[Senate Report 112-173]
[From the U.S. Government Printing Office]


                                                       Calendar No. 419

112th Congress                                                  Report
                               SENATE
2d Session                                                     112-173
_______________________________________________________________________

 
                     NATIONAL DEFENSE AUTHORIZATION
                        ACT FOR FISCAL YEAR 2013

                              R E P O R T

                         [to accompany s. 3254]

                                   on

     TO AUTHORIZE APPROPRIATIONS FOR FISCAL YEAR 2013 FOR MILITARY 
ACTIVITIES OF THE DEPARTMENT OF DEFENSE, FOR MILITARY CONSTRUCTION, AND 
   FOR DEFENSE ACTIVITIES OF THE DEPARTMENT OF ENERGY, TO PRESCRIBE 
   MILITARY PERSONNEL STRENGTHS FOR SUCH FISCAL YEAR, AND FOR OTHER 
                                PURPOSES

                             together with

                            ADDITIONAL VIEWS

                               ----------

                      COMMITTEE ON ARMED SERVICES
                          UNITED STATES SENATE

                                     




                  June 4, 2012.--Ordered to be printed




        NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 2013




                                                       Calendar No. 419

112th Congress                                                   Report
                            SENATE
2nd Session                                                     112-173
_______________________________________________________________________


                     NATIONAL DEFENSE AUTHORIZATION
                        ACT FOR FISCAL YEAR 2013

                              R E P O R T

                         [to accompany s. 3254]

                                   on

     TO AUTHORIZE APPROPRIATIONS FOR FISCAL YEAR 2013 FOR MILITARY 
ACTIVITIES OF THE DEPARTMENT OF DEFENSE FOR MILITARY CONSTRUCTION, AND 
   FOR DEFENSE ACTIVITIES OF THE DEPARTMENT OF ENERGY, TO PRESCRIBE 
   MILITARY PERSONNEL STRENGTHS FOR SUCH FISCAL YEAR, AND FOR OTHER 
                                PURPOSES

                             together with

                            ADDITIONAL VIEWS

                               ----------

                      COMMITTEE ON ARMED SERVICES

                          UNITED STATES SENATE

                                     


                                     

                  June 4, 2012.--Ordered to be printed



                                 ------

                    U.S. GOVERNMENT PRINTING OFFICE

74-387                  WASHINGTON : 2012



For sale by the Superintendent of Documents, U.S. Government Printing Office, 
   http://bookstore.gpo.gov. For more information, contact the GPO Customer 
   Contact Center, U.S. Government Printing Office. Phone 202-512-1800, or
            866-512-1800 (toll-free). E-mail, gpo@custhelp.com.  



                      COMMITTEE ON ARMED SERVICES

                     CARL LEVIN, Michigan, Chairman

JOSEPH I. LIEBERMAN, Connecticut     JOHN McCAIN, Arizona
JACK REED, Rhode Island              JAMES M. INHOFE, Oklahoma
DANIEL K. AKAKA, Hawaii              JEFF SESSIONS, Alabama
E. BENJAMIN NELSON, Nebraska         SAXBY CHAMBLISS, Georgia
JIM WEBB, Virginia                   ROGER F. WICKER, Mississippi
CLAIRE McCASKILL, Missouri           SCOTT P. BROWN, Massachusetts
MARK UDALL, Colorado                 ROB PORTMAN, Ohio
KAY R. HAGAN, North Carolina         KELLY AYOTTE, New Hampshire
MARK BEGICH, Alaska                  SUSAN M. COLLINS, Maine
JOE MANCHIN III, West Virginia       LINDSEY GRAHAM, South Carolina
JEANNE SHAHEEN, New Hampshire        JOHN CORNYN, Texas
KIRSTEN E. GILLIBRAND, New York      DAVID VITTER, Louisiana
RICHARD BLUMENTHAL, Connecticut

                   Richard D. DeBobes, Staff Director

                 Ann E. Sauer, Minority Staff Director

                                  (ii)

  
                            C O N T E N T S

                              ----------                              
                                                                   Page
Purpose of the Bill..............................................     1
        Committee overview.......................................     2
        Scoring of budgetary effects (sec. 4)....................     3
        Summary of discretionary authorizations and budget 
          implication............................................     3
            Summary of National Defense Authorizations For Fiscal 
              Year 2013 Table....................................     4
    National Defense Budget Authority Implication Table..........     9
Division A--Department of Defense Authorizations.................    11
Title I--Procurement.............................................    11
    Subtitle A--Authorization of Appropriations..................    11
        Authorization of appropriations (sec. 101)...............    11
    Subtitle B--Army Programs....................................    11
        Multiyear procurement authority for Army CH-47F 
          helicopters (sec. 111).................................    11
    Subtitle C--Navy Programs....................................    11
        Refueling and complex overhaul of the U.S.S. Abraham 
          Lincoln (sec. 121).....................................    11
        Ford Class Aircraft Carriers (sec. 122)..................    11
        Limitation on availability of amounts for second Ford 
          class aircraft carrier (sec. 123)......................    12
        Multiyear procurement authority for Virginia class 
          submarine program (sec. 124)...........................    12
        Multiyear procurement authority for Arleigh Burke class 
          destroyers and associated systems (sec. 125)...........    13
        Authority for relocation of certain Aegis weapon system 
          assets between and within the DDG-51 class destroyer 
          and Aegis Ashore Programs in order to meet mission 
          requirements (sec. 126)................................    14
        Designation of mission modules of the littoral combat 
          ship as a major defense acquisition program (sec. 127).    15
        Transfer of certain fiscal year 2012 Procurement of 
          Ammunition, Navy and Marine Corps funds (sec. 128).....    16
        Transfer of certain fiscal year 2012 Procurement, Marine 
          Corps funds for procurement of weapons and combat 
          vehicles (sec. 129)....................................    16
        Sense of Congress on Marine Corps amphibious lift and 
          presence requirements (sec. 130).......................    16
        Sense of Senate on Department of Navy fiscal year 2014 
          budget request for tactical aviation aircraft (sec. 
          131)...................................................    17
    Subtitle D--Air Force Programs...............................    17
        Reduction in number of aircraft required to be maintained 
          in strategic airlift aircraft inventory (sec. 141).....    17
        Treatment of certain programs for the F-22A Raptor 
          aircraft as major defense acquisition program (sec. 
          142)...................................................    17
        Avionics systems for C-130 aircraft (sec. 143)...........    19
        Procurement of space-based infrared system satellites 
          (sec. 144).............................................    19
        Transfer of certain fiscal year 2011 and 2012 funds for 
          aircraft procurement for the Air Force (sec. 145)......    20
    Subtitle E--Joint and Multiservice Matters...................    20
        Multiyear procurement authority for V-22 Joint Aircraft 
          Program (sec. 151).....................................    20
        Limitation on availability of funds for full-rate 
          production of Handheld, Manpack, and Small Form/Fit 
          radios under the Joint Tactical Radio System program 
          (sec. 152).............................................    20
        Shallow Water Combat Submersible Program (sec. 153)......    21
    Budget Items.................................................    22
        Army.....................................................    22
            Joint tactical radio systems integration.............    22
            M88A2 improved recovery vehicle......................    22
            Advanced procurement for M1 Abrams tank upgrade 
              program............................................    22
            Lightweight .50 caliber machine gun..................    24
            30mm and 40mm ammunition reductions for excess.......    24
            Excalibur 1-b round schedule delay...................    25
            Spider network munitions reduction...................    25
            Family of medium tactical vehicles...................    25
            Joint tactical radio system airborne and maritime/
              fixed radios.......................................    25
            Spider remote control unit...........................    25
            Sense-through-the-wall sensor program................    25
            Small unmanned ground vehicle........................    26
        Joint Improvised Explosive Device Defeat Fund............    26
            Joint Improvised Explosive Device Defeat Fund........    26
        Navy.....................................................    26
            F/A-18E/F............................................    26
            Close-in weapon system modifications.................    27
            81mm, grenade, and demolition munitions reductions 
              for excess.........................................    27
        Air Force................................................    27
            Joint surveillance/target attack radar system........    27
        Defense-wide.............................................    29
            Terminal High Altitude Area Defense..................    29
            Special operations aviation..........................    30
            High definition full motion video....................    30
    Items of Special Interest....................................    31
        Common remotely operated weapon station..................    31
        Impact of Global Hawk Block 30 termination...............    31
        Integrated base defense..................................    31
        Joint strike fighter program.............................    32
        Paladin integrated management program....................    34
        Rotary-wing planning tools...............................    34
        Summary of discretionary authorizations and budget 
          implication............................................    34
        Use of advance procurement for major systems.............    35
        U.S. Special Operations Command Budget line items........    36
Title II--Research, Development, Test, and Evaluation............    37
    Subtitle A--Authorization of Appropriations..................    37
        Authorization of appropriations (sec. 201)...............    37
    Subtitle B--Program Requirements, Restrictions, and 
      Limitations................................................    37
        Next Generation Foundry for the Defense Microelectronics 
          Activity (sec. 211)....................................    37
        Advanced rotorcraft initiative (sec. 212)................    37
        Transfer of certain fiscal year 2012 Navy research, 
          development, test, and evaluation funds (sec. 213).....    40
        Authority for Department of Defense laboratories to enter 
          into education partnerships with educational 
          institutions in United States territories and 
          possessions (sec. 214).................................    41
        Transfer of certain fiscal year 2012 Air Force research, 
          development, test, and evaluation funds (sec. 215).....    41
    Subtitle C--Missile Defense Matters..........................    41
        Homeland ballistic missile defense (sec. 231)............    41
        Regional ballistic missile defense (sec. 232)............    42
        Missile defense cooperation with Russia (sec. 233).......    42
        Next-generation Exo-atmospheric Kill Vehicle (sec. 234)..    43
        Modernization of the Patriot air and missile defense 
          system (sec. 235)......................................    44
        Medium Extended Air Defense System (sec. 236)............    44
        Availability of funds for Iron Dome short-range rocket 
          defense program (sec. 237).............................    45
    Subtitle D--Reports..........................................    45
        Mission packages for the littoral combat ship (sec. 251).    45
        Comptroller General of the United States annual reports 
          on the acquisition program for the Amphibious Combat 
          Vehicle (sec. 252).....................................    46
        Conditional requirement for report on amphibious assault 
          vehicles for the Marine Corps (sec. 253)...............    46
    Subtitle E--Other Matters....................................    47
        Transfer of administration of Ocean Research and 
          Resources Advisory Panel from Department of the Navy to 
          National Oceanic and Atmospheric Administration (sec. 
          271)...................................................    47
    Budget Items.................................................    47
        Army.....................................................    47
            Medium Extended Air Defense System...................    47
            Improved turbine engine program......................    48
        Air Force................................................    48
            Next generation aerial refueling aircraft............    48
        Defense-wide.............................................    49
            Special Operations/Low Intensity Conflict Advanced 
              Development and Combatting Terrorism Technology 
              Support............................................    49
            Industrial base innovation fund......................    50
            Defense microelectronics strategy and Next Generation 
              Foundry............................................    50
            Advanced sensor applications program.................    52
            U.S.-Israeli cooperative missile defense programs....    52
            Department of Defense Corrosion Program shortfall....    53
            Defense research and development Rapid Innovation 
              Program science and technology thrust areas........    53
            General fund enterprise business systems realignment.    55
            Developmental test and evaluation....................    56
            Shallow Water Combat Submersible Program.............    56
            Defense Advanced Research Projects Agency programs...    56
    Items of Special Interest....................................    58
        Adaptive engine technology development program...........    58
        Air Force cyber and information technology research......    58
        Air Force space developmental test and evaluation........    59
        Applied mathematics and computational science............    59
        Army manned airborne intelligence, surveillance, and 
          reconnaissance platforms...............................    60
        Army robotics............................................    61
        Ballistic missile defense overview.......................    62
        Cyber research, development, test, and evaluation, and 
          training infrastructure................................    67
        Department of Defense labs workforce and infrastructure..    69
        Dry Combat Submersible...................................    70
        Energy efficiency research and development coordination 
          and transition.........................................    70
        Hexavalent chromium......................................    71
        Human bone collections for Department of Defense research    71
        Hypersonics ground test and evaluation capabilities and 
          workforce..............................................    71
        Internet cartography.....................................    73
        Massachusetts Institute of Technology--Lincoln Laboratory 
          improvement project....................................    74
        Medical Countermeasures Initiative.......................    74
        Naval electromagnetic railgun projectiles................    75
        Naval Engineering Education Center.......................    75
        Support for the Minerva Research Initiative..............    76
Title III--Operation and Maintenance.............................    79
    Subtitle A--Authorization of Appropriations..................    79
        Operation and maintenance funding (sec. 301).............    79
    Subtitle B--Energy and Environmental Provisions..............    79
        Department of Defense guidance on environmental exposures 
          at military installations (sec. 311)...................    79
        Funding of agreements under the Sikes Act (sec. 312).....    80
        Limitation on availability of funds for procurement of 
          alternative fuel (sec. 313)............................    80
    Subtitle C--Logistics and Sustainment........................    81
        Repeal of certain provisions relating to depot-level 
          maintenance (sec. 321).................................    81
    Subtitle D--Reports..........................................    82
        Annual report on Department of Defense long-term 
          corrosion strategy (sec. 331)..........................    82
        Modified deadline for Comptroller General review of 
          annual report on prepositioned materiel and equipment 
          (sec. 332).............................................    82
    Subtitle E--Other Matters....................................    82
        Savings to be achieved in civilian workforce and 
          contractor employee workforce of the Department of 
          Defense (sec. 341).....................................    82
        NATO Special Operations Headquarters (sec. 342)..........    83
        Repeal of redundant authority to ensure interoperability 
          of law enforcement and emergency responder training 
          (sec. 343).............................................    84
    Budget Items.................................................    84
        General Fund Enterprise Business System realignment......    84
        Museum funding decrease for ahead of need request........    84
        Unobligated Operation and Maintenance balances...........    85
        U.S. Special Operations Command Operation and Maintenance    85
        Defense Security Cooperation Agency......................    85
        Defense-wide funding decrease for ahead of need request..    86
        Enhanced intelligence, surveillance, and reconnaissance 
          support to Operation Observant Compass.................    86
        Operation and Maintenance funding for impact aid.........    87
    Items of Special Interest....................................    87
        Advanced predictive modeling and simulation methodologies    87
        Air Force strategic basing process.......................    88
        Canines in support of members of the armed forces........    88
        Comptroller General of the United States assessment of 
          Department of Defense security cooperation activities..    88
        Consideration of fuel cell systems.......................    89
        Corrosion prevention.....................................    89
        Corrosion projects return on investment and funding for 
          corrosion-related activities...........................    90
        Critical manufacturing capabilities and capacities.......    91
        Department of Defense inventory management...............    91
        Energy performance savings contracts.....................    92
        Essential role of rare earth materials...................    92
        Funding shortfalls for minimum capital investment 
          program, facilities sustainment, restoration, and 
          modernization, and base operations support.............    92
        Ground combat and camouflage utility uniforms............    93
        Lack of competition in Air Force C-17 engine maintenance 
          contracting............................................    94
        Marine Corps depot maintenance activity group............    95
        Modernizing the aging fleet..............................    95
        Rapid equipping and fielding initiatives.................    95
        Readiness support for unfunded requirements..............    96
        Report on Defense Science Board climate change 
          recommendations........................................    96
Title IV--Military Personnel Authorizations......................    99
    Subtitle A--Active Forces....................................    99
        End strengths for active forces (sec. 401)...............    99
    Subtitle B--Reserve Forces...................................   100
        End strengths for Selected Reserve (sec. 411)............   100
        End strengths for reserves on active duty in support of 
          the reserves (sec. 412)................................   100
        End strengths for military technicians (dual status) 
          (sec. 413).............................................   101
        Fiscal year 2013 limitation on number of non-dual status 
          technicians (sec. 414).................................   101
        Maximum number of reserve personnel authorized to be on 
          active duty for operational support (sec. 415).........   101
    Subtitle C--Authorization of Appropriations..................   102
        Military personnel (sec. 421)............................   102
    Budget Item..................................................   102
        Military personnel funding changes.......................   102
Title V--Military Personnel Policy...............................   103
    Subtitle A--Officer Policy...................................   103
        Extension of relaxation of limitation on selective early 
          discharges (sec. 501)..................................   103
        Exception to 30-year retirement for regular Navy warrant 
          officers in the grade of chief warrant officer, W-5 
          (sec. 502).............................................   103
        Modification of definition of joint duty assignment to 
          include all instructor assignments for joint training 
          and education (sec. 503)...............................   103
        Sense of Senate on inclusion of assignments as academic 
          instructor at the military service academies as joint 
          duty assignments (sec. 504)............................   104
    Subtitle B--Reserve Component Management.....................   104
        Authority for appointment of persons who are lawful 
          permanent residents as officers of the National Guard 
          (sec. 511).............................................   104
        Reserve component suicide prevention and resilience 
          program (sec. 512).....................................   104
    Subtitle C--General Service Authorities......................   104
        Diversity in the armed forces and related reporting 
          requirements (sec. 521)................................   104
        Modification of authority to conduct programs on career 
          flexibility to enhance retention of members of the 
          armed forces (sec. 522)................................   105
        Authority for additional behavioral health professionals 
          to conduct pre-separation medical examinations for 
          post-traumatic stress disorder (sec. 523)..............   105
        Quarterly reports on involuntary separation of members of 
          the armed forces (sec. 524)............................   105
        Review of eligibility of victims of domestic terrorism 
          for award of the Purple Heart and the Defense Medal of 
          Freedom (sec. 525).....................................   105
    Subtitle D--Military Justice and legal Matters Generally.....   106
        Clarification and enhancement of the role of the Staff 
          Judge Advocate to the Commandant of the Marine Corps 
          (sec. 531).............................................   106
        Additional information in reports on annual surveys of 
          the committee on the Uniform Code of Military Justice 
          (sec. 532).............................................   106
    Subtitle E--Sexual Assault, Hazing, and Related Matters......   107
        Authority to retain or recall to active duty reserve 
          component members who are victims of sexual assault 
          while on active duty (sec. 541)........................   107
        Additional elements in comprehensive Department of 
          Defense policy on sexual assault prevention and 
          response (sec. 542)....................................   107
        Hazing in the armed forces (sec. 543)....................   108
    Subtitle F--Education and Training...........................   108
        Inclusion of the School of Advanced Military Studies 
          Senior Level Course as a senior level service school 
          (sec. 551).............................................   108
        Modification of eligibility for associate degree programs 
          under the Community College of the Air Force (sec. 552)   108
        Support of Naval Academy Athletic Programs (sec. 553)....   108
        Grade of commissioned officers in uniformed medical 
          accession programs (sec. 554)..........................   109
        Authority for service commitment for Reservists who 
          accept fellowships, scholarships, or grants to be 
          performed in the Selected Reserve (sec. 555)...........   109
        Repeal of requirement for eligibility for in-state 
          tuition of at least 50 percent of participants in 
          Senior Reserve Officers' Training Corps program (sec. 
          556)...................................................   110
        Modification of requirements on plan to increase the 
          number of units of the Junior Reserve Officers' 
          Training Corps (sec. 557)..............................   110
        Consolidation of military department authority to issue 
          arms, tentage, and equipment to educational 
          institutions not maintaining units of the Junior ROTC 
          (sec. 558).............................................   111
        Modification of requirement for reports in Federal 
          Register on institutions of higher education ineligible 
          for contracts and grants for denial of ROTC or military 
          recruiter access to campus (sec. 559)..................   111
        Comptroller General of the United States report on the 
          Reserve Officers' Training Corps (sec. 560)............   111
    Subtitle G--Defense Dependents' Education and Military.......   112
        Family Readiness Matters.................................   112
        Impact aid for children with severe disabilities (sec. 
          571)...................................................   112
        Continuation of authority to assist local educational 
          agencies that benefit dependents of members of the 
          armed forces and Department of Defense civilian 
          employees (sec. 572)...................................   112
        Amendments to the impact aid program (sec. 573)..........   112
        Military spouses (sec. 574)..............................   112
        Modification of authority to allow Department of Defense 
          domestic dependent elementary and secondary schools to 
          enroll certain students (sec. 575).....................   112
        Sense of Congress regarding support for Yellow Ribbon Day 
          (sec. 576).............................................   113
    Subtitle H--Other Matters....................................   113
        Family briefings concerning accountings for members of 
          the armed forces and Department of Defense civilian 
          employees listed as missing (sec. 581).................   113
        Enhancement of authority to accept gifts and services 
          (sec. 582).............................................   113
        Clarification of authorized Fisher House residents at the 
          Fisher House for the Families of the Fallen and 
          Meditation Pavilion at Dover Air Force Base, Delaware 
          (sec. 583).............................................   113
        Report on accuracy of data in the Defense Enrollment 
          Eligibility Reporting System (sec. 584)................   113
    Items of Special Interest....................................   114
        American Bar Association Military Pro Bono Project.......   114
        Army's sexual assault and special investigation training.   115
        Assessment of skills and abilities to enhance transition 
          from military service..................................   115
        Crime Victims' Rights Act................................   115
        Department of Defense Inspector General oversight of 
          investigations of sexual assault.......................   116
        Inclusion of synthetic drug compounds in the Uniform Code 
          of Military Justice....................................   116
        Joint Professional Military Education special areas of 
          emphasis...............................................   116
        Recruiting for cyber-related career fields...............   117
        Report on assignment policies concerning women in the 
          armed forces and the characterization of certain 
          combat-related service.................................   117
        Report on specialized graduate programs..................   118
        Requirement for Council of Governors views on legislative 
          proposals addressing child custody litigation involving 
          members of the armed forces............................   118
        Social media and operational security....................   119
        Special Operations Force Generation......................   120
        Title VI--Compensation and Other Personnel Benefits......   121
    Subtitle A--Pay and Allowances...............................   121
        Rates of basic allowance for housing for Army National 
          Guard and Air National Guard members on full-time 
          National Guard duty (sec. 601).........................   121
    Subtitle B--Bonuses and Special and Incentive Pays...........   121
        One-year extension of certain bonus and special pay 
          authorities for reserve forces (sec. 611)..............   121
        One-year extension of certain bonus and special pay 
          authorities for health care professionals (sec. 612)...   121
        One-year extension of special pay and bonus authorities 
          for nuclear officers (sec. 613)........................   122
        One-year extension of authorities relating to title 37 
          consolidated special pay, incentive pay, and bonus 
          authorities (sec. 614).................................   122
        One-year extension of authorities relating to payment of 
          other title 37 bonuses and special pays (sec. 615).....   122
        Increase in amount of officer affiliation bonus for 
          officers in the Selected Reserve (sec. 616)............   122
        Increase in maximum amount of incentive bonus for reserve 
          component members who convert military occupational 
          specialty to ease personnel shortages (sec. 617).......   122
    Subtitle C--Travel and Transportation Allowances.............
        Permanent change of station allowances for members of 
          Selected Reserve units filling a vacancy in another 
          unit after being involuntarily separated (sec. 631)....   122
        Authority for comprehensive program for space-available 
          travel on Department of Defense aircraft (sec. 632)....   123
    Subtitle D--Disability, Retired Pay, and Survivor Benefits...   124
        Repeal of requirement for payment of Survivor Benefit 
          Plan premiums when participant waives retired pay to 
          provide a survivor annuity under Federal Employees 
          Retirement System and termination of payment of 
          Survivor Benefit Plan annuity (sec. 641)...............   124
        Repeal of automatic enrollment in Family Servicemembers' 
          Group Life Insurance for members of the armed forces 
          married to other members (sec. 642)....................   124
    Subtitle E--Military Lending Matters.........................   124
        Enhancement of protections on consumer credit for members 
          of the armed forces and their dependents (sec. 651)....   124
        Additional enhancements of protections on consumer credit 
          for members of the armed forces and their dependents 
          (sec. 652).............................................   124
        Relief in civil actions for violations of protections on 
          consumer credit extended to members of the armed forces 
          and their dependents (sec. 653)........................   125
        Modification of definition of dependent for purposes of 
          limitations on terms of consumer credit extended to 
          members of the armed forces and their dependents (sec. 
          654)...................................................   125
    Subtitle F--Other Matters....................................   125
        Transitional compensation for dependent children who are 
          carried during pregnancy at time of dependent-abuse 
          offense (sec. 661).....................................   125
Title VII--Health Care Provisions................................   127
    Subtitle A--TRICARE Program..................................   127
        Extension of TRICARE Standard coverage and TRICARE dental 
          program for members of the Selected Reserve who are 
          involuntarily separated (sec. 701).....................   127
        Inclusion of certain over-the-counter drugs in TRICARE 
          uniform formulary (sec. 702)...........................   127
        Expansion of evaluation of the effectiveness of the 
          TRICARE program (sec. 703).............................   127
    Subtitle B--Other Health Care Benefits.......................   128
        Use of Department of Defense funds for abortions in cases 
          of rape and incest (sec. 711)..........................   128
        Availability of certain fertility preservation treatments 
          for members of the armed forces on active duty (sec. 
          712)...................................................   128
        Modification of requirements on mental health assessments 
          for members of the armed forces deployed in connection 
          with a contingency operation (sec. 713)................   128
    Subtitle C--Health Care Administration.......................   128
        Clarification of applicability of certain authority and 
          requirements to subcontractors employed to provide 
          health care services to the Department of Defense (sec. 
          721)...................................................   128
        Research program to enhance Department of Defense efforts 
          on mental health in the National Guard and reserves 
          through community partnerships (sec. 722)..............   129
    Subtitle D--Reports and Other Matters........................   129
        Reports on performance data on Warriors in Transition 
          programs (sec. 731)....................................   129
        Report on Department of Defense support of members of the 
          armed forces who experience traumatic injury as a 
          result of vaccinations required by the Department (sec. 
          732)...................................................   129
        Plan to eliminate gaps and redundancies in programs of 
          the Department of Defense on psychological health and 
          traumatic brain injury among members of the armed 
          forces (sec. 733)......................................   130
        Report on implementation of recommendations of the 
          Comptroller General of the United States on prevention 
          of hearing loss among members of the armed forces (sec. 
          734)...................................................   130
    Items of Special Interest....................................   131
        Comptroller General study on Department of Defense health 
          care contracting.......................................   131
        Cooperative health care agreements.......................   132
        Health care provider appointment and compensation 
          authorities............................................   132
        Medication therapy management............................   133
        Standards for production and performance of prostheses 
          and prosthetic sockets for military amputees...........   134
        TRICARE efficiencies.....................................   135
Title VIII--Acquisition Policy, Acquisition Management, and 
  Related Matters................................................   137
    Subtitle A--Provisions Relating to Major Defense Acquisition 
      Programs...................................................   137
        Limitation on use of cost-type contracts (sec. 801)......   137
        Acquisition strategies for major subsystems and 
          subassemblies on major defense acquisition programs 
          (sec. 802).............................................   137
        Management structure for developmental test and 
          evaluation (sec. 803)..................................   138
        Assessments of potential termination liability of 
          contracts for the development or production of major 
          defense acquisition programs (sec. 804)................   139
        Technical change regarding programs experiencing critical 
          cost growth due to change in quantity purchased (sec. 
          805)...................................................   139
        Repeal of requirement to review ongoing programs 
          initiated before enactment of Milestone B certification 
          and approval process (sec. 806)........................   140
    Subtitle B--Acquisition Policy and Management................   140
        One-year extension of temporary limitation on aggregate 
          annual amount available for contract services (sec. 
          821)...................................................   140
        Prohibition of excessive pass-through contracts and 
          charges in the acquisition of services (sec. 822)......   141
        Availability of amounts in Defense Acquisition Workforce 
          Development Fund for temporary members of workforce 
          (sec. 823).............................................   141
        Department of Defense policy on contractor profits (sec. 
          824)...................................................   142
        Modification of authorities on internal controls for 
          procurements on behalf of the Department of Defense by 
          certain non-defense agencies (sec. 825)................   142
        Extension of pilot program on management of supply-chain 
          risk (sec. 826)........................................   143
    Subtitle C--Amendments Relating to General Contracting 
      Authorities, Procedures, and Limitations...................   143
        Applicability of Truth in Negotiations Act to major 
          systems and related subsystems, components, and support 
          services (sec. 841)....................................   143
        Maximum amount of allowable costs of compensation of 
          contractor employees (sec. 842)........................   144
        Department of Defense access to and use of contractor 
          internal audit reports (sec. 843)......................   144
        Enhancement of whistleblower protections for contractor 
          employees (sec. 844)...................................   145
        Extension of contractor conflict of interest limitations 
          (sec. 845).............................................   146
        Repeal of sunset for certain protests of task and 
          delivery order contracts (sec. 846)....................   146
    Subtitle D--Provisions Relating to Wartime Contracting.......   147
        Responsibility within Department of Defense for contract 
          support for overseas contingency operations (sec. 861).   147
        Annual reports on contract support for overseas 
          contingency operations involving combat operations 
          (sec. 862).............................................   147
        Inclusion of contract support in certain requirements for 
          Department of Defense planning, joint professional 
          military education, and management structure (sec. 863)   147
        Risk assessment and mitigation for contractor performance 
          of critical functions in support of overseas 
          contingency operations (sec. 864)......................   148
        Extension and modification of reports on contracting in 
          Iraq and Afghanistan (sec. 865)........................   149
        Extension of temporary authority to acquire products and 
          services in countries along a major route of supply to 
          Afghanistan (sec. 866).................................   149
        Compliance with Berry amendment required for uniform 
          components supplied to Afghanistan military or 
          Afghanistan National Police (sec. 867).................   149
        Sense of the Senate on the contributions of Latvia and 
          other North Atlantic Treaty Organization member nations 
          to the success of the Northern Distribution Network 
          (sec. 868).............................................   149
    Subtitle E--Other Matters....................................   150
        Requirements and limitations for suspension and debarment 
          officials of the Department of Defense (sec. 881)......   150
        Uniform contract writing system requirements for the 
          Department of Defense (sec. 882).......................   150
        Comptroller General of the United States review of use by 
          the Department of Defense of urgent and compelling 
          exception to competition (sec. 883)....................   150
        Authority to provide fee-for-service inspection and 
          testing by Defense Contract Management Agency for 
          certain critical equipment in the absence of a 
          procurement contract (sec. 884)........................   151
        Disestablishment of Defense Materiel Readiness Board 
          (sec. 885).............................................   151
        Modification of period of wait following notice to 
          Congress of intent to contract for leases of certain 
          vessels and vehicles (sec. 886)........................   151
        Extension of other transaction authority (sec. 887)......   151
    Items of Special Interest....................................   151
        Competition in the development and procurement of 
          training systems for major ground and airborne vehicle 
          programs...............................................   151
        Engagement with independent experts and interested 
          parties in implementation of counterfeit parts 
          legislation............................................   152
        Implementation of section 811 of the National Defense 
          Authorization Act for Fiscal Year 2010.................   152
        Inventories and reviews of contracts for services........   153
        Joint Urgent Operational Needs and Joint Emergent 
          Operational Needs......................................   154
        Recommendations by Chairman of the Joint Chiefs of Staff 
          on the involvement by the service chiefs in the 
          acquisition of major weapon systems....................   156
        Reverse auctions.........................................   157
        Strategic sourcing and spend analyses....................   157
        Treatment of procurements on behalf of the Department of 
          Defense in accordance with the interagency agreement 
          between the Department of Defense and the Department of 
          Energy.................................................   158
Title IX--Department of Defense Organization and Management......   159
    Subtitle A--Department of Defense Management.................   159
        Definition and report on terms ``preparation of the 
          environment'' and ``operational preparation of the 
          environment'' for joint doctrine purposes (sec. 901)...   159
        Expansion of duties and responsibilities of the Nuclear 
          Weapons Council (sec. 902).............................   159
    Subtitle B--Space Activities.................................   160
        Operationally Responsive Space Program Office (sec. 911).   160
        Commercial space launch cooperation (sec. 912)...........   161
        Reports on integration of acquisition and capability 
          delivery schedules for components for major satellite 
          acquisition programs and funding for such programs 
          (sec. 913).............................................   161
        Department of Defense representation in dispute 
          resolution regarding surrender of Department of Defense 
          bands of electromagnetic frequencies (sec. 914)........   161
    Subtitle C--Intelligence-Related and Cyber Matters...........   161
        Authority to provide geospatial intelligence support to 
          security alliances and international and regional 
          organizations (sec. 921)...............................   161
        Army Distributed Common Ground System (sec. 922).........   162
        Rationalization of cyber networks and cyber personnel of 
          the Department of Defense (sec. 923)...................   163
        Next-generation host-based cyber security system for the 
          Department of Defense (sec. 924).......................   164
        Improvements of security, quality, and competition in 
          computer software procured by the Department of Defense 
          (sec. 925).............................................   165
        Competition in connection with Department of Defense data 
          link systems (sec. 926)................................   168
        Integration of critical signals intelligence capabilities 
          (sec. 927).............................................   168
        Collection and analysis of network flow data (sec. 928)..   169
        Department of Defense use of National Security Agency 
          cloud computing database and intelligence community 
          cloud computing infrastructure and services (sec. 929).   170
        Electro-optical imagery (sec. 930).......................   172
        Software licenses of the Department of Defense (sec. 931)   175
        Defense Clandestine Service (sec. 932)...................   176
        Authority for short-term extension of lease for aircraft 
          supporting the Blue Devil intelligence, surveillance, 
          and reconnaissance program (sec. 933)..................   177
        Sense of the Senate on potential security risks to 
          Department of Defense networks (sec. 934)..............   177
    Subtitle D--Other Matters....................................   178
        National Language Service Corps (sec. 941)...............   178
        Report on education and training and promotion rates for 
          pilots of remotely piloted aircraft (sec. 942).........   178
    Budget Items.................................................   178
        Operationally Responsive Space Funding...................   178
        Space Test Program.......................................   179
    Items of Special Interest....................................   179
        Determination of accuracy of spectrum auction proceeds...   179
        Development of cyber security expertise and partnerships.   180
        Evolved Expendable Launch Vehicle Program................   180
        Navigation location and tracking in GPS-denied 
          environments...........................................   182
        Reports on airborne intelligence, surveillance, and 
          reconnaissance requirements and investment strategy....   182
        Report on cost savings in the Joint Space Operations 
          Center Mission System Program..........................   183
Title X--General Provisions......................................   185
    Subtitle A--Financial Matters................................   185
        General transfer authority (sec. 1001)...................   185
        Authority to transfer of funds to the National Nuclear 
          Security Administration to sustain nuclear weapons 
          modernization (sec. 1002)..............................   185
        Audit readiness of Department of Defense statements of 
          budgetary resources (sec. 1003)........................   185
        Report on effects of budget sequestration on the 
          Department of Defense (sec. 1004)......................   185
    Subtitle B--Counter-Drug Activities..........................   186
        Extension of authority for joint task forces to provide 
          support to law enforcement agencies conducting counter-
          terrorism activities (sec. 1011).......................   186
        Requirement for biennial certification on provision of 
          support for counter-drug activities to certain foreign 
          governments (sec. 1012)................................   186
        Authority to support the unified counterdrug and 
          counterterrorism campaign in Colombia (sec. 1013)......   186
        Quarterly reports on use of funds in the Drug 
          Interdiction and Counter-Drug Activities, Defense-wide 
          account (sec. 1014)....................................   187
    Subtitle C--Naval Vessels and Shipyards......................   187
        Retirement of naval vessels (sec. 1021)..................   187
        Termination of a Maritime Prepositioning Ship squadron 
          (sec. 1022)............................................   188
        Sense of Congress on recapitalization for the Navy and 
          Coast Guard (sec. 1023)................................   188
    Subtitle D--Counterterrorism.................................   189
        Extension of certain prohibitions and requirements 
          relating to detainees at United States Naval Station, 
          Guantanamo Bay, Cuba (sec. 1031).......................   189
    Subtitle E--Miscellaneous Authorities and Limitations........   189
        Enhancement of responsibilities of the Chairman of the 
          Joint Chiefs of Staff regarding the National Military 
          Strategy (sec. 1041)...................................   189
        Modification of authority on training of special 
          operations forces with friendly foreign forces (sec. 
          1042)..................................................   189
        Extension of authority to provide assured business 
          guarantees to carriers participating in Civil Reserve 
          Air Fleet (sec. 1043)..................................   190
        Participation of veterans in the Transition Assistance 
          Program of the Department of Defense (sec. 1044).......   190
        Modification of the Ministry of Defense Advisors Program 
          (sec. 1045)............................................   190
        Interagency collaboration on unmanned aircraft systems 
          (sec. 1046)............................................   191
        Sense of Senate on notice to Congress on unfunded 
          priorities (sec. 1047).................................   192
    Subtitle F--Reports..........................................   192
        Report on strategic airlift aircraft (sec. 1061).........   192
        Repeal of biennial report on the Global Positioning 
          System (sec. 1062).....................................   192
        Repeal of annual report on threat posed by weapons of 
          mass destruction, ballistic missiles, and cruise 
          missiles (sec. 1063)...................................   192
    Subtitle G--Nuclear Matters..................................   192
        Strategic delivery system (sec. 1071)....................   192
        Requirements definition for combined warhead for certain 
          missile systems (sec. 1072)............................   193
        Congressional Budget Office estimate of costs of nuclear 
          weapons and delivery systems (sec. 1073)...............   193
    Subtitle H--Other Matters....................................   193
        Redesignation of Center for Hemispheric Defense Studies 
          as the William J. Perry Center for Hemispheric Defense 
          Studies (sec. 1081)....................................   193
        Technical amendments to repeal statutory references to 
          United States Joint Forces Command (sec. 1082).........   193
        Sense of Congress on non-United States citizens who are 
          graduates of United States educational institutions 
          with advanced degrees in science, technology, 
          engineering, and mathematics (sec. 1083)...............   193
    Items of Special Interest....................................   194
        Arctic region............................................   194
        B-52 Combat Network Communications Study.................   195
        B-52 Strategic Radar Replacement.........................   195
        Clarification of scope of requirements for periodic 
          detention review of individuals detained at United 
          States Naval Station, Guantanamo Bay, Cuba.............   195
        Combat Network Communications Technology.................   196
        Funds transfers between Department of Defense accounts...   196
        Government Accountability Office Report on duplication, 
          overlap and fragmentation in federal programs..........   198
        Government Accountability Office review of the Nuclear 
          Command, Control and Communications System.............   199
        Hazard assessments related to new construction of 
          obstructions on military installations and operations..   199
        Impacts of ``Sequestration'' on the Department of Defense   200
        Resiliency and survivability for nuclear air-launched 
          cruise and missile basing..............................   201
        Roles of the Air Force Global Strike Command and Air 
          Combat Command.........................................   202
        Safety and security standards for Department of Defense 
          hazardous materials transport..........................   202
        Use of general purpose forces and special operations 
          forces for security force assistance...................   203
        Vacancies in critical Inspector General positions........   204
        Working partnerships with State and local law enforcement 
          authorities............................................   204
Title XI--Civilian Personnel Matters.............................   207
        Authority for transportation of family household pets of 
          civilian personnel during evacuation of non-essential 
          personnel (sec. 1101)..................................   207
        Expansion of experimental personnel program for 
          scientific and technical personnel at the Defense 
          Advanced Research Projects Agency (sec. 1102)..........   207
        One-year extension of discretionary authority to grant 
          allowances, benefits, and gratuities to personnel on 
          official duty in a combat zone (sec. 1103).............   207
    Item of Special Interest.....................................   207
        Department of Defense strategic workforce plan...........   207
Title XII--Matters Relating to Foreign Nations...................   209
    Subtitle A--Assistance and Training..........................   209
        Extension of authority to build the capacity of foreign 
          military forces and modification of notice in 
          connection with initiation of activities (sec. 1201)...   209
        Extension of authority for non-reciprocal exchange of 
          defense personnel between the United States and foreign 
          countries (sec. 1202)..................................   209
        Authority to build the capacity of certain 
          counterterrorism forces in Yemen and East Africa (sec. 
          1203)..................................................   209
        Limitation on availability of funds for State Partnership 
          Program (sec. 1204)....................................   210
    Subtitle B--Matters Relating to Iraq, Afghanistan, and 
      Pakistan...................................................   210
        Commanders' Emergency Response Program in Afghanistan 
          (sec. 1211)............................................   210
        Extension of authority to support operations and 
          activities of the Office of Security Cooperation in 
          Iraq (sec. 1212).......................................   211
        One-year extension and modification of authority to use 
          funds for reintegration activities in Afghanistan (sec. 
          1213)..................................................   211
        One-year extension and modification of authority for 
          program to develop and carry out infrastructure 
          projects in Afghanistan (sec. 1214)....................   211
        Extension of Pakistan Counterinsurgency Fund (sec. 1215).   212
        Extension and modification of authority for reimbursement 
          of certain coalition nations for support provided to 
          United States military operations (sec. 1216)..........   213
        Extension and modification of logistical support for 
          coalition forces supporting certain United States 
          military operations (sec. 1217)........................   213
        Strategy for supporting the achievement of a secure 
          presidential election in Afghanistan in 2014 (sec. 
          1218)..................................................   214
        Independent assessment of the Afghan National Security 
          Forces (sec. 1219).....................................   214
        Report on Afghanistan Peace and Reintegration Program 
          (sec. 1220)............................................   214
    Subtitle C--Reports..........................................   215
        Review and reports on Department of Defense efforts to 
          build the capacity of and partner with foreign security 
          forces (sec. 1231).....................................   215
        Additional elements in annual report on military and 
          security developments involving the People's Republic 
          of China (sec. 1232)...................................   215
    Subtitle D--Other Matters....................................   216
        Improved administration of the American, British, 
          Canadian, and Australian Armies' Program (sec. 1241)...   216
        United States participation in Headquarters Eurocorps 
          (sec. 1242)............................................   216
        Department of Defense participation in European program 
          on multilateral exchange of air transportation and air 
          refueling services (sec. 1243).........................   217
        Authority to establish program to provide assistance to 
          foreign civilians for harm incident to combat 
          operations of the armed forces in foreign countries 
          (sec. 1244)............................................   217
        Limitation on availability of funds for certain capital 
          projects in connection with overseas contingency 
          operations (sec. 1245).................................   218
    Items of Special Interest....................................   218
        Insider threat...........................................   218
        North Atlantic Treaty Organization capabilities and 
          burden-sharing.........................................   219
        Review of United States-Egypt military-to-military 
          relations..............................................   219
        Special operations security force assistance activities..   220
Title XIII--Cooperative Threat Reduction.........................   223
    Specification of Cooperative Threat Reduction programs and 
      funds (sec. 1301)..........................................   223
    Funding allocations (sec. 1302)..............................   223
    Item of Special Interest.....................................   223
        Metrics for Cooperative Threat Reduction.................   223
Title XIV--Other Authorizations..................................   225
    Subtitle A--Military Programs................................   225
        Working Capital Funds (sec. 1401)........................   225
        National Defense Sealift Fund (sec. 1402)................   225
        Defense Health Program (sec. 1403).......................   225
        Chemical agents and munitions destruction, defense (sec. 
          1404)..................................................   225
        Drug interdiction and counter-drug activities, defense-
          wide (sec. 1405).......................................   225
        Defense Inspector General (sec. 1406)....................   225
    Subtitle B--National Defense Stockpile.......................   225
        Release of materials needed for national defense purposes 
          from the Strategic and Critical Materials Stockpile 
          (sec. 1411)............................................   225
    Subtitle C--Chemical Demilitarization Matters................   226
        Supplemental chemical agent and munitions destruction 
          technologies at Pueblo Chemical Depot, Colorado, and 
          Blue Grass Army Depot, Kentucky (sec. 1421)............   226
    Subtitle D--Other Matters....................................   227
        Authorization of appropriations for Armed Forces 
          Retirement Home (sec. 1431)............................   227
        Additional Weapons of Mass Destruction Civil Support 
          Teams (sec. 1432)......................................   227
    Budget Items.................................................   228
        Defense Health Program funding...........................   228
        Demand Reduction Program--expanded drug testing..........   228
        Department of Defense Inspector General growth plan......   229
Title XV--Authorization of Appropriations for Overseas 
  Contingency Operations.........................................   231
    Subtitle A--Authorization of Appropriations..................   231
        Purpose (sec. 1501)......................................   231
        Procurement (sec. 1502)..................................   231
        Research, development, test, and evaluation (sec. 1503)..   231
        Operation and maintenance (sec. 1504)....................   231
        Military personnel (sec. 1505)...........................   231
        Working capital funds (sec. 1506)........................   231
        Defense Health Program (sec. 1507).......................   231
        Drug Interdiction and Counter-Drug Activities, Defense-
          wide (sec. 1508).......................................   231
        Defense Inspector General (sec. 1509)....................   232
    Subtitle B--Financial Matters................................   232
        Treatment as additional authorizations (sec. 1521).......   232
        Special transfer authority (sec. 1522)...................   232
    Subtitle C--Limitations and Other Matters....................   232
        Afghanistan Security Forces Fund (sec. 1531).............   232
        Joint Improvised Explosive Device Defeat Fund (sec. 1532)   233
        Plan for transition in funding of United States Special 
          Operations Command from supplemental funding for 
          overseas contingency operations to recurring funding 
          under the future-years defense program (sec. 1533).....   233
        Extension of authority on Task Force for Business and 
          Stability Operations in Afghanistan (sec. 1534)........   234
        Assessments of training activities and intelligence 
          activities of the Joint Improvised Explosive Device 
          Defeat Organization (sec. 1535)........................   234
    Budget Items.................................................   234
        AH-64 Apache Block IIIB new build........................   234
        Rapid equipping soldier support equipment................   235
        Solar power units........................................   235
        Afghanistan Infrastructure Fund..........................   235
        Commanders' Emergency Response Program...................   235
        Installation information infrastructure support for 
          United States Southern Command.........................   236
        Joint Improvised Explosive Device Defeat Fund............   236
    Items of Special Interest....................................   237
        Department of Defense procurement of Mi-17 helicopters 
          through Rosoboronexport................................   237
        Future size of the Afghan National Security Forces.......   238
Title XVI--Military Compensation and Retirement Modernization 
  Commission.....................................................   241
        Short title (sec. 1601)..................................   241
        Purpose (sec. 1602)......................................   241
        Definitions (sec. 1603)..................................   241
        Military Compensation and Retirement Modernization 
          Commission (sec. 1604).................................   241
        Commission hearings and meetings (sec. 1605).............   242
        Principles and procedure for commission recommendations 
          (sec. 1606)............................................   242
        Consideration of commission recommendations by the 
          President and Congress (sec. 1607).....................   243
        Pay for members of the commission (sec. 1608)............   243
        Executive Director (sec. 1609)...........................   243
        Staff (sec. 1610)........................................   243
        Contracting authority (sec. 1611)........................   244
        Judicial review precluded (sec. 1612)....................   244
        Termination (sec. 1613)..................................   244
        Funding (sec. 1614)......................................   244
Title XVII--National Commission on the Structure of the Air Force   245
        National commission on the structure of the Air Force 
          (secs. 1701-1709)......................................   245
        Retention of core functions of the Electronic Systems 
          Center at Hanscom Air Force Base pending future 
          structure study (sec. 1710)............................   247
Division B--Military Construction Authorizations.................   249
        Summary and explanation of funding tables................   249
        Short title (sec. 2001)..................................   249
        Expiration of authorizations and amounts required to be 
          specified by law (sec. 2002)...........................   249
Title XXI--Army Military Construction............................   251
        Summary..................................................   251
        Authorized Army construction and land acquisition 
          projects (sec. 2101)...................................   252
        Family housing (sec. 2102)...............................   252
        Authorization of appropriations, Army (sec. 2103)........   252
        Modification of authority to carry out certain fiscal 
          year 2010 project (sec. 2104)..........................   252
        Extension of authorizations of certain fiscal year 2009 
          projects (sec. 2105)...................................   252
        Extension of authorizations of certain fiscal year 2010 
          projects (sec. 2106)...................................   252
        Additional authority to carry out certain fiscal year 
          2013 project (sec. 2107)...............................   253
Title XXII--Navy Military Construction...........................   255
        Summary..................................................   255
        Authorized Navy construction and land acquisition 
          projects (sec. 2201)...................................   255
        Family housing (sec. 2202)...............................   255
        Improvements to military family housing units (sec. 2203)   255
        Authorization of appropriations, Navy (sec. 2204)........   256
        Modification of authority to carry out certain fiscal 
          year 2012 project (sec. 2205)..........................   256
        Extension of authorizations of certain fiscal year 2009 
          projects (sec. 2206)...................................   256
        Extension of authorizations of certain fiscal year 2010 
          projects (sec. 2207)...................................   256
        Realignment of Marines in the Asia-Pacific region (sec. 
          2208)..................................................   256
    Items of Special Interest....................................   256
        Comptroller General of the United States assessment of 
          the costs of realignment of the Marines in the Asia-
          Pacific region.........................................   256
        U.S. force posture in the Asia-Pacific and realignment of 
          the U.S. Marines on Okinawa............................   257
Title XXIII--Air Force Military Construction.....................   261
        Summary..................................................   261
        Authorized Air Force construction and land acquisition 
          projects (sec. 2301)...................................   261
        Family housing (sec. 2302)...............................   261
        Improvements to military family housing units (sec. 2303)   262
        Authorization of appropriations, Air Force (sec. 2304)...   262
        Extension of authorizations of certain fiscal year 2010 
          projects (sec. 2305)...................................   262
Title XXIV--Defense Agencies Military Construction...............   263
        Summary..................................................   263
    Subtitle A--Defense Agency Authorizations....................   263
        Authorized defense agencies construction and land 
          acquisition projects (sec. 2401).......................   263
        Authorized energy conservation projects (sec. 2402)......   264
        Authorization of appropriations, defense agencies (sec. 
          2403)..................................................   264
        Extension of authorization of certain fiscal year 2010 
          project (sec. 2404)....................................   264
        Modification of authority to carry out certain fiscal 
          year 2012 project (sec. 2405)..........................   264
        Additional authority to carry out certain fiscal year 
          2013 project (sec. 2406)...............................   264
    Subtitle B--Chemical Demilitarization Authorizations.........   264
        Authorization of appropriations, chemical 
          demilitarization construction, defense-wide (sec. 2411)   264
        Modification of authority to carry out certain fiscal 
          year 1997 project (sec. 2412)..........................   264
    Item of Special Interest.....................................   265
        Excess overseas facilities for defense agencies..........   265
Title XXV--North Atlantic Treaty Organization Security Investment 
  Program........................................................   267
        Summary..................................................   267
        Authorized NATO construction and land acquisition 
          projects (sec. 2501)...................................   267
        Authorization of appropriations, NATO (sec. 2502)........   267
Title XXVI--Guard and Reserve Forces Facilities..................   269
        Summary..................................................   269
    Subtitle A--Project Authorizations and Authorization of 
      Appropriations.............................................   269
        Authorized Army National Guard construction and land 
          acquisition projects (sec. 2601).......................   269
        Authorized Army Reserve construction and land acquisition 
          projects (sec. 2602)...................................   269
        Authorized Navy Reserve and Marine Corps Reserve 
          construction and land acquisition projects (sec. 2603).   269
        Authorized Air National Guard construction and land 
          acquisition projects (sec. 2604).......................   269
        Authorized Air Force Reserve construction and land 
          acquisition projects (sec. 2605).......................   269
        Authorization of appropriations, National Guard and 
          Reserve (sec. 2606)....................................   270
    Subtitle B--Other Matters....................................   270
        Extension of authorization of certain fiscal year 2009 
          project (sec. 2611)....................................   270
        Extension of authorization of certain fiscal year 2010 
          projects (sec. 2612)...................................   270
Title XXVII--Base Realignment and Closure Activities.............   271
        Summary and explanation of tables........................   271
        Authorization of appropriations for base realignment and 
          closure activities funded through Department of Defense 
          base closure account 1990 (sec. 2701)..................   271
        Authorization of appropriations for base realignment and 
          closure activities funded through Department of Defense 
          base closure account 2005 (sec. 2702)..................   271
        Technical amendments to section 2702 of fiscal year 2012 
          Act (sec. 2703)........................................   271
        Criteria for decisions involving certain base closure and 
          realignment activities (sec. 2704).....................   271
    Item of Special Interest.....................................   272
        Government Accountability Office review of the systems 
          and processes that the Department uses to identify the 
          extent to which bases or facilities are excess to needs   272
Title XXVIII--Military Construction General Provisions...........   275
    Subtitle A--Military Construction Program and Military Family 
      Housing Changes............................................   275
        Authorized cost and scope variations (sec. 2801).........   275
        Comptroller General report on in-kind payments (sec. 
          2802)..................................................   276
        Extension of temporary, limited authority to use 
          operation and maintenance funds for construction 
          projects in certain areas outside the United States 
          (sec. 2803)............................................   276
    Subtitle B--Real Property and Facilities Administration......   276
        Authority to accept as consideration for leases of non-
          excess property of military departments and defense 
          agencies real property interests and natural resource 
          management services related to agreements to limit 
          encroachment (sec. 2811)...............................   276
        Clarification of parties with whom Department of Defense 
          may conduct exchanges of real property at military 
          installations (sec. 2812)..............................   276
    Subtitle C--Energy Security..................................   276
        Guidance on financing for renewable energy projects (sec. 
          2821)..................................................   276
        Continuation of limitation on use of funds for Leadership 
          in Energy and Environmental Design (LEED) gold or 
          platinum certification (sec. 2822).....................   277
        Prohibition on biofuel refinery construction (sec. 2823).   277
    Subtitle D--Land Conveyances.................................   277
        Land conveyance, local training area for Browning Army 
          Reserve Center, Utah (sec. 2831).......................   277
        Use of proceeds, land conveyance, Tyndall Air Force Base, 
          Florida (sec. 2832)....................................   277
    Subtitle E--Other Matters....................................   277
        Clarification of authority of Secretary to assist with 
          development of public infrastructure in connection with 
          the establishment or expansion of a military 
          installation (sec. 2841)...............................   277
        Petersburg National Battlefield boundary modification 
          (sec. 2842)............................................   277
        Congressional notification with respect to oversight and 
          maintenance of base cemeteries following closure of 
          overseas military installations (sec. 2843)............   277
Division C--Department of Energy National Security Authorizations 
  and Other Authorizations.......................................   278
Title XXXI--Department of Energy National Security Programs......   278
    Subtitle A--National Security Programs Authorizations........   278
        Overview.................................................   278
        National Nuclear Security Administration (sec. 3101).....   278
        Weapons activities.......................................   279
        Directed stockpile work..................................   279
        Campaigns................................................   280
        Readiness in the technical base..........................   281
        Secure transportation asset..............................   283
        Nuclear counterterrorism incident response...............   283
        Site stewardship.........................................   283
        Safeguards and security..................................   283
        National security applications...........................   283
        Defense Nuclear Nonproliferation programs................   283
        Nonproliferation and verification research and 
          development............................................   283
        Nonproliferation and international security..............   284
        International nuclear materials protection and 
          cooperation............................................   284
        Fissile materials disposition............................   284
        Global threat reduction initiative.......................   284
        Naval reactors...........................................   285
        Office of the Administrator..............................   285
        Defense environmental cleanup (sec. 3102)................   285
        Savannah River Site......................................   286
        Waste Treatment Plant....................................   286
        Other defense activities (sec. 3103).....................   286
    Subtitle B--Program Authorizations, Restrictions, and 
      Limitations................................................   286
        Replacement project for Chemistry and Metallurgy Research 
          building, Los Alamos National Laboratory, New Mexico 
          (sec. 3111)............................................   286
        Submittal to Congress of selected acquisition reports and 
          independent cost estimates on nuclear weapon systems 
          undergoing life extension (sec. 3112)..................   289
        Two-year extension of schedule for disposition of 
          weapons-usable plutonium at Savannah River Site, Aiken, 
          South Carolina (sec. 3113).............................   289
        Program on scientific engagement for nonproliferation 
          (sec. 3114)............................................   289
        Repeal of requirement for annual update of Department of 
          Energy defense nuclear facilities workforce 
          restructuring plan (sec. 3115).........................   289
        Quarterly reports to Congress on financial balances for 
          atomic energy defense activities (sec. 3116)...........   290
        Transparency in contractor performance evaluations by the 
          National Nuclear Security Administration leading to 
          award fees (sec. 3117).................................   290
        Expansion of authority to establish certain scientific, 
          engineering, and technical positions (sec. 3118).......   290
        Modification and extension of authority on acceptance of 
          contributions for acceleration of removal or security 
          of fissile materials, radiological materials, and 
          related equipment at vulnerable sites worldwide (sec. 
          3119)..................................................   290
        Cost containment for the Y-12 Uranium Processing 
          Facility, Y-12 National Security Complex, Oak Ridge, 
          Tennessee (sec. 3120)..................................   291
        Authority to restore certain formerly Restricted Data to 
          the Restricted Data category (Sec. 3121)...............   292
    Subtitle C--Reports..........................................   292
        Report on actions required for transition of regulation 
          of non-nuclear activities of the National Nuclear 
          Security Administration to federal agencies (sec. 3131)   292
        Report on consolidation of facilities of the National 
          Nuclear Security Administration (sec. 3132)............   292
        Regional radiological security zones (sec. 3133).........   293
        Report on legacy uranium mines (sec. 3134)...............   293
        Comptroller General of the United States review of 
          projects carried out by Office of Environmental 
          Management of the Department of Energy pursuant to the 
          American Recovery and Reinvestment Act of 2009 (sec. 
          3135)..................................................   293
    Items of Special Interest....................................   293
        General Accountability Office Study of National Nuclear 
          Security Administration Cost Estimating Practices......   293
        National Ignition Facility overhead structure............   294
        Readiness in Technical Base and Facilities...............   294
        Acquisition corps........................................   294
        Plan for use of Office of Science facilities.............   294
        Independence of the National Nuclear Security 
          Administration.........................................   295
        Adherence to section 3114 of the Ike Skelton National 
          Defense Authorization Act for Fiscal Year 2011.........   295
Title XXXII--Defense Nuclear Facilities Safety Board.............   297
        Authorization (sec. 3201)................................   297
Title XXXV--Maritime Administration..............................   299
        Maritime Administration (sec. 3501)......................   299
Division D--Funding Tables.......................................   301
        Authorization of amounts in funding tables (sec. 4001)...   301
Title XLI--Procurement...........................................   303
        Procurement (sec. 4101)..................................   304
        Procurement for overseas contingency operations (sec. 
          4102)..................................................   350
Title XLII--Research, Development, Test, and Evaluation..........   363
        Research, development, test, and evaluation (sec. 4201)..   364
        Research, development, test, and evaluation for overseas 
          contingency operations (sec. 4202).....................   399
Title XLIII--Operation and Maintenance...........................   402
        Operation and maintenance (sec. 4301)....................   403
        Operation and maintenance for overseas contingency 
          operations (sec. 4302).................................   418
Title XLIV--Military Personnel...................................   427
        Military personnel (sec. 4401)...........................   428
        Military personnel for overseas contingency operations 
          (sec. 4402)............................................   429
Title XLV--Other Authorizations..................................   431
        Other authorizations (sec. 4501).........................   432
        Other authorizations for overseas contingency operations 
          (sec. 4502)............................................   434
Title XLVI--Military Construction................................   437
        Military construction (sec. 4601)........................   438
Title XLVII--Department of Energy National Security Programs.....   461
        Department of Energy national security authorizations 
          (sec. 4701)............................................   462
Legislative Requirements.........................................   473
        Departmental Recommendations.............................   473
        Committee Action.........................................   473
        Congressional Budget Office Cost Estimate................   474
        Regulatory Impact........................................   474
        Changes in Existing Law..................................   475
Additional Views.................................................   476
        Additional Views of Mr. Begich...........................   476
        Additional Views of Mr. McCain...........................   478
        Additional Views of Mr. Inhofe...........................   482
        Additional Views of Mr. Chambliss........................   485
        Additional Views of Ms. Ayotte...........................   486
                                                       Calendar No. 419
112th Congress                                                   Report
                                 SENATE
 2d Session                                                     112-173

