The Insider

The House Appropriations Committee plans to slash the Pentagon's fiscal year 2011 budget request by $13.2 billion, according to a chart on spending limits and cuts issued today by the committee. This is a 2 percent cut relative to the Defense Department's FY-11 request, but a 2 percent increase to what was enacted in FY-10, a committee spokeswoman confirmed.

In a related statement, Rep. Hal Rogers (R-KY), the panel's chairman said he is instructing each of the 12 appropriations subcommittees to produce specific, substantive and comprehensive spending cuts.

"We are going go line by line to weed out and eliminate unnecessary, wasteful, or excess spending -- and produce legislation that will represent the largest series of spending reductions in the history of Congress," he said. "These cuts will not be easy, they will be broad and deep, they will affect every Congressional district, but they are necessary and long overdue."

Asked whether House appropriators have decided which specific programs they want to cut, committee spokeswoman Jennifer Hing said "The legislation is being crafted; no final decisions have been made."

Under the current time line for floor consideration, details on House appropriators' proposed cuts to specific defense programs should be made  public sometime late next week, Hing said.

Rogers issued the statement after the House Budget Committee Chairman Rep. Paul Ryan (R-WI) announced plans to cut $74 billion compared to the president’s FY-11 request.

The Navy's much-delayed, Northrop Grumman-built X-47B unmanned combat air system demonstrator (UCAS-D) will undergo its first flight test this afternoon, a service official announced this morning.

Rear Adm. Matt Klunder, director of the Navy's Intelligence, Surveillance and Reconnaissance Capabilities Division, told attendees of an unmanned systems conference in Washington that the UCAS-D would fly at 5 p.m. local time today out of Edwards Air Force Base, CA.

The UCAS' previous December flight test was pushed back due to bad weather and program officials' desire to take a closer look at the vehicle's braking system, according to Klunder.

The most recent delay has not been the first, as Inside the Navy reported last August:

Last November, Naval Air Systems Command announced that first flight would be delayed until early 2010. Capt. Jeffrey Penfield, UCAS program manager, said in an Aug. 2 interview that a review of the program was conducted in the spring and "we came out with a new schedule in late April to early May."

The new schedule calls for flight tests to begin in December, which would push back at-sea trials on an aircraft carrier from 2012 to the summer of 2013, he said.

"I think it's safe to say that when you put it on contract in August of 2007 and we're going to fly in November of 2009, that's a pretty aggressive schedule," he said. "I don't think we understood how complex that was going to be. So we know a lot more. This is a demonstration; this is all about learning and learning lessons that we can apply to future acquisition programs.

"I believe now we have a schedule that is much more executable for getting us out to 2013," he added.

The $1.5 billion program, started in 2007, is a six-year effort aimed at demonstrating that an unmanned aircraft about the size of an F/A-18 Hornet can be integrated on a carrier flight deck and can be refueled in the air, Penfield said.

The Pentagon recently completed a report to Congress that concludes the Defense Department "paid $285 billion over a three-year span to hundreds of military contractors that defrauded the Pentagon during the same period," according to a statement by the office of Sen. Bernie Sanders (I-VT). Sanders, who requested the report, further says:

"With the country running a $14 trillion national debt, my goal is to provide as much transparency as possible about what is happening with taxpayer money," said Sanders (I-Vt.). "The sad truth is that virtually all of the major defense contractors in this country for years have been engaged in systemic fraudulent behavior, while receiving hundreds of billions of dollars of taxpayer money."

The preliminary report detailed how the Pentagon spent $270 billion from 2007 to 2009 on 91 contractors involved in civil fraud cases that resulted in judgments of more than $1 million. Another $682 million went to 30 contractors convicted of hard-core criminal fraud in the same three-year period. Billions more went to firms that had been suspended or debarred by the Pentagon for misusing taxpayer dollars.

A Sanders provision in a defense spending bill required the report and directed the Department of Defense to recommend ways to punish fraudulent contractors. The Pentagon brass saw no need for any changes. "The department believes that existing remedies with respect to contractor wrongdoing are sufficient," the Report to Congress on Contractor Fraud concluded.

"It is clear that DOD's current approach is not working and we need far more vigorous enforcement to protect taxpayers from massive fraud," Sanders said.

Under a separate Sanders provision in another law signed by President Obama, a government-wide federal contractor fraud database will be accessible to the public by April 15.  Until now, access to the Federal Awardee Performance and Integrity Information System was limited to federal acquisition officials and certain members of Congress.

Sanders' office also released a "staff analysis" of the DOD report.

Eliminating fraud is something all the services have striven to do. As InsideDefense.com reported last December, each year the Army asks its headquarters staff, its major commands and what are known as direct reporting units to deliver a report card on their individual programs aimed at detecting and correcting instances of waste, fraud and abuse. The report card, called the "Annual Statement of Assurance," is sent to the Army secretary. Further:

"On Dec. 16, the assistant secretary of the Army for financial management and comptroller sent out a 40-page memo that provides guidance for the fiscal year 2011 statement," InsideDefense.com reported. "According to the memo, the statements are due to the Army comptroller's office by May 16, 2011, for everyone but the headquarters staff. That staff has until May 31 to submit its report card."

