) the installations to which personnel 
                will be transferred as a result of closures, 
                realignments, and redeployments; and
                  (iii) the effects of such transfers on the 
                number of dependent children who will be 
                included in determinations with respect to the 
                payment of funds to each affected local 
                educational agency [under subsections (a) and 
                (b) of section 3 of such Act (20 U.S.C. 238)].

           *       *       *       *       *       *       *

  (h) Definitions.--In this section:
          (1) The term ``local educational agency'' has the 
        meaning given that term in [section 1471(12) of the 
        Elementary and Secondary Education Act of 1965 (20 
        U.S.C. 2891(12)) section 8013(9) of the Elementary and 
        Secondary Education Act of 1965 (20 U.S.C. 7713(9))].

           *       *       *       *       *       *       *

          [(3) The term ``State'' has the meaning given that 
        term in section 3(d)(3)(D)(i) of the Act of September 
        30, 1950 (Public Law 874, Eighty-first Congress; 20 
        U.S.C. 238(d)(3)(D)(i)).]
          (3) The term ``State'' does not include Puerto Rico, 
        Wake Island, Guam, American Samoa, the Northern Mariana 
        Islands, or the Virgin Islands.

           *       *       *       *       *       *       *


TITLE X--GENERAL PROVISIONS

           *       *       *       *       *       *       *


Subtitle E--Counter-Drug Activities

           *       *       *       *       *       *       *


[SEC. 1045. PILOT OUTREACH PROGRAM TO REDUCE DEMAND FOR ILLEGAL DRUGS.

  [(a) Pilot Program.--The Secretary of Defense shall conduct a 
pilot outreach program to reduce the demand for illegal drugs. 
The program shall include outreach activities by the active and 
reserve components of the Armed Forces and shall focus 
primarily on youths in general and inner-city youths in 
particular.
  [(b) Payment of Travel and Living Expenses.--The Secretary of 
Defense may provide travel and living allowances to members of 
the Armed Forces who participate in the pilot outreach program 
to permit such members to carry out demand reduction activities 
in areas beyond the vicinity of military installations and 
National Guard facilities.
  [(c) Funding.--Funds available to the Department of Defense 
for drug interdiction and counter-drug activities may be used 
for carrying out the pilot outreach program described in 
subsection (a).
  [(d) Duration of Program.--The pilot outreach program 
described in subsection (a) shall be conducted for a test 
period ending three years after the date of the enactment of 
this Act.
  [(e) Report.--Not later than two years after the date of the 
enactment of this Act, the Secretary of Defense shall submit to 
the Congress a report that assesses the effectiveness of the 
pilot outreach program and includes the recommendations of the 
Secretary regarding the continuation of the program.]

           *       *       *       *       *       *       *


Subtitle H--Other Matters

           *       *       *       *       *       *       *


SEC. 1081. CIVIL-MILITARY COOPERATIVE ACTION PROGRAM.

  [(a) Findings.--Congress makes the following findings:
          [(1) Many of the skills, capabilities, and resources 
        that the Armed Forces have developed to meet military 
        requirements can assist in meeting the civilian 
        domestic needs of the United States.
          [(2) Members of the Armed Forces have the training, 
        education, and experience to serve as role models for 
        United States youth.
          [(3) As a result of the reductions in the Armed 
        Forces resulting from the ending of the Cold War, the 
        Armed Forces will have fewer overseas deployments and 
        lower operating tempos, and there will be a much 
        greater opportunity than in the past for the Armed 
        Forces to assist civilian efforts to address critical 
        domestic problems.
          [(4) The United States has significant domestic needs 
        in areas such as health care, nutrition, education, 
        housing, and infrastructure that cannot be met by 
        current and anticipated governmental and private sector 
        programs.
          [(5) There are significant opportunities for the 
        resources of the Armed Forces, which are maintained for 
        national security purposes, to be applied in 
        cooperative efforts with civilian officials to address 
        these vital domestic needs.
          [(6) Civil-military cooperative efforts can be 
        undertaken in a manner that is consistent with the 
        military mission and does not compete with the private 
        sector.]

           *       *       *       *       *       *       *


                Subtitle I--Youth Service Opportunities

[SEC. 1091. NATIONAL GUARD CIVILIAN YOUTH OPPORTUNITIES PILOT PROGRAM.