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


AUTHORIZING APPROPRIATIONS FOR FISCAL YEAR 2013 FOR MILITARY ACTIVITIES 
   OF THE DEPARTMENT OF DEFENSE, FOR MILITARY CONSTRUCTION, AND FOR 
 DEFENSE ACTIVITIES OF THE DEPARTMENT OF ENERGY, TO PRESCRIBE MILITARY 
    PERSONNEL STRENGTHS FOR SUCH FISCAL YEAR, AND FOR OTHER PURPOSES

                                _______
                                

                  June 4, 2012.--Ordered to be printed

                                _______
                                

           Mr. Levin, from the Committee on Armed Services, 
                        submitted the following

                              R E P O R T

                         [To accompany S. 3254]

    The Committee on Armed Services reports favorably an 
original bill to authorize appropriations for the fiscal year 
2013 for military activities of the Department of Defense, for 
military construction, and for defense activities of the 
Department of Energy, to prescribe personnel strengths for such 
fiscal year, and for other purposes, and recommends that the 
bill do pass.

                          PURPOSE OF THE BILL

    This bill would:
          (1) authorize appropriations for (a) procurement, (b) 
        research, development, test and evaluation, (c) 
        operation and maintenance and the revolving and 
        management funds of the Department of Defense for 
        fiscal year 2013;
          (2) authorize the personnel end strengths for each 
        military active duty component of the Armed Forces for 
        fiscal year 2013;
          (3) authorize the personnel end strengths for the 
        Selected Reserve of each of the reserve components of 
        the Armed Forces for fiscal year 2013;
          (4) impose certain reporting requirements;
          (5) impose certain limitations with regard to 
        specific procurement and research, development, test 
        and evaluation actions and manpower strengths; provide 
        certain additional legislative authority, and make 
        certain changes to existing law;
          (6) authorize appropriations for military 
        construction programs of the Department of Defense for 
        fiscal year 2013; and
          (7) authorize appropriations for national security 
        programs of the Department of Energy for fiscal year 
        2013.

Committee overview

    The United States Armed Forces have been involved in armed 
conflict for more than 10 years. U.S. forces are drawing down 
in Afghanistan and are no longer deployed in Iraq. However, 
real threats to our national security remain and our forces are 
deployed throughout the globe. Whether engaged in combat in 
Afghanistan, tracking down Al Qaeda and associated forces in 
the Arabian Peninsula, keeping a watchful eye on Iran or North 
Korea, delivering humanitarian assistance to victims of natural 
disasters at home or abroad, or training foreign national 
forces to combat terrorism in their own countries, the men and 
women of our armed forces, both active and reserve, are serving 
honorably and courageously to promote and defend our Nation's 
interests. They do so often at great personal risk and 
significant sacrifice to themselves and their families.
    The Administration has completed a comprehensive strategic 
review in the light of current and anticipated threats, and has 
put in place a new strategic guidance. The Department of 
Defense's ability to implement that strategic guidance will be 
in question should the Administration and Congress fail to 
reach agreement on a plan to avoid automatic defense spending 
reductions scheduled to take effect in January 2013.
    In Afghanistan, the surge force will be withdrawn by the 
end of this summer, as Afghan National Security Forces (ANSF) 
embark on the third tranche of the transition that will result 
in the ANSF having primary responsibility for three-fourths of 
the Afghan people. The transition to Afghan security lead 
throughout Afghanistan is on track to be completed by the end 
of 2014.
    To date in this Second Session of the 112th Congress, the 
Committee on Armed Services has conducted 32 hearings and 
formal briefings on the President's budget request for fiscal 
year 2013, the ongoing conflict in Afghanistan, and related 
defense matters.
    In order to provide a framework for the consideration of 
these matters, the committee identified 10 guidelines to guide 
its work on the National Defense Authorization Act for Fiscal 
Year 2013. These guidelines are:
    1. Improve the quality of life of the men and women of the 
all-volunteer force (active duty, National Guard, and Reserves) 
and their families, as well as Department of Defense civilian 
personnel, through fair pay, policies, and benefits, and 
address the needs of the wounded, ill, and injured service 
members and their families.
    2. Provide our service men and women with the resources, 
training, technology, equipment (especially force protection) 
and authorities they need to succeed in combat, 
counterinsurgency, and stability operations.
    3. Enhance the capability of the U.S. Armed Forces to 
support the ANSF and Afghan Local Police as the lead 
responsibility for security throughout Afghanistan transitions 
to the ANSF.
    4. Address the threats from nuclear weapons and materials 
by strengthening nonproliferation programs, maintaining a 
credible nuclear deterrent, reducing the size of the nuclear 
weapons stockpile, and ensuring the safety, security and 
reliability of the stockpile, the delivery systems and the 
nuclear infrastructure.
    5. Improve the ability of the armed forces to counter 
nontraditional threats, focusing on terrorism, cyber warfare, 
and the proliferation of weapons of mass destruction and their 
means of delivery.
    6. Enhance the capability of the security forces of allied 
and friendly nations to defeat al Qaeda, its affiliates, and 
other violent extremist organizations.
    7. Seek to reduce our Nation's strategic risk by taking 
action aimed at restoring, as soon as possible, the readiness 
of the military services to conduct the full range of their 
assigned missions.
    8. Terminate troubled or unnecessary programs and 
activities, identify efficiencies, and reduce defense 
expenditures in light of the Nation's budget deficit problems. 
Ensure the future capability, viability, and fiscal 
sustainability of the all-volunteer force.
    9. Emphasize the reduction of dependency on fossil fuels 
and seek greater energy security and independence and pursue 
affordable technological advances in traditional and 
alternative energy storage, power systems, operational energy 
tactical advantages, renewable energy production, and more 
energy efficient ground, air, and naval systems.
    10. Promote aggressive and thorough oversight of the 
Department's programs and activities to ensure proper 
stewardship of taxpayer dollars and compliance with relevant 
laws and regulations.

Scoring of budgetary effects (sec. 4)

    The committee recommends a provision that would require 
that the budgetary effects of this Act be determined in 
accordance with the procedures established in the Statutory 
Pay-As-You-Go-Act of 2010 (title I of Public Law 111-139).

Summary of discretionary authorizations and budget implication

    The administration's budget request for national defense 
discretionary programs within the jurisdiction of the Senate 
Committee on Armed Services for fiscal year 2013 was $631.6 
billion. Of this amount, $525.3 billion was requested for base 
Department of Defense programs, $88.5 billion was requested for 
overseas contingency operations, and $17.8 billion was 
requested for national security programs in the Department of 
Energy and the Defense Nuclear Facilities Safety Board.
    The bill authorizes $631.4 billion in fiscal year 2013, 
including $525.8 billion for base Department of Defense 
programs, $88.2 billion for overseas contingency operations, 
and $17.3 billion for national security programs in the 
Department of Energy and the Defense Nuclear Facilities Safety 
Board.
    The administration's fiscal year 2013 budget for national 
defense also included discretionary programs outside the 
jurisdiction of the Senate Committee on Armed Services, 
discretionary programs that do not require further 
authorization, and mandatory programs that are in current law. 
When these programs are added to the administration's budget 
the request for national defense totaled $646.7 billion.
    The following two tables summarize the direct 
authorizations and the equivalent budget authority levels for 
fiscal year 2013 defense programs. The first table summarizes 
committee action on the authorizations within the jurisdiction 
of this committee. It includes the authorization for spending 
from the trust fund of the Armed Forces Retirement Home which 
is outside the national defense budget function. The second 
table summarizes the total budget authority implication for 
national defense by adding funding for items that are not 
within the jurisdiction of this committee or do not require an 
annual authorization.