The Army's acquisition shop has one specific task for FY-11, according to the comptroller:

In May 2008, the Office of Federal Procurement Policy in [Office of Management and Budget] published guidelines for Federal Agencies to use in conducting internal control reviews of their acquisition functions. The DOD is required to integrate the internal control review of acquisition with the existing internal control assessment and annual Statement of Assurance reporting processes, beginning with the Fiscal Year 2009 cycle. Office of the Secretary of Defense Acquisition, Technology and Logistics -- has developed a template that provides focus areas ("cornerstones") and related questions that should be addressed when reviewing the acquisition processes. The execution of this requirement has been included by OSD as a validation requirement during Fiscal Year 2011.

Director of National Intelligence James Clapper will give his first view of the world to Congress next week when he appears before the House Permanent Select Committee on Intelligence. Clapper will present the committee with his worldwide threat assessment Feb. 10. Clapper was sworn in as the fourth DNI on August 9, 2010.

Tomorrow, the Senate Select Committee on Intelligence will consider the nomination of Stephanie O'Sullivan to be Clapper's No. 2 official. President Obama sent O'Sullivan's nomination to be the principal deputy DNI to Congress on Jan. 5. O'Sullivan previously held the position of associate deputy director of the Central Intelligence Agency. She was appointed to that job in December 2009.

The date is set. The Obama administration will submit its fiscal year 2012 budget request on Valentine's Day, Feb. 14.

Officials in the Pentagon as well as the Office of Management and Budget confirmed the date to InsideDefense.com today.

As always, stay tuned to Defense Budget Alert for all DOD spending news, including:

Analysts: Debt Limit Impasse Unlikely To Dramatically Affect DOD Funding

Defense Leaders Stress 'Conditions-Based' Nature Of Planned Army Cuts

Deputy SECDEF Promises More Basic R&D Funding In FY-12 Budget

McKeon Challenges Proposed Pentagon Budget Cuts

Senate Appropriations Committee Chairman Daniel Inouye (D-HI) today announced that his panel would implement a two-year moratorium on earmarks.

According to a committee statement, Inouye says:

I continue to support the Constitutional right of members of Congress to direct investments to their states and districts under the fiscally responsible and transparent earmarking process that we have established.

However, the handwriting is clearly on the wall. The President has stated unequivocally that he will veto any legislation containing earmarks, and the House will not pass any bills that contain them. Given the reality before us, it makes no sense to accept earmark requests that have no chance of being enacted into law.

The Appropriations Committee will thoroughly review its earmark policy to ensure that every member has a precise definition of what constitutes an earmark. To that end, we will send each member a letter with the interpretation of Rule XLIV (44) that will be used by the Committee. If any member submits a request that is an earmark as defined by that rule, we will respectfully return the request.

Next year, when the consequences of this decision are fully understood by the members of this body, we will most certainly revisit this issue and explore ways to improve the earmarking process.  At the appropriate time, I will once again urge the Senate to consider a transparent and fair earmark process that protects our rights as legislators to answer the petitions of our constituents, regardless of what the President or some Federal bureaucrat thinks is right.

The newly appointed ranking Democrat on the House Armed Services readiness subcommittee plans to try to advance amendments to expand the scope of the Sikes Act -- a natural resources law that applies to the military -- as part of the next defense authorization bill, Defense Environment Alert reports this morning. Specifically:

The effort could extend coverage of the Sikes Act to include state-owned National Guard installations -- something the Defense Department had sought in the last Congress -- and could expand an invasive species management pilot program used by the military in Guam to all U.S. military installations.

Del. Madeleine Bordallo (D-Guam), who on Jan. 19 was named ranking member of the Armed Services readiness subcommittee, introduced a stand-alone bill -- H.R. 5284 -- last year that would have amended the Sikes Act, extending its provisions to state-owned National Guard facilities and expanding the invasive species management program. While that bill did not pass despite efforts by DOD to include the Guard measures in the fiscal year 2011 defense authorization bill, Bordallo intends to address the substance of H.R. 5284 in the context of the FY-12 defense authorization bill, the congressional staffer says.

Bordallo's 2010 bill specifically would have extended Sikes Act provisions to state-owned Guard installations, applying the same requirements to these installations to develop and implement integrated natural resources management plans (INRMPs) that are already required at federally owned military bases.

DOD had proposed similar language to Congress last April as part of the FY-11 defense authorization bill, which would have given nearly four dozen Army National Guard bases the ability to substitute military-derived, legally binding INRMPs for Endangered Species Act (ESA) critical habitat designations should those lands be deemed key to an endangered species. Such INRMPs must be deemed by the Fish and Wildlife Service to give a benefit to the species if used as a substitute for an ESA critical habitat designation.