  [(a) Program Authority.--During fiscal years 1993 through 
1995, the Secretary of Defense, acting through the Chief of the 
National Guard Bureau, may conduct a pilot program to be known 
as the ``National Guard Civilian Youth Opportunities Program''.
  [(b) Purpose.--The purpose of the pilot program is to provide 
a basis for determining--
          [(1) whether the life skills and employment potential 
        of civilian youth who cease to attend secondary school 
        before graduating can be significantly improved through 
        military-based training, including supervised work 
        experience in community service and conservation 
        projects, provided by the National Guard; and
          [(2) whether it is feasible and cost effective for 
        the National Guard to provide military-based training 
        to such youth for the purpose of achieving such 
        improvements.
  [(c) Conduct of Program in 10 National Guard Jurisdictions.--
The Secretary of Defense may provide for the conduct of the 
pilot program in any 10 of the States.
  [(d) Program Agreements.--(1) To carry out the pilot program 
in a State, the Secretary of Defense shall enter into an 
agreement with the Governor of the State or, in the case of the 
District of Columbia, with the commanding general of the 
District of Columbia National Guard.
  [(2) Each agreement under the pilot program shall provide for 
the Governor or, in the case of the District of Columbia, the 
commanding general to establish, organize, and administer a 
National Guard civilian youth opportunities program in the 
State.
  [(3) The agreement may provide for the Secretary to reimburse 
the State for civilian personnel costs attributable to the use 
of civilian employees of the National Guard in the conduct of 
the National Guard civilian youth opportunities program.
  [(e) Persons Eligible to Participate in Program.--(1) A 
school dropout from secondary school shall be eligible to 
participate in a National Guard civilian youth opportunities 
program conducted under the pilot program.
  [(2) The Secretary shall prescribe the standards and 
procedures for selecting participants for a National Guard 
civilian youth opportunities program from among school dropouts 
eligible to participate in the program.
  [(f) Authorized Benefits for Participants.--(1) To the extent 
provided in an agreement entered into in accordance with 
subsection (d) and subject to the approval of the Secretary, a 
person selected for training in a National Guard civilian youth 
opportunities program conducted under the pilot program may 
receive the following benefits in connection with that 
training:
          [(A) Allowances for travel expenses, personal 
        expenses, and other expenses.
          [(B) Quarters.
          [(C) Subsistence.
          [(D) Transportation.
          [(E) Equipment.
          [(F) Clothing.
          [(G) Recreational services and supplies.
          [(H) Other services.
          [(I) Subject to paragraph (2), a temporary stipend 
        upon the successful completion of the training, as 
        characterized in accordance with procedures provided in 
        the agreement.
  [(2) In the case of a person selected for training in a 
National Guard civilian youth opportunities program conducted 
under the pilot program who afterwards becomes a member of the 
Civilian Community Corps under subtitle E of title I of the 
National and Community Service Act of 1990 (as added by section 
1092(a)), the person may not receive a temporary stipend under 
paragraph (1)(I) while the person is a member of that Corps. 
The person may receive the temporary stipend after completing 
service in the Corps unless the person elects to receive 
benefits provided under subsection (f) or (g) of section 158 of 
such Act.
  [(g) Program Personnel.--(1) Personnel of the National Guard 
of a State in which a National Guard civilian youth 
opportunities program is conducted under the pilot program may 
serve on full-time National Guard duty for the purpose of 
providing command, administrative, training, or supporting 
services for that program. For the performance of those 
services, any such personnel may be ordered to duty under 
section 502(f) of title 32, United States Code, for not longer 
than the period of the program.
  [(2) For fiscal year 1993, personnel so serving may not be 
counted for the purposes of--
          [(A) any provision of law limiting the number of 
        personnel that may be serving on full-time active duty 
        or full-time National Guard duty for the purpose of 
        organizing, administering, recruiting, instructing, or 
        training the reserve components; or
          [(B) section 524 of title 10, United States Code, 
        relating to the number of reserve component officers 
        who may be on active duty or full-time National Guard 
        duty in certain grades.
  [(3) A Governor participating in the pilot program and the 
commanding general of the District of Columbia National Guard 
(if the District of Columbia National Guard is participating in 
the pilot program) may procure by contract the temporary full 
time services of such civilian personnel as may be necessary to 
augment National Guard personnel in carrying out a National 
Guard civilian youth opportunities program under the pilot 
program.
  [(4) Civilian employees of the National Guard performing 
services for such a program and contractor personnel performing 
such services may be required, when appropriate to achieve a 
program objective, to be members of the National Guard and to 
wear the military uniform.
  [(h) Equipment and Facilities.--(1) Equipment and facilities 
of the National Guard, including military property of the 
United States issued to the National Guard, may be used in 
carrying out the pilot program.
  [(2) Activities under the pilot program shall be considered 
noncombat activities of the National Guard for purposes of 
section 710 of title 32, United States Code.
  [(i) Status of Participants.--(1) A person receiving training 
under the pilot program shall be considered an employee of the 
United States for the purposes of the following provisions of 
law:
          [(A) Subchapter I of chapter 81 of title 5, United 
        States Code (relating to compensation of Federal 
        employees for work injuries).
          [(B) Section 1346(b) and chapter 171 of title 28, 
        United States Code, and any other provision of law 
        relating to the liability of the United States for 
        tortious conduct of employees of the United States.
  [(2) In the application of the provisions of law referred to 
in paragraph (1)(A) to a person referred to in paragraph (1)--
          [(A) the person shall not be considered to be in the 
        performance of duty while the person is not at the 
        assigned location of training or other activity or duty 
        authorized in accordance with a program agreement 
        referred to in subsection (d), except when the person 
        is traveling to or from that location or is on pass 
        from that training or other activity or duty;
          [(B) the person's monthly rate of pay shall be deemed 
        to be the minimum rate of pay provided for grade GS-2 
        of the General Schedule under section 5332 of title 5, 
        United States Code; and
          [(C) the entitlement of a person to receive 
        compensation for a disability shall begin on the day 
        following the date on which the person's participation 
        in the pilot program is terminated.
  [(3) A person referred to in paragraph (1) may not be 
considered an employee of the United States for any purpose 
other than a purpose set forth in that paragraph.
  [(j) Supplemental Resources.--(1) To carry out a National 
Guard civilian youth opportunities program conducted under the 
pilot program, the Governor of a State or, in the case of the 
District of Columbia, the commanding general of the District of 
Columbia National Guard may supplement any funding made 
available pursuant to subsection (m) out of other resources 
(including gifts) available to the Governor or the commanding 
general.
  [(2) The provision of funds authorized to be appropriated for 
the pilot program shall not preclude a Governor participating 
in the pilot program, or the commanding general of the District 
of Columbia National Guard (if the District of Columbia 
National Guard is participating in the pilot program), from 
accepting, using, and disposing of gifts or donations of money, 
other property, or services for the pilot program.
  [(k) Report.--(1) Within 90 days after the end of the one-
year period beginning on the first day of the pilot program, 
the Secretary shall submit to the congressional defense 
committees a report on the design, conduct, and effectiveness 
of the pilot program during that one-year period. The report 
shall include an assessment of the matters set forth in 
paragraphs (1) and (2) of subsection (b).
  [(2) In preparing the report required by paragraph (1), the 
Secretary shall coordinate with the Governor of each State in 
which a National Guard civilian youth opportunities program is 
carried out under the pilot program and, if such a program is 
carried out in the District of Columbia, with the commanding 
general of the District of Columbia National Guard.
  [(l) Definitions.--In this section:
          [(1) The term ``pilot program'' means the National 
        Guard Civilian Youth Opportunities Program authorized 
        to be conducted under subsection (a).
          [(2) The term ``State'' includes the District of 
        Columbia, Puerto Rico, Guam, and the Virgin Islands.
          [(3) The term ``school dropout'' has the meaning 
        established for the term by the Secretary of Education 
        pursuant to section 6201(a) of the Elementary and 
        Secondary Education Act of 1965 (20 U.S.C. 3271(a)).
          [(4) The term ``full-time National Guard duty'' has 
        the meaning given that term in section 101 of title 32, 
        United States Code.
  [(m) Funding.--Of the amounts appropriated for the Department 
of Defense for operation and maintenance in fiscal year 1993 
pursuant to the authorization of appropriations in section 301, 
$50,000,000 shall be available to carry out the pilot program 
for fiscal year 1993.]