     SUMMARY OF NATIONAL DEFENSE AUTHORIZATIONS FOR FISCAL YEAR 2013
                        (In Thousands of Dollars)
------------------------------------------------------------------------
                                    FY 2013       Senate       Senate
                                    Request       Change     Authorized
------------------------------------------------------------------------
    DISCRETIONARY AUTHORIZATIONS WITHIN THE JURISDICTION OF THE ARMED
                           SERVICES COMMITTEE

             Division A: Department of Defense Authorizations

Division A: Base Budget (Titles I, II, III, IV, XIV, XVI)

Title I: PROCUREMENT
Aircraft Procurement, Army.....     5,853,729      -44,000     5,809,729
Missile Procurement, Army......     1,302,689            0     1,302,689
Weapons & Tracked Combat            1,501,706      188,817     1,690,523
 Vehicles, Army................
Procurement of Ammunition, Army     1,739,706     -166,438     1,573,268
Other Procurement, Army........     6,326,245      -19,212     6,307,033
Joint Improvised Explosive            227,414     -227,414             0
 Device Defeat Fund............
Aircraft Procurement, Navy.....    17,129,296       60,000    17,189,296
Weapons Procurement, Navy......     3,117,578        7,700     3,125,278
Procurement of Ammunition, Navy       759,539     -100,800       658,739
 & Marine Corps................
Shipbuilding & Conversion, Navy    13,579,845      777,679    14,357,524
Other Procurement, Navy........     6,169,378            0     6,169,378
Procurement, Marine Corps......     1,622,955     -275,200     1,347,755
Aircraft Procurement, Air Force    11,002,999     -908,748    10,094,251
Missile Procurement, Air Force.     5,491,846            0     5,491,846
Procurement of Ammunition, Air        599,194            0       599,194
 Force.........................
Other Procurement, Air Force...    16,720,848            0    16,720,848
Procurement, Defense-Wide......     4,187,935      234,400     4,422,335
National Guard and Reserve                  0            0             0
 Equipment.....................
Joint Urgent Operational Needs         99,477            0        99,477
 Fund..........................
Subtotal, PROCUREMENT..........    97,432,379     -473,216    96,959,163

Title II: RESEARCH, DEVELOPMENT, TEST & EVALUATION
RDT&E, Army....................     8,929,415     -425,661     8,503,754
RDT&E, Navy....................    16,882,877       -8,832    16,874,045
RDT&E, Air Force...............    25,428,046     -153,156    25,274,890
RDT&E, Defense-Wide............    17,982,161      462,100    18,444,261
Operational Test & Evaluation,        185,268        4,000       189,268
 Defense.......................
Subtotal, RESEARCH,                69,407,767     -121,549    69,286,218
 DEVELOPMENT, TEST & EVALUATION

Title III: OPERATION AND MAINTENANCE
Operation & Maintenance, Army..    36,608,592     -145,300    36,463,292
Operation & Maintenance, Navy..    41,606,943      -23,000    41,583,943
Operation & Maintenance, Marine     5,983,163            0     5,983,163
 Corps.........................
Operation & Maintenance, Air       35,435,360      -32,000    35,403,360
 Force.........................
Operation & Maintenance,           31,993,013       39,500    32,032,513
 Defense-Wide..................
Operation & Maintenance, Army       3,162,008            0     3,162,008
 Reserve.......................
Operation & Maintenance, Navy       1,246,982            0     1,246,982
 Reserve.......................
Operation & Maintenance, Marine       272,285            0       272,285
 Corps Reserve.................
Operation & Maintenance, Air        3,166,482            0     3,166,482
 Force Reserve.................
Operation & Maintenance, Army       7,108,612            0     7,108,612
 National Guard................
Operation & Maintenance, Air        6,015,455            0     6,015,455
 National Guard................
Miscellaneous Appropriations...     2,340,038            0     2,340,038
Subtotal, OPERATION AND           174,938,933     -160,800   174,778,133
 MAINTENANCE...................

Title IV: MILITARY PERSONNEL...   135,111,799        6,000   135,117,799

Title XIV: OTHER AUTHORIZATIONS
Working Capital Fund, Army.....        60,037            0        60,037
Working Capital Fund, Air Force        45,452            0        45,452
Working Capital Fund, Defense-         39,135            0        39,135
 Wide..........................
Working Capital Fund, DECA.....     1,371,560            0     1,371,560
National Defense Sealift Fund..       608,136            0       608,136
Defense Health Program.........    32,528,718      452,000    32,980,718
Chemical Agents & Munitions         1,301,786            0     1,301,786
 Destruction, Defense..........
Drug Interdiction & Counter-          999,363            0       999,363
 Drug Activities, Defense......
Office of the Inspector General       273,821       59,100       332,921
Subtotal, OTHER AUTHORIZATIONS.    37,228,008      511,100    37,739,108

Title XVII: COMMISSION ON THE               0    1,400,000     1,400,000
 STRUCTURE OF THE AIR FORCE....

Subtotal, Division A, Base        514,118,886    1,161,535   515,280,421
 Budget........................

   Division A: Overseas Contingency Operations (OCO) Budget (Title XV)

Title XV--OVERSEAS CONTINGENCY OPERATIONS

PROCUREMENT, OCO
Aircraft Procurement, Army.....       486,200      -71,000       415,200
Missile Procurement, Army......        49,653            0        49,653
Weapons & Tracked Combat               15,422            0        15,422
 Vehicles, Army................
Procurement of Ammunition, Army       357,493            0       357,493
Other Procurement, Army........     2,015,907       33,000     2,048,907
Joint Improvised Explosive          1,675,400       27,414     1,702,814
 Device Defeat Fund............
Aircraft Procurement, Navy.....       164,582            0       164,582
Weapons Procurement, Navy......        23,500            0        23,500
Procurement of Ammunition, Navy       285,747            0       285,747
 & Marine Corps................
Other Procurement, Navy........        98,882            0        98,882
Procurement, Marine Corps......       943,683            0       943,683
Aircraft Procurement, Air Force       305,600            0       305,600
Missile Procurement, Air Force.        34,350            0        34,350
Procurement of Ammunition, Air        116,203            0       116,203
 Force.........................
Other Procurement, Air Force...     2,818,270            0     2,818,270
Procurement, Defense-Wide......       196,349            0       196,349
Joint Urgent Operational Needs        100,000            0       100,000
 Fund..........................
Subtotal, PROCUREMENT, OCO.....     9,687,241      -10,586     9,676,655

RESEARCH, DEVELOPMENT, TEST &
 EVALUATION, OCO
RDT&E, Army....................        19,860            0        19,860
RDT&E, Navy....................        60,119            0        60,119
RDT&E, Air Force...............        53,150            0        53,150
RDT&E, Defense-Wide............       112,387            0       112,387
Subtotal, RDT&E, OCO...........       245,516            0       245,516

OPERATION AND MAINTENANCE, OCO
Operation & Maintenance, Army..    28,591,441     -240,000    28,351,441
Operation & Maintenance, Navy..     5,880,395            0     5,880,395
Operation & Maintenance, Marine     4,066,340            0     4,066,340
 Corps.........................
Operation & Maintenance, Air        9,241,613            0     9,241,613
 Force.........................
Operation & Maintenance,            7,824,579            0     7,824,579
 Defense-Wide..................
Operation & Maintenance, Army         154,537            0       154,537
 Reserve.......................
Operation & Maintenance, Navy          55,924            0        55,924
 Reserve.......................
Operation & Maintenance, Marine        25,477            0        25,477
 Corps Reserve.................
Operation & Maintenance, Air          120,618            0       120,618
 Force Reserve.................
Operation & Maintenance, Army         382,448            0       382,448
 National Guard................
Operation & Maintenance, Air           19,975            0        19,975
 National Guard................
Afghanistan Security Forces         5,749,167            0     5,749,167
 Fund..........................
Afghanistan Infrastructure Fund       400,000      -50,000       350,000
Subtotal, OPERATION AND            62,512,514     -290,000    62,222,514
 MAINTENANCE, OCO..............

MILITARY PERSONNEL, OCO........    14,060,094            0    14,060,094

OTHER AUTHORIZATIONS, OCO
Working Capital Fund, Army.....        42,600            0        42,600
Working Capital Fund, Air Force       240,400            0       240,400
Working Capital Fund, Defense-        220,364            0       220,364
 Wide..........................
Defense Health Program.........       993,898            0       993,898
Drug Interdiction & Counter-          469,025            0       469,025
 Drug Activities, Defense......
Office of the Inspector General        10,766            0        10,766
Subtotal, OTHER AUTHORIZATIONS,     1,977,053            0     1,977,053
 OCO...........................

Subtotal, Division A, OCO          88,482,418     -300,586    88,181,832
 Budget........................

Total, Division A..............   602,601,304      860,949   603,462,253

             Division B: Military Construction Authorizations

Division B: Base Budget (Titles XXI--XXVII)

Titles XXI--XXVI: MILITARY CONSTRUCTION
Military Construction, Army....     1,923,323     -325,000     1,598,323
Military Construction, Navy and     1,701,985      -53,757     1,648,228
 Marine Corps..................
Military Construction, Air            388,200      -65,657       322,543
 Force.........................
Military Construction, Defense-     3,654,623     -219,500     3,435,123
 Wide..........................
NATO Security Investment              254,163            0       254,163
 Program.......................
Military Construction, Army           613,799            0       613,799
 National Guard................
Military Construction, Air             42,386            0        42,386
 National Guard................
Military Construction, Army           305,846            0       305,846
 Reserve.......................
Military Construction, Navy            49,532            0        49,532
 Reserve.......................
Military Construction, Air             10,979            0        10,979
 Force Reserve.................
Chemical Demilitarization             151,000            0       151,000
 Construction..................
Subtotal, MILITARY CONSTRUCTION     9,095,836     -663,914     8,431,922

Titles XXI--XXVI: FAMILY HOUSING
Family Housing Construction,            4,641            0         4,641
 Army..........................
Family Housing O&M, Army.......       530,051            0       530,051
Family Housing Construction,          102,182            0       102,182
 Navy and Marine Corps.........
Family Housing O&M, Navy and          378,230            0       378,230
 Marine Corps..................
Family Housing Construction,           83,824            0        83,824
 Air Force.....................
Family Housing O&M, Air Force..       497,829            0       497,829
Family Housing O&M, Defense-           52,238            0        52,238
 Wide..........................
Family Housing Improvement Fund         1,786            0         1,786
Subtotal, FAMILY HOUSING.......     1,650,781            0     1,650,781

Title XXVII: BRAC
Defense Base Closure Account          349,396            0       349,396
 1990..........................
Defense Base Closure Account          126,697            0       126,697
 2005..........................
Subtotal, BRAC.................       476,093            0       476,093

Total, Division B..............    11,222,710     -663,914    10,558,796

SUBTOTAL, BASE BUDGET,            525,341,596      497,621   525,839,217
 DIVISIONS A & B...............
SUBTOTAL, OCO BUDGET, DIVISION     88,482,418     -300,586    88,181,832
 A.............................

TOTAL, DEPARTMENT OF DEFENSE      613,824,014      197,035   614,021,049
 (051).........................

  Division C: Department of Energy National Security Authorizations and
                          Other Authorizations

Division C: (Titles XXXI and XXXII)

Department of Energy Authorization (Title XXXI)

Electricity Delivery and Energy         6,000       -6,000             0
 Reliability...................

Title XXXI: NATIONAL NUCLEAR SECURITY ADMINISTRATION
Weapons Activities.............     7,577,341       25,000     7,602,341
Defense Nuclear                     2,458,631            0     2,458,631
 Nonproliferation..............
Naval Reactors.................     1,088,635       37,986     1,126,621
Office of the Administrator....       411,279      -25,000       386,279
Subtotal, NATIONAL NUCLEAR         11,535,886       37,986    11,573,872
 SECURITY ADMINISTRATION.......

Title XXXI: ENVIRONMENTAL AND OTHER DEFENSE ACTIVITIES
Defense Environmental Cleanup..     5,472,001     -463,000     5,009,001
Other Defense Activities.......       735,702            0       735,702
Subtotal, ENVIRONMENTAL AND         6,207,703     -463,000     5,744,703
 OTHER DEFENSE ACTIVITIES......

TOTAL, DEPARTMENT OF ENERGY....    17,749,589     -431,014    17,318,575

Title XXXII: DEFENSE NUCLEAR FACILITIES SAFETY BOARD
Defense Nuclear Facilities             29,415            0        29,415
 Safety Board..................
TOTAL, DEFENSE NUCLEAR                 29,415            0        29,415
 FACILITIES SAFETY BOARD.......

TOTAL, ATOMIC ENERGY DEFENSE       17,779,004     -431,014    17,347,990
 PROGRAMS (053)................

GRAND TOTAL, NATIONAL DEFENSE     631,603,018     -233,979   631,369,039
 (050).........................

MEMORANDUM: NON-DEFENSE AUTHORIZATIONS
Title XIV--Armed Forces                67,590            0        67,590
 Retirement Home (Function 600)

MEMORANDUM: TRANSFER AUTHORITIES (NON-ADDS)
Title X--General Transfer         [5,000,000]            0   [5,000,000]
 Authority (non-add)...........
Title XV--Special Transfer        [4,000,000]            0   [4,000,000]
 Authority (non-add)...........
------------------------------------------------------------------------


              NATIONAL DEFENSE BUDGET AUTHORITY IMPLICATION
                        (In Thousands of Dollars)
------------------------------------------------------------------------
                                    FY 2013       Senate       Senate
                                    Request       Change     Authorized
------------------------------------------------------------------------
Summary, Discretionary Authorizations Within the Jurisdiction of the
 Armed Services Committee
SUBTOTAL, BASE BUDGET,            525,341,596      497,621   525,839,217
 DIVISIONS A & B...............
SUBTOTAL, OCO BUDGET, DIVISION     88,482,418     -300,586    88,181,832
 A.............................
TOTAL, DEPARTMENT OF DEFENSE      613,824,014      197,035   614,021,049
 (051).........................
TOTAL, ATOMIC ENERGY DEFENSE       17,779,004     -431,014    17,347,990
 PROGRAMS (053)................
GRAND TOTAL, NATIONAL DEFENSE     631,603,018     -233,979   631,369,039
 (050).........................

    Base National Defense Discretionary Programs that are Not In the
                          Jurisdiction of the
   Armed Services Committee or Do Not Require Additional Authorization
Defense Production Act                 89,189                     89,189
 Purchases.....................
Indefinite Account: National               25                         25
 Science Center, Army..........
Indefinte Account: Disposal Of          7,855                      7,855
 DOD Real Property.............
Indefinite Account: Lease Of           12,029                     12,029
 DOD Real Property.............
Subtotal, Budget Sub-Function         109,098                    109,098
 051...........................
Formerly Utilized Sites               104,000                    104,000
 Remedial Action Program.......
Nuclear Energy.................        93,000                     93,000
Subtotal, Budget Sub-Function         197,000                    197,000
 053...........................
Other Discretionary Programs...     7,168,000                  7,168,000
Subtotal, Budget Sub-Function       7,168,000                  7,168,000
 054...........................
Total Defense Discretionary         7,474,098                  7,474,098
 Adjustments (050).............

Budget Authority Implication, National Defense Discretionary
Department of Defense--Military   613,933,112      197,035   614,130,147
 (051).........................
Atomic Energy Defense              17,976,004     -431,014    17,544,990
 Activities (053)..............
Defense-Related Activities          7,168,000                  7,168,000
 (054).........................
Total BA Implication, National    639,077,116     -233,979   638,843,137
 Defense Discretionary.........

National Defense Mandatory Programs, Current Law (CBO Estimates)
Concurrent receipt accrual          6,849,000                  6,849,000
 payments to the Military
 Retirement Fund...............
Revolving, trust and other DOD      1,100,000                  1,100,000
 Mandatory.....................
Offsetting receipts............    -1,794,000                 -1,794,000
Subtotal, Budget Sub-Function       6,155,000                  6,155,000
 051...........................
Energy employees occupational       1,165,000                  1,165,000
 illness compensation programs
 and other.....................
Subtotal, Budget Sub-Function       1,165,000                  1,165,000
 053...........................
Radiation exposure compensation        57,000                     57,000
 trust fund....................
Payment to CIA retirement fund        514,000                    514,000
 and other.....................
Subtotal, Budget Sub-Function         571,000                    571,000
 054...........................
Total National Defense              7,891,000                  7,891,000
 Mandatory (050)...............

Budget Authority Implication, National Defense Discretionary and
 Mandatory
Department of Defense--Military   620,088,112      197,035   620,285,147
 (051).........................
Atomic Energy Defense              19,141,004     -431,014    18,709,990
 Activities (053)..............
Defense-Related Activities          7,739,000                  7,739,000
 (054).........................
Total BA Implication, National    646,968,116     -233,979   646,734,137
 Defense Discretionary and
 Mandatory.....................
------------------------------------------------------------------------

            DIVISION A--DEPARTMENT OF DEFENSE AUTHORIZATIONS

                          TITLE I--PROCUREMENT

              Subtitle A--Authorization of Appropriations

Authorization of appropriations (sec. 101)
    The committee recommends a provision that would authorize 
appropriations for procurement activities at the levels 
identified in section 4101 of division D of this Act.

                       Subtitle B--Army Programs

Multiyear procurement authority for Army CH-47F helicopters (sec. 111)
    The committee recommends a provision that would authorize 
the Secretary of the Army to enter a multiyear procurement 
contract in accordance with section 2306b of title 10, United 
States Code, for up to 5 years for Army CH-47F Chinook 
helicopters.
    The committee has taken the position that committing the 
Department of Defense, Congress, and the taxpayers to multiyear 
contracts is justified only when the multiyear contract results 
in substantial savings that would not be achieved by annual 
contracts and meets other statutory criteria. In this case, the 
Army is projecting savings for this next multiyear contract, if 
authorized, to be just over 10 percent. The committee 
recommends supporting the request for multiyear contract 
authority, but directs the Secretary of the Army to provide the 
congressional defense committees with an annual briefing during 
the execution of this contract on progress achieved in meeting 
or exceeding the projected savings used to justify granting 
this authority. This briefing shall accompany the Army's annual 
budget request.

                       Subtitle C--Navy Programs

Refueling and complex overhaul of the U.S.S. Abraham Lincoln (sec. 121)
    The committee recommends a provision that would authorize 
the Secretary of the Navy to provide funding for the refueling 
and complex overhaul of the U.S.S. Abraham Lincoln 
incrementally over a 2-year period.
Ford-class-aircraft-carriers (sec. 122)
    The committee recommends a provision that would authorize 
the Secretary of the Navy to buy Ford-class aircraft carriers 
designated CVN-79 and CVN-80 over a 6-year period, rather than 
over a 5-year period as currently allowed.
Limitation on availability of amounts for second Ford-class aircraft 
        carrier (sec. 123)
    The committee recommends a provision that would limit 
fiscal year 2013 obligations for the Ford-class aircraft 
carrier program to 50 percent of the amount in the budget, 
pending submission of a report by the Secretary of the Navy to 
the congressional defense committees setting forth a 
description of the program management and cost control measures 
that will be employed in constructing the second Ford-class 
aircraft carrier.
    The Secretary would be required, at a minimum, to describe 
a plan to:
          (1) maximize planned work in shops and early stages 
        of construction;
          (2) sequence construction of structural units to 
        maximize the effects of lessons learned;
          (3) incorporate design changes to improve 
        producibility for the Ford-class aircraft carriers;
          (4) increase the size of erection units to eliminate 
        disruptive unit breaks and improve unit alignment and 
        fairness;
          (5) increase outfitting levels for assembled units 
        before erection in the dry-dock;
          (6) increase overall ship completion levels at each 
        key construction event;
          (7) improve facilities in a manner that will lead to 
        improved productivity; and
          (8) ensure the shipbuilder initiates plans that will 
        improve productivity through capital improvements that 
        would provide targeted return on investment, 
        including--
                  (a) increasing the amount of temporary and 
                permanent covered work areas;
                  (b) adding ramps and service towers for 
                improved access to work sites and the dry-dock; 
                and
                  (c) increasing lift capacity to enable 
                construction of larger, more fully outfitted 
                superlifts.
    The committee also expects the Secretary of the Navy to re-
certify the statutory cost cap for the CVN-79 and that the Navy 
and the contractor will build this ship within the amount 
permitted by law.
Multiyear procurement authority for Virginia-class submarine program 
        (sec. 124)
    The committee recommends a provision that would authorize 
the Secretary of the Navy to buy Virginia-class submarines 
under a multiyear procurement contract. This would be the third 
multiyear contract for the Virginia-class program. The Navy 
estimates that the previous two multiyear procurement contracts 
(fiscal years 2003-2008 and fiscal years 2009-2013) achieved 
savings of greater than 10 percent as compared to annual 
procurements. For the third contract (for fiscal years 2014-
2018), the Navy is estimating that the expected savings will be 
14 percent for the multiyear approach as compared to annual 
procurement contracts.
    The Navy is expecting that the number of attack submarines 
will fall short of meeting the requirement in each of the 13 
years (2022-2034), starting in the next decade, when the 
inventory of attack submarines will be below the requirement of 
48 boats. The committee appreciates that fiscal year 2014 is 
the only year for the foreseeable future where we might afford 
to buy an additional attack submarine to mitigate that 
shortfall. In other years, we are already buying two boats or 
more, or a single attack submarine and a ballistic missile 
submarine. The next opportunity where the Navy intends to buy 
only one boat is 2036, far too late to have any effect on the 
projected requirements shortfall.
    Therefore, the provision would also permit the Navy to use 
incremental funding within the second and third multiyear for 
the explicit purpose of buying an extra boat in 2014. During 
budget deliberations surrounding the fiscal year 2013 budget, 
the Navy had to delete one of the two boats planned for fiscal 
year 2014 due to top line pressures on the budget, not due to 
any schedule or cost performance issues. The Navy believes 
that, if the Navy were allowed to incrementally fund the boats 
within these years, the Navy could buy an additional and 
restore the rate of two per year in 2014 without requiring 
additional resources. This would have two-fold benefit of 
stabilizing production at a more affordable rate, and reducing 
the planned shortfall of attack submarines in each of the 13 
years when the Navy attack submarine inventory falls short of 
requirements, and would be consistent with congressional 
authorization in section 2308 of title 10, United States Code, 
for the Secretary to buy-to-budget.
    The committee appreciates that multiyear procurement 
authority already represents a departure from the full funding 
policy. In addition to the normal advance procurement (which is 
a lesser departure from full funding in itself), multiyear 
procurement authority allows the Department to contract for 
parts and construction effort on procurement items for which 
full funding has not been provided. The committee believes 
that, facing the choice between living with a shortfall in 
requirements and with a very stable production program, 
departing from the full funding policy for this very important 
program is an appropriate step at this time.
    The committee also recommends an increase of $777.7 million 
in advance procurement to provide a down payment on the second 
boat in fiscal year 2014.
Multiyear procurement authority for Arleigh Burke-class destroyers and 
        associated systems (sec. 125)
    The committee recommends a provision that would authorize 
the Secretary of the Navy to buy up to 10 Arleigh Burke-class 
Flight IIA destroyers under a multiyear procurement contract. 
This would be the third multiyear contract for the Arleigh 
Burke-class program. The Navy estimates that the previous two 
multiyear procurement contracts (fiscal years 1998-2001 and 
fiscal years 2002-2005) achieved savings of greater than $1.0 
billion, as compared to annual procurements. For the third 
contract (for fiscal years 2013-2017), the Navy is estimating 
that the expected savings will be 8.7 percent, or in excess of 
$1.5 billion, for the multiyear approach as compared to annual 
procurement contracts.
    While the Navy's shipbuilding plan currently provides for 
only nine Arleigh Burke-class destroyers during the period of 
the planned multiyear contract, the committee understands from 
the Navy that competition between the two shipyards in fiscal 
year 2011 and 2012 has led to significant savings in the 
program compared to the original budget request. The Navy 
program office believes that competition for the multiyear 
contract starting in fiscal year 2013 could also yield 
additional savings, and that the sum total of those savings 
might be sufficient to purchase an additional destroyer in 
fiscal year 2014. The committee is recommending approval of a 
multiyear authority for up to 10 ships with the prospect that 
the Navy may be able to combine the savings from fiscal years 
2011, 2012, and 2013 and buy an additional destroyer, which is 
consistent with congressional authorization in section 2308 of 
title 10, United States Code, for the Secretary to buy-to-
budget.
    The committee believes that continued production of Arleigh 
Burke-class destroyers is critical to provide required forces 
for sea-based ballistic missile defense (BMD) capabilities. The 
Navy envisions that, if research and development activities 
yield an improved radar suite and combat systems capability, 
they would like to install those systems on the destroyers in 
fiscal years 2016 and 2017, at which time the designation for 
those destroyers would be Flight III. Should the Navy decide to 
move forward with the integration of an engineering change 
proposal (ECP) to incorporate a new BMD capable radar and 
associated support systems during execution of this multiyear 
procurement, the Secretary of the Navy shall submit a report to 
the congressional defense committees, no later than with the 
budget request for the year of contract award of such an ECP. 
The report will contain a description of the final scope of 
this ECP, as well as the level of maturity of the new 
technology to be incorporated on the ships of implementation 
and rationale as to why the maturity of the technology and the 
capability provided justify execution of the change in 
requirements under that ECP during the execution of a multiyear 
procurement contract.
Authority for relocation of certain Aegis weapon system assets between 
        and within the DDG-51 class destroyer and Aegis Ashore Programs 
        in order to meet mission requirements (sec. 126)
    The committee recommends a provision that would allow the 
Defense Department to transfer AEGIS weapon systems (AWS) 
equipment between ships in the DDG-51 class destroyer program, 
or between the DDG-51 class destroyer program and Missile 
Defense Agency's (MDA) AEGIS Ashore Program, part of the 
European Phased, Adaptive Approach to missile defense. The 
Department anticipates that under the current budgets, MDA will 
be unable to obtain AWS equipment with ballistic missile 
defense (BMD) capability to support its first planned Aegis 
Ashore deployment in December 2015. If MDA is going to maintain 
that schedule, MDA would have to take delivery of AWS equipment 
with BMD capability in February 2013, to complete appropriate 
system integration and testing prior to shipment to the 
deployment site. MDA is requesting research, development, test, 
and evaluation funds in the fiscal years 2012 and 2013 budgets 
for the AWS equipment for the first deployment, but AWS 
equipment production lead times will not support delivery of an 
AWS with BMD capability in 2013 using those MDA funds alone. 
This provision would allow the Department to support the first 
MDA deployment by diverting AWS equipment from the DDG-51 
program to support the MDA, and, using the MDA contract dollars 
to replace that diverted AWS equipment, still support the 
planned delivery dates of the AEGIS destroyers.
Designation of mission modules of the littoral combat ship as a major 
        defense acquisition program (sec. 127)
    The committee recommends a provision that would require the 
Secretary of Defense to designate the effort to develop and 
produce all variants of the mission modules in support of the 
Littoral Combat Ship program as a major defense acquisition 
program under section 2430 of title 10, United States Code.
    The committee seeks greater visibility into the procurement 
costs associated with mission modules supporting the Littoral 
Combat Ship program. The committee believes that, to ensure 
that it has the visibility required to fully understand and 
closely track the costs of developing and producing each 
variant of the mission module, the overall effort should be 
designated as a major defense acquisition program (MDAP). In so 
doing, the committee expects to receive all of the cost, 
schedule, and performance information on this effort that is 
typically produced in connection with typical MDAPs, including, 
selected acquisition reports, unit cost reports and program 
baselines. The committee hopes that this initiative will help 
discipline how the Department of the Navy has structured its 
plan to develop and produce each variant of the mission modules 
and improve Congress' ability to subject the overall effort to 
strong oversight.
    As part of this initiative, the committee directs the 
Secretary of the Navy to provide the congressional defense 
committees, no later than 30 days after enactment of this Act, 
with the Department of the Navy's estimates as to the cost of 
completing the development and production of each mission 
module, operative as of May 31, 2012.
    The committee understands that in the fourth quarter of 
2012, the Department of the Navy expects to approve the mission 
modules for entry into Milestone B, that is, the engineering 
and manufacturing development phase of the Defense Acquisition 
Management System. At that time, the committee expects that the 
Milestone Decision Authority will certify that, as required 
under section 2366b of title 10, United States Code, reasonable 
cost and schedule estimates have been developed to execute, 
with the concurrence of the Director of the Cost Assessment and 
Program Evaluation, the product development and production plan 
under the program. To ensure that the Department of the Navy's 
plans to develop and produce these mission modules is realistic 
and affordable, the committee looks forward to receiving these 
cost and schedule estimates, will exercise close oversight of 
this certification, and expects that the Department will not 
waive the certification.
Transfer of certain fiscal year 2012 Procurement of Ammunition, Navy 
        and Marine Corps funds (sec. 128)
    The committee recommends a provision that, to the extent 
provided in appropriations acts, the Secretary of the Navy may 
transfer $88.3 million of fiscal year 2012 funds made available 
for ammunition procurement for the Marine Corps to other higher 
priority programs. These funds are excess to Marine Corps needs 
for the procurement of small arms, 60mm and 81mm mortar rounds, 
grenades, artillery rounds, demolition munitions, and fuses. 
According to the Government Accountability Office, funds for 
procurement of these items are excess to need as a result of a 
change in the methodology for calculating consumption 
requirements for training, war reserves, and operations.
Transfer of certain fiscal year 2012 Procurement, Marine Corps funds 
        for procurement of weapons and combat vehicles (sec. 129)
    The committee recommends a provision that, to the extent 
provided in appropriations acts, the Secretary of the Navy may 
transfer $135.2 million of fiscal year 2012 funds made 
available for procurement of weapons and combat vehicles for 
the Marine Corps to other higher priority programs. These funds 
are excess to Marine Corps needs for the procurement of the 
Light Armored Vehicle-25 (LAV-25) due to a reduction in the 
number of such vehicles that the Marine Corps intends to buy 
and sustain in the inventory.
    For the same reason, the committee recommends a reduction 
of $140.0 million to the budget request for LAV-25 procurement 
for fiscal year 2013.
Sense of Congress on Marine Corps amphibious lift and presence 
        requirements (sec. 130)
    The committee recommends a provision that would express the 
sense of Congress that:
          (1) the Department of Defense should carefully 
        evaluate the maritime force structure necessary to 
        execute demand for forces by the commanders of the 
        combatant commands;
          (2) the Department of the Navy carefully evaluate 
        amphibious lift capabilities to meet current and 
        projected requirements;
          (3) the Department of the Navy should consider 
        prioritization of investment in and procurement of the 
        next-generation of amphibious assault ships, as a 
        component of the balanced battle force;
          (4) the next-generation amphibious assault ships 
        should maintain survivability protection;
          (5) operation and maintenance requirements analysis, 
        as well as the potential to leverage a common hull form 
        design, should be considered to reduce total ownership 
        cost and acquisition cost; and
          (6) maintaining a robust amphibious ship building 
        industrial base is vital for the future of the national 
        security of the United States.
Sense of Senate on Department of Navy fiscal year 2014 budget request 
        for tactical aviation aircraft (sec. 131)
    The committee recommends a provision that would express the 
sense of the Senate that, if the budget request of the 
Department of the Navy for fiscal year 2014 for F-18 aircraft 
includes a request for funds for more than 13 new F-18 
aircraft, the budget request of the Department of the Navy for 
fiscal year 2014 for F-35 aircraft should include a request for 
funds for not fewer than 6 F-35B aircraft and 4 F-35C aircraft, 
presuming that development, testing, and production of the F-35 
aircraft are proceeding according to current plans.

                     Subtitle D--Air Force Programs

Reduction in number of aircraft required to be maintained in strategic 
        airlift aircraft inventory (sec. 141)
    The committee recommends a provision that would amend 
section 8062(g)(1) of title 10, United States Code, to reduce 
the number of strategic airlift aircraft the Air Force must 
maintain from 301 aircraft to 275 aircraft. It would also 
correspondingly change the certification requirement in section 
137 of the National Defense Authorization Act for Fiscal Year 
2010 (Public Law 111-84). Finally, it would require that the 
Secretary of the Air Force maintain any C-5A aircraft retired 
after September 30, 2012, in inviolate storage with only the 
Secretary of Defense permitted to authorize the Air Force to 
take any spare parts from those aircraft.
Treatment of certain programs for the F-22A Raptor aircraft as major 
        defense acquisition program (sec. 142)
    The committee recommends a provision that would require 
that the Air Force report F-22A modernization and upgrade 
programs under the system of the Selected Acquisition Reports 
(SAR). The committee was informed that, with new production of 
the F-22A coming to an end, the Air Force intends to stop 
reporting within the SAR system on the F-22A, despite the fact 
that there could be as much as $11.7 billion remaining to be 
spent on defined F-22A upgrade programs. The committee believes 
the category ``major defense acquisition programs'' is not 
limited only to programs that are acquiring brand new weapon 
systems, and that any F-22A program for modifications or 
upgrades, if it would otherwise meet the statutory definition 
of a major defense acquisition program, should be treated that 
way.
    The committee believes there is ample justification for 
continuing to track F-22A modernization past the end of new 
production.
    (1) In April 2012, the Government Accountability Office 
(GAO) issued a report on the program to modernize the F-22A 
Raptor fleet, estimated to cost almost $10.0 billion through 
2023. In this report, GAO noted that similar efforts to 
modernize Air Force and Navy tactical fighters in the past 
involved building upgrades into newly produced jets, resulting 
in entirely new, fresh airplanes.
    (2) In another report, issued in May 2012, GAO found that 
the total projected cost to modernize the F-22A Raptor fighter 
jet more than doubled from $5.4 billion to $11.7 billion since 
the program started and the schedule for delivering full 
capabilities slipped 7 years from 2010 to 2017.
    (3) Upgrades to the F-22A are much more complicated than 
those made to other legacy fighters, giving rise to likelihood 
of schedule slips and cost growth.
    (4) With these factors in mind, GAO believes that many of 
the Air Force's F-22A Raptors may not get their long-promised 
capability upgrades until they will have, in some cases, 
expended as much as 20 percent of their service lives. This 
could limit the amount of utility the Air Force will be able to 
extract from this enormously expensive modernization program.