Currently, military installations with significant natural resources must implement INRMPs that protect species, wetlands and other resources. Congress granted DOD the INRMP substitution ability for its federally owned bases many years ago, after the department argued that environmental requirements like critical habitat designations were placing too many hurdles on the military's ability to train. But a DOD analysis last year found that Guard bases did not meet the statutory definition of a "military installation."

DOD suggested technical changes to Bordallo's bill late last Congress -- too late to try to get them into the defense authorization bill -- which was passed in late December, according to the congressional staffer. In addition to the Armed Services Committee, the measure also falls under the jurisdiction of the House Natural Resources Committee, which sponsored a hearing on Bordallo's bill last May, the source notes.

DOD Environmental Management Director Maureen Sullivan testified before the House Natural Resources insular affairs, oceans and wildlife subcommittee last May in support of Bordallo's Guard provisions. In written testimony, she said the ability to develop Guard INRMPs would allow for "more efficient and effective natural resources management" at these bases. In addition, without the amendment, Guard bases could not compete on a level playing field for funds, according to a DOD source.

Bordallo's 2010 bill would also have expanded an invasive species management program for Guam to include all U.S. military bases, according to Bordallo's floor statement last May. DOD expressed concerns with the bill's initial wording, with Sullivan warning that having a statutory requirement to address invasive species "in the INRMP may overburden the process. This would impede the development of INRMPs that would otherwise have substantial beneficial impact," she testified.

The DOD source said a slight tweak was needed to the language, but added that the amendment is nonetheless important because invasive species control currently is not considered a "must-fund" item under the military's budgeting process. The amendment would be helpful in order to avoid mission impacts, the source said, citing the example of the yellow star thistle, an invasive plant that has blanketed 23,000 acres of land on Ft. Hunter Liggett, CA, making some lands unusable for military training.

In her Jan. 19 press release announcing her appointment as ranking member on the readiness subcommittee, Bordallo says she would continue her focus on overseeing the military's massive buildup on Guam, noting the readiness panel's jurisdiction over infrastructure and environmental issues regarding the buildup. Rep. Randy Forbes (R-VA) is the new chairman of the readiness subcommittee.

The Congressional Research Service published a report last October outlining the major issues of moving thousands of Marines from Okinawa to Guam. Here's a taste:

In 2006, the United States and Japan agreed on a "Roadmap" to strengthen their alliance, including a buildup on Guam to cost $10.3 billion, with Japan contributing 60 percent. Primary goals were to start the related construction on Guam by 2010 and to complete relocation of about 8,000 marines from Okinawa to Guam by 2014. In Tokyo on February 17, 2009, the Secretary of State signed the bilateral “Agreement Between the Government of the United States of America and the Government of Japan Concerning the Implementation of the Relocation of the III Marine Expeditionary Force Personnel and Their Dependents From Okinawa to Guam” that reaffirmed the "Roadmap" of May 1, 2006. The two governments agreed that of the estimated $10.27 billion cost of the facilities and infrastructure development for the relocation, Japan will provide $6.09 billion, including up to $2.8 billion in direct cash contributions (in FY2008 dollars). The United States committed to fund $3.18 billion plus about $1 billion for a road.

However, in September 2009, the Democratic Party of Japan (DPJ) became the ruling party. This political change raised uncertainty as Japan sought to re-negotiate the agreement, even while the United States sought its implementation. The dispute over the location on Okinawa of the Futenma Replacement Facility (FRF) to replace the Marine Corps Air Station Futenma raised implications for the relocation of marines from Okinawa to Guam. In January 2010, Japan promised to decide by May on the location of the FRF. Then, North Korea’s attack on South Korea’s naval ship (Cheonan) in March, and China’s deployment of its Navy near Okinawa which confronted Japan’s forces in April, catalyzed Japan to resolve the dispute in favor of deterrence. On May 28, the Secretaries of Defense and State and their counterparts in Japan issued a “2+2” Joint Statement, in which they reaffirmed commitment to implement the 2006 Roadmap and the 2009 Agreement. In July, the Navy issued the final Environmental Impact Statement on the buildup on Guam, while planning to start construction by the end of FY2010. The Navy estimated that Guam’s population would increase by a total of 30,190, including 8,552 Marines.

The National Defense Authorization Act for FY2010 (enacted as P.L. 111-84 on October 28, 2009) authorized the first substantial incremental funding for the relocation of about 8,000 marines from Okinawa to Guam, but conditioned upon the Defense Department’s submission to Congress of a Guam Master Plan. Among a number of provisions related to Guam in the legislation and conference report, Congress designated the Deputy Secretary of Defense to lead a Guam Executive Council and coordinate interagency efforts related to Guam. Congress also required a report on training, readiness, and movement requirements for Marine Forces Pacific, with a sense of Congress that expansion of Marine Corps training should not impact the implementation of the U.S.-Japan agreement on relocation from Okinawa to Guam. Congress authorized a total amount (including for Defense-wide, Army, Navy, and Air Force) of almost $733 million.