           *       *       *       *       *       *       *


[SEC. 1093. COORDINATION OF PROGRAMS.

  [(a) Coordinated Administration.--To the maximum extent 
practicable, the Chief of the National Guard Bureau, the Board 
of Directors and Chief Executive Officer of the Corporation for 
National and Community Service, and the Director of the 
Civilian Community Corps shall coordinate the National Guard 
Youth Opportunities Program established pursuant to section 
1091 and the Civilian Community Corps Demonstration Program 
established pursuant to the authorization contained in section 
152 of the National and Community Service Act of 1990 (as added 
by section 1092(a)).
  [(b) Objectives.--The officials referred to in subsection (a) 
shall ensure that--
          [(1) the programs referred to in subsection (a) are 
        conducted in such a manner in relationship to each 
        other that the public benefit of those programs is 
        maximized;
          [(2) to the maximum extent appropriate to meet the 
        needs of program participants, persons who complete 
        participation in the National Guard Youth Opportunities 
        Program and are eligible and apply to participate in 
        the Civilian Community Corps under the Civilian 
        Community Corps Demonstration Program are accepted for 
        participation in that Program; and
          [(3) the programs referred to in subsection (a) are 
        conducted simultaneously in competition with each other 
        in the same immediate area of the United States only 
        when the population of eligible participants in that 
        area is sufficient to justify the simultaneous conduct 
        of such programs in that area.]