F-22A Raptor Sustainment

    In addition to the near-term modernization, sustainment 
over the life cycle of a weapon system represents a significant 
expenditure of resources. On average, about two-thirds of the 
total life cycle cost of a major defense system lies in post-
production--in its operation and sustainment over its useful 
life. If that rule were to hold true, with a charge of roughly 
$79.0 billion to buy the F-22A, the Air Force could be facing a 
demand for roughly $160.0 billion in F-22A sustainment costs. 
Moreover, under its ``structures retrofit program'', over the 
next few years the Air Force will need more than $100.0 million 
to retrofit the F-22A fleet just to ensure these aircraft can 
fly for the full 8,000 hours for which they were designed. Over 
just the last 2 years, the Air Force issued sole-source 
contracts for sustainment of the F-22A fleet to the prime 
contractor totaling almost $1.4 billion.
    The Air Force recently completed an F-22A sustainment 
strategy review that concluded that a joint contractor/
government approach could save more than $1.0 billion in 
sustainment costs over the life of the aircraft. The committee 
believes that the Air Force must transition its sustainment 
strategy to adopt the least expensive sustainment strategy now, 
while continuing to be aggressive in exploring opportunities to 
compete F-22A sustainment work.

F-22A Raptor Pilot Air-Supply Problems

    The Air Force has been having problems with the oxygen-
supply for its F-22A Raptor pilots. The committee is aware of, 
and has been closely monitoring, these problems. The Air Force 
has documented 11 reported incidents of hypoxia-like symptoms 
in 10,000 sorties (about 0.1 percent) since late 2011, with 6 
of these incidents having occurred as recently as February and 
March 2012. Since reports of pilots experiencing hypoxia-like 
symptoms in flight first arose, the Secretary of the Air Force, 
among other actions, directed the Air Force Scientific Advisory 
Board (SAB) to conduct a quick-look study; gather and evaluate 
information; and recommend any corrective actions on aircraft 
using on-board oxygen generation systems. Unfortunately, to 
date, the Air Force has not been able to identify conclusively 
a root cause for the problem. But, the committee has been 
assured that the Air Force has put in place measures intended 
to ensure that these aircraft are safe to fly, including new 
commercial oxygen status sensors and emergency oxygen handles 
in the aircraft. For this reason, after having grounded the 
fleet after initial reports of hypoxia-related symptoms in its 
pilots late last year, the Air Force returned the F-22A to 
flying under its full mission envelope and, in fact, deployed 
it to Southwest Asia and the United Arab Emirates in late 
April. Despite that a small number of pilots have asked not to 
fly the F-22A or to be reassigned because of this issue, Air 
Force leadership has conveyed to the committee that, while the 
Air Force continues to investigate this problem, these aircraft 
are safe to fly today.
    Notably, the Navy had similar problems with F-18s; there 
were 64 incidents from 2002 to 2009, resulting in 2 deaths. 
Ultimately, however, the Navy overcame these problems. The 
committee remains hopeful that the Air Force will be similarly 
successful. In the meantime, the committee will continue to 
exercise close oversight of this problem and how the Air Force 
addresses it. The committee directs the Secretary of the Air 
Force to explain, no later than 90 days after enactment of this 
Act, how the Air Force has implemented or will implement each 
of the recommendations provided by the SAB. If the Secretary 
disagrees with any of these recommendations, he should explain 
why and describe what other corrective actions he may be taking 
to respond to the concern underlying that recommendation.
    Finally, as the Air Force continues to investigate this 
matter, the committee will view as unacceptable any act of 
retaliation against any F-22A Raptor pilot who raises concerns 
about the safety of this aircraft or declines to fly it on that 
basis.

Avionics systems for C-130 aircraft (sec. 143)

    The committee recommends a provision that would delay Air 
Force implementation of the cancellation or modification of the 
Avionics Modernization Program for the C-130 aircraft until 30 
days after the receipt of a report submitted to the 
congressional defense committees.

Procurement of space-based infrared system satellites (sec. 144)

    The committee recommends a provision that would authorize 
the Secretary of the Air Force to acquire two Space Based 
Infrared System Satellites (SBIRS) under a fixed price 
contract. The provision would further cap the total cost of the 
satellites at $3.9 billion but provide limited exceptions to 
this cap. The provision would also permit the Secretary to 
incrementally fund the contract over a 6 year period.
    Thirty days after entering into the contract, the provision 
would direct the Secretary to submit a report to the 
congressional defense committees setting forth the specifics of 
the contract, which would include the cost savings and total 
cost of the contract. A second report would be due 90 days 
after the date of the contract describing the amount of the 
cost savings achieved and how the Secretary plans to use the 
savings to improve the capability of military infrared and 
early warning satellites. In addition, the provision would 
authorize the Secretary to use prior year funds for advance 
procurement for SBIRS satellite 6. Finally, the provision would 
set forth a sense of Congress that the cost savings achieved 
through the contracting authority provided in the provision 
should result in no less than 20 percent cost savings.

Transfer of certain fiscal year 2011 and 2012 funds for aircraft 
        procurement for the Air Force (sec. 145)

    The committee recommends a provision that would permit the 
Secretary of the Air Force to use, subject to appropriations, 
prior year funds that have been made available from program 
cancellations reflected in the fiscal 2013 budget request. The 
funds available from cancellations are as follows:

------------------------------------------------------------------------
                                                    Recommended Amount
                    Program                       (Dollars in millions)
------------------------------------------------------------------------
Light attack armed reconnaissance..............                   $115.0
Light mobility aircraft........................                     65.3
Common vertical lift support platform..........                     52.8
C-130 avionics modernization program...........                    207.2
RQ-4 Global Hawk Block 30......................                    480.4
                                                ------------------------
    Total......................................                   $920.7
------------------------------------------------------------------------

               Subtitle E--Joint and Multiservice Matters


Multiyear procurement authority for V-22 Joint Aircraft Program (sec. 
        151)

    The committee recommends a provision that would authorize 
the Secretary of the Navy to buy V-22 aircraft for the 
Department of the Navy, the Department of the Air Force, and 
the United States Special Operations Command under a multiyear 
procurement contract. This would be the second multiyear 
contract for the V-22 program. The Navy estimates that for the 
second contract (for fiscal years 2013-2017), the Navy stands 
to achieve almost 12 percent savings under the multiyear 
approach, as compared to annual procurement contracts.

Limitation on availability of funds for full-rate production of 
        Handheld, Manpack, and Small Form/Fit radios under the Joint 
        Tactical Radio System program (sec. 152)

    The committee recommends a provision that would prohibit 
the obligation of any funds for full rate production of the 
Joint Tactical Radio System (JTRS), Handheld, Manpack, and 
Small Form/Fit (HMS) radios until the Under Secretary of 
Defense for Acquisition, Technology, and Logistics (USD-ATL) 
certifies to the congressional defense committees that there is 
an approved acquisition strategy that promotes full and open 
competition to the maximum extent practicable.
    The committee continues to support the JTRS program and 
remains convinced that managing program costs through 
competition will contribute significantly to the success and 
affordability of the Army's tactical network objectives. The 
committee is also aware that for over a year the Joint Program 
Office for JTRS has been preparing a detailed plan for an 
innovative acquisition model that would take advantage of 
competition based upon the availability of several developers 
of software programmable tactical radios that could meet the 
standards of JTRS. Accordingly, in last year's Senate report 
accompanying S. 1253 (S. Rept. 112-26) of the National Defense 
Authorization Act for Fiscal Year 2012, the committee directed 
that the USD-ATL provide a briefing on the approved competition 
strategy for JTRS HMS radios. The committee is concerned that 
after nearly 1 year there is still no approved competition 
strategy and that additional delay will make it more difficult 
for potential JTRS tactical radio producers to meet the Army's 
testing, certification, competition, and production objectives. 
The committee believes that competition, taking maximum 
advantage of both government and commercially developed and 
available tactical radios that meet JTRS technical and 
operational requirements, provides the Army the most affordable 
and flexible means of realizing its plans for a fully networked 
operational force.

Shallow Water Combat Submersible Program (sec. 153)

    On November 9, 2010, U.S. Special Operations Command 
(USSOCOM) provided the committee with a notification that the 
Command had awarded a sole source contract for the Shallow 
Water Combat Submersible (SWCS) program and stated ``the 
contract provides only for firm-fixed-price task orders which 
are established in the contract.'' USSOCOM has requested a 
modification to its fiscal year 2013 budget request that would 
transfer $8.0 million from Procurement, Defense-wide, to 
Research, Development, Test, and Evaluation, Defense-wide, to 
pay for cost growth in the engineering and manufacturing 
development phase of the SWCS program. According to U.S. 
USSOCOM, ``extreme schedule variations from the baseline 
resulted in the inability to accurately track progress and 
cost.'' In response to an inquiry from committee staff 
following notification of SWCS cost and schedule variations, 
USSOCOM indicated ``the contract has a combination of cost 
contract line items and firm fixed price contract line items.''
    The committee is concerned by the inaccurate and misleading 
contract notification described above and that it only learned 
of the projected SWCS schedule and cost overruns following the 
release of the fiscal year 2013 budget. The committee expects 
full and accurate notification of contract awards and 
reiterates its expectation that USSOCOM will keep it adequately 
informed of such acquisition program deviations at the time 
they are identified.
    The committee recommends a provision that would require the 
Commander of USSOCOM, not later than 90 days after enactment of 
this Act, to provide the congressional defense committees with 
a report describing: efforts by the contractor and USSOCOM to 
more accurately track schedule and cost; the revised timeline 
for SWCS initial and full operational capability; and the 
projected cost to meet the basis of issue requirement. The 
provision would also require that the Commander submit 
quarterly updates on the metrics from the earned value 
management system with which the Command is tracking cost and 
scheduled performance of the contractor. That requirement shall 
lapse once the SWCS has completed operational testing and has 
been found to be operationally effective and operationally 
suitable.

                              Budget Items


                                  Army


Joint tactical radio systems integration

    The budget request included $46.8 million in Aircraft 
Procurement, Army (APA), for the integration of the Joint 
Tactical Radio System (JTRS) onto the UH-60M Black Hawk and CH-
47 Chinook helicopters. The committee notes that the airborne 
and maritime/fixed portion of the JTRS program is in the 
process of a restructuring that will result in an updated 
acquisition strategy, revised acquisition program baseline, and 
updated test and evaluation master plan. It is unlikely that 
JTRS radios will be available for integration before the end of 
fiscal year 2014. The committee recommends a decrease of $44.0 
million in APA for aircraft integration of the JTRS radio.

M88A2 improved recovery vehicle

    The budget request included $107.9 million in Weapons and 
Tracked Combat Vehicles, Army (WTCV), for the M88A2 (Hercules) 
improved recovery vehicle. The committee notes that the M88A2 
is an upgrade program to the existing M88A1 recovery vehicle 
making it the only vehicle capable of towing an M1 Abrams tank 
without assistance from other vehicles. The Army planned to use 
a mixed fleet of M88A2s and older M88A1s in its armor brigade 
combat teams. M1 Abrams tanks require M88A2 recovery vehicles, 
but the current M2 Bradley vehicles, and other armored vehicle 
variants, can be recovered by the M88A1. The Army would 
reconsider its recovery vehicle mix, if any, when the M2 
Bradley replacement Ground Combat Vehicle program matures and 
the recovery requirements of that vehicle are known. In the 
meantime, there is risk of a suspension of the industrial 
capability and capacity for production of M88A2 vehicles, as 
well as likely production of the Paladin Integrated Management 
program, and the potential production of a replacement for the 
M113 family of armored personnel carriers.
    The committee recommends an increase of $123.0 million in 
WCTV for the M88A2 improved recovery vehicle to mitigate the 
risk of the suspension of production through fiscal year 2013.

Advanced procurement for M1 Abrams tank upgrade program

    The budget request included $74.4 million in Weapons and 
Tracked Combat Vehicles, Army (WTCV), for the M1 Abrams tank 
upgrade program. The budget request funds technical support 
services and the cost of fielding M1A2 System Enhancement 
Package (SEP) tanks to the Army, but does not fund additional 
tank upgrades. The committee recommends an increase of $91.0 
million in WTCV only for the advanced procurement of critical 
long-lead materials for the Abrams upgrade program.
    The committee is aware that beginning in fiscal year 2014 
the Army will suspend its M1 Abrams tank upgrade program for up 
to 3 years at which time it plans to start its next series of 
improvements. Congress provided additional funds in the fiscal 
year 2012 appropriation to sustain tank production at the 
facility through 2013 and into 2014. However, not enough tank 
upgrade production is funded in the fiscal year 2013 request to 
sustain the facility throughout 2014.
    The Army's tank industrial base and production facility 
could sustain its minimum capability and capacity over the next 
3 years if a number of potential tank and other armored vehicle 
sales to foreign allies are approved and orders finalized over 
the next several months. If all projected and potential foreign 
sales materialize, armored vehicle production could exceed the 
minimum sustaining requirement asserted by the contractor until 
the Army starts its next tank upgrade program.
    Given that funds added by Congress in fiscal year 2012 
already sustains production through fiscal year 2013, the 
industrial base risk is limited to long-lead materials related 
to potential production shortfalls in fiscal year 2014. 
Accordingly, in order to reduce industrial risk among second 
and third tier suppliers, the committee recommends an increase 
of $91.0 million in WTCV for advance procurement of long-lead 
materials for 33 additional tanks in the M1 Abrams upgrade 
program. Advanced procurement is common to many large, complex 
weapon systems programs in which funds are provided in 1 or 
more years prior to the year of final production in order to 
ensure the availability of those components that require a long 
time to produce for installation at the appropriate point in 
the assembly process.
    Additional funds for M1 Abrams tank upgrade advanced 
procurement should be targeted in a manner that best mitigates 
the most acute criticality and fragility risks in the 
industrial base among small suppliers who are in danger of 
getting out of the tank components business 6 months or more 
ahead of final tank production. The committee expects the Army 
to use data developed by the Department of Defense's ongoing 
sector by sector/tier by tier analysis of the defense 
industrial base in making decisions on the allocation of these 
funds.
    Supporting long-lead suppliers with additional funds in 
fiscal year 2013 also manages financial risk in this 
challenging budget environment and allows time for the 
resolution of sales to foreign allies that could stabilize and 
sustain the flow of workload throughout the production cycle 
for the Army's facility and suppliers. Congress retains the 
flexibility to fund the completion of this tank production, if 
necessary to sustain the facility's minimum requirements, in 
fiscal year 2014.
    Finally, the committee recognizes that the Army is working 
through force structure and capability mix analysis and 
decision making processes that to a significant extent will 
determine the demand for tank production for the next 10 or 
more years. Additionally, the Defense Department's and Army's 
increased focus on building the capacity of partner nations 
will create particular combat vehicle production demands. 
Accordingly, the committee directs the Secretary of the Army to 
report not later than March 31, 2013, on the Army's analysis 
and plans to utilize and configure it's government-owned/
contractor-operated tank production facility to efficiently and 
effectively meet the Army's tank and other tracked and wheeled 
vehicle production related requirements and foreign military 
sales to meet Department partnership building capability goals 
to 2025 and beyond.

Lightweight .50 caliber machine gun

    The budget request included $25.2 million in Weapons and 
Tracked Combat Vehicles (WTCV), Army, for the XM806 lightweight 
.50 caliber machine gun. The committee understands that the 
Army will terminate this program and therefore recommends a 
decrease of $25.2 million in WCTV for the XM806 lightweight .50 
caliber machine gun.
    The committee also understands that the decision to cancel 
the XM806 program was based on the Army's recalculation of its 
machine gun requirements given pending force structure 
reductions and cost tradeoffs compared to upgrading the 
currently fielded version of the M2A1 .50 caliber machine gun.
    The committee is concerned that this decision may be 
inconsistent with the Army's broader equipping objectives to 
reduce the soldier's load while at the same time increasing the 
capability and reliability of weapons. Accordingly, the 
committee directs the Secretary of the Army to submit with its 
fiscal year 2014 budget request submission, a report to the 
congressional defense committees on its revised requirements 
for M2 .50 caliber machine guns, in light of proposed force 
structure reductions, with a description of its plan to meet 
those requirements. The report should include: cost and 
schedule plans for the overhaul of M2 .50 caliber weapons 
through the future-years defense program (FYDP); the estimated 
procurement average unit cost of M2 .50 caliber overhaul 
compared to the cost of producing the XM806; the current number 
of M2 and M2A1 machine guns in the Army inventory; the total 
number of .50 caliber machine guns that would be in the 
inventory at the end of the FYDP if funds for M2 overhaul were 
allocated for new XM806 machine guns; the costs and benefits of 
the XM806 compared to M2 and M2A1 weapons; and an assessment of 
the potential impact of the Army's M2 and M2A1 plan to the 
machine gun industrial base.

30mm and 40mm ammunition reductions for excess

    The budget request included $1.7 billion in Procurement of 
Ammunition, Army (PAA), of which $72.1 million was for 30mm and 
$60.1 million was for 40mm.
    The Government Accountability Office has identified $37.0 
million in excess to requirements for 30mm in fiscal year 2013 
due to changes in pricing. Additionally, $75.0 million in 
excess to requirements in fiscal year 2011 funding for 40mm 
ammunition has been identified and has been returned by the 
Army's Program Executive Office for Ammunition to the Army 
Budget Office for potential reprogramming. This funding remains 
available for obligation until September 30, 2013, and if 
released back to the program, $60.1 million could be used to 
cover the Army's entire fiscal year 2013 procurement budget 
request for 40mm ammunition.
    Accordingly, the committee recommends a decrease of $97.1 
million in PAA: $37.0 million in 30mm and $60.1 million in 
40mm.

Excalibur 1-b round schedule delay

    The budget request included $110.3 million in Procurement 
of Ammunition, Army (PAA), for 155mm extended range XM-982 
(Excalibur 1-b).
    The committee was briefed by the Army that the Excalibur 1-
b round will have a schedule delay in fiscal year 2013.
    Accordingly, the committee recommends a decrease of $55.0 
million in PAA for 155mm extended range XM-982 munitions.

Spider network munitions reduction

    The budget request included $1.7 billion in Procurement of 
Ammunition, Army (PAA), of which $17.4 million was for Spider 
network munitions.
    The Director of Operational Test and Evaluation expressed 
concerns with respect to the XM-7 Spider.
    Accordingly, the committee recommends a decrease of $14.3 
million in PAA for Spider network munitions.

Family of medium tactical vehicles

    The budget request included $346.1 million in Other 
Procurement, Army (OPA), for the procurement of Family of 
Medium Tactical Vehicle (FMTV) trucks. The committee recommends 
an increase of $50.0 million in OPA for FMTV trucks for the 
U.S. Army Reserve.

Joint tactical radio system airborne and maritime/fixed radios

    The budget request included $74.0 million in Other 
Procurement, Army (OPA), for the procurement of airborne and 
maritime/fixed (AMF) radios. The committee notes that the AMF 
portion of the Joint Tactical Radio System program is in the 
process of a restructuring that will result in an updated 
acquisition strategy, revised acquisition program baseline, and 
updated test and evaluation master plan. It is unlikely that 
JTRS radios will be available for integration onto Army 
helicopters before the end of fiscal year 2014. The committee 
recommends a decrease of $30.0 million in OPA for AMF radio.

Spider remote control unit

    The budget request included $34.4 million in Other 
Procurement, Army (OPA), for the Spider remote control unit. 
The committee notes that this technology is not performing as 
expected and will not be approved for service use until awarded 
a full material release and type classification late in fiscal 
year 2013. The committee recommends a decrease of $21.0 million 
in OPA for Spider remote control units.

Sense-through-the-wall sensor program

    The budget request included $6.2 million in Other 
Procurement, Army (OPA), for the sense-through-the-wall (STTW) 
sensor. The committee notes that the program has been delayed 
due to technology performance issues and that most of the funds 
provided in prior year appropriations remains unobligated. The 
committee recommends a decrease of $6.2 million in OPA for 
STTW.

Small unmanned ground vehicle

    The budget request included $83.9 million in Other 
Procurement, Army (OPA), for the small unmanned ground vehicle 
(SUGV). At the Army's request, the committee recommends a 
decrease of $12.0 million in OPA for SUGV and an increase of 
$12.0 million in PE 64641A for continued SUGV research and 
development.

             Joint Improvised Explosive Device Defeat Fund


Joint Improvised Explosive Device Defeat Fund

    The budget request included $227.4 million for the Joint 
Improvised Explosive Device Defeat Fund (JIEDDF) staff and 
infrastructure line of operation. The committee recommends 
transferring all of JIEDDF funds from title I to the same 
budget activity in title XV, which funds the Overseas 
Contingency Operations (OCO) of the Department. The committee 
believes JIEDDO should be in the OCO portion of the budget 
request as it was established in response to threats confronted 
by U.S. forces in Afghanistan.

                                  Navy


F/A-18E/F

    The budget request included $3,063.6 million to purchase 26 
F/A-18E/F aircraft and 12 EA-18G aircraft. The budget also 
included $30.3 million for advance procurement of 13 F/A-18E/F 
aircraft in fiscal year 2014. Fiscal year 2014 would represent 
the final year of production for the Department of the Navy. 
Throughout the past several years, the committee has expressed 
concern that the Navy is facing a sizeable gap in aircraft 
inventory as older F/A-18A-D Hornets retire before the aircraft 
carrier variant (F-35C) of the Joint Strike Fighter is 
available.
    This year, the Navy says that the maximum shortfall is now 
projected to be around 56 aircraft. The Navy claims that the 
estimated shortfall has not increased much since last year even 
though the Department removed a total of 64 F-35B and F-35C 
aircraft from the future-years defense program (FYDP). The 
Navy's estimate of the shortfall is based on conducting 
intensive management of the current inventory, making some 
reduction in force structure within Marine Corps aviation, and 
pursuing a service life extension program (SLEP) of 150 F/A-18 
aircraft.
    The Navy intends that a SLEP would extend the life of 
select legacy F/A-18s from 8,600 to 10,000 flight hours. As 
yet, the Navy does not have sufficient data to predict the 
failure rate for aircraft being inducted into the SLEP program. 
Too high a failure rate could leave the Navy with too few 
aircraft that could benefit from the SLEP program, which would 
exacerbate the shortfall projections.
    The FYDP projection shows that the Navy intends to buy no 
more EA-18G aircraft, despite the fact that the Marine Corps 
intends to retire their fleet of EA-6B electronic warfare 
aircraft without fielding a direct replacement.
    Either a realization of a larger shortfall of strike 
fighter inventory, or a new requirement to replace the 
capability currently provided by the Marine Corps' EA-6B 
aircraft could result in a demand for more aircraft beyond the 
13 aircraft planned in fiscal year 2014. Therefore, the 
committee believes it would be prudent to provide some 
additional advance procurement funding in fiscal year 2013 to 
allow the Navy and the Defense Department time to get better 
data on the SLEP program and evaluate proposals to increase 
requirements for the EA-18G aircraft to account for the 
impending loss of the EA-6B aircraft. The committee recommends 
an additional $60.0 million for advance procurement for F/A-
18E/F or EA-18G aircraft, to be obligated only if the Navy 
budget request for fiscal year 2014 for F-18 aircraft includes 
buying more than 13 new aircraft.

Close-in weapon system modifications

    The budget request included $59.3 million to purchase and 
install various modifications for the close-in weapon system 
(CIWS), including $9.7 million for reliability, maintainability 
and availability (RMA) kits. The CIWS is the primary, last 
ditch self defense system in the Navy fleet.
    The Navy has begun experiencing reliability problems with 
the latest CIWS version, the Block 1B. To deal with these 
issues, the Navy has developed the RMA kit that will fix known 
reliability problems and also deal with issues of parts 
obsolescence. The Navy can install the RMA kits dockside, 
without having to send the CIWS or its modules to the depot. In 
addition, installing these kits will allow the Navy to extend 
time between major CIWS overhauls to be extended, while still 
maintaining an acceptable level of operational availability. 
The committee believes that the Navy should move more 
expeditiously on fielding these kits to the fleet, and 
recommends an additional $7.7 million to buy 28 additional RMA 
kits.

81mm, grenade, and demolition munitions reductions for excess

    The budget request included $759.5 million in Procurement 
of Ammunition, Navy and Marine Corps (PANMC), of which $13.7 
million was for 81mm, $7.6 million was for grenades, and $2.0 
million was for demolition munitions.
    The Government Accountability Office has identified $12.5 
million in excess to requirements for the Marine Corps' fiscal 
year 2013 ammunition procurement request. Program officials 
stated that changes in Marine Corps' methodology for 
determining ammunition requirements for training, changes to 
assumptions for calculating the necessary war reserves, and the 
large amount of ammunition already in inventory or expected for 
delivery, have made a portion of the fiscal year 2013 budget 
request for specific ammunition types excess to program needs.
    Accordingly, the committee recommends a decrease of $12.5 
million in PANMC: $10.0 million in 81mm, $0.5 million in 
grenades, and $2.0 million in demolition munitions.

                               Air Force


Joint surveillance/target attack radar system

    The budget request included $59.3 million in Aircraft 
Procurement, Air Force (APAF), for the E-8 modifications 
program and $24.2 million in Research, Development, Test, and 
Evaluation (RDT&E), Air Force for Joint Surveillance/Target 
Attack Radar Systems (JSTARS). Unlike previous years, the Air 
Force did not request procurement funding for the program to 
re-engine JSTARS aircraft. A portion of RDT&E funding supports 
continuing system development and demonstration (SDD) in the 
re-engining program. The committee recommends an increase of 
$12.0 million to the budget request for APAF to restart the 
production line for the re-engining program.
    The committee remains concerned by the slow progress of the 
re-engining program despite years of significant congressional 
support. The Air Force decided to delay the re-engining program 
pending an Analysis of Alternatives (AoA) of overall ground 
moving target indicator (GMTI) requirements. Last year, the 
Senate report accompanying S. 1235 (S. Rept. 112-26) of the 
National Defense Authorization Act for Fiscal Year 2012 said, 
``Regardless of what that study concludes, however, the 
committee believes that re-engining the JSTARS fleet makes 
sense. . . . However, even if the Air Force study were to 
conclude that some new system or combination of systems would 
provide better broad area GMTI for the future, it is hard to 
imagine that another alternative would actually begin complete 
fielding of a JSTARS replacement capability before the re-
engining pays for itself.''
    Therefore, the committee was troubled that funding 
authorized and appropriated for re-engining over the past 
several years has either been reprogrammed or remains unspent. 
Last year, the committee recommended a provision requiring the 
Air Force Audit Agency to submit to the congressional defense 
committees the results of a financial audit of the funds 
previously authorized and appropriated for the JSTARS aircraft 
re-engining program. The committee still has not received the 
results of that audit.
    The Air Force has still not produced the AoA either, so the 
budget remains silent on course of action for modernizing GMTI 
capability. However, in testimony before the committee on March 
22, 2012, Air Force Chief of Staff General Norton Schwartz 
confirmed that the Air Force was going to stick with the E-8C 
program, testifying, ``Notwithstanding the AoA . . . we will 
continue with the combination of the JSTARS GMTI capability, 
with the Block 40 Global Hawk.'' This prospect was confirmed in 
the Department of Defense's Annual Aviation Inventory and 
Funding Plan for Fiscal Years 2013-2042, which indicated that 
the Department has no alternatives to JSTARS expected to emerge 
in that 30-year period.
    Since the Air Force will now clearly be keeping the E-8C 
aircraft for the foreseeable future, the committee believes it 
is even more critical that the Air Force budget sufficient 
funds to sustain JSTARS for the long term. The committee 
understands the need to proceed carefully through re-engining 
SDD to collect all necessary data to inform decisions about 
this program, as well as the difficulties associated with 
restarting the re-engining process on a small fleet of aircraft 
in a constant state of high operational tempo.
    However, the committee believes that proceeding with re-
engining of the JSTARS fleet to improve performance and fuel 
efficiency is consistent with warfighter requirements and Air 
Force priorities.
    Also, if the Air Force continues to operate the JSTARS 
platform for the foreseeable future, the Service will have to 
modernize other aspects of the JSTARS airframe and system. To 
keep the JSTARS system viable and avoid erosion in performance, 
the Air Force will have to pursue such modernization efforts as 
upgrading radars, replacing diminishing manufacturing source 
items (including those for primary mission equipment and 
avionics), and improving communications and target 
identification systems. From that perspective, the committee is 
concerned that the current future-years defense program (FYDP) 
includes minimal funding for JSTARS modernization efforts. 
Therefore, the committee believes the Air Force should devote 
increased funding toward JSTARS modernization in the next FYDP 
to ensure that the JSTARS aircraft continue to fly and operate 
for the foreseeable future, without any decrease in mission 
capable rates or system performance.

                              Defense-wide


Terminal High Altitude Area Defense

    The budget request included $460.7 million in Procurement, 
Defense-wide, for procurement of Terminal High Altitude Area 
Defense (THAAD) interceptors. The committee notes that the 
THAAD interceptor system has experienced difficulties with its 
production process and has not yet been able to achieve the 
planned production rate of four interceptors per month. Over 
the past 2 years, this has led Congress to reduce funds below 
the level requested for THAAD interceptor procurement by nearly 
$400.0 million. As a result of these production challenges, the 
schedule for THAAD interceptor deliveries has been delayed and 
reduced significantly.
    In the budget request, the Department of Defense would 
reduce the planned number of THAAD batteries in the future-
years defense program (FYDP) from 9 to 6, and reduce the 
corresponding number of THAAD interceptors by 157. Although the 
Department maintains its previous procurement objective of 503 
THAAD interceptors, this level would not be achieved until 
after the FYDP. According to LTG Richard Formica, the Commander 
of U.S. Army Space and Missile Defense Command, and Commander 
of the Joint Functional Component Command for Integrated 
Missile Defense, the decision to reduce THAAD procurement 
during the FYDP was made by a broad range of senior defense and 
military officials after careful consideration of the 
integrated missile defense priorities of the combatant 
commanders and the need to maintain a balance between homeland 
defense and regional missile defense investments and 
capabilities.
    The committee notes that, as LTG Formica testified, ``the 
demand for THAAD and TPY-2 radars--like the demand for other 
missile defense assets--continues to increase and has not been 
reduced by combatant commanders.'' The committee believes that 
increasing the number of THAAD interceptors is the most cost-
effective and affordable way to provide increased capability to 
regional combatant commanders.
    Therefore, the committee recommends an increase of $100.0 
million to Procurement, Defense-wide, for procurement of 
additional THAAD interceptors.

Special operations aviation

    The budget request included $99.8 million for the 
procurement of seven Aviation Foreign Internal Defense (AvFID) 
aircraft and $7.5 million for low cost modifications to U-28 
aircraft in Procurement, Defense-wide.
    Last year, the congressional defense committees expressed 
concern about the AvFID and Non-Standard Aviation (NSAv) 
programs and required a report from the Commander of U.S. 
Special Operations Command (USSOCOM) describing these programs, 
justifying their requirement, and analyzing efficiencies that 
could be gained from procuring common special operations 
aviation platforms, among other things. On March 5, 2012, the 
Commander of USSOCOM delivered the required report to the 
congressional defense committees with a revised strategy that 
combines special operations AvFID and NSAv missions while 
gaining additional manned intelligence, surveillance, and 
reconnaissance (ISR) capabilities. The committee supports this 
revised strategy because it provides training and maintenance 
efficiencies through the procurement of multi-mission platforms 
for AvFID and NSAv missions, while also increasing much needed 
ISR capacity to support deployed special operations forces.
    Consistent with the new strategy outlined by the Commander 
of USSOCOM, the committee recommends a transfer of $62.8 
million within Procurement, Defense-wide, from the Non-Standard 
Aviation budget line to the U-28 budget line. This transfer 
would reduce AvFID procurement from seven to two aircraft and 
increase the quantity of U-28 aircraft by four. Additionally, 
the committee supports use of previously authorized funds to 
re-mission previously acquired aircraft consistent with the 
strategy laid out by the Commander of USSOCOM.