           *       *       *       *       *       *       *


             TITLE XI--ARMY GUARD COMBAT REFORM INITIATIVE


SEC. 1101. SHORT TITLE.

  This title may be cited as the ``Army National Guard Combat 
Readiness Reform Act of 1992''.

                 Subtitle A--Deployability Enhancements


SEC. 1111. [MINIMUM PERCENTAGE OF] PRIOR ACTIVE-DUTY PERSONNEL.

  [(a) Establishment of Minimum Percentage.--The Secretary of 
the Army shall have an objective of increasing the percentage 
of qualified prior active-duty personnel in the Army National 
Guard to 65 percent, in the case of officers, and to 50 
percent, in the case of enlisted members, by September 30, 
1997.
  [(b) Interim Accession Percentages.--The Secretary shall 
prescribe regulations establishing for each of fiscal years 
1993 through 1997 an accession percentage for officers, and a 
separate accession percentage for enlisted members, for prior 
active-duty personnel so as to facilitate compliance with the 
objectives stated in subsection (a).]
  (a) Additional Prior Active Duty Officers.--The Secretary of 
the Army shall increase the number of qualified prior active-
duty officers in the Army National Guard by providing a program 
that permits the separation of officers on active duty with at 
least two, but less than three, years of active service upon 
condition that the officer is accepted for appointment in the 
Army National Guard. The Secretary shall have a goal of having 
not fewer than 150 officers become members of the Army National 
Guard each year under this section.
  (b) Additional Prior Active Duty Enlisted Members.--The 
Secretary of the Army shall increase the number of qualified 
prior active-duty enlisted members in the Army National Guard 
through the use of enlistments as described in section 8020 of 
the Department of Defense Appropriations Act, 1994 (Public Law 
103-139). The Secretary shall enlist not fewer than 1,000 new 
enlisted members each year under enlistments described in that 
section.
  (c) Qualified Prior Active-Duty Personnel.--For purposes of 
this section, qualified prior active-duty personnel are members 
of the Army National Guard with not less than two years of 
active duty.
  [(d) Deadline for Regulations.--The regulations required by 
subsection (a) shall be prescribed not later than March 15, 
1993. The Secretary shall submit those regulations to the 
Committees on Armed Services of the Senate and House of 
Representatives not later than April 1, 1993.
  [(e) List of Certain Separated Officers.--On a semiannual 
basis, the Secretary of the Army shall furnish to the Chief of 
the National Guard Bureau a list containing the name, home of 
record, and last-known mailing address of each officer of the 
Army who during the previous six months was honorably separated 
from active duty in the grade of major or below.]

SEC. 1112. SERVICE IN SELECTED RESERVE IN LIEU OF ACTIVE-DUTY SERVICE.

  (a) * * *
  (b) ROTC Graduates.--The Secretary of the Army shall provide 
a program under which graduates of the Reserve Officers' 
Training Corps program may perform their minimum period of 
obligated service by a combination of (A) two years of active 
duty, and (B) such additional period of service as is necessary 
to complete the remainder of such obligation, to be served in 
the [National Guard] Selected Reserve.

SEC. 1113. REVIEW OF OFFICER PROMOTIONS BY COMMANDER OF ASSOCIATED 
                    ACTIVE DUTY UNIT.

  (a) Review.--Whenever an officer in an Army [National Guard] 
Selected Reserve unit as defined in subsection (b) is 
recommended for a unit vacancy promotion to a grade above first 
lieutenant, the recommended promotion shall be reviewed by the 
commander of the active duty unit associated with the [National 
Guard] Selected Reserve unit of that officer or another active-
duty officer designated by the Secretary of the Army. The 
commander or other active-duty officer designated by the 
Secretary of the Army shall provide to the promoting authority, 
through the promotion board convened by the promotion authority 
to consider unit vacancy promotion candidates, before the 
promotion is made, a recommendation of concurrence or 
nonconcurrence in the promotion. The recommendation shall be 
provided to the promoting authority within 60 days after 
receipt of notice of the recommended promotion.
  [(b) Implementation.--Subsection (a) shall take effect--
          [(1) on April 1, 1993, for officers in Army National 
        Guard units that on that date are designated as round-
        out/round-up units;
          [(2) on October 1, 1993, for officers in other units 
        of the Army National Guard in the Selected Reserve of 
        the Ready Reserve that are designated as early 
        deploying units; and
          [(3) on April 1, 1994, for officers in all other Army 
        National Guard combat units.]
  (b) Coverage of Selected Reserve Combat and Early Deploying 
Units.--(1) Subsection (a) applies to officers in all units of 
the Selected Reserve that are designated as combat units or 
that are designated for deployment within 75 days of 
mobilization.
  (2) Subsection (a) shall take effect with respect to officers 
of the Army Reserve, and with respect to officers of the Army 
National Guard in units not subject to subsection (a) as of the 
the date of the enactment of the National Defense Authorization 
Act for Fiscal Year 1996, at the end of the 90-day period 
beginning on such date of enactment.

           *       *       *       *       *       *       *


SEC. 1115. INITIAL ENTRY TRAINING AND NONDEPLOYABLE PERSONNEL ACCOUNT.

  (a) Establishment of Personnel Account.--The Secretary of the 
Army shall establish a personnel accounting category for 
members of the Army National Guard[ Selected Reserve to be used 
for categorizing members of the [National Guard] Selected 
Reserve who have not completed the minimum training required 
for deployment or who are otherwise not available for 
deployment. The account shall be designed so that it is 
compatible with the decentralized personnel systems of the Army 
Guard and Reserve. The account shall be used for the reporting 
of personnel readiness and may not be used as a factor in 
establishing the level of Army Guard and Reserve force 
structure.
  (b) Use of Account.--Until a member of the Army [National 
Guard] Selected Reserve has completed the minimum training 
necessary for deployment, the member may not be assigned to 
fill a position in a [National Guard] Selected Reserve unit but 
shall be carried in the account established under subsection 
(a).
  (c) Time for Qualification for Deployment.--(1) If at the end 
of 24 months after [a member of the Army National Guard enters 
the National Guard] a member of the Army Selected Reserve 
enters the Army Selected Reserve, the member has not completed 
the minimum training required for deployment, the member shall 
be discharged [from the Army National Guard].
  (2) The Secretary of the Army may waive the requirement in 
paragraph (1) in the case of health care providers and in other 
cases determined necessary. The authority to make such a waiver 
may not be delegated.

SEC. 1116. MINIMUM PHYSICAL DEPLOYABILITY STANDARDS.

  The Secretary of the Army shall transfer the personnel 
classification of a member of the Army [National Guard] 
Selected Reserve from the [National Guard] Selected Reserve 
unit of the member to the personnel account established 
pursuant to section 1115 if the member does not meet minimum 
physical profile standards required for deployment. Any such 
transfer shall be made not later than 90 days after the date on 
which the determination that the member does not meet such 
standards is made.

[SEC. 1117. MEDICAL ASSESSMENTS.

  [The Secretary of the Army shall require that--
          [(1) each member of the Army National Guard undergo a 
        medical and dental screening on an annual basis; and
          [(2) each member of the Army National Guard over the 
        age of 40 undergo a full physical examination not less 
        often than every two years.

[SEC. 1118. DENTAL READINESS OF MEMBERS OF EARLY DEPLOYING UNITS.

  [(a) Development of Plan.--The Secretary of the Army shall 
develop a plan to ensure that units of the Army National Guard 
scheduled for early deployment in the event of a mobilization 
(as determined by the Secretary) are dentally ready (as defined 
in regulations of the Secretary) for deployment.
  [(b) Report.--The Secretary shall submit to the Committees on 
Armed Services of the Senate and House of Representatives a 
report on such plan not later than February 15, 1993. The 
Secretary shall include in the report any legislative proposals 
that the Secretary considers necessary in order to implement 
the plan.]

           *       *       *       *       *       *       *


SEC. 1120. USE OF COMBAT SIMULATORS.

  The Secretary of the Army shall expand the use of 
simulations, simulators, and advanced training devices and 
technologies in order to increase training opportunities for 
members and units of the Army National Guard and the Army 
Reserve.

           *       *       *       *       *       *       *


                       TITLE XV--NONPROLIFERATION


SEC. 1501. SHORT TITLE.

  This title may be cited as the ``Weapons of Mass Destruction 
Control Act of 1992''.