High definition full motion video

    The budget request included no funding in Procurement, 
Defense-wide, for high definition full motion video (HD FMV) 
capabilities for airborne intelligence, surveillance, and 
reconnaissance (ISR) platforms. The Commander of U.S. Special 
Operations Command (USSOCOM) has indicated that the requirement 
for HD FMV was not quantified until after the fiscal year 2013 
budget request was finalized and has identified it as the only 
fiscal year 2013 unfunded requirement for special operations 
forces.
    In testimony before the Subcommittee on Emerging Threats 
and Capabilities on March 27, 2012, the Assistant Secretary of 
Defense for Special Operations/Low Intensity Conflict stated 
``the high definition capability is a game changer for decision 
makers'' because it provides a greater degree of clarity in 
making decisions regarding the use of force, while minimizing 
the risk of collateral damage. Additionally, the Commander of 
USSOCOM has told the committee ``Recent operational success 
highlighted the need for the HD FMV capability to be fielded on 
special operations platforms as soon as possible.''
    The committee recommends total increases of $142.4 million 
in Procurement, Defense-wide, $16.5 million in Operation and 
Maintenance, Defense-wide, and $0.6 million in Research, 
Development, Test, and Evaluation, Defense-wide, for the 
fielding of additional HD FMV capabilities. The committee is 
aware that USSOCOM intends to begin to address this urgent 
requirement using previously authorized and appropriated funds, 
including $9.5 million in Combat Mission Requirements funds and 
a $29.6 million Above Threshold Reprogramming request.

                       Items of Special Interest


Common remotely operated weapon station

    The committee notes that funding for the common remotely 
operated weapon station (CROWS) has been transferred from the 
Overseas Contingency Operations budget to the Weapons and 
Tracked Combat Vehicles appropriation in the Army's base budget 
for fiscal year 2013. The committee is also aware that the Army 
released a request for proposals in January 2012, to initiate a 
competition for the next-generation of CROWS systems with 
contract award projected for early in fiscal year 2013.
    The committee supports this competitive acquisition 
strategy; however, the Army has not yet decided on a CROWS 
basis of issue plan and therefore there is uncertainty with 
respect to the overall Army acquisition objective for this 
system. The committee is aware that the Army currently has over 
6,400 CROWS systems in its inventory and estimates for an 
acquisition objective vary from as few as just over 11,000 to 
as many as 14,000.
    The committee directs the Assistant Secretary of the Army 
for Acquisition, Logistics, and Technology (ASA-ALT) to notify 
the congressional defense committees when decisions are made 
that establish a CROWS basis of issue plan and an acquisition 
objective. Following notification, the ASA-ALT shall provide a 
briefing that describes the CROWS acquisition strategy 
including a full and open competition, Army acquisition 
objective, other services' acquisition objectives, if any, as 
well as a funding profile and schedule through the future-years 
defense program.

Impact of Global Hawk Block 30 termination

    The committee directs that the Under Secretary of Defense 
for Acquisition, Technology, and Logistics provide a briefing 
to the congressional defense and intelligence committees on the 
likely impact of the termination on the MQ-4C Broad-Area 
Maritime Surveillance System (BAMS) program no later than July 
31, 2012.
    The committee understands that the unit price of the BAMS 
aircraft could also be affected by decisions on the continued 
production of Global Hawk Block 40 aircraft for the North 
Atlantic Treaty Organization (NATO) Alliance Ground 
Surveillance (AGS) program and for the Air Force. Therefore, 
the committee would also like to understand the impact on the 
unit price of BAMS if the NATO AGS program does not proceed 
with the acquisition of five Global Hawk aircraft, or if the 
Air Force terminates its Block 40 program, or if both of these 
contingencies were to occur.

Integrated base defense

    The committee is aware of Department of Defense efforts to 
develop and field technologies that address threats to forward 
stationed and deployed military installations as well as those 
within the United States. The committee is encouraged by the 
inclusion of funds for integrated base defense programs in the 
fiscal year 2013 budget and the potential of a variety of 
technologies that could provide joint, interoperable force 
protection systems and better protect our installations, 
regardless of size, with increased efficiency and 
affordability.
    The committee directs that the Under Secretary of Defense 
for Acquisition, Technology, and Logistics, or his designee, in 
consultation with the Secretaries of the military departments, 
provide the congressional defense committees with a briefing 
not later than March 31, 2013, on the Department of Defense's 
requirements determination and technology development, 
acquisition, and fielding plans to provide capabilities to 
improve integrated base defense systems.

Joint strike fighter program

    Department of Defense (DOD) officials have testified that 
the F-35 ``Lightning II'' Joint Strike Fighter (JSF) program is 
the most concurrent program in DOD recent experience. 
Concurrency refers to the overlap between system development 
and testing, and production. Excessive concurrency arises when 
a program's development and production overlap to the extent 
that major, expensive changes identified in testing have to be 
made in production items after they are on the production line 
or after they are delivered.
    According to JSF's Program Executive Officer, 
``Fundamentally, that was a miscalculation . . . You'd like to 
take the keys to your shiny new jet and give it to the fleet 
with all the capability and all the service life they want. 
What we're doing is, we're taking the keys to the shiny new 
jet, giving it to the fleet and saying, `Give me that jet back 
in the first year. I've got to go take it up to this depot for 
a couple of months and tear into it and put in some structural 
mods, because if I don't, we're not going to be able to fly it 
more than a couple, three, four, five years.' That's what 
concurrency is doing to us.''
    The Acting Under Secretary of Defense of Acquisition, 
Technology, and Logistics was considerably more pointed in his 
assessment, referring to the decision made years ago to put JSF 
into production before flight testing had started as 
``acquisition malpractice.'' He noted that the program was 
started with ``the optimistic prediction that we were good 
enough at modeling and simulation that we would not find 
problems in flight test . . . That was wrong, and now we are 
paying for that.''
    The committee agrees with these appraisals and views them 
as a valuable starting point that may help ensure that the 
additional 33 months and $7.9 billion that DOD has added to the 
previous JSF development plan will result in a sustainable 
program capable of delivering the required capability to the 
warfighter. The committee remains concerned that, even with 
these changes, the level of concurrency risk that still resides 
in the program may be excessive.
    Because of concern about the lack of a coherent concurrency 
change management strategy in the JSF program, the committee 
declined to approve DOD's request to reprogram funds from other 
programs to cover part of a roughly $771.0 million cost overrun 
in low-rate initial production lots (LRIP) lots 1 through 3.
    Unfortunately, the cost growth problem persists. As of 
March 2012, DOD estimates total concurrency costs for LRIP-1 at 
$50.1 million; LRIP-2, $300.3 million; LRIP-3, $319.1 million; 
and LRIP-4, $523.3 million. The committee does not find this 
trend encouraging and believes that the program must ensure 
that these costs are managed more effectively and that the 
prime contractor share equitably in them.
    In addition to concurrency change management, the committee 
is concerned about the JSF program's lack of progress in 
software development. The most recent Selected Acquisition 
Report for this program identified this issue as ``a 
significant area of focus,'' Challenges facing efforts to 
develop and integrate software Block 1B and Block 2A appear to 
be affecting the successful delivery of Block 2B capability. 
While the program has built capacity in the integrated master 
schedule for discovering and dealing with problems in the 
development of Blocks 2 and 3, the potential cascading effect 
of failures to deliver software capability on the balance of a 
major developmental program like JSF can be particularly 
pernicious.
    The committee, therefore, believes that the contracting 
strategy for this program should target improved performance in 
the development of software to ensure that the Block 2A 
schedule will be met. To ensure the dependable delivery of 
needed software capability, the Joint Program Office (JPO) and 
the prime contractor must work collaboratively to properly 
assess software maturity for readiness to proceed to flight-
testing and for production-release; provide for sufficient 
schedule capacity to support the production and delivery of 
unscheduled software builds; move towards automatically 
generated, data-driven capability maturity metrics across the 
entire air-system; and structure the program's management of 
software development to enable premeditated trades among 
capability, cost, and schedule.
    The committee is similarly concerned about production 
quality and whether it is sufficient to ensure the delivery of 
JSF aircraft to the U.S. and its allies at an affordable price. 
The average rate of scrap, rework, and repair at the prime 
contractor's main manufacturing facility from 2009 through the 
first 2 months of 2012 gives rise to concern. Inattention to 
production quality also appears to have contributed to 
discovery of a potentially serious issue with an aperture on 
the aircraft critical to its electronic warfare capability. 
While the full extent of this problem is presently unknown, it 
underscores the fact that DOD and the contractor team must 
rigorously manage production quality.
    With the foregoing in mind, the committee is hopeful about 
an approach that DOD has taken to try to address some of the 
issues described above. Under this approach, called a 
``development dial'' or ``dial-up'' approach, DOD would 
modulate its purchase of future aircraft for which funding has 
been authorized and appropriated based on how the prime 
contractor performs in the areas of concurrency risk reduction, 
software development, flight-testing, and durability.
    While the committee believe this approach holds merit, it 
also believes that the approach's success in incentivizing 
desired contractor performance will require that DOD identify a 
very clear, specific, and realistically achievable set of 
performance criteria upfront. The specificity of these criteria 
should be sufficient to convey to the prime contractor what 
constitutes desired performance and how its performance, once 
rendered, would be assessed. The committee directs DOD to 
provide these criteria to the congressional defense committees 
before they are actually implemented so that the committees may 
assess their efficacy.

Paladin integrated management program

    The committee has observed over many years and programs 
that the challenges of development, testing, production, and 
fielding schedules must be carefully estimated and tradeoffs 
managed to avoid increasing risk and cost to the overall 
program. In the case of the Paladin Integrated Management (PIM) 
program, however, the committee recognizes the potential to 
accelerate elements of the development and production schedules 
that could result in the earlier delivery of improved artillery 
capability to the Army. According to the Army's current 
production schedule, the PIM program will receive a Milestone C 
decision in June 2013, and a full-rate production decision in 
January 2017. The committee is aware that the Army is 
conducting a business case analysis to identify and assess 
options with respect to the cost effectiveness of the program's 
schedule, the health and readiness of the industrial base, and 
opportunities, if any, to accelerate development, production, 
and fielding of this system.
    The committee directs the Secretary of the Army to submit a 
report to the congressional defense committees within 30 days 
of the completion of the business case analysis. The report 
shall include delineation and an assessment of feasible and 
affordable courses of action that includes contract and 
accelerated schedule options and a detailed explanation of any 
program decisions that result from the business case analysis.

Rotary-wing planning tools

    The committee is aware that the Army has no documented 
requirement for a rotary wing performance mission planning tool 
but that a variety of tools and capabilities are available that 
could increase the safety and effectiveness of helicopter 
operations. The committee directs the Secretary of the Army to 
provide a briefing and corresponding data to the congressional 
defense committees by January 31, 2013, assessing the Army's 
current helicopter operations mission planning tools and 
capabilities, and efforts to develop or acquire such 
capabilities if required, suitable, effective, and affordable.

Summary of discretionary authorizations and budget implication

    The administration's budget request for national defense 
discretionary programs within the jurisdiction of the Senate 
Committee on Armed Services for fiscal year 2013 was $631.6 
billion. Of this amount, $525.3 billion was requested for base 
Department of Defense programs, $88.5 billion was requested for 
overseas contingency operations, and $17.8 billion was 
requested for national security programs in the Department of 
Energy and the Defense Nuclear Facilities Safety Board.
    The bill authorizes $631.4 billion in fiscal year 2013, 
including $525.8 billion for base Department of Defense 
programs, $88.2 billion for overseas contingency operations, 
and $17.3 billion for national security programs in the 
Department of Energy and the Defense Nuclear Facilities Safety 
Board.
    The administration's fiscal year 2013 budget for national 
defense also included discretionary programs outside the 
jurisdiction of the Senate Committee on Armed Services, 
discretionary programs that do not require further 
authorization, and mandatory programs that are in current law. 
When these programs are added to the administration's budget 
the request for national defense totaled $646.7 billion.
    The following two tables summarize the direct 
authorizations and the equivalent budget authority levels for 
fiscal year 2013 defense programs. The first table summarizes 
committee action on the authorizations within the jurisdiction 
of this committee. It includes the authorization for spending 
from the trust fund of the Armed Forces Retirement Home which 
is outside the national defense budget function. The second 
table summarizes the total budget authority implication for 
national defense by adding funding for items that are not 
within the jurisdiction of this committee or do not require an 
annual authorization.

Use of advance procurement for major systems

    The Department of Defense (DOD) has traditionally requested 
advance procurement funding to support the efficient 
procurement and production rates for significant annual buys 
and multiyear purchases of weapon systems and equipment. The 
fiscal year 2012 budget request did not include any advance 
procurement funding for C-130J aircraft the Air Force intended 
to purchase in fiscal year 2013. However, Congress added $120.0 
million for this purpose in the Consolidated Appropriations 
Act, 2012 (Public Law 112-74), based on information that such 
advance procurement would reduce overall costs of the program.
    In the fiscal year 2013 budget request, the Air Force again 
failed to ask for advance procurement funding for the 27 HC/MC/
AC-130J aircraft the Department intends to purchase in fiscal 
year 2014. In responding to questions from the committee last 
year, DOD indicated that adding advance procurement funding for 
C-130J aircraft in fiscal year 2012 could result in net savings 
to the government. Also, internal Air Force documents asserted 
that failure to include advance procurement funding would 
result in increased unit cost and delayed delivery of aircraft 
to the warfighter.
    The committee believes that DOD should apply traditional 
advance procurement funding practices consistently across all 
DOD aircraft procurement programs, particularly when having 
advance procurement funding would result in more efficient 
production and lower costs. The committee expects that DOD will 
explain the rationale for any departure from the normal 
practice of providing advance procurement funding, including 
why such a departure is more efficient or more effective.

U.S. Special Operations Command Budget line items

    The committee notes that in recent years the number of 
budget line items associated with U.S. Special Operations 
Command (USSOCOM) research and development and procurement 
activities has grown. The committee believes adequate fidelity 
in USSOCOM's budget justification documents is critical to 
performance of its oversight responsibilities. However, the 
committee also understands that congressionally imposed 
reprogramming thresholds may, in some cases, have a disparate 
impact on USSOCOM as compared to the military departments 
because of the number of relatively small USSOCOM budget line 
items, thereby reducing USSOCOM's budget flexibility to meet 
command requirements. The committee would welcome a proposal 
from USSOCOM to address this issue by consolidating appropriate 
budget line items in future years, while providing equal or 
better fidelity in the budget justification documents to the 
congressional defense committees.
         TITLE II--RESEARCH, DEVELOPMENT, TEST, AND EVALUATION

              Subtitle A--Authorization of Appropriations

Authorization of appropriations (sec. 201)
    The committee recommends a provision that would authorize 
appropriations for research, development, test, and evaluation 
activities at the levels identified in section 4201 of division 
D of this Act.

    Subtitle B--Program Requirements, Restrictions, and Limitations

Next Generation Foundry for the Defense Microelectronics Activity (sec. 
        211)
    The committee recommends a provision that would prohibit 
the Department of Defense from executing any funds in PE 
603720S for the 90 nanometer Next Generation Foundry until 60 
days after the Department delivers to the congressional defense 
committees a defense microelectronics strategy and a full life 
cycle cost estimate of the Defense Microelectronics Activity's 
Next Generation Foundry. This strategy, as well as the 
committee's recommendation to decrease funds available in this 
program element, are described elsewhere in this report.
Advanced rotorcraft initiative (sec. 212)
    The committee recommends a provision that would direct the 
Under Secretary of Defense for Acquisition, Technology, and 
Logistics (USD(AT&L)) to develop and submit a strategy to the 
congressional defense committees no later than 180 days after 
the enactment of this Act on the use of integrated platform 
design teams and agile prototyping approaches for the 
development of advanced rotorcraft capabilities.
    The committee notes that the Department of Defense (DOD) 
has recently stated that increasing prototyping of advanced 
technology capabilities is a potential approach to be able to 
keep the technical expertise of the defense industrial base 
exercised in a reduced budgetary environment. With declining 
budgets leading to reduced numbers of acquisition programs and 
quantities of weapon systems, it is crucial that design 
experience and skills in the various sectors of the defense 
industrial base be preserved. These skills are important not 
only to be readily available when the Department requires them, 
but the ability to sustain and pass these skills on to 
successive generations of engineers is intertwined intimately 
with the challenges of attracting and retaining the best and 
brightest engineers and technicians to work in both the public 
and private sectors of the national security enterprise. Such 
talent will not be recruited or retained without the key 
attraction of multiple opportunities for very challenging work 
over the course of one's professional career.
    One of the key challenges facing the defense industrial 
base today is that the design and development cycles of major 
defense acquisition programs (MDAP) are so protracted. The 
skills typically acquired and honed through multiple design 
cycles are not being adequately learned. The result is that 
many of the MDAPs are behind schedule and above cost because 
the design and development teams are actually doing ``on the 
job training''. Such a situation is far from acceptable, and 
hence the acknowledgement that the DOD needs to develop a 
comprehensive strategy identifying and growing integrated 
platform design teams. Providing these teams the opportunity to 
exercise their skills in a series of relatively frequent 
prototyping activities is long overdue.
    The Department needs to go beyond the rhetoric of 
occasional speeches and needs to undertake a serious effort to 
develop a comprehensive strategy that encompasses elements 
within USD(AT&L) including the Assistant Secretary of Defense 
for Research and Engineering (ASD(R&E)) and the Deputy 
Assistant Secretary of Defense for Manufacturing and Industrial 
Base Policy, as well as the services. Two key elements that 
must be addressed in such a strategy are integrated platform 
design teams and agile prototyping activities.
    Depending upon the defense industrial base sector, 
integrated platform design teams should be viewed as critical 
national assets. They can provide the capability to quickly 
develop and field revolutionary defense capabilities. These 
teams are small, by nature, typically consisting of an 
engineering and design core of less than 50 people. This core 
group is prized for its cross-disciplinary nature, breadth of 
knowledge, and past experience with successfully shepherding 
defense products all the way from concept to initial fielding.
    As demonstrated in the ``golden age'' of aerospace 
development, integrated platform design teams were most 
effectively built and managed by running complex, integrated 
development projects in rapid succession, preferably with 1-4 
year timelines. The most effective projects involved complex, 
integrated systems or platforms (such as complete aircraft), 
which also drove advancement of subsystems and component 
technologies beyond what was available off-the-shelf 
commercially.
    Closing the design-to-initial operations cycle is essential 
to building and maintaining design capabilities. The successful 
core design team is typically surrounded by talented 
technicians and operators. In this manner, engineering, 
manufacturing, testing, and operations capabilities are tightly 
integrated without organizational or communications barriers. 
The close interactions between these various areas of expertise 
promote design validation through real-world operational 
experimentation.
    Lastly, it is imperative that the core engineers work under 
streamlined management, driven to motivate and empower the 
team. To foster rapid technological advances, the team must be 
granted significant requirements leeway and be insulated from 
excessive pressures of process, thus focusing entirely on time 
and cost-effective development and fielding.
    In the absence of sufficient new major defense acquisition 
programs, a mechanism to keep integrated platform design teams 
exercised is the use of agile prototyping. This concept, 
sometimes referred to as exploratory development, is a 
framework to ensure that rapid, higher risk technology 
development can continue without the linkages to formal 
requirements and the attendant commitment to production and a 
formal acquisition program. In the historical parlance of 
aeronautics, X-planes have been the classic example. The point 
of such technology development activities is not to produce 
systems that have a formal operational requirement, but to 
create technology options and reduce technical risk for 
whenever formal operational and programmatic requirements 
emerge in the future.
    One area of the defense industrial base that has not seen 
significant new innovations is rotorcraft. Over the last 
decade, rotorcraft have been crucial in our war fighting 
operations. The committee believes that among the various 
defense industrial base sectors, the preservation of integrated 
platform design teams and the use of agile prototyping is most 
needed in this sector. The committee observes that it has been 
over 2 decades since the last completely new DOD rotorcraft, 
the V-22 Osprey, was developed.
    Last year, the committee expressed its views on the state 
of DOD's rotorcraft science and technology (S&T) activities in 
its report. The committee continues to express concern over the 
overall state of DOD's rotorcraft S&T programs. Specifically, 
the committee strongly believes that the DOD is not engaging to 
the maximum possible extent in a coordinated fashion with its 
limited resources with the broadest range of industry and 
academia to foster innovative concepts for the next-generation 
of rotorcraft. The committee acknowledges the efforts that the 
ASD(R&E) is taking to coordinate the DOD's rotorcraft S&T 
activities, primarily by the Army, and its claims that it is 
making progress on the S&T plan in the Future Vertical Lift 
(FVL) Strategic Plan.
    USD(AT&L)'s Vertical Lift Consortium (VLC)--self-formed by 
industry over 2 years ago--is not being exercised adequately by 
the services. The VLC is an open and competitive forum that 
leverages all sectors of the vertical lift community to 
encourage teaming of innovative small business and non-
traditional contractors with major defense firms and academia. 
The VLC is contracted with the DOD through the establishment of 
an Other Transaction Authority (OTA). The OTA allows the 
formation of competitive teams to rapidly develop and flight 
demonstrate innovative vertical lift technologies that address 
capability gaps identified in the DOD FVL Strategic Plan such 
as performance, survivability, and affordability. The committee 
understands the DOD is completing an overdue report on the VLC 
that was called for by the Committee on Armed Services of the 
House of Representatives last year that was due April 1, 2012.
    The Army is pursuing its Joint Multi-role (JMR) development 
program--without funding from other services. Absent further 
funding, current plans envision only one technology 
demonstrator in the 2017-2020 timeframe and initial fielding of 
a platform in the 2030 timeframe. The committee is concerned 
that only a single technology demonstrator will fly and that 
pressures will be such that this vehicle will ultimately turn 
into the platform for the program of record--thus suppressing a 
truly competitive process for innovative concepts. Furthermore, 
the committee strongly urges that the Army develop Technology 
Capability Enabled Demonstrations, as it has for soldier-
centric technologies, for advancing rotorcraft capabilities.
    In addition, the Defense Advanced Research Projects Agency 
(DARPA) has launched an X-Plane Rotorcraft program in fiscal 
year 2013 and it remains to be seen what this program will lead 
to. The committee strongly urges DARPA to structure its X-Plane 
Rotorcraft program to develop specific performance steps beyond 
the Army's desired attributes for platforms under the JMR 
program. DARPA should also consider expanding its X-Plane 
Rotorcraft program to provide for at least two competing teams. 
In addition, the committee urges DARPA to investigate how 
advances that it is making in advanced manufacturing can be 
applicable to the rotorcraft sector.
    Given the situation depicted above, the committee directs 
that the USD(AT&L), working with the services and DARPA, 
develop and submit to the congressional defense committees a 
strategy that will address measures that DOD will take to 
retain--and where appropriate--develop, integrated platform 
design teams. Given the complexity of this problem, this 
strategy shall focus initially on the rotorcraft sector. The 
strategy shall also address how agile prototyping practices and 
programs can be established, including rotorcraft X-planes, and 
what level of resources would be required. The strategy should 
consider possibly restructuring the Army's JMR program to 
include more technology demonstration platforms with challenge 
goals of significant reductions in cost and time to flight.
    Lastly, the strategy should also address how other 
innovative approaches such as competitive prize awards can be 
applied. The committee found it disappointing that in a report 
by the Office of Science and Technology Policy, dated March 
2012, ``Implementation of Federal Prize Authority: Progress 
Report'', there was only one example of DOD using this prize 
authority. The strategy should address how prizes could be 
potentially used to address some challenge problems, primarily 
for unmanned rotorcraft, such as: nap-of-earth automated 
flight, urban operation near buildings, slope landings, 
automated autorotation or power-off recovery, and automated 
selection of landing areas.
    In the development of this strategy, the committee directs 
the USD(AT&L) to work with the VLC for their inputs and to 
consider both manned and unmanned rotorcraft across the broad 
range of DOD missions.
Transfer of certain fiscal year 2012 Navy research, development, test, 
        and evaluation funds (sec. 213)
    The committee recommends a provision that would permit the 
Secretary of the Navy to use, subject to appropriations, prior 
year funds that have been made available from program 
cancellations reflected in the fiscal 2013 budget request. The 
funds available from cancellations are as follows:

------------------------------------------------------------------------
                                                    Recommended Amount
                    Program                       (Dollars in millions)
------------------------------------------------------------------------
Medium-range Maritime Unmanned Aerial System...                     $8.8
                                                ------------------------
    Total......................................                     $8.8
------------------------------------------------------------------------

Authority for Department of Defense laboratories to enter into 
        education partnerships with educational institutions in United 
        States territories and possessions (sec. 214)
    The committee recommends a provision, based upon a 
Department of Defense legislative proposal, that would 
authorize the directors of defense laboratories to enter into 
education partnership agreements with educational institutions 
in United States territories and possessions. Currently, a 
defense laboratory can only enter into an education partnership 
with educational institutions in the 50 states and the District 
of Columbia.
    This provision will increase opportunities for defense 
laboratories to interact with additional educational 
institutions to further science, technology, engineering, and 
mathematics objectives. In addition, this provision would 
provide a potential opportunity for educational institutions in 
the U.S. territories and possessions to contribute to the 
national defense through a partnership with a Department of 
Defense laboratory.
Transfer of certain fiscal year 2012 Air Force research, development, 
        test, and evaluation funds (sec. 215)
    The committee recommends a provision that would permit the 
Secretary of the Air Force to use, subject to appropriations, 
prior year funds that have been made available from program 
cancellations reflected in the fiscal 2013 budget request. The 
funds available from cancellations are as follows:

------------------------------------------------------------------------
                                                    Recommended Amount
                    Program                       (Dollars in millions)
------------------------------------------------------------------------
C-130 avionics modernization program...........                     $6.5
Miniature air-launched decoy, phase II.........                      7.9
RQ-4 Global Hawk Block 30......................                     64.0
                                                ------------------------
    Total......................................                    $78.4
------------------------------------------------------------------------

                  Subtitle C--Missile Defense Matters

Homeland ballistic missile defense (sec. 231)
    The committee recommends a provision that would express the 
sense of Congress on homeland ballistic missile defense, and 
would require a report on the status of efforts to improve the 
homeland defense capability of the United States.
    The committee notes that the first policy priority 
described in the February 2010 Ballistic Missile Defense Review 
is to continue providing homeland ballistic missile defense 
against the potential future threat of limited ballistic 
missile attack from nations such as North Korea and Iran. The 
currently deployed Ground-based Midcourse Defense (GMD) system, 
with 30 Ground-Based Interceptors deployed in Alaska and 
California, provides protection of the United States against 
such future threats. This policy relies on two approaches: 1) 
improving the reliability and performance of the GMD system, 
particularly its Ground-Based Interceptors; and 2) taking 
prudent steps to hedge against the possibility that the threat 
might grow faster or larger than anticipated. The Department of 
Defense is taking significant steps on both approaches. The 
provision would require the Department to report on the steps 
it is taking on both approaches, including the results of its 
efforts to demonstrate in flight testing the correction to the 
problem that caused the GMD flight test failure of December 
2010.

Regional ballistic missile defense (sec. 232)

    The committee recommends a provision that would express the 
sense of Congress on regional ballistic missile defense, and 
would require a report on the European Phased Adaptive Approach 
to missile defense and other regional missile defense efforts 
of the United States.
    The committee notes that the threat to forward-deployed 
U.S. forces, allies and partners from regional ballistic 
missiles, particularly from Iran and North Korea, is serious 
and growing rapidly. Consequently, the Department of Defense 
has ``made defending against near-term regional threats a top 
priority in our missile defense plans, programs and 
capabilities,'' as Secretary of Defense Robert Gates stated in 
the Ballistic Missile Defense Review of February 2010.
    The committee believes the Department of Defense has an 
obligation to provide force protection to forward-deployed U.S. 
forces, assets, and facilities, and to defend allies, from the 
threat of regional ballistic missile attack. The Department is 
implementing a set of programs and efforts to enhance U.S. and 
allied capabilities to defend against such regional ballistic 
missiles, especially against Iran and North Korea. These 
efforts, which include the European Phased Adaptive Approach to 
missile defense and similar phased and adaptive efforts 
tailored to the Middle East and the Asia-Pacific region, are 
essential to providing force protection for our deployed 
forces. These efforts are balanced with programs to enhance 
homeland defense, and are designed to meet the integrated 
missile defense priorities of the geographic combatant 
commands. Some of the regional missile defense capabilities, 
such as forward-deployed AN/TPY-2 missile defense radars in 
Japan and Turkey, and development of the Standard Missile-3 
Block IIB interceptor missile, are intended to enhance homeland 
defense.
    The Department also has numerous programs of cooperation 
with international partners to improve regional missile defense 
capabilities, including our North Atlantic Treaty Organization 
allies, Israel, and Japan, among others. The committee supports 
these regional missile defense programs and partnerships, and 
believes they are an important component of regional security 
and stability.

Missile defense cooperation with Russia (sec. 233)

    The committee recommends a provision that would express the 
sense of Congress in support of efforts of the United States to 
pursue missile defense cooperation with Russia that would 
enhance the security of the United States, its North Atlantic 
Treaty Organization (NATO) allies, and Russia, particularly 
against missile threats from Iran. The provision states that 
the United States should pursue such cooperation in a manner 
that does not in any way limit United States missile defenses 
and that ensures the protection of United States classified 
information. The provision also states the view that the United 
States should not provide Russia with sensitive missile defense 
information that would in any way compromise United States 
national security, including ``hit-to-kill'' technology and 
interceptor telemetry.
    The committee notes that, for more than a decade, the 
United States has been pursuing and discussing, cooperation 
with Russia on shared early warning and ballistic missile 
defense issues. Congress has supported such efforts, and 
section 221 of the Ike Skelton National Defense Authorization 
Act for Fiscal Year 2011 (Public Law 111-383) states the sense 
of Congress ``to support the efforts of the United States 
government and the North Atlantic Treaty Organization to pursue 
cooperation with the Russian Federation on ballistic missile 
defense relative to Iranian missile threats.''
    In addition to United States bilateral efforts with Russia 
on missile defense cooperation, NATO has undertaken efforts to 
seek such cooperation with Russia. At the Lisbon Summit in 
November 2010, NATO committed to ``actively seek cooperation on 
missile defense with Russia,'' and declared that ``NATO-Russia 
cooperation is of strategic importance,'' and that ``the 
security of the North Atlantic Treaty Organization and Russia 
is intertwined.''
    The committee believes that missile defense cooperation 
with Russia could enhance the security of the United States, 
and could send a strong signal to Iran that the United States 
and Russia are joined in their opposition to Iran's nuclear and 
missile programs. The committee commends the administration for 
seeking such cooperation, and for its commitment to take the 
steps necessary to ensure that United States information is 
adequately safeguarded, including its commitment to ``not 
provide Russia with sensitive information that would in any way 
compromise our national security, including hit-to-kill 
technology and interceptor telemetry,'' as stated by Robert 
Nabors, Assistant to the President and Director of the Office 
of Legislative Affairs in a letter dated April 13, 2012.

Next-generation Exo-atmospheric Kill Vehicle (sec. 234)

    The committee recommends a provision that would require the 
Director of the Missile Defense Agency to develop a long-term 
plan for the Exo-atmospheric Kill Vehicle (EKV) that addresses 
both modifications and enhancements to the current EKV and 
options for the competitive development of a next-generation 
EKV for the Ground-Based Interceptor of the Ground-Based 
Midcourse Defense system and any other interceptor that might 
be developed for the defense of the United States against long-
range ballistic missiles. The provision would also require the 
Director to submit a report to Congress setting forth the plan 
and an estimate of the cost and schedule of implementing the 
plan.

Modernization of the Patriot air and missile defense system (sec. 235)

    The committee recommends a provision that would require the 
Secretary of the Army to submit to the congressional 
defensecommittees a plan for support of requirements in 
connection with the modernization of the Patriot air and 
missile defense system. The plan would also include an 
assessment of the integrated air and missile defense 
capabilities required to meet the demands of evolving and 
emerging threats, and a plan for achieving reductions in the 
life cycle cost of the Patriot system.

Medium Extended Air Defense System (sec. 236)

    The committee recommends a provision that would prohibit 
the obligation or expenditure of fiscal year 2013 funds for the 
Medium Extended Air Defense System (MEADS).
    Section 235 of the National Defense Authorization Act for 
Fiscal Year 2012 (Public Law 112-81) limited the obligation or 
expenditure of more than 25 percent of the fiscal year 2012 
funds authorized for MEADS until the Department of Defense 
submitted to the congressional defense committees a plan to use 
such funds as final obligations for the MEADS program. The 
Department submitted that plan in April 2012, as described 
elsewhere in this report.
    Although the budget request included $400.9 million for the 
MEADS program, the committee believes it would be inconsistent 
with section 235 to authorize additional funds for MEADS, or to 
allow additional funds to be obligated or expended for MEADS.
    The committee is aware that additional funding would be 
needed for the Army to continue providing security and 
technology transfer support for sensitive MEADS-related 
technology and equipment furnished by the United States to 
Germany and Italy on a temporary basis, in the event Germany 
and Italy choose to proceed without the United States for an 
additional year of MEADS design and development.
    The committee understands the importance of ensuring the 
necessary security and technology transfer support for this 
sensitive technology and equipment until it is returned to the 
United States, and does not intend to hinder the ability of the 
Army to provide such security.
    The committee directs the Secretary of the Army to provide 
the committee, within 30 days after the enactment of this Act, 
a revised estimate as to how much it would cost for the United 
States MEADS National Program Office to provide appropriate 
oversight and security of the sensitive U.S. Government 
Furnished Equipment (GFE) relative to the program. The 
committee further directs the Secretary to provide the 
committee with a plan for how the Army intends to budget for 
these costs through fiscal year 2013 utilizing funds authorized 
and appropriated in fiscal year 2012.
    The committee is aware of the possibility that additional 
legislative authority may be necessary to permit the Army to 
ensure continued security and technology transfer support for 
the sensitive GFE. The committee directs the Army to provide 
the committee with any views on this matter on an expedited 
basis, to permit early committee consideration of such views.