           *       *       *       *       *       *       *


SEC. 1505. INTERNATIONAL NONPROLIFERATION INITIATIVE.

  (a) Assistance for International Nonproliferation 
Activities.--Subject to the limitations and requirements 
provided in this section, [during fiscal years 1994 and 1995] 
the Secretary of Defense, under the guidance of the President, 
may provide assistance to support international 
nonproliferation activities.
  (b) Activities for Which Assistance May Be Provided.--
Activities for which assistance may be provided under this 
section are activities such as the following:
          (1) Activities carried out by the International 
        Atomic Energy Agency (IAEA) that are designed to ensure 
        more effective safeguards against nuclear proliferation 
        and more aggressive verification of compliance with the 
        Treaty on the Non-Proliferation of Nuclear Weapons, 
        done on July 1, 1968.
          (2) Activities of [the On-Site Inspection Agency] the 
        Department of State in support of the United Nations 
        Special Commission on Iraq.

           *       *       *       *       *       *       *

  (c) Form of Assistance.--(1) * * *

           *       *       *       *       *       *       *

  (3) No amount may be obligated for an expenditure under this 
section unless the Director of the Office of Management and 
Budget determines that the expenditure [will be counted against 
the defense category of the discretionary spending limits for 
fiscal year 1993 (as defined in section 601(a)(2) of the 
Congressional Budget Act of 1974) for purposes of part C of the 
Balanced Budget and Emergency Deficit Control Act of 1985.] 
will be counted as discretionary spending in the national 
defense budget function (function 050).

           *       *       *       *       *       *       *

  (d) Sources of Assistance.--(1) Funds provided as assistance 
under this section [for fiscal year 1994 shall be derived from 
amounts made available to the Department of Defense for fiscal 
year 1994. Funds provided as assistance under this section for 
fiscal year 1995 shall be derived from amounts made available 
to the Department of Defense for fiscal year 1995.] for any 
fiscal year shall be derived from amounts made available to the 
Department of Defense for that fiscal year. Funds provided as 
assistance under this section for a fiscal year [referred to in 
this paragraph] may also be derived from balances in working 
capital accounts of the Department of Defense.
  (2) Supplies and equipment provided as assistance under this 
section may be provided, by loan or donation, from existing 
stocks of the Department of Defense and the Department of 
Energy.
  (3) The total amount of the assistance provided in the form 
of funds under this section [may not exceed $40,000,000. Of 
such amount, not more than $25,000,000 for fiscal year 1994 or 
$20,000,000 for fiscal year 1995] may be used for the 
activities of [the On-Site Inspection Agency] the Department of 
Defense in support of the United Nations Special Commission on 
Iraq, may not exceed $25,000,000 for fiscal year 1994, 
$20,000,000 for fiscal year 1995, or $15,000,000 for fiscal 
year 1996.

           *       *       *       *       *       *       *

  (e) Quarterly Report.--(1) Not later than 30 days after the 
end of each quarter of [fiscal years 1994 and 1995] a fiscal 
year during which the authority of the Secretary of Defense to 
provide assistance under this section is in effect, the 
Secretary of Defense shall transmit to the committees of 
Congress named in paragraph (2) a report of the activities to 
reduce the proliferation threat carried out under this section. 
Each report shall set forth (for the preceding quarter and 
cumulatively)--
          (A) * * *

           *       *       *       *       *       *       *

  (f) Termination of Authority.--The authority of the Secretary 
of Defense to provide assistance under this section terminates 
at the close of fiscal year 1996.

           *       *       *       *       *       *       *


            DIVISION B--MILITARY CONSTRUCTION AUTHORIZATIONS

SEC. 2001. SHORT TITLE.

  This division may be cited as the ``Military Construction 
Authorization Act for Fiscal Year 1993''.

           *       *       *       *       *       *       *


TITLE XXVIII--GENERAL PROVISIONS

           *       *       *       *       *       *       *


Subtitle C--Land Transactions

           *       *       *       *       *       *       *



SEC. 2834. LEASES OF PROPERTY, NAVAL SUPPLY CENTER, OAKLAND, 
                    CALIFORNIA.

  (a) * * *
  (b) Lease Authorized with City or Port of Oakland.--(1) * * *

           *       *       *       *       *       *       *

  (4) In lieu of entering into a lease under paragraph (1), or 
in place of an existing lease under such paragraph, the 
Secretary may convey, without consideration, the property 
described in such paragraph to the City of Oakland, California, 
the Port of Oakland, California, or the City of Alameda, 
California, under such terms and conditions as the Secretary 
considers appropriate.
  (5) The exact acreage and legal description of any property 
conveyed under paragraph (4) shall be determined by a survey 
satisfactory to the Secretary. The cost of each survey shall be 
borne by the recipient of the property.

           *       *       *       *       *       *       *

                              ----------                              


NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 1994

           *       *       *       *       *       *       *


            DIVISION A--DEPARTMENT OF DEFENSE AUTHORIZATIONS

                          TITLE I--PROCUREMENT

          * * * * * * *

                     Subtitle D--Air Force Programs

SEC. 131. B-2 BOMBER AIRCRAFT PROGRAM.

  (a)  * * *
          * * * * * * *
  [(c) Reaffirmation of Limitation on Number of B-2 Aircraft.--
As provided in section 151(c) of Public Law 102-484 (106 Stat. 
2339), the Secretary of the Air Force may not procure more than 
20 deployable B-2 bomber aircraft (plus one test aircraft which 
may not be made operational).
  [(d) Limitation on Total Program Cost.--The total amount 
obligated on or after the date of the enactment of this Act (1) 
for research, development, test, and evaluation for, and 
acquisition, modification and retrofitting of, the B-2 bomber 
aircraft referred to in subsection (c), and (2) for paying the 
costs associated with termination of the B-2 bomber aircraft 
program upon completion of the acquisition of those aircraft 
may not exceed $28,968,000,000 (in fiscal year 1981 constant 
dollars).]
          * * * * * * *

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

          * * * * * * *

                  Subtitle C--Missile Defense Programs

          * * * * * * *

[SEC. 234. COMPLIANCE OF BALLISTIC MISSILE DEFENSE SYSTEMS AND 
                    COMPONENTS WITH ABM TREATY.