Availability of funds for Iron Dome short-range rocket defense program 
        (sec. 237)

    The committee recommends a provision that would authorize 
the Secretary of Defense to provide up to $210.0 million in 
fiscal year 2013 funds to the Government of Israel for the Iron 
Dome short-range rocket defense system.
    After the budget request was submitted, the Department of 
Defense announced it would submit a request for additional 
funding to provide to the Government of Israel to procure 
additional Iron Dome short-range rocket defense systems. 
Although the Department has not yet submitted the request, the 
committee understands that the fiscal year 2013 funding request 
will be for $210.0 million. The committee is aware of reports 
that the request being considered by the Department could 
include funding of as much as $680.0 million over multiple 
fiscal years, including fiscal year 2013. The committee looks 
forward to receiving the Department's request, and to 
continuing its support for Israel's missile defense programs, 
as described elsewhere in this report.
    The committee notes that Israel has recently come under 
fire from short-range rockets from the Gaza strip. Israel 
currently has three operational Iron Dome batteries, and a 
fourth battery nearing deployment. However, these existing 
batteries do not provide adequate protection for the populated 
areas in Israel within range of short-range rocket attacks. The 
funding authorized in the provision would permit Israel to 
acquire additional Iron Dome systems to provide protection for 
more of its population against recurring short-range rocket 
attacks.

                          Subtitle D--Reports


Mission packages for the littoral combat ship (sec. 251)

    The committee recommends a provision that would require the 
Secretary of the Navy to produce a report, in consultation with 
the Director of Operational Test and Evaluation, on the mine 
countermeasures warfare, antisubmarine warfare, and surface 
warfare mission packages for the Littoral Combat Ship (LCS).
    The Secretary's report would be required, at a minimum, to 
set forth the following:
          (1) A plan for the Mission Packages demonstrating 
        that Preliminary Design Review for every capability 
        increment precedes Milestone B or equivalent approval 
        for that increment;
          (2) A plan for demonstrating that the capability 
        increment for each Mission Package, combined with a 
        Littoral Combat Ship, on the basis of a Preliminary 
        Design Review and post-Preliminary Design Review 
        assessment, will achieve the capability specified for 
        that increment; and
          (3) A plan for demonstrating the survivability and 
        lethality of the Littoral Combat Ship with its Mission 
        Packages sufficiently early in the development phase of 
        the system to minimize costs of concurrency.
    The committee remains concerned about this program's 
ability to deliver combat-ready LCS when our sailors need them 
in support of worldwide maritime operations. The development 
and fielding of these mission module capabilities will require 
the Navy to field a range of 24 critical technologies, 
including sensors, vehicles, and weapons. In addition, there 
have been perturbations in the objective systems to be deployed 
in the mission modules, as the Navy is replacing some items 
because of poor performance or increasing costs. All of this 
argues for pursuing the regular order in defining, developing, 
testing, and fielding incremental improvements in capability 
for the LCS. This provision will make it clear that the Navy 
should follow a regular, transparent process in managing the 
mission module program.

Comptroller General of the United States annual reports on the 
        acquisition program for the Amphibious Combat Vehicle (sec. 
        252)

    The committee recommends a provision that would require the 
Comptroller General to conduct an annual review of the Marine 
Corps Amphibious Combat Vehicle acquisition program, and to 
submit a report to the congressional defense committees by 
March 15 of each year, from 2013 until the award of the first 
contract for full rate production. Where appropriate and 
feasible, each report shall assess whether the program is 
meeting cost, schedule, performance, and risk mitigation goals; 
the progress and results of developmental and operational 
testing and plans to correct any shortcomings in vehicle 
performance, operational effectiveness, reliability, 
suitability, and safety; the procurement plans, production 
results, and efforts to improve manufacturing efficiency and 
supplier performance; the acquisition strategy, including 
whether it complies with acquisition management best practices 
and the acquisition policies and regulations of the Department 
of Defense; and, the risks reflected in the integrated master 
schedule and test and evaluation master plan related to 
probability of success, funding required for the vehicle 
compared to funding programmed, and development and production 
concurrency. In addition, the first report shall assess the 
sufficiency and objectivity of the analysis of alternatives, 
the initial capabilities document, and the capability 
development document.
    While the committee fully supports the Marine Corps' 
efforts to develop and field a capable replacement for its 
Vietnam-era Assault Amphibious Vehicle, the committee is 
mindful of the cost increases, schedule delays, and performance 
problems associated with the Marine Corps' last attempt to 
develop such a replacement under the cancelled Expeditionary 
Fighting Vehicle program. Given the importance of the 
Amphibious Combat Vehicle, the committee intends to subject the 
program to continuing and robust oversight.

Conditional requirement for report on amphibious assault vehicles for 
        the Marine Corps (sec. 253)

    The committee recommends a provision that would require the 
Secretary of the Navy and the Commandant of the Marine Corps to 
jointly submit to the congressional defense committees a report 
by February 1, 2013, if the ongoing Marine Corps ground combat 
vehicle fleet mix study recommends the acquisition of a Marine 
Personnel Carrier (MPC). The report would include an 
explanation of the role of the MPC in fulfilling the two Marine 
Expeditionary Brigades (MEB) forcible entry requirement; the 
fraction of the assault echelon of the MEBs comprised of MPCs, 
along with an assessment of the operational risks associated 
with using ship-to-shore connectors to ferry MPCs rather than 
tanks and artillery; and an estimate of the acquisition and 
life cycle costs of a split fleet of Amphibious Combat Vehicles 
and MPCs as compared to the costs of a pure fleet of Amphibious 
Combat Vehicles.

                       Subtitle E--Other Matters


Transfer of administration of Ocean Research and Resources Advisory 
        Panel from Department of the Navy to National Oceanic and 
        Atmospheric Administration (sec. 271)

    The committee recommends a provision, based upon a 
Department of Defense legislative proposal, that would transfer 
responsibility for administration of the Ocean Research 
Advisory Panel (ORAP) from the Department of the Navy to the 
National Oceanic and Atmospheric Administration of the 
Department of Commerce. This change would allow the functions 
of the ORAP to be aligned more appropriately to address the 
full range of ocean, coastal, and Great Lakes policy issues.

                              Budget Items


                                  Army


Medium Extended Air Defense System

    The budget request included $400.9 million in PE 64869A for 
development of the Medium Extended Air Defense System (MEADS). 
Under the tri-national (United States, Germany and Italy) 
Memorandum of Understanding (MOU) on development of MEADS, the 
Department of Defense is obligated to seek fiscal year 2013 
congressional funding for the MEADS program as the final 
increment of U.S. funding.
    The committee notes that section 235 of the National 
Defense Authorization Act for Fiscal Year 2012 (Public Law 112-
81), limited the obligation or expenditure of more than 25 
percent of the fiscal year 2012 funds for MEADS until the 
Department submits a plan to use such funds as final 
obligations under the MEADS program for either: (1) 
implementing a restructured program of reduced scope; or (2) 
contract termination liability costs with respect to the 
contracts covering the program. In keeping with section 235 of 
that Act, the committee recommends a reduction of $400.9 
million in PE 64869A, the entire amount of the budget request 
for continued development of the MEADS program.
    On April 26, 2012, the Department of Defense submitted a 
report to the congressional defense committees with the plan 
required by section 235. The Department reported that it plans 
to ``use the FY [fiscal year] 2012 funds as final obligations 
to implement a restructured program of reduced scope.'' In 
accordance with section 235, Department of Defense officials 
proposed options to their German and Italian counterparts for 
reducing the scope of the MEADS Proof of Concept program, but 
the partner governments did not agree to the Department's 
proposals. The report noted that ``[a]ll three MEADS 
Participants must reach unanimous agreement before the Proof of 
Concept can be amended or the prime contract can be 
terminated.''
    The Department's report also noted that, ``[i]f Congress 
does not appropriate FY 2013 funding, the U.S. DOD [Department 
of Defense] would take the position that the FY 2012 funds 
represent the U.S. DOD's final financial contribution under the 
MOU. The U.S. DOD would also take the position that failure to 
provide FY 2013 funding would not be a unilateral withdrawal 
from the MOU, with reference to the MOU's provision subjecting 
Participants' activities under the MOU `to the availability of 
funds appropriated for such purposes.''' In January 2012, 
Acting Under Secretary of Defense for Acquisition, Technology, 
and Logistics, Frank Kendall, informed his German and Italian 
counterparts that, ``it is very unlikely that Congress will 
authorize and appropriate any U.S. FY 2013 funds for MEADS.'' 
Given that the U.S. responsibility under the MEADS MOU is made 
``subject to the availability of funds appropriated for the 
purposes of carrying out MEADS activities,'' and that the 
United States is not withdrawing unilaterally from the MOU, the 
committee urges the Department to continue its efforts to reach 
agreement with its German and Italian partners on a plan to 
restructure the MEADS program further to reduce its scope, 
using fiscal year 2012 funds as the final U.S. obligations for 
the program.

Improved turbine engine program

    The budget request included $72.3 million in PE 23744A for 
the Improved Turbine Engine Program (ITEP). The committee notes 
that the fiscal year 2013 request assumed contract award for 
engineering and manufacturing development would occur in fiscal 
year 2012. The program is delayed, however, and contract award 
is not anticipated until fiscal 2014. The committee recommends 
a decrease of $54.0 million in PE 23744A for ITEP.
    The committee also notes that the Army's ITEP strategy 
includes dual vendor competitive development through milestone 
C. The committee supports competition in technology development 
and encourages the Army to take advantage of the capability and 
interest of multiple helicopter engine developers through 
competitive prototyping.

                               Air Force


Next generation aerial refueling aircraft

    The budget request included $1,815.6 million to continue 
development of the KC-46A, the next-generation aerial refueling 
aircraft.
    The program office received fiscal year 2010 and fiscal 
year 2011 Tanker Replacement Transfer Fund (TRTF) funds in 
fiscal year 2011 that provided $135.0 million more research, 
development, test, and evaluation (RDT&E) funding than the Air 
Force believed it needed during that period. The Department of 
the Air Force applied $47.9 million of the $135.0 million to 
small business innovation research activities, leaving $87.1 
million of the $135.0 million in excess fiscal year 2011 
funding available to cover fiscal year 2012 activities. Since 
Congress already provided full funding of the fiscal year 2012 
requirement, the Department could apply $87.1 million in fiscal 
year 2012 funds against fiscal year 2013 funding requirements. 
Therefore, the committee recommends a reduction of $87.1 
million in the budget request for the KC-46A EMD program.

                              Defense-wide


Special Operations/Low Intensity Conflict Advanced Development and 
        Combatting Terrorism Technology Support

    The budget request includes $77.1 million in PE 603122D8Z 
for Combatting Terrorism Technology Support (CTTS) and $26.3 
million in PE 603121 for Special Operations/Low Intensity 
Conflict (SO/LIC) Advanced Development. The budget lines fund a 
broad spectrum of technology development ranging from chemical, 
biological, radiological, and nuclear countermeasures; to 
explosives detection and improvised explosive device (IED) 
defeat; to special reconnaissance capabilities; to decision, 
planning, and analytical tools; to irregular warfare support--
all for various interagency customers.
    The committee is concerned that a significant portion of 
these activities appear to overlap or exist in a non-
coordinated fashion with activities under the Joint IED Defeat 
Organization (JIEDDO), U.S. Special Operations Command 
(USSOCOM), the military departments, and other Department of 
Defense (DOD) agencies. Furthermore, it is not clear what 
transition mechanisms are in place to ensure technologies 
developed under these activities have an enduring impact on the 
capabilities of the special operations or general purpose 
forces.
    The committee also notes that the new defense strategic 
guidance highlights Counter Terrorism and Irregular Warfare (CT 
& IW) as the first of 10 mission areas for the Joint Force. The 
committee feels that of all the activities in these two budget 
lines, the CT & IW area does not have significant funding in 
other DOD organizations and hence is most appropriate for 
funding in the CTTS and SO/LIC budget lines.
    The committee directs the Assistant Secretary of Defense 
for Special Operations and Low Intensity Conflict, in 
coordination with the Commander of USSOCOM and the Director of 
JIEDDO, to submit to the congressional defense committees not 
later than 90 days after enactment of this Act, a report that: 
(1) describes and assesses the effectiveness of the 
coordination mechanisms in place to avoid duplication of 
efforts funded by these two budget lines and other relevant 
defense entities, including JIEDDO and USSOCOM; (2) outlines 
the differences between technologies funded by the CTTS and SO/
LIC budget lines and other relevant defense entities, including 
JIEDDO and SOCOM; (3) provides a listing of which technologies 
have successfully transitioned to the services and USSOCOM; and 
(4) describes how the CT & IW programs funded by SO/LIC fit 
within the Department's broader CT & IW strategy.
    Furthermore the committee recommends a decrease of $11.3 
million from PE 603122D8Z for activities relating to counter-
IED activities, given that they appear to be duplicative of 
activities conducted by JIEDDO.

Industrial base innovation fund

    The budget request included $22.0 million in PE 603680D8Z 
for defense-wide manufacturing science and technology. The 
committee, along with other congressional defense committees, 
has been a strong supporter of programs that sustain and 
advance targeted sectors and capabilities of the defense 
industrial base. A February 2006 report by the Defense Science 
Board regarding the Department of Defense's Manufacturing 
Technology Program points out that manufacturing technology 
plays a critical role in addressing development, acquisition, 
and sustainment problems associated with advanced weapons 
programs and recommended increased funding in this area.
    Furthermore, the 2010 Quadrennial Defense Review explicitly 
stressed the importance of the defense industrial base and the 
Department of Defense's new strategic guidance released in 
January 2012, stated that the Department ``will make every 
effort to maintain an adequate industrial base and our 
investment in science and technology.'' In addition, the 
administration recently announced the formation of a national 
network of institutes for manufacturing innovation, which in 
part, are planned to address Department of Defense mission 
requirements.
    The committee recommends an additional $30.0 million to 
continue the Industrial Base Innovation Fund (IBIF) program in 
the above program element line. The committee directs the 
Deputy Assistant Secretary of Defense for Manufacturing and 
Industrial Base Policy to continue to make competitive, merit-
based investments in manufacturing research and development 
that address defense industrial base shortfalls, especially 
those related to more urgent production requirements and 
diminishing defense manufacturing sources and material 
shortages, and a sustainable defense design team base. Other 
areas of emphasis encouraged are those related to the emerging 
fields of model-based engineering and integrated computational 
materials engineering, as highlighted in a recent National 
Research Council report, and new innovative technologies being 
developed through public-private partnerships such as the 
National Advanced Manufacturing Partnership, Connecting 
American Manufacturing, and the National Digital Engineering 
and Manufacturing Consortium.
    Furthermore, if the Department of Defense believes that the 
IBIF is important to the sustainment of the industrial base, 
then the Department should institutionalize this program with 
adequate resources in future years and consider it as an 
important component of its wider manufacturing and industrial 
base strategy, in part, informed by its on-going ``Sector-by-
Sector, Tier-by-Tier'' analyses.

Defense microelectronics strategy and Next Generation Foundry

    The Senate report accompanying S. 1235 (S. Rept. 112-26) of 
the National Defense Authorization Act for Fiscal Year 2012 
directed the Assistant Secretary of Defense for Research and 
Engineering to brief the congressional defense committees by 
September 30, 2011, on a microelectronics strategy that would 
address components including resilient advanced 
microprocessors, application specific integrated circuits, 
field programmable gate arrays, printed circuit boards, 
photonics devices, and other related electronics components for 
the next-generation of military and intelligence systems. The 
committee notes that the promising field of photonics includes 
research on devices, for example, lasers that are fully 
monolithically integrated as interconnects on integrated 
circuits. If successful, such devices could significantly 
reduce the power consumption, weight, and cooling requirements 
of networks for both terrestrial applications, as well as for 
weapon systems. In addition, the committee understood this 
strategy would also address the full spectrum of the supply 
chain including design, mask development and inspection, 
fabrication, packaging and assembly, and testing. However, the 
committee has not received this strategy yet and is concerned 
that the Department of Defense (DOD) is requesting $10.0 
million in fiscal year 2013 for the development of a 90 
nanometer (nm) Next Generation Foundry for the Defense 
Microelectronics Activity without the context of this broader 
strategy.
    The committee fully appreciates the DOD's need to upgrade 
its fabrication capabilities for microelectronics devices that 
are obsolete and no longer produced by the commercial sector, 
but are still required by its weapon systems. In addition, the 
committee understands that developing this capability is at 
least a 5 year endeavor and that if the Department delays, 
there may be detrimental consequences in the out-years to the 
warfighting readiness and capabilities of weapon systems that 
rely upon outdated microelectronics devices.
    However, the committee is not satisfied that a complete 
life cycle cost estimate has been conducted that accounts for 
the full costs of this upgrade, including whether workforce 
training and/or expansion is required. The committee believes 
that this comprehensive planning must be completed before 
spending the full $10.0 million the initial year. Hence, the 
committee recommends a decrease of $3.0 million to PE 603720S 
for the 90 nm Next Generation Foundry budget request. In 
addition, the committee recommends a fence on this funding that 
is described elsewhere in this report.
    Lastly, due to its ongoing oversight and concerns regarding 
the security of the electronics supply chain, the committee 
expects the defense microelectronics strategy to address 
linkages to the broader policy guidance and regulations that 
DOD is developing for two areas. One is related to ``Trusted 
Systems and Networks'' that addresses both the needs for 
procuring DOD-unique components for well-defined mission 
critical systems from suppliers that are certified under 
Defense Microelectronics Activity's Trusted Integrated Circuit 
Suppliers program and the management of risk in the supply 
chain for other integrated circuit-related products. The other 
is related to combating counterfeit components and the need for 
``Trustworthy Suppliers'' that adhere to DOD requirements and 
established industry standards. The committee is expecting that 
these new policies and regulations, under the umbrella of the 
DOD's Program Protection process, will identify the steps that 
the DOD will take to ensure that it will procure 
microelectronic systems through trusted contractors and 
subcontractors and that potential vulnerabilities due to non-
domestic foundries will be addressed. The committee directs the 
Under Secretary of Defense for Acquisition, Technology, and 
Logistics to brief the Committees on Armed Services of the 
Senate and the House of Representatives on the status of these 
policies no later than December 31, 2012.

Advanced sensor applications program

    The budget request included $16.9 million for the Advanced 
Sensor Applications Program (ASAP). This represents a reduction 
from a level of $18.4 million in fiscal year 2012 and reflects 
a general reduction applied to a number of budget line items in 
an across-the-board manner. The committee believes that this 
reduction, while modest by other program standards, will cause 
the program to postpone important testing and experiments. The 
committee believes that these efforts are too important to 
postpone or cancel, and therefore, recommends an additional 
$2.0 million for ASAP.

U.S.-Israeli cooperative missile defense programs

    The budget request included $99.8 million in PE 63913C for 
the Missile Defense Agency for United States-Israeli 
cooperative missile defense programs, including: $10.7 million 
to improve the existing Arrow Weapon System; $50.9 million for 
continued development of the Arrow-3 upper-tier interceptor 
missile, and $38.3 million for co-development of a short-range 
missile defense system called ``David's Sling.'' These systems 
are part of Israel's layered defenses against missiles and 
rockets of different ranges, from longer-range missiles from 
Iran or Syria, to short-range missiles and large caliber 
rockets fired from Lebanese territory in the summer of 2006, to 
the very short-range rockets fired recently from Gaza. The 
United States is co-managing and jointly developing these 
systems to ensure that they are compatible and interoperable 
with U.S. missile defense systems.
    The committee recognizes that the missile threat to Israel 
from ballistic missiles and rockets of varying ranges is 
extremely serious and increasing, and that effective missile 
defenses are an essential component of Israel's security and 
regional stability. The committee supports efforts to enhance 
and accelerate these systems, including technical and schedule 
risk reduction, in a manner that is consistent with the terms 
and conditions of the joint Project Agreements governing the 
management and execution of these cooperative projects.
    Therefore, the committee recommends an increase of $100.0 
million in PE 63193C for U.S.-Israeli cooperative missile 
defense programs, including: $20.0 million to improve the Arrow 
Weapon System, $20.0 million for the Arrow-3 upper-tier 
interceptor program, and $60.0 million for the David's Sling 
weapon system. The committee expects that the Department of 
Defense will continue its efforts to enhance the joint 
management of these programs, including efforts to avoid 
excessive concurrency.
    The budget request included no funds for the Israeli Iron 
Dome short-range rocket defense system. However, after the 
budget submission the Department of Defense stated it would 
seek additional funds from Congress for the United States to 
provide to Israel to acquire additional Iron Dome short-range 
rocket defense systems. The committee understands that the 
fiscal year 2013 funding request will be for $210.0 million, 
and recommends an additional increase of $210.0 million in PE 
63913C for the Israeli Iron Dome system. A legislative 
provision that would authorize this funding is described 
elsewhere in this report. The committee is aware of reports 
that the additional request for Iron Dome funding could be for 
as much as $680.0 million over multiple fiscal years, and looks 
forward to receiving the Department's request, and to 
continuing its support for Israeli missile defense programs.

Department of Defense Corrosion Program shortfall

    The budget request included $10.1 million for the 
Department of Defense (DOD) Corrosion Program divided between 
Operation and Maintenance and Research, Development, Test, and 
Evaluation (RDT&E). The DOD has consistently underfunded the 
DOD Corrosion Program in fiscal years 2011, 2012, and now 2013. 
The DOD Corrosion Program has identified to Congress a $41.5 
million requirements shortfall in RDT&E funding.
    The committee remains concerned that corrosion is costly 
and can have negative effects on military equipment in terms of 
cost, readiness, operator and maintenance burdens, and safety. 
The DOD estimates that the negative effects of corrosion cost 
approximately $23.0 billion in annual maintenance expenditures 
for weapon systems and infrastructure.
    The committee has recommended a provision that would amend 
the DOD reporting requirements to Congress by requiring 
additional information on corrosion projects, including 
validated returns on investment for completed corrosion 
projects, activities, and information on how corrosion funding 
is used for military projects, the Technical Corrosion 
Collaboration pilot program, and other corrosion-related 
activities. Additionally, the Government Accountability Office 
has stated that the Corrosion Policy and Oversight Office 
within the DOD Corrosion Program delivers at least a 14 to 1 
ratio return on investment to the taxpayer through corrosion 
project opportunities and activity requirements. Ensuring 
proper corrosion prevention and control plays a major role in 
the sustainment costs and life cycle range of many current and 
future weapon systems including the F-22, F-35, and various 
ground vehicles, ships, and aircraft.
    The committee continues to urge the Secretary of Defense to 
fully fund the corrosion control requirements in the fiscal 
year 2014 base budget request.
    In light of the committee requesting additional information 
from the DOD Corrosion Program, the committee recommends an 
increase of $20.8 million in RDT&E, line 099, Program Element 
64016D8Z for the DOD Corrosion Program to address the 
identified shortfall.

Defense research and development Rapid Innovation Program science and 
        technology thrust areas

    The Defense Research and Development Rapid Innovation 
Program (RIP) is a competitive, merit-based program established 
by section 1073 of the Ike Skelton National Defense 
Authorization Act for Fiscal Year 2011 (Public Law 111-383) 
that is designed to fund innovative technologies, reduce 
acquisition or life cycle costs, address technical risks, 
improve the timeliness of test and evaluation outcomes, and 
rapidly insert technologies needed to meet critical national 
security needs. The committee notes that $200.0 million was 
appropriated for the RIP in the Department of Defense 
Appropriations Act, 2012 (Public Law 112-74); however, no funds 
were requested in fiscal year 2013. While the RIP is still new 
and the committee has yet to see the results of the first round 
of projects funded by fiscal year 2011 funds, there is clearly 
strong service support because of the overwhelming response 
from industry--especially small businesses--providing new 
innovative technologies and opening up more collaborative 
opportunities with a broader base of small businesses and non-
traditional suppliers to the DOD.
    The committee understands that the Assistant Secretary of 
Defense for Research and Engineering will soon be conducting a 
review of the fiscal year 2011 projects to assess the value of 
continuing the RIP. If the review validates the program, then 
the Department should integrate it into its future annual 
budget requests.
    The committee recommends an increase of $200.0 million in 
funding for the RIP to PE 604775D8Z, and suggests an emphasis 
on the following areas:
          1. Enhancing energy security and independence. For 
        increased investment in technologies that will improve 
        energy efficiency, enhance energy security, and reduce 
        the Department's dependence on fossil fuels through 
        advances in traditional and alternative energy storage, 
        power systems, renewable energy production and more 
        energy efficient ground, air, and naval systems. The 
        committee notes that the Department of Defense remains 
        critically dependent upon energy for both its far-flung 
        infrastructure, and for its global military operations. 
        The Department currently consumes as much energy as 
        two-thirds of all the world's nations. Improved energy 
        efficiency in remote areas such as Afghanistan can 
        reduce the dependence of our armed forces on fragile 
        fuel supply lines that are vulnerable to enemy attack, 
        and thus can help save lives;
          2. Developing, utilizing, and maintaining advanced 
        materials. For increased investment in a broad range of 
        materials technologies that can provide: enhanced 
        performance in extreme environments; improved strength 
        and reduced weight for the spectrum of applications 
        ranging from aerospace to lighter soldier loads; 
        greater survivability of ground, air, and naval 
        systems; and reduced life cycle costs through better 
        maintainability for a wide variety of the challenging 
        environments and unique properties demanded of military 
        systems. Such materials could include advanced 
        composites and metals, nanomaterials, and rare-earth 
        alternatives. Whether increasing survivability, 
        improving fuel efficiency for greater performance, or 
        decreasing maintenance costs, advanced materials are a 
        foundational enabling component of military systems 
        across all services and all warfighting domains;
          3. Improving manufacturing technologies and 
        capabilities. For increased investment in advanced and 
        innovative manufacturing technologies across the 
        spectrum of applications to significantly compress 
        design to production time cycles, reduce cost, minimize 
        waste and energy consumption, and improve product 
        quality and reliability. Historically, the Department 
        has heavily invested in the technologies to improve the 
        performance of military systems, but not in the 
        processes to reduce the costs of the production of 
        those military systems. Numerous high-level studies 
        have stressed the benefits of advancing the state of 
        manufacturing technologies--whether for a ship hull or 
        a radiation-hardened chip--for long-term savings and 
        the need to capitalize on the latest innovations in 
        manufacturing processes for defense systems. Projects 
        in this area should be coordinated with the Deputy 
        Assistant Secretary of Defense for Manufacturing and 
        Industrial Base Policy to ensure that investments are 
        guided, in part, by shortfalls identified in industrial 
        base analyses such as the ongoing ``Sector by Sector, 
        Tier by Tier'' study effort;
          4. Advancing microelectronics. For increased 
        investment in the development of resilient advanced 
        microprocessors, application-specific integrated 
        circuits, field programmable gate arrays, printed 
        circuit boards, photonics devices, and other related 
        electronics components for the next-generation of 
        military and intelligence systems. Similar to advanced 
        materials, advanced microelectronics are a cross-
        cutting enabler across all military systems. Given that 
        the majority of costs of most advanced weapons 
        platforms are in electronics and supporting software, 
        investments in this area to improve processing 
        capacity, decrease weight and power requirements, and 
        increase resiliency should have high payoff; and
          5. Developing cybersecurity tools. For increased 
        investment in areas such as internet and network 
        mapping capabilities, software reverse engineering and 
        vulnerability analysis, network data collection and 
        analysis, new innovative defensive techniques against 
        cyber attacks--especially in virtual environments, and 
        integrated cloud security capabilities. The security of 
        DOD's war fighting and business networks, as well as 
        the networks of the defense industrial base is a 
        serious concern. DOD needs access to the latest 
        innovative technologies in this field in order to stay 
        ahead of rapidly growing and evolving threats in 
        cyberspace.
    Funding authorized for the RIP may be used to augment 
existing research and development efforts or initiate new 
projects. As provided in section 1073, the Secretary of Defense 
may transfer funds available for the RIP to the research, 
development, test, and evaluation accounts of a military 
department, defense agency, or the unified combatant command 
for special operations forces pursuant to a proposal, or any 
part of a proposal, that the Secretary determines would 
directly support the purposes of the program. All such funding 
is required by law to be allocated on the basis of a merit-
based selection, pursuant to a broad agency announcement or 
similar competitive process.

General fund enterprise business systems realignment

    The budget request included $9.9 million in Research, 
Development, Test, and Evaluation (RDT&E), for General Fund 
Enterprise Business System (GFEBS).
    The committee has received a request from the Army to 
realign $17.2 million into GFEBS to support the engineering 
development effort necessary to process classified and 
sensitive transactions and to mitigate the risk of exposing 
classified information.
    Accordingly, the committee recommends an increase of $17.2 
million in RDT&E for GFEBS realignment.

Developmental test and evaluation

    The budget request included $15.1 million in PE 605804D8Z 
for developmental test and evaluation, which was a decrease of 
about $0.7 million from the fiscal year 2012 budget request, 
and about $4.2 million below the fiscal year 2012 appropriation 
of $19.3 million.
    The committee notes the Weapon Systems Acquisition Reform 
Act of 2009 (Public Law 111-23) required the Department of 
Defense to rebuild its systems engineering and developmental 
testing organizations to ensure that design problems are 
understood and addressed early in the acquisition process.
    While the Department has taken great strides in improving 
its acquisition process, the committee notes that the Fiscal 
Year 2011 Annual Report by the Director of Operational Test and 
Evaluation--dated December 2011--provided a list of 17 major 
defense acquisition programs that had discoveries of 
significant problems during operational test and evaluation 
that should have been detected and corrected during 
developmental test and evaluation.
    Furthermore, the committee notes that the Department's 
defense-wide systems engineering budget request is almost three 
times greater than the developmental test and evaluation budget 
request. In fiscal year 2012, the committee recommended an 
increase of $5.0 million to developmental test and evaluation. 
The committee believes the Department is continuing to 
underfund its developmental test and evaluation activities, as 
evidenced by the unacceptable number of problems being 
discovered in operational test and evaluation. Hence, the 
committee recommends an increase of $5.0 million in the above 
program element line.

Shallow Water Combat Submersible Program

    The budget request includes $8.9 million in PE 1160483BB 
for the continued development of the Shallow Water Combat 
Submersible. The committee understands that the contractor's 
failure to meet systems engineering requirements will result in 
an overall program delay of several months and require at least 
an additional $8.0 million to complete research and development 
activities. According to U.S. Special Operations Command 
(USSOCOM), ``extreme schedule variations from the baseline 
resulted in the inability to accurately track progress and 
cost.'' At the request of USSOCOM, the committee recommends a 
transfer of $8.0 million from Procurement, Defense-wide, to 
Research, Development, Test, and Evaluation, Defense-wide, for 
cost growth in the engineering and manufacturing development 
phase of the program.

Defense Advanced Research Projects Agency programs

    The budget request included $2.8 billion for the research 
and management activities of the Defense Advanced Research 
Projects Agency (DARPA). While DARPA's fiscal performance has 
notably improved, the committee is still concerned about the 
timeliness of sustained funding execution. The committee 
recommends a reduction of $100.0 million from DARPA's overall 
budget to reflect continuing concerns about timely and 
effective execution of funds by the agency, as well as concerns 
about specific programs.
    DARPA is pursuing a broad range of manufacturing-related 
programs with over $500.0 million planned over the future-years 
defense program. The committee continues to support DARPA's 
efforts to revolutionize manufacturing technologies and 
methods. However, DARPA's transition plans for these programs 
are not clear. One of the metrics of success to DARPA's efforts 
in this area will be when the defense industrial base (as well 
as the broader national industrial base) incorporates new 
innovative manufacturing technologies and methods that will 
focus on increasing affordability and decreasing timelines. In 
order to accomplish this goal, DARPA needs to work more closely 
with the Services' Manufacturing Technology programs and the 
Deputy Assistant Secretary of Defense for Manufacturing and 
Industrial Base Policy and its research and development 
activities tied to new national manufacturing initiatives such 
as the Advanced Manufacturing Program. In addition, DARPA needs 
to work with the appropriate entities within the Department in 
considering the legal and policy implications to open-source 
manufacturing such as trusted supply chains, export controls 
and intellectual property issues.
    The Fast, Adaptable, Next-Generation Ground Combat Vehicle 
is a program where model-based design tools and highly 
adaptable foundry-style manufacturing techniques are being 
explored with respect to combat vehicle design and production. 
The committee continues to be concerned that force protection 
and related armor technologies, which are an integral component 
of any ground combat vehicle, are not adequately being 
addressed in conjunction with the Army.
    Hence, the committee directs DARPA to commission a review 
of its Adaptive Vehicle Make (AVM) umbrella program by an 
external review panel and submit the results of this review to 
the congressional defense committees 90 days after the 
enactment of this Act. The review should assess DARPA's 
transition plans for the AVM program and how well potential 
policy and legal issues are being addressed.
    The committee is strongly disappointed in DARPA's report to 
the congressional defense committees requested in the Ike 
Skelton National Defense Authorization Act for Fiscal Year 2011 
(Public Law 111-383) on the transition plan for the National 
Cyber Range (NCR) that identified U.S. Cyber Command as the 
transition partner. Given that U.S. Cyber Command has not 
agreed to be the transition partner, and given that this 
facility and technology represents at least a $116.0 million 
investment through fiscal year 2011, the committee recommends 
increasing PE 605118OTE by $4.0 million and directs the 
Director of Operational Test and Evaluation to continue testing 
the NCR with the broad cyber community in fiscal year 2013 
until a final plan is developed for the NCR by the Department 
of Defense.

                       Items of Special Interest


Adaptive engine technology development program

    The committee notes the Air Force budget request for fiscal 
year 2013 includes $214.0 million for the Adaptive Engine 
Technology Development (AETD) program. The Air Force has 
explained that this engine technology program has the potential 
to achieve a 25 percent reduction in cruise specific fuel 
consumption compared to existing state-of-the art engines such 
as the F135 engine. This fuel efficiency goal was set by the 
National Aeronautics Research and Development Plan of 2010 that 
provides overarching research goals and objectives to the 
interagency aeronautics research and development community, of 
which the Department of Defense is a key member. Such 
aggressive fuel consumption reduction goals are driven by the 
need to reduce overall fuel costs in military operations, as 
well as to make significant improvements to unrefueled aircraft 
range and time-on-station.
    The committee supports the Air Force Research Lab's (AFRL) 
efforts to pursue increased fuel efficiency and support the 
military aircraft engine industrial base through science and 
technology (S&T) programs including AETD. The committee's 
support for AETD is based on two understandings. First, the 
committee understands that AFRL will award up to two contracts 
for the AETD program through a fully open and competitive 
process that will not unduly advantage competitors who 
performed for the predecessor Adaptive Versatile Engine 
Technology program, nor disadvantage competitors performing for 
other military aircraft engine research or production programs.
    Second, the committee has received assurances in testimony 
from the Air Force that AETD is purely a technology maturation 
program and is not a new ``alternate engine'' program for the 
F-35 Joint Strike Fighter. The committee notes that further 
development of the alternate engine for the F-35 is prohibited 
under current law, and expects the Air Force to abide by the 
letter and the spirit of this law.
    The committee notes that it will review annually the 
progress of the AETD program during the course of its annual 
reviews of the Air Force's S&T programs.

Air Force cyber and information technology research

    The fiscal year 2013 Air Force budget request included 
$136.0 million for research and development in PE 602788F 
(Dominant Information Technology) and PE 603788F (Global 
Information Dev/Demo) for a broad spectrum of activities in 
cyber science and technology (S&T); autonomy, command and 
control, and decision support; connectivity and dissemination; 
and processing and exploitation technologies. The committee 
notes that these investment areas are consistent with the Air 
Force's Technology Horizons S&T plans, as well as with elements 
of the Department of Defense's overarching S&T priority areas. 
However, the committee notes that this investment level is a 
reduction of almost 20 percent compared to the fiscal year 2012 
funding levels, and that funding is projected to increase again 
in the fiscal year 2014-2017 time frame. The committee 
understands that the fiscal year 2013 decrease in funding in 
these areas is due to a ``strategic pause'' that the Air Force 
is taking to develop an investment plan for its activities. 
However, given the strategic importance of these technology 
areas--as identified in the new defense strategic guidance 
issued in January 2012, the committee is concerned about this 
significant drop in funding that would impact cyber-related 
research and development (R&D).
    Hence, the committee directs the Air Force to provide a 
report to the congressional defense committees detailing its 
investment strategy for these technology areas outlined above 
within 180 days after the enactment of this Act. The report 
should, at a minimum: 1) identify the Air Force's near-, mid-, 
and far-term S&T priorities for cyber and information-related 
technologies and the resources--both in funding and personnel--
projected to address these priorities; 2) lay out a transition 
strategy for the results of these S&T efforts into weapon 
systems, including cyber tools; 3) address how the Air Force 
will recruit, train, and retain a highly skilled workforce in 
these areas; and 4) address laboratory infrastructure and 
research facilities necessary for the accomplishment of this 
R&D.

Air Force space developmental test and evaluation

    In the Developmental Test and Evaluation and Systems 
Engineering FY 2011 Annual Report to Congress, the Deputy 
Assistant Secretary of Defense (DASD) for Developmental Test 
and Evaluation (DT&E) stated that the Air Force Space Community 
should ``grow their Developmental Test and Evaluation workforce 
and training in order for it to provide a robust government 
DT&E capability.''
    The committee notes that while the Air Force has an 
operational test and evaluation organization, it does not have 
a developmental test and evaluation organization for space 
systems similar to what it has for its aeronautical systems.
    Hence the committee directs the Air Force to provide a 
report to the congressional defense committees by December 31, 
2012, on how it currently accomplishes its developmental test 
and evaluation activities for its space systems, the 
effectiveness of the current construct, and a plan for how they 
are responding to the above observation made by the DASD for 
DT&E.

Applied mathematics and computational science

    The committee recognizes the important role that applied 
mathematics and computational science play in support of 
current Department of Defense (DOD) activities, including 
modeling and simulation, high performance computing, and large-
scale data analysis. In addition, the committee acknowledges 
the foundational impact of applied mathematics and 
computational science on some of the DOD's science and 
technology (S&T) emphasis areas, such as autonomy, cyber 
sciences, and data-to-decisions.
    However, the committee is aware of some concerns about the 
lack of a robust interaction between DOD laboratories and 
weapons centers and the academic research community in the 
fields of applied mathematics and computational science. The 
Assistant Secretary of Defense for Research and Engineering 
(ASDR&E) held a workshop on mathematics in January 2012, and a 
workshop on computer science in May 2011, that addressed 
leading areas of mathematics and computer science research from 
a disciplinary perspective. However, what is needed is a better 
understanding on how advances in the applied mathematics and 
computational sciences communities can assist in addressing the 
fundamental mathematical challenges underpinning some of the 
DOD S&T emphasis areas referenced above. For instance, DOD 
needs to ensure that advances and challenges identified in 
these workshops in areas of information science, mathematical 
modeling, human-machine interactions, and robotics will enable 
advances in the DOD's S&T emphasis area of autonomy.
    Hence, the committee urges the ASDR&E and the service S&T 
executives to ensure that the DOD robustly engages with the 
academic mathematics and computational science communities to 
leverage their expertise. The committee believes that more 
active engagement will enable the contributions of these 
communities to assist progress in the DOD's S&T emphasis areas 
that will ultimately lead to the next-generation of warfighting 
capabilities and technologies.

Army manned airborne intelligence, surveillance, and reconnaissance 
        platforms

    The budget request included $47.4 million in PE 65626A to 
complete four Engineering and Manufacturing Development (EMD) 
phase Enhanced Medium Altitude Reconnaissance and Surveillance 
System (EMARSS) aircraft. The committee understands that the 
Army plans to take delivery of these EMD phase EMARSS aircraft, 
conduct a utility assessment of them and then field them into 
the U.S. Army Intelligence and Security Command (INSCOM) Aerial 
Exploitation Battalions (AEB). Once these EMARSS aircraft reach 
the INSCOM AEBs, they will join a vastly heterogeneous fleet of 
aging programs of records--such as the Guardrail and Airborne 
Reconnaissance Low aircraft--and various quick-reaction 
capability (QRC) platforms.
    The Army requested the funding for these aircraft despite 
the fact that there is no procurement funding in the future-
years defense program to purchase any more EMARSS aircraft. 
Moreover, the Army asked to complete and retain these aircraft 
despite the fact that this committee signaled its clear 
intent--both through cuts to the EMARSS program and through 
report language on the MC-12W Project Liberty program in the 
Senate report accompanying S. 1235 (S. Rept. 112-26), the 
National Defense Authorization Act for Fiscal Year 2012--that 
the committee would not support procuring a second, separate 
fleet of C-12-based manned airborne intelligence, surveillance, 
and reconnaissance (ISR) platforms.
    The committee does not recommend denying the requested 
funds, in part because the Air Force was allowed to send the 
Liberty fleet to Air National Guard units and to man those 
units to support the deployment of enough aircraft to sustain 
only two combat air patrols, which are expected to be allocated 
to Special Operations Command support. The committee also 
believes that the new Army G-2 needs time to assess all of the 
airborne ISR programs and assets that the Army has accumulated 
and to chart a course looking ahead to the drawdown in 
Afghanistan.
    At the same time, the committee emphasizes its growing 
concerns about the state of the Army's manned airborne ISR 
portfolio. The wide mixture of manned airborne ISR platforms 
and sensors described above reflects the adaptation of Army 
Military Intelligence to the dynamic demands of the battlefield 
after 11 years of war. With soldiers gradually returning from 
the battlefield and with mounting pressure to decrease defense 
spending, now is the time for the Army to rationalize this 
fleet rather than to keep adding to it with low numbers of 
diverse aircraft.
    The committee directs the Army G-2, the Army G-8, and the 
Assistant Secretary of the Army for Acquisition, Logistics, and 
Technology to develop a plan for Army manned airborne ISR 
platforms. This plan should address the following questions:
           What requirements for manned airborne ISR 
        support to Army general purpose forces can be met with 
        shared assets from other services;
           What requirements for manned airborne ISR 
        support to Army general purpose forces need to be met 
        organically;
           Given the set of requirements that need to 
        be met organically, what existing QRC systems need to 
        become programs of record;
           Which current programs of record need to be 
        modernized or eliminated; and
           How will the Army resource these platform 
        choices?
    The committee directs the Army to provide this plan to the 
congressional defense and intelligence committees in 
conjunction with the submission of the budget request for 
fiscal year 2014. The committee expects the Army to consult 
with the committee as this plan is crafted. If requirements 
change or if assumptions about the level of support available 
from other services change, the committee would like to be kept 
apprised.

Army robotics

    The committee notes that ground robotic vehicles have saved 
many lives in the fight against improvised explosive devices 
(IED) and other efforts are underway to use ground robotics to 
accomplish ``dirty, dull, and dangerous'' tasks, including the 
transport of equipment and supplies, that will make our troops 
more safe and effective. Leading the research effort in ground 
robotics and autonomous control systems is the Army's Tank and 
Automotive Research Development and Engineering Center working 
collaboratively with industry and academia, as well as the Army 
Research Laboratory with the Robotics Collaborative Technology 
Alliance. The Army also works closely with the Robotic Systems 
Joint Project Office that is dedicated to continuous 
improvement of unmanned system capabilities to meet current and 
future joint military requirements.
    The committee believes that Army investments in the 
development of new ground robotics technologies to date are 
inadequate and lack focus. The Senate report accompanying S. 
1235 (S. Rept. 112-26) of the National Defense Authorization 
Act for Fiscal Year 2012 highlighted the importance of robotic 
ground vehicle technologies and acknowledged that the Army 
leadership was in the process of determining operational and 
technical requirements for ground robotics vehicles that will 
guide the development of a long-term research, development, and 
acquisition strategy. The committee understood that this 
strategy would be developed by the end of 2011 and used to 
guide Army research and development investments in robotic 
ground vehicles in fiscal year 2013 and beyond. However, the 
Army has not yet produced this strategy.
    The committee understands that recent Army strategic 
planning efforts on ground robotic vehicles have resulted in 
the development of an Unmanned Systems (Air, Ground, Maritime) 
Initial Capabilities Document that is approved by both the Army 
and Marine Corps, and is awaiting approval by the Joint Staff. 
Furthermore, the committee understands that the multi-service 
Joint Ground Robotics Integration Team, established by the 
Army's Maneuver Center of Excellence, is developing an Unmanned 
Ground Systems (UGS) Campaign Plan for the Army. It is expected 
that this campaign plan will provide the Army with the unity of 
effort across the unmanned enterprise including science and 
technology; experimentation, test and evaluation, and safety; 
development and fielding; training and sustainment; and 
deployment and employment. The committee believes this 
integrated effort is crucial to address not only technical 
challenges, but the more important policy and operational 
concepts issues that will ultimately inform the Army's 
investment plans in this area. Ultimately, the goal of this UGS 
Campaign Plan should be an affordably modernized force that 
fully integrates manned and unmanned teaming capabilities with 
improved persistence, protection, endurance, and autonomy.
    The committee expects the Army to complete and approve this 
UGS Campaign Plan in 2012, and to be briefed no later than 
December 31, 2012.

Ballistic missile defense overview

    The budget request included $9.7 billion for missile 
defense, including $7.8 billion for the Missile Defense Agency 
(MDA) and $1.9 billion for Army and related missile defense 
programs.
    In the area of homeland defense, 30 Ground-Based 
Interceptors (GBI) have been deployed in Alaska and California 
as part of the Ground-based Midcourse Defense (GMD) system, and 
are providing protection of the United States from the possible 
future threat of limited ballistic missile attack from nations 
such as North Korea and Iran. As outlined in the February 2010 
Ballistic Missile Defense Review, the Department of Defense has 
a program to improve the reliability and performance of the GMD 
system. The GBI reliability program is intended to double the 
number of threat intercontinental ballistic missiles (ICBM) 
that the current GMD system could defeat, without adding any 
GBIs--thus effectively doubling the capability of the existing 
GMD system.
    In December 2011, the Missile Defense Agency (MDA) awarded 
the GMD development and sustainment contract. Its cost was 
roughly $1.0 billion below the government cost estimate. This 
cost reduction resulted from competition, and permitted a 
reduction in the negotiated price of GBIs from about $75.0 
million to about $53.0 million each. One benefit of the new GMD 
contract is the inclusion of a defects clause that holds the 
contractor accountable for quality failures, and would require 
the contractor--not the taxpayer--to pay the costs of defective 
work. The committee commends MDA for achieving such substantial 
cost reduction and contractor accountability, and encourages 
MDA to pursue similar benefits in future contracts through 
competition.
    In the budget request, the Missile Defense Agency is 
requesting an additional five GBIs as test and spare missiles. 
These additional interceptors would provide several benefits 
that would: 1) allow a more robust test and evaluation program; 
2) allow the operational deployment of eight additional GBIs in 
spare silos at Missile Field-2 at Fort Greely, Alaska, if 
needed to meet a potential expansion of future threats from 
North Korea or Iran; and 3) keep the GBI production line warm 
into fiscal year 2018, thus permitting future procurement of 
additional GBIs, if needed.
    As a result of a GMD flight test failure in December 2010, 
MDA's highest priority is to correct the problem that caused 
the failure and to demonstrate the correction in two flight 
tests prior to resuming production or refurbishment of the 
newest model of exo-atmospheric kill vehicle (EKV) that 
failed--the Capability Enhancement-II model. This plan is 
consistent with the committee's position, and the committee 
commends MDA for its rigorous and disciplined approach to 
demonstrating that the new kill vehicle will work as intended 
before resuming production. As part of this approach, MDA is 
requiring the EKV contractors to meet more rigorous 
manufacturing and production quality standards, which has 
delayed the two planned flight tests several months. The 
committee believes it is important to take such prudent steps 
to improve quality and increase confidence in the system.
    The committee notes that the Integrated Master Test Plan 
for missile defense includes a series of planned GMD tests 
through 2022, including salvo testing, multiple simultaneous 
engagement testing, and operational testing. These tests are 
planned at a rate of roughly one test per year, which the 
Director of Operational Test and Evaluation testified is the 
best rate that has been achievable over the last decade. The 
Director of MDA testified that ``conducting flight tests at a 
pace greater than once a year prohibits thorough analysis of 
pre-mission and post-mission flight test data and causes 
greater risk of further failure and setbacks to developing our 
homeland defense capability as rapidly as possible.''
    In addition to its plans and programs to improve the 
reliability and performance of the GMD system, the Department 
is also pursuing a strategy to hedge against the possibility 
that the future ICBM threat from North Korea or Iran could 
emerge faster or in greater numbers than anticipated. Under 
this homeland defense hedging strategy, the Department has 
already made or implemented a number of decisions to improve 
the missile defense posture of the United States. For example, 
the Department has completed the construction of eight extra 
GBI silos at Missile Field 2 at Fort Greely, Alaska, which 
would permit the deployment of eight additional GBIs if needed 
to cope with a future emerging threat. The Department is 
evaluating the evolving threat and considering other potential 
hedging options, such as the advisability, feasibility, and 
affordability of deploying additional GBIs in the future, 
either in Alaska or possibly on the East Coast. The committee 
recommends a provision that would require the Department to 
report on these homeland defense activities, as described 
elsewhere in this report. The committee notes that section 233 
of the National Defense Authorization Act for Fiscal Year 2012 
(Public Law 112-81) required a report on the homeland defense 
hedging policy and strategy that was due in March, but which 
the Department has not yet submitted. The committee understands 
that the review process has taken much longer than originally 
planned, and is still continuing. However, the committee still 
expects the Department to provide the report as soon as it is 
finished, and to provide an interim report in case of any 
significant anticipated delay.
    The committee notes that the threat of regional missiles, 
particularly short- and medium-range missiles from Iran and 
North Korea, is serious and growing. These missiles pose a 
significant risk to forward-deployed U.S. forces, allies, and 
partners in Europe, the Middle East, and Asia. The Department 
has an obligation to provide force protection to U.S. forces 
against ballistic missiles deployed in these regions, as well 
as to meet our security commitments to our allies. To meet 
these needs, the Department is pursuing a Phased Adaptive 
Approach (PAA) to regional missile defense, tailored to each 
region.
    In 2011, the Department completed the deployment of Phase 1 
of the European Phased Adaptive Approach (EPAA) to missile 
defense, which is intended to defend our deployed forces and 
allies against Iranian missiles. This included: the deployment 
of an Aegis Ballistic Missile Defense (BMD) ship in the eastern 
Mediterranean Sea, equipped with Standard Missile-3 (SM-3) 
Block IA interceptors; the deployment of an AN/TPY-2 X-band 
missile defense radar in Turkey; and establishment of a command 
and control facility in Germany.
    During 2011, the administration also completed negotiations 
on all the bilateral agreements required to implement all four 
phases of the EPAA, including: agreements with Romania and 
Poland for the deployment of Aegis Ashore systems on their 
territory; an agreement with Turkey to deploy the AN/TPY-2 
radar on its territory; and an agreement with Spain to permit 
the forward stationing of four Aegis BMD ships at Rota.
    The core capability of the EPAA will be the Aegis BMD 
system, both at sea and on land, with four increasingly capable 
variants of the SM-3 interceptor missile, the SM-3 Blocks IA, 
IB, IIA and IIB. As indicated previously, the committee 
strongly supports the development, testing, production, and 
deployment of operationally effective Aegis BMD and SM-3 
capabilities in sufficient numbers to support the needs of the 
regional combatant commanders to implement the PAA in Europe 
and other regions, and to help protect the Homeland.
    In April 2011, an Aegis BMD ship with an SM-3 IA 
interceptor, using sensor information from a forward-deployed 
AN/TPY-2 radar like the one now deployed in Turkey, 
successfully intercepted an intermediate-range ballistic 
missile target during a flight test. This was a demonstration 
of the EPAA Phase 1 capability.
    In September 2011, the first flight test of the SM-3 Block 
IB interceptor failed to intercept the target. The MDA has 
analyzed the problem, and conducted a repeat test on May 10, 
2012, which successfully intercepted the target, to demonstrate 
the problem has been resolved. The September flight test 
failure caused a delay in the planned initial procurement of 
SM-3 IB missiles, and MDA plans to procure additional SM-3 IA 
missiles to meet the needs of combatant commanders for 
additional interceptor inventory. Prior to a full production 
decision for SM-3 IB, MDA would need to demonstrate success in 
five planned flight tests, three in 2012 and two more in 2013. 
The SM-3 IB is intended for deployment in Phase 2 of the EPAA 
in the 2015 timeframe, both at sea and at an Aegis Ashore site 
in Romania.
    Phase 3 of the EPAA is planned for deployment in the 2018 
timeframe, and will include the SM-3 IIA interceptor at sea and 
at Aegis Ashore sites in Poland and Romania. The SM-3 IIA is 
being co-developed with Japan, which will also deploy the 
missile on its Kongo-class Aegis BMD ships. During 2011, MDA 
completed the preliminary design review and extended the 
development phase of the SM-3 IIA with Japan to reduce 
technical and schedule risk. The first flight test (non-
intercept) of the SM-3 IIA is planned for fiscal year 2014, and 
nine more tests are planned before the Phase 3 deployment. 
Phase 3 is designed to provide a robust defense against Iranian 
intermediate-range missiles.
    The last planned variant of the SM-3 missile is the Block 
IIB, which is intended for deployment in Phase 4 of the EPAA in 
the 2021 timeframe. The SM-3 IIB is intended to defend against 
possible future long-range Iranian missiles that could reach 
the United States. This system would augment the GMD system for 
homeland defense and would provide an early intercept 
capability that could permit a ``shoot-look-shoot'' option to 
permit GBIs being held in reserve. The committee believes it is 
important to develop a second type of interceptor system to 
defend the Homeland, in addition to the GBI system. By pursuing 
a competitive approach to the concept development phase, MDA 
has engaged the significant engineering and design talent of 
the industrial base. The committee believes it is important to 
maintain this competitive approach, particularly since it could 
produce the most innovative, cost-effective, and operationally 
effective results.
    The budget request for the Missile Defense Agency would 
reduce the Terminal High Altitude Area Defense (THAAD) system 
from a planned procurement of nine batteries to six batteries 
in the future-years defense program (FYDP), and the number of 
THAAD interceptors was reduced correspondingly by 122 compared 
to the plan presented in the fiscal year 2012 budget request. 
Given that the combatant commander interest in THAAD remains 
undiminished, the committee is disappointed to see these 
planned reductions to the THAAD system. In testimony to the 
committee, LTG Richard Formica, the Commander of U.S. Army 
Space and Missile Defense Command, and Commander of the Joint 
Functional Component Command for Integrated Missile Defense, 
explained that the choice of how many THAAD batteries to 
procure in the FYDP came down to considering the missile 
defense ``priority between investing in the Homeland and 
investing in the region.'' However, the committee understands 
that the Department plans to continue THAAD production beyond 
the FYDP, including plans to maintain a procurement objective 
of 503 missiles.
    Previous difficulties with the THAAD production line have 
delayed the program, and resulted in slower production than 
planned. These production rate issues appear to be close to 
resolution. The committee notes that the THAAD production line 
will remain open through fiscal year 2017, including the 
production of two THAAD batteries for the United Arab Emirates, 
and will be capable of producing additional THAAD systems in 
the future. The committee encourages the Department to explore 
options to restore THAAD production to higher levels in the 
future. Furthermore, the committee recommends an increase of 
$100.0 million for additional procurement of THAAD 
interceptors, as described elsewhere in this report.
    In October 2011, the THAAD system conducted a successful 
initial operational test and evaluation (IOT&E) flight test, 
intercepting two targets nearly simultaneously. This test, 
using the operational THAAD soldiers, represented operationally 
realistic conditions with fielded equipment. Based on lessons 
learned from this test, MDA decided to add a new flight test in 
2012 to gain experience with THAAD and debris mitigation in a 
flight test to integrate THAAD with Aegis BMD, and Patriot all 
operating simultaneously. This will take place prior to the 
first operational test involving THAAD, Aegis BMD, and Patriot 
PAC-3 defending against five separate targets in flight. The 
committee believes this integration flight test, described by 
the Director of MDA as the ``largest, most complex missile 
defense ever attempted,'' is a useful risk mitigation step 
before the first multi-system operational test in 2013.
    In testimony to the committee in April 2012, the Director 
of MDA stated that the ``greatest future enhancement for both 
homeland and regional missile defense in the next 10 years is 
the development of the Precision Tracking Space System (PTSS) 
satellites, which will provide fire control quality track data 
of raids of hostile ballistic missiles over their entire flight 
trajectories. . .''. He also noted that ``the need for 
persistent, full trajectory, tracking of ballistic missiles is 
one of the war-fighter's highest development priorities as 
stated in the 2012 STRATCOM PCL [U.S. Strategic Command's 
Prioritized Capabilities List].''
    In 2011, the Missile Defense Executive Board, the 
Department's acquisition oversight body for missile defense, 
directed U.S. Strategic Command to conduct an assessment of the 
cost and performance of the three alternative remote missile 
defense sensor systems--including PTSS, the Airborne Infrared 
system, and forward-based AN/TPY-2 radars--to make 
recommendations for the fiscal year 2013 budget request. 
Strategic Command's recommendations are reflected in the budget 
request, which includes $276.3 million to continue development 
of PTSS, ends the Airborne Infrared program as a program of 
record (Congress appropriated no funds for it in fiscal year 
2012), and would stop procurement of forward-based AN/TPY-2 
radars at five, rather than nine. This assessment, based on 
operational considerations, had participation from the 
geographic combatant commands, the Joint Staff, Air Force Space 
Command, the Joint Functional Component Commands under U.S. 
Strategic Command, the DOD Cost Analysis and Program Evaluation 
(CAPE) office, and the Office of the Under Secretary of Defense 
for Acquisition, Technology, and Logistics. In addition, the 
DOD CAPE is currently performing an Independent Cost Estimate 
and technical evaluation of PTSS that is due in October 2012.
    In June 2011, the Acting Chairman of the Joint Chiefs of 
Staff wrote to the committee that, ``the Joint Staff supports 
PTSS as the most cost effective future sensor providing assured 
access and persistent tracking coverage in an integrated 
Ballistic Missile Defense Architecture.'' He also noted that he 
fully concurred with the assessment of the Joint Functional 
Component Commander for Integrated Missile Defense for U.S. 
Strategic command that ``PTSS would provide a capability that 
increases our forces' ability to defend against larger raids 
and would reduce our reliance on terrestrial based radar 
systems and airborne sensor platforms that require overseas 
basing agreements.''
    Given the strong military support for PTSS as the most 
cost-effective means of providing persistent tracking and 
targeting of ballistic missiles for homeland and regional 
missile defense, and its expected operational benefits, the 
committee supports continuing with development of PTSS as a 
high priority program.

Cyber research, development, test, and evaluation, and training 
        infrastructure

    The Department of Defense's new strategic guidance 
emphasizes the importance of operating effectively in 
cyberspace and states that the United States will ``invest in 
advanced capabilities to defend its networks, operational 
capability, and resiliency in cyberspace''. To the Department's 
credit, cyber was one of the few areas where the DOD increased 
its investments in both defensive and offensive capabilities.
    Developing and testing these cyber capabilities and 
training personnel effectively for cyber operations requires a 
cyber infrastructure that can be used by the research 
community, the acquisition community for development and 
testing (both developmental and operational), and the 
operational community for training, exercises, and rehearsals. 
While this infrastructure is necessary for all these missions, 
it is typically referred to as ``cyber test and evaluation 
(T&E) infrastructure'', or simply ``cyber ranges''.
    Despite the importance of this cyber T&E infrastructure, 
comprehensive oversight and strategic planning for long-term 
funding, personnel plans, and modernization investments do not 
exist. There is a significant disconnect between the DOD's 
policy statements to increase cyber operations and security, 
and its lack of attention to its cyber ranges. The last few 
years have seen a decline in the funding and the personnel 
attached to a number of key DOD-wide cyber ranges--while the 
demand for more rigorous testing and training has increased.
    Currently, there are a number of cyber ranges either in 
operation or still undergoing development that could be 
considered ``national assets'' due to their scope and 
capabilities, and that could be components of a broader 
federated cyber range infrastructure for the DOD.
    The National Cyber Range (NCR) was developed by the Defense 
Advanced Research Projects Agency (DARPA) with the goal of 
creating a secure, self-contained facility that could rapidly 
emulate complex defense and commercial networks, allowing for 
the cost-effective and timely validation of cyber technologies. 
The NCR is currently in a 1 year beta operation phase and is in 
the process of securing Sensitive Compartmented Information 
security accreditation. In a letter to the committee in June 
2011, the Under Secretary of Defense for Acquisition, 
Technology, and Logistics stated that the NCR would transition 
to U.S. Cyber Command (CYBERCOM), but CYBERCOM has not agreed 
to this plan, and there are no funds requested for CYBERCOM to 
operate and support the range. Hence the future of the NCR, an 
investment of $116.0 million through fiscal year 2011, is 
unknown. The fiscal year 2013 budget request contains only $1.8 
million for DARPA to close out the contract.
    The Joint Information Operations Range (JIOR) is a nation-
wide network of 68 nodes for live, virtual, and constructive 
operations across the full spectrum of security 
classifications. Originally operated by the Joint Forces 
Command (JFCOM), it was transferred to the Joint Staff in 
fiscal year 2011. However, funding and personnel are being 
reduced. Only 39 research, development, test, and evaluation 
and training events are planned for fiscal year 2012 compared 
to 60 events that were conducted in fiscal year 2011.
    The DOD Cyber/Defense Information Systems Agency 
Information Assurance Range is an operationally realistic 
environment for emulating the Global Information Grid 
Information Assurance/Computer Network Defense capabilities 
that is used for research and development, test and evaluation, 
and training. Funding and personnel are relatively constant 
over the out-years, but the number of RDT&E and training events 
planned at this range is also declining.
    In addition, U.S. Cyber Command has developed a virtual 
training environment for the DOD annual Cyber Flag exercise 
that has the potential to be integrated with other environments 
and ranges. This range supports training operations involving 
friendly, neutral, and adversarial participants, and is 
instrumented for situational awareness and training 
assessments.
    Lastly, there is the potential to broaden the scope of uses 
of the Joint Systems Integration Center/Joint System 
Integration and Interoperability Lab that was formerly under 
JFCOM and now under the Joint Staff. While the current focus of 
this range is to replicate operational command and control 
networks and assess system interoperability, its capabilities 
could be used for broader information assurance assessments and 
activities, including direct linkage to the JIOR.
    Recently, through prompting, the Department has recognized 
the need to take a more strategic view of its cyber ranges. In 
a report to Congress requested in section 933 of the National 
Defense Authorization Act for Fiscal Year 2012 (Public Law 112-
81), Report on Acquisition and Oversight of Department of 
Defense Cyberspace Operations Capabilities, the Under Secretary 
of Defense for Acquisition, Technology, and Logistics stated 
that the Department's Cyber Investment Management Board has 
directed the Director of the Test Resources Management Center 
and the Director of Operational Test and Evaluation to develop 
an enterprise roadmap for cyber T&E infrastructure 
capabilities. Furthermore, the committee is awaiting a brief on 
the Department's analysis of T&E resources needed to address 
the capability gaps outlined by the ``2010 Test and Evaluation 
Strategic Plan''--a reporting requirement from the House report 
accompanying H.R. 1540 (H. Rpt. 112-78) of the National Defense 
Authorization Act for Fiscal Year 2012.
    However, these activities have not yet addressed the key 
issue of centralized oversight and management of these or 
potentially new cyber ranges. While the committee sees the 
management of cyber ranges as a natural extension of the 
Department's oversight of the Major Range and Test Facilities 
Base through the Test Resources Management Center, the 
committee believes that the Department should conduct its own 
evaluation. Hence, the committee directs the Under Secretary of 
Defense for Acquisition, Technology, and Logistics and the 
Under Secretary of Defense for Intelligence, working with the 
Director of Operational Test and Evaluation, and the Director 
of the Test Resources Management Center to submit a report to 
the congressional defense committees 180 days after the 
enactment of this Act on the determination of an entity within 
the Department that will have oversight of the cyber T&E range 
infrastructure, funding and personnel.
    In addition to identifying the management structure for the 
cyber ranges, this report shall identify the entities (e.g., 
such as executive agents) that will provide funding and 
resources for the operation and modernization of the ranges, as 
well as the mechanisms for the allocation of range resources to 
range users. The committee expects that future budget requests 
will not simply arrest but reverse the decline in funding and 
activities at the Department's cyber ranges, commensurate with 
the importance that the Department attaches to the cyber 
mission.

Department of Defense labs workforce and infrastructure

    As a key element of the Department of Defense's (DOD's) 
roughly $12.0 billion per year science and technology 
portfolio, its laboratories contribute to a broad range of 
science and technology activities, ranging from conducting 
Nobel-prize winning basic research to rapidly developing and 
fielding capabilities for the warfighter. The lab enterprise 
includes 62 organizations spread across 22 states with a total 
workforce of about 60,000 employees, more than half of whom are 
degreed scientists and engineers. In certain critical national 
security-related areas, these organizations--and more 
importantly, the highly skilled scientists, engineers and 
technicians in them--are national assets.
    The committee understands that among the numerous 
challenges facing the DOD lab enterprise, two key issues 
require focused and sustained attention:
          (a) recruiting and retaining the best and brightest 
        scientists, engineers, and technicians; and
          (b) modernizing aging infrastructure.
    Congress has provided a number of authorities to the labs 
over the years, including direct hiring authority of scientists 
and engineers with advanced degrees. However, in testimony 
before the Subcommittee on Emerging Threats and Capabilities 
Subcommittee of the Senate Committee on Armed Services on April 
17, 2012, it appears that there may be a need for the labs to 
have a similar authority for scientists, engineers, and 
technicians with undergraduate technical degrees with unique 
skills, expertise, and experience. Hence, the committee directs 
each service science and technology executive, consulting with 
the Assistant Secretary of Defense for Research and Engineering 
and the Under Secretary of Defense for Personnel and Readiness, 
to submit a report to the congressional defense committees not 
later than 180 days after the enactment of this Act that will 
describe whether direct hiring authority of undergraduate 
scientists and engineers is required, and provide an 
explanation why existing authorities under the laboratory 
personnel demonstration program authorized by section 342 of 
the National Defense Authorization Act for Fiscal Year 1995 
(Public Law 103-337), as amended, are not sufficient to meet 
this need for direct hiring authority.
    Concerning aging laboratory infrastructure, the committee 
is pleased that the Army has initiated a survey of its 
laboratory infrastructure and directs the Navy and Air Force to 
undertake similar surveys of its laboratory infrastructure. In 
addition, the committee understands the Assistant Secretary of 
Defense for Research and Engineering is also conducting a 
survey of the DOD's laboratories. The committee directs the 
services to brief the congressional defense committees on the 
results of their surveys no later than March 1, 2013.

Dry Combat Submersible

    The committee notes that U.S. Special Operations Command 
(USSOCOM) has deferred plans for the foreseeable future to 
procure Dry Combat Submersible-Light and associated Future Dry 
Deck Shelter Extension Modifications in light of higher 
priority requirements and budget constraints. The committee 
also notes USSOCOM intends to continue forward with modified 
plans to field a single Dry Combat Submersible variant. The 
committee expects, consistent with the National Defense 
Authorization Act for Fiscal Year 2012 (Public Law 112-81), 
that the Under Secretary of Defense for Acquisition, 
Technology, and Logistics will make a determination, prior to a 
milestone B decision, on whether to treat the Dry Combat 
Submersible program as a Major Defense Acquisition Program.

Energy efficiency research and development coordination and transition

    The committee is encouraged by the Defense Department's 
efforts to coordinate with the Department of Energy in pursuing 
and evaluating energy efficient technologies. The wide variety 
of investments made by the Defense Department towards reducing 
energy usage has already illustrated savings; however, the 
numerous organizations pursuing these initiatives within the 
Defense Department and other federal agencies also presents 
increasing potential for duplicative research and development 
as well as successful technologies not identified and 
effectively transitioned. The continued cooperation and 
combination of technical expertise as coordinated in the July 
2010, memorandum of understanding (MOU) between the Departments 
of Defense and Energy is important in maximizing the return on 
these investments. The committee encourages the Defense 
Department to continue both internal efforts and coordination 
with other agencies to manage ongoing and planned energy 
efficiency research and development as well as continuing to 
establish processes for effectively transitioning technologies 
for broader application across the Department of Defense.

Hexavalent chromium

    The committee is encouraged by the Defense Department's 
efforts to reduce and eliminate materials identified by the 
Department of Defense Chemical and Material Risk Management 
Directorate. In particular, the Department outlined aggressive 
plans to reduce the use of hexavalent chromium. The committee 
supports the Department's efforts to continue to pursue 
research, development, testing, and evaluation of substitute 
solutions as well as effective transition into existing and 
future programs of record.

Human bone collections for Department of Defense research

    The committee understands the importance of the Department 
of Defense (DOD) to conduct research and study collections of 
human bones. This research has contributed to the development 
of personal protective equipment, improved medical procedures, 
as well as medical devices for wounded service members. 
Furthermore, the committee understands that collections 
currently utilized by DOD may require a significant wait-time 
to conduct the necessary research and the collections may lack 
the demographic diversity in size and other characteristics 
needed to represent the U.S. armed services today.
    The committee encourages the DOD to utilize as broad of a 
spectrum of publicly available bone collections as possible and 
relevant when conducting research requiring the use of human 
bones.

Hypersonics ground test and evaluation capabilities and workforce

    Crucial to advancing the field of hypersonics that will 
support the development of advanced weapons systems, is a 
robust ground test and evaluation infrastructure that enables a 
broad range of research and development capabilities. Whether 
for vehicle aerodynamics, thermal design, or propulsion system 
development, ground test facilities are crucial to not only 
reducing risk in development, but for the research community to 
expand foundational knowledge in this area of aeronautics, as 
well as to increase confidence in computational design tools.
    Much of the U.S. hypersonics test and evaluation 
infrastructure--primarily shared between the Department of 
Defense (DOD) and the National Aeronautics and Space 
Administration (NASA), but also including some capabilities in 
other parts of the government and the private sector--is dated; 
existing facilities have limits in either test duration, or in 
accurately replicating the physics of hypersonic flows, or in 
the size of the models that can be tested. Furthermore, the 
development of hypersonic air vehicles--including gliders or 
those with air breathing propulsion--has experienced periods of 
increasing and decreasing demand in the past few decades. This 
situation has led to a large degree of uncertainty in the 
demand for hypersonic test and evaluation facilities and hence 
they have been a target for cost savings in the current fiscal 
environment.
    However, the DOD's new defense strategic guidance 
emphasizes the importance of projecting power despite anti-
access/area denial challenges. In addition to rebalancing focus 
towards the Asia-Pacific region, the guidance states that the 
U.S. military ``will invest as required to ensure its ability 
to operate effectively in anti-access and area denial (A2/AD) 
environments.''
    The committee notes that the wide expanses of distances in 
the Asia-Pacific region, the growing A2/AD threat which 
requires greater stand-off distances, and the increasing need 
in modern warfare for fast response times for time-critical 
targeting all point to the need for the Department to invest in 
high-speed weapon and platform technologies, including 
hypersonics.
    The committee notes that the state of the Nation's 
hypersonics ground test and evaluation facilities and workforce 
have not received adequate attention over the years facing both 
threats of divesture as well as gradual decay, and is concerned 
that the broad developmental hypersonics community needs 
renewed attention.
    Hence, the committee directs the Secretary of the Air Force 
to conduct a study on the ability of the Air Force air and 
ground test and evaluation infrastructure facilities, including 
wind tunnels and air test ranges, as well as associated 
instrumentation, to support defense hypersonic test and 
evaluation activities for the near and far term. The study 
should consider the needs of research and technology 
development as well as potential future DOD weapons programs. 
The Secretary shall incorporate the results of the study into a 
master plan for requirements and proposed investments to meet 
the DOD needs through 2025. The Secretary of the Air Force 
shall consult with the secretaries of the other military 
departments, the Directors of the appropriate defense agencies, 
the Assistant Secretary of Defense for Research and Engineering 
(who oversees the Joint Technology Office on Hypersonics), and 
the Director of the Test Resource Management Center to assess 
the requirements needed to support hypersonic research, 
development, test, and evaluation throughout the DOD and to 
include all DOD requirements in the master plan. In addition, 
the Secretary shall consult with NASA and leverage current 
studies under the National Partnership for Aeronautical 
Testing.
    The study shall contain the following:
          (a) Document the current condition and adequacy of 
        the Air Force test and evaluation infrastructure 
        required to support hypersonic research and development 
        within DOD;
          (b) Identify test and evaluation infrastructure that 
        could be used to support DOD hypersonic research and 
        development outside the Department of the Air Force and 
        assess means to ensure the availability of such 
        capabilities to the DOD now and in the future; and
          (c) Include a time phased plan to acquire required 
        hypersonic research and development test and evaluation 
        capabilities including identification of the resources 
        necessary to acquire any needed capabilities that are 
        currently not available.
    The Secretary shall submit a report of the findings of this 
study not later than 1 year after the enactment of this Act.
    According to section 139d(a)(5)(D) of the Weapon System 
Acquisition Reform Act (WSARA) of 2009 (Public Law 111-23), the 
Deputy Assistant Secretary of Defense (DASD) for Developmental 
Test and Evaluation (DT&E) shall provide advocacy, oversight, 
and guidance to elements of the acquisition workforce 
responsible for developmental test and evaluation. In addition, 
section 139d(b)(1)(A) of WSARA mandates that the service 
acquisition executive of each military department develops 
plans to ensure the military department concerned has provided 
appropriate resources for developmental test organizations with 
adequate numbers of trained personnel.
    Hence, the Deputy Assistant Secretary of Defense for 
Developmental Test and Evaluation, dual-hatted as the Director 
of the Test Resource Management Center, shall work with the Air 
Force acquisition executive, as well as the Commanders of the 
Air Force Materiel Command and the Air Force Research 
Laboratory, to ensure that the following objectives are met:
          (a) Develop and sustain the expertise of the 
        hypersonics test and evaluation workforce; and
          (b) Develop the next generation of hypersonics T&E 
        experts via Science, Technology, Engineering, and 
        Mathematics efforts.
    The DASD for DT&E, along with the two Air Force officials 
identified, shall brief the congressional defense committees no 
later than 180 days after the enactment of this Act on what 
specific steps are being taken to meet these objectives.

Internet cartography

    One of the foundations of military operations are up-to-
date maps that vary in scale and detail to enable commanders to 
visualize the terrain, understand the operational situation, 
plan courses of action, and create a common understanding with 
subordinates and peers. The Department of Defense (DOD) for 
decades has supported a combat support defense agency whose 
mission has solely or largely been focused on mapping, charting 
and geodesy.
    In the cyber domain, the need to understand the operational 
``terrain'' is no less important. Yet, DOD has never 
established a telecommunications and computer network mapping 
program to address Department-wide requirements for 
intelligence, network defense, campaign planning, exercises and 
wargames, support to military operations, targeting, and 
establishing a common operational picture. The National 
Security Agency (NSA) certainly collects and analyzes a wealth 
of data on foreign networks, but it does so only to support its 
mission set, and not on a comprehensive or consistent basis. 
Other DOD components map the cyber terrain in even more 
sporadic and limited ways.
    In part, this basic need has not been met because it has 
been considered to be too hard--the Internet appears to be too 
complex, too large in scale, and experiencing too rapid 
changes. In addition, collecting the necessary detail 
accurately at the necessary volume and speed was considered 
technically too difficult.
    This appears to be changing. Commercial capabilities exist 
that hold promise for meeting the needs of U.S. Cyber Command 
and the intelligence community.
    The committee encourages the Cyber Command J-3, the NSA 
Threat Operations Center, and the Defense Information Systems 
Agency-managed Community Data Center to collaborate on a pilot 
program to demonstrate a capability to produce detailed, 
accurate Internet maps, update them rapidly, display them 
interactively, and overlay enriching information. The committee 
believes that an effective pilot demonstration program could be 
conducted inexpensively, and encourages the Department to 
pursue such efforts with available resources.
    The committee also directs the Vice Chairman of the Joint 
Chiefs of Staff, in conjunction with the Under Secretary of 
Defense for Policy, to undertake a study of DOD's broad needs 
for cyberspace mapping and make a recommendation on whether DOD 
needs to create a focused program and assign the mission to one 
or more organizations to manage. The Vice Chairman shall brief 
the congressional defense committees on this assessment by 
March 1, 2013.

Massachusetts Institute of Technology--Lincoln Laboratory improvement 
        project

    As a designated Department of Defense Federally Funded 
Research and Development Center, Lincoln Laboratory conducts 
research and development pertinent to national security on 
behalf of the military services, the Office of the Secretary of 
Defense, the intelligence community, and other government 
agencies. The committee understands that the Air Force and 
Lincoln Laboratory are considering modernizing and improving 
some of the Laboratory's research facilities required for the 
development of certain systems and technology for national 
security needs.
    The committee strongly urges the Department of Defense to 
expedite its deliberations with the Office of Management and 
Budget to develop a path forward to permit the Air Force to 
conclude an arrangement with the Massachusetts Institute of 
Technology for improving and modernizing the Lincoln Laboratory 
complex at Hanscom Air Force Base, Massachusetts.

Medical Countermeasures Initiative

    The budget request included $98.9 million in a variety of 
defense-wide research and development budget lines for the 
Medical Countermeasures Initiative (MCMI). This initiative is 
intended to advance significantly the development and 
manufacturing of biodefense medical countermeasures, including 
vaccines and therapeutics. Such advances are important to meet 
the growing risks of biological threats, including genetically 
engineered threats, potential terrorist threats, and naturally 
occurring disease outbreaks like pandemic influenza.
    The committee notes that this initiative is a coordinated 
and collaborative interagency effort, guided by updated 
national strategy and guidance documents, and involves 
particularly close cooperation between the Department of 
Defense and the Department of Health and Human Services. 
Congress has previously encouraged such interagency 
collaboration and coordination, and the committee commends the 
administration for placing a priority on improving the medical 
countermeasures capability of the nation, particularly 
countermeasures to protect military forces against biological 
threats.
    The MCMI program is intended to establish an advanced 
development and manufacturing facility on a cost-shared basis 
with industry and academia. The Department will not own the 
facility, which will ensure this approach is more cost-
effective and efficient than would otherwise be the case.
    The committee notes that section 1601 of the National 
Defense Authorization Act for Fiscal Year 2004 (Public Law 108-
136), directed the Secretary of Defense to ``carry out a 
program to accelerate the research, development and procurement 
of biomedical countermeasures, including but not limited to 
therapeutics and vaccines, for the protection of the Armed 
Forces . . .''. The committee believes the MCMI program is an 
important effort to meet this requirement.

Naval electromagnetic railgun projectiles

    The Navy is developing an electromagnetic rail gun for 
engagements of surface and air threats at ranges up to 200 
nautical miles. The committee expressed concerns with the 
program last year, but now feels that the Navy is making 
progress in overcoming the various technical challenges on the 
launcher. However, much remains to be done on the development 
of suitable projectiles.
    The committee is aware that in the past, the Navy and the 
Defense Advanced Research Projects Agency (DARPA) discussed 
collaborating on projectile development, but no serious joint 
efforts emerged. The committee now understands that the Navy 
and DARPA are planning to work together on projectile 
development, including hardening and guidance/navigation 
systems. The technologies may include low cost sensors tolerant 
of high accelerations and temperatures, advanced materials, 
modeling and simulation, and exo-atmospheric control systems. 
Given the investments made to date in the launcher, the 
committee fully supports this collaboration. The committee also 
encourages the Navy and the Air Force to collaborate on this 
project given the Air Force's expertise in hypersonics, as well 
as high-speed, high acceleration fusing and warhead 
technologies.

Naval Engineering Education Center

    The committee notes that the Navy faces significant 
challenges in training and hiring the next-generation of naval 
engineers. As former Secretary of the Navy Donald Winter said 
in 2007, ``Hiring top-quality people who have experience with 
large shipbuilding programs is essential. The ability to assign 
an experienced and capable team must be a precondition to a 
program's initiation. Finding and developing the people we need 
is easier said than done, and it will take time to rectify this 
problem, but we cannot ignore the leverage that can be obtained 
by putting the right, experienced and prepared people, in the 
right positions.'' The Naval Engineering Education Center 
(NEEC) was established in 2010 to help address the issues 
identified by then-Secretary Winter and now supports research 
and educational opportunities for more than 100 students at 
member universities with the goal of attracting and retaining 
qualified naval engineering talent. The committee commends the 
Navy for proactively working to address its naval engineering 
workforce issues and has been impressed with the success of the 
program in meeting its goals to date.
    However, the committee is concerned that the Navy has not 
identified a long-term, stable funding source for the NEEC. The 
committee understands that, to date, the NEEC has been 
substantially funded by Operation and Maintenance funds 
provided to Navy laboratories to pay for overhead expenses. The 
committee believes this is an unsustainable funding arrangement 
and is concerned that continuing in such a way will hinder the 
growth and effectiveness of the NEEC over time. The committee 
believes robust and predictable funding is important to 
sustaining meaningful research activities, recruiting students 
to participate in the program, and ensuring professors and Navy 
personnel remain fully engaged.
    In light of these concerns, the committee directs the 
Secretary of the Navy to provide a report, not later than 
December 31, 2012, outlining: (1) the Navy's plan to ensure the 
sustainability of the NEEC; (2) the potential funding sources 
to provide robust and predictable support to the program; (3) 
the projected funding levels for the NEEC across the future-
years defense program; (4) a value assessment of the NEEC to 
date in meeting the goals of the program; and (5) the metrics 
the Navy will use to measure the success of the program in 
future years.

Support for the Minerva Research Initiative

    The budget request included $19.4 million in PE 61110D8Z 
for Department of Defense Basic Research Initiatives. Of this 
amount, $16.5 million was requested for the Minerva Research 
Initiative.
    The Minerva program was established by then-Secretary of 
Defense Robert Gates in 2008 as a way to improve the 
Department's understanding of social, cultural, and political 
forces that shape regions of the world of strategic importance 
to U.S. national security policy. The current Secretary of 
Defense, Leon Panetta, has since expressed his support for the 
initiative.
    The committee supports the Department's fiscal year 2013 
funding request for Minerva, despite a significant cut in the 
program's fiscal year 2012 appropriations that unfortunately 
impacted the number of new research grants. The committee 
believes that the research supported by Minerva is more 
important than ever in today's uncertain geopolitical 
environment. It is important to develop a deeper understanding 
for responses to significant events and issues such as the Arab 
awakening, the continuing--and growing in some regions--threat 
of violent Islamic extremism, and the dynamics of resource-
driven conflicts in many parts of the world. In addition, it is 
vital to gain a better understanding of, and respond to, the 
trends and developments in China's military growth and 
modernization, strategic interests, and technological advances, 
particularly as they relate to the People's Liberation Army's 
role in setting priorities and influencing China's national 
security, economic, and foreign policy agenda.
    To this end, the committee encourages the Assistant 
Secretary of Defense for Research and Engineering and the Under 
Secretary of Defense for Policy to ensure that fiscal year 2013 
funds for the Initiative properly reflect the new strategic 
defense guidance, published by the Department of Defense in 
2012. The committee also urges the Initiative to invest in 
nationally recognized academic experts for the chairs at the 
professional military education institutes. Lastly, the 
committee encourages the Department to ensure that funding for 
Minerva-type research increases in the individual services.
                  TITLE III--OPERATION AND MAINTENANCE

              Subtitle A--Authorization of Appropriations

Operation and maintenance funding (sec. 301)
    The committee recommends a provision that would authorize 
appropriations for operation and maintenance activities at the 
levels identified in section 4301 of division D of this Act.

            Subtitle B--Energy and Environmental Provisions

Department of Defense guidance on environmental exposures at military 
        installations (sec. 311)
    The committee recommends a provision that would require the 
Secretary of Defense to issue guidance relating to how the 
military departments and other defense agencies deal with the 
possible exposure of individuals to environmental contamination 
at military installations.
    Section 314 of the Ike Skelton National Defense 
Authorization Act for Fiscal Year 2011 (Public Law 111-383) 
directed the Comptroller General of the United States to 
conduct an assessment of possible exposures to environmental 
hazards on military installations and examine related policies 
and processes of the Department of Defense (DOD) and other 
aspects of how environmental exposures are handled. On May 1, 
2012, the Government Accountability Office (GAO) issued its 
final report entitled, DOD Can Improve Its Response to 
Environmental Exposures on Military Installations (GAO-12-412). 
As this title implies, the GAO found various limitations in 
existing DOD policies and processes that impact adversely on 
the Department's ability to address environmental exposures of 
people living and working at military installations. To address 
these deficiencies, GAO made a number of recommendations, to 
include:
          1. Establishing procedures to track and document 
        status and nature of DOD responses to the Agency for 
        Toxic Substances and Disease Registry (ATSDR) 
        recommendations and findings of significant risk, and 
        to update the Memorandum of Understanding between DOD 
        and ATSDR to reflect these new procedures;
          2. Establishing a policy that identifies when 
        installations should consider requesting public health 
        assessments in addition to the initial assessments at 
        National Priorities List sites; and
          3. Provide guidance on what actions, if any, DOD 
        should take to identify and address possible health 
        risks faced by individuals from past exposures at 
        military installations.
    DOD, in its comments on the GAO recommendations, concurred 
with part of the first recommendation, but did not concur with 
part of the first recommendation or with the second or third 
recommendation.
    The committee agrees that these recommendations would help 
improve the policies and procedures within the DOD regarding 
the handling of possible environmental exposures at military 
installations, would result in more consistent responses to 
these issues throughout Department, and would advance the goal 
of providing safe and environmentally sound living and working 
conditions on military installations.
Funding of agreements under the Sikes Act (sec. 312)
    The committee recommends a provision that would amend the 
Sikes Act (16 U.S.C. 670 et seq.) to allow funds committed by 
the Department of Defense in a cooperative agreement to be made 
in a lump sum and to be placed in an interest bearing account 
with the interest available to be applied for the same purposes 
as the principal.
Limitation on availability of funds for procurement of alternative fuel 
        (sec. 313)
    The committee recommends a provision that would prohibit 
the use of funds authorized to be appropriated to the 
Department of Defense in fiscal year 2013 from being obligated 
or expended for the production or sole purchase of an 
alternative fuel if the cost exceeds the cost of traditional 
fossil fuels used for the same purpose, except for continued 
testing purposes.
    The committee notes that in December 2011, the Defense 
Logistics Agency, on behalf of the Department of the Navy, 
purchased 450,000 gallons of biofuels for $12.0 million, which 
equates to $26.66 a gallon. According to the Department of the 
Navy it was the single largest purchase of biofuel in 
government history and was carried out in order to 
``demonstrate the capability of a Carrier Strike Group and its 
air wing to burn alternative fuels.'' The Department of the 
Navy noted that, despite the use of operation and maintenance 
funds for the purchase, the demonstration is deemed a research, 
development, test, and evaluation (RDTE) initiative as 
justification for the higher cost per gallon.
    The committee also notes that the Vice Chief of Naval 
Operations testified before the Subcommittee on Readiness and 
Management Support on May 10, 2012, regarding pressure on 
readiness accounts from increased fuel prices that ``every $1 
increase in the price per barrel of fuel results in 
approximately $31M of additional cost annually above our 
budgeted level.'' Therefore, the high cost of fuel has direct 
and detrimental impact on other readiness accounts.
    The committee strongly supports initiatives undertaken by 
the Department of Defense to reduce the fuel demand of the 
operational forces through affordable new technologies that 
increase fuel efficiency and offer alternative sources of 
power. But given the pressure placed on current and future 
defense budgets, the committee is concerned about the use of 
operation and maintenance funds to pay significantly higher 
costs for biofuels being used for RDTE efforts. Therefore, the 
committee directs the Secretary of Defense to develop and 
promulgate guidance to the military services and defense 
agencies on the difference between the operational use of 
alternative fuels versus continued RDTE initiatives.

                 Subtitle C--Logistics and Sustainment


Repeal of certain provisions relating to depot-level maintenance (sec. 
        321)

    The committee recommends a provision that would repeal the 
amendments to provisions relating to depot-level maintenance 
made by sections 321 and 327 of the National Defense 
Authorization Act for Fiscal Year 2012 (Public Law 112-81).
    Sections 321 and 327 were intended to make the existing 
requirements more ``visible and readily understood'' without 
making any substantive change. However, the new language 
included changes that could significantly impact the balance of 
work between the public and private sectors. For example:
     Before the enactment of the new provisions, 
section 2460 of title 10, United States Code, excluded major 
modifications and upgrades from the definition of depot-level 
maintenance. The amendments made by section 321 eliminated this 
exclusion.
     Before the enactment of the new provisions, 
section 2460 and section 2464 of title 10, United States Code, 
excluded nuclear aircraft carrier refueling availabilities from 
the definition of depot-level maintenance and from the 
requirement for core logistics capabilities. The amendments 
made by sections 321 and 327 eliminated these exclusions.
     Before the enactment of the new provisions, 
section 2464 excluded special access programs. The amendments 
made by section 327 eliminated this exclusion.
     Before the enactment of the new provisions, 
section 2464 applied only to programs of record. The amendments 
made by section 327 extended the applicability of the provision 
to any military equipment that ``is fielded in support of 
operations.''
    Moreover, even language changes that the Department of 
Defense has assessed to have no substantive impact--such as the 
change in terminology from ``core logistics capabilities'' to 
``core depot-level maintenance and repair capabilities''--may 
have unintended consequences.
    The Department of Defense has indicated that it will 
attempt to address problems caused by the new language through 
creative interpretation of the statutory language and the 
issuance of multiple waivers (including categorical waivers) to 
the core logistics requirements in section 2464 and the so-
called ``50-50'' requirements in section 2466 of title 10, 
United States Code. While it appears that this approach will 
enable the department to get through fiscal year 2012 without 
major disruption of public sector or private sector depot 
activities, extensive reliance on questionable statutory 
interpretations and waivers to comply with a statute that is 
otherwise unworkable is not good precedent or good policy.
    While it might be possible to fix specific problems in the 
new statute through targeted amendments, the committee is 
concerned that such targeted amendments could themselves raise 
difficult issues of interpretation. The previous balance 
between public and private sectors was achieved not only by 
statutory language, but also by longstanding policies and 
practices, some of which differed from military department to 
military department. The new legislation, in its effort to make 
the statutory language more visible and readily understood, has 
placed many of these longstanding policies and practices in 
question.
    For this reason, the committee concluded that the best 
alternative is to repeal sections 321 and 327 and restore the 
former statutory language in its entirety. By making this 
repeal retroactive to the date of the enactment of the National 
Defense Authorization Act for Fiscal Year 2012, the committee 
intends to ensure that waivers issued during the period when 
the amendments made by sections 321 and 327 were in effect have 
no precedential value.
    The committee directs the military departments to interpret 
the restored statute in accordance with longstanding policies 
and practices that were in place before the enactment of the 
National Defense Authorization Act for Fiscal Year 2012.

                          Subtitle D--Reports


Annual report on Department of Defense long-term corrosion strategy 
        (sec. 331)

    The committee recommends a provision that would amend 
section 371 of the National Defense Authorization Act for 
Fiscal Year 2008 (P.L. 110-181, 10 U.S.C. 2228) to require the 
Department of Defense to provide additional information on 
corrosion projects in reports to Congress, including validated 
returns on investment for completed corrosion projects, 
activities, and information on how corrosion funding is used 
for military projects, the Technical Corrosion Collaboration 
pilot program, and other corrosion-related activities.

Modified deadline for Comptroller General review of annual report on 
        prepositioned materiel and equipment (sec. 332)

    The committee recommends a provision that would modify the 
deadline for the annual report on prepositioned materiel and 
equipment conducted by the Government Accountability Office.

                       Subtitle E--Other Matters


Savings to be achieved in civilian workforce and contractor employee 
        workforce of the Department of Defense (sec. 341)

    The committee recommends a provision that would require the 
Secretary of Defense to develop and begin implementation of a 
plan to achieve savings in funding for the civilian workforce 
and the service contractor workforce of the Department of 
Defense (DOD) that are not less, as a percentage of such 
funding, than the savings in funding for military personnel 
achieved by the planned reduction in military end strength 
contained in the budget request for fiscal year 2012. Current 
DOD plans call for a reduction in military end strength in 
excess of 5 percent through fiscal year 2017. The committee 
estimates that a comparable level of savings in the civilian 
and service contractor workforces will total in excess of $5.0 
billion over 5 years, over and above any savings that the 
Department may already plan or expect to achieve as a result of 
initiatives already in place.
    The provision would exempt expenses for civilian employees 
in mission critical occupations, personnel employed at military 
depots, and the offices of the Inspector General of the 
Department of Defense, and for contractor employees performing 
maintenance and repair of military equipment, medical services, 
and financial audit services. It would authorize the Secretary 
to establish additional exemptions, if he determines that they 
are necessary for the performance of critical functions in the 
interest of national defense. The committee concludes that 
these exceptions provide the Department with ample flexibility 
to ensure that the Department has the capacity it needs to 
perform its critical missions. The committee expects the 
Secretary to continue to seek savings with regard to critical 
functions, such as maintenance and repair of military 
equipment, even though they are exempt from the reductions 
under this provision.
    The committee acknowledges that the DOD efficiencies 
initiatives will result in an overall reduction in civilian 
personnel of almost 2 percent, and additional savings through 
the freeze on civilian pay increases. The committee is also 
aware that the efficiencies initiatives, coupled with the 
requirements of section 808 of the National Defense 
Authorization Act for Fiscal Year 2012 (Public Law 112-81), 
have resulted in significant savings in the service contractor 
workforce.
    However, these policies were established before the 
administration's decision to reduce military end strength by 
123,900 over the next 5 years--a 6.8 percent reduction for the 
Army, 3.9 percent reduction for the Navy, 8.3 percent reduction 
for the Marine Corps and 2.3 percent reduction for the Air 
Force. This provision will ensure that savings achieved in the 
civilian personnel workforce and the contractor employee 
workforce are brought in line with savings from the newer, 
deeper cuts to military end strength.
    The committee notes that the Comptroller General, in the 
``2012 Annual Report: Opportunities to Reduce Duplication, 
Overlap and Fragmentation, Achieve Savings, and Enhance 
Revenue,'' concluded that DOD should continue to consolidate or 
eliminate defense headquarters to achieve additional 
efficiencies. In the development of plans to reduce federal 
civilian personnel expenses, particular attention should be 
paid to reduction of management headquarters. The committee 
expects the Secretary to take into account the strategic 
workforce plan, and critical capabilities included therein, in 
the development of plans to reduce expenditures for federal 
civilian personnel of the Department.

NATO Special Operations Headquarters (sec. 342)

    The committee recommends a provision that would authorize 
the Department of Defense to provide up to $50.0 million in 
fiscal year 2013 and subsequent years to the North Atlantic 
Treaty Organization Special Operations Headquarters (NSHQ) for 
the purposes of: (1) improving coordination and cooperation 
between the special operations forces of North Atlantic Treaty 
Organization (NATO) nations; (2) facilitating joint operations 
by special operations forces of NATO nations; (3) supporting 
command, control, and communications capabilities peculiar to 
special operations forces of NATO nations; (4) promoting 
special operations forces intelligence and informational 
requirements within the NATO structure; and (5) promoting 
interoperability through the development of common equipment 
standards, tactics, techniques, and procedures, and through 
execution of multinational education and training programs. 
Additionally, the recommended provision requires an annual 
report summarizing Department of Defense support to the NSHQ.
    The committee notes that the Secretary of Defense 
designated the U.S. Special Operations Command (USSOCOM) as the 
``Lead Component with Executive Agent Responsibilities'' for 
the NSHQ on November 5, 2010. The committee also notes that the 
U.S. Army continues to retain funding responsibilities for the 
NSHQ as the designated administrative agent for NATO. The 
committee further notes that the Secretary of Defense has 
directed USSOCOM and the Army to complete a Memorandum of 
Agreement detailing their respective roles and responsibilities 
as they relate to the NSHQ. The committee expects funding of 
the NSHQ will be executed in accordance with the specified 
Memorandum of Agreement.

Repeal of redundant authority to ensure interoperability of law 
        enforcement and emergency responder training (sec. 343)

    The committee recommends a provision that would amend 
section 372 of title 10, United States Code, to ensure that 
Department of Defense support to a federal, state, or local law 
enforcement or emergency response agency to prepare for or 
respond to an emergency involving chemical or biological agents 
is consistent with the national preparedness system and other 
statutory changes made since the creation of the Department of 
Homeland Security.

                              Budget Items


General Fund Enterprise Business System Realignment

    The budget request included $556.3 million in Operation and 
Maintenance, Army (OMA), for administration.
    The committee has received a request from the Army to 
realign $17.2 million into General Fund Enterprise Business 
System (GFEBS) to support the engineering development effort 
necessary to process classified and sensitive transactions and 
to mitigate the risk of exposing classified information.
    Accordingly, the committee recommends a decrease of $17.2 
million in OMA for GFEBS realignment.

Museum funding decrease for ahead of need request

    The budget request included $1.1 billion in Operation and 
Maintenance, Army (OMA), for Other Service Support, of which 
$8.1 million was for the National Museum of the United States 
Army.
    The Army's budget growth justification cited, ``exhibits 
planning, fabrication, installation, storage and conversation 
for the initial opening of the museum''. However, given the 
museum has yet to be built, the committee is concerned that the 
increase of funding requested for museum exhibits is ahead of 
need. Accordingly, the committee recommends a decrease of $8.1 
million in OMA for the National Museum of the United States 
Army.

Unobligated Operation and Maintenance balances

    The budget request included $36.6 billion for Operation and 
Maintenance, Army (OMA), $41.6 billion for Operation and 
Maintenance, Navy (OMN), $5.9 billion for Operation and 
Maintenance, Marine Corps, $35.4 billion for Operation and 
Maintenance, Air Force (OMAF), and $31.9 billion for Operation 
and Maintenance, Defense-wide (OMDW).
    The committee notes that the sustained challenges 
associated with combat operations in Afghanistan have created a 
difficult fiscal management situation, especially for the Army 
and Marine Corps. However, the Department of Defense continues 
to under-execute its Operation and Maintenance (O&M) 
appropriations. The Government Accountability Office has 
informed the committee that the average annual O&M unobligated 
balances for fiscal years 2007-2011 were $1.4 billion for the 
Army, $286.1 million for the Navy, $386.5 million for the Air 
Force, $91.8 million for the Marine Corps, and $340.8 million 
for Defense-wide. These continued excessive unobligated 
balances are not consistent with sound stewardship of taxpayer 
dollars. In light of the fiscal management challenges, the 
committee concludes that certain reductions are appropriate.
    Accordingly, the committee recommends a decrease of $120.0 
million to OMA, a decrease of $23.0 million to OMN, a decrease 
of $32.0 million to OMAF, and a decrease of $25.0 million to 
OMDW.

U.S. Special Operations Command Operation and Maintenance

    The budget request included no funding in Operation and 
Maintenance, Defense-wide, for U.S. Special Operations Command 
(USSOCOM). A clerical error placed USSOCOM's base request of 
$5,091.0 million for Operation and Maintenance incorrectly in 
the ``classified programs'' budget line. Therefore, the 
committee recommends a transfer of $5,091.0 million from the 
Classified Programs Operation and Maintenance budget line to 
the USSOCOM Operation and Maintenance budget line, reflecting 
the amounts shown in the budget justification documents.

Defense Security Cooperation Agency

    The budget request included $557.9 million in Operation and 
Maintenance, Defense-wide (OMDW), for the Defense Security 
Cooperation Agency (DSCA). Of this amount, the request included 
$365.0 million for the Global Train and Equip program to build 
the capacity of foreign military forces to meet emerging 
security threats. The requested amount for the Global Train and 
Equip program would be $15.0 million in excess of the program's 
currently authorized level for fiscal year 2012 of $350.0 
million under section 1206 of the National Defense 
Authorization Act for Fiscal Year 2006 (Public Law 109-163), as 
most recently amended by section 1204 of the National Defense 
Authorization Act for Fiscal Year 2012 (Public Law 112-81).
    Further, the budget request included $2.6 million for the 
DSCA'S Security Cooperation Assessment Office (SCAO). The SCAO 
is an initiative by DSCA to gather, analyze, and assess the 
impact of the Department's security cooperation programs and 
initiatives. The committee continues to believe such an 
assessment of DSCA's programs is necessary. That is why in the 
Senate report accompanying S. 1235 (S. Rept. 112-26) of the 
National Defense Authorization Act for Fiscal Year 2012 the 
committee directed the Comptroller