  [(a) Findings.--Congress makes the following findings:
          [(1) Section 232(a)(1) of the Missile Defense Act of 
        1991 (10 U.S.C. 2431 note) establishes a goal for the 
        United States to comply with the ABM Treaty (including 
        any protocol or amendment thereto) and not develop, 
        test, or deploy any ballistic missile defense system, 
        or component thereof, in violation of that treaty (as 
        modified by any protocol or amendment thereto) while 
        deploying an anti-ballistic missile system capable of 
        providing a highly effective defense of the United 
        States against limited attacks of ballistic missiles.
          [(2) The Department of Defense has conducted no 
        formal compliance review of any of the components or 
        systems scheduled for early deployment as part of 
        either the Theater Missile Defense Initiative or the 
        initial limited defense system to be located at Grand 
        Forks, North Dakota.
          [(3) The Department of Defense is continuing to 
        obligate hundreds of millions of dollars for the 
        development and testing of systems or components of 
        ballistic missile defense systems before a 
        determination has been made that, if successfully 
        developed, tested, or deployed, those systems and 
        components would be in compliance with the ABM Treaty.
          [(4) The President requested the authorization and 
        appropriation of additional funds for continued 
        development of such systems and components during 
        fiscal year 1994.
          [(5) The United States and its allies face existing 
        and expanding threats from ballistic missiles capable 
        of being used as theater weapon systems that are 
        presently possessed by, being developed by, or being 
        acquired by a number of countries, including Iraq, 
        Iran, and North Korea.
          [(6) Some theater ballistic missiles presently 
        deployed or being developed (such as the Chinese-made 
        CSS-2) have capabilities equal to or greater than the 
        capabilities of missiles which were determined to be 
        strategic missiles more than 20 years ago under the 
        SALT I Interim Agreement of 1972 entered into between 
        the United States and the Soviet Union.
          [(7) The ABM Treaty was not intended to, and does 
        not, apply to or limit research, development, testing, 
        or deployment of missile defense systems, system 
        upgrades, or system components that are designed to 
        counter modern theater ballistic missiles, regardless 
        of the capabilities of such missiles, unless those 
        systems, system upgrades, or system components are 
        tested against or have demonstrated capabilities to 
        counter modern strategic ballistic missiles.
          [(8) It is a national security priority of the United 
        States to develop and deploy highly effective theater 
        missile defense systems capable of countering the 
        existing and expanding threats posed by modern theater 
        ballistic missiles as soon as is technically possible.
          [(9) It is essential that the Secretary of Defense 
        immediately undertake and complete a review for 
        compliance with the ABM Treaty of proposed theater 
        missile defense systems, system upgrades, and system 
        components so as to not delay the development and 
        deployment of such highly effective theater missile 
        defense systems.
  [(b) Required Compliance Review.--(1) The Secretary of 
Defense shall review the current baseline configuration of each 
system or system upgrade specified in paragraph (2), and the 
system components, to determine whether the development, 
testing, or deployment of that system or system upgrade would 
be in compliance with the ABM Treaty, including the 
interpretation of the Treaty set forth in the enclosure to the 
July 13, 1993, ACDA letter.
  [(2) The systems and system upgrades to be reviewed pursuant 
to paragraph (1) are the following:
          [(A) The Patriot Multimode Missile.
          [(B) The Extended Range Interceptor (ERINT).
          [(C) The Ground-Based Radar for theater missile 
        defenses (GBR-T).
          [(D) The Theater High Altitude Area Defense 
        interceptor missile (THAAD).
          [(E) The Brilliant Eyes space-based sensor system.
          [(F) Upgrades to the AEGIS/SPY radar system of the 
        Navy.
          [(G) Upgrades to the Standard Missile-2 (SM-2) 
        interceptor of the Navy.
  [(3) If during the course of the compliance review under 
paragraph (1) (or any other such compliance review of a 
ballistic missile system or system upgrade), an issue arises 
that appears to indicate that a provision of the ABM Treaty may 
limit research, development, testing, or deployment by the 
United States of highly effective theater missile defense 
systems capable of countering modern theater ballistic 
missiles, the Secretary of Defense shall immediately submit to 
the appropriate congressional committees a report on that 
issue.
  [(c) Report.--(1) For each system and system upgrade 
specified in paragraph (2) of subsection (b), the Secretary 
shall submit to the appropriate congressional committees a 
report on the results of the review required by that 
subsection. A report may include the results of the reviews of 
more than one system and system upgrade. For any system or 
system upgrade determined not to be in compliance with the ABM 
Treaty, the Secretary shall indicate (A) what changes to the 
ABM Treaty would be required for the system to be deemed 
compliant with such modified ABM Treaty, and (B) what changes 
to the performance capability of the system or system upgrade 
would be required in order for it to become compliant with the 
existing Treaty, together with the effect of those performance 
capability changes on the effectiveness of the planned missile 
defense architecture.
  [(2) With regard to the Brilliant Eyes space-based sensor 
system, the Secretary shall include in the report findings on 
each of the following issues:
          [(A) Whether the current baseline configuration of 
        the Brilliant Eyes space-based sensor system would 
        comply with the ABM Treaty if the system were used in 
        conjunction with the planned ground-based radar system 
        and its ground-based interceptors at Grand Forks, North 
        Dakota.
          [(B) If not, whether design changes or operational 
        changes can be made to the Brilliant Eyes space-based 
        sensor system that--
                  [(i) will result in the sensor system, when 
                employed in conjunction with the planned 
                ground-based radar system and its ground-based 
                interceptors, being in compliance with the ABM 
                Treaty; and
                  [(ii) will not prevent the sensor system from 
                performing its strategic defense missions with 
                a high degree of effectiveness.
          [(C) If not, whether the Brilliant Eyes space-based 
        sensor system can be made, through design changes or 
        operational changes, for use only with theater missile 
        defense systems and be in compliance with the ABM 
        Treaty.
          [(D) If so, the extent to which deployment of the 
        Brilliant Eyes space-based sensor system would enhance 
        the capability of upper-tier theater defense systems 
        and lower-tier theater defense systems, respectively.
  [(d) Limitations on Funding Pending Submission of Report.--
(1) Not more than 50 percent of the funds reported pursuant to 
section 231(e) to be allocated for fiscal year 1994 for a 
system or system upgrade specified in subsection (b)(2) may be 
obligated for that system or system upgrade, or any of its 
components, until the Secretary completes the compliance review 
of such system or system upgrade required by subsection (b) and 
submits to the appropriate congressional committees the report 
on the results of the compliance review of that system or 
system upgrade as required by subsection (c).
  [(2) Funds appropriated to the Department of Defense for 
fiscal year 1994, or otherwise made available to the Department 
of Defense from any funds appropriated for fiscal year 1994 or 
for any fiscal year before 1994, may not be obligated or 
expended--
          [(A) for any development or testing of anti-ballistic 
        missile systems or components except for development 
        and testing consistent with the interpretation of the 
        ABM Treaty set forth in the enclosure to the July 13, 
        1993, ACDA letter; or
          [(B) for the acquisition of any material or equipment 
        (including long lead materials, components, piece 
        parts, or test equipment, or any modified space launch 
        vehicle) required or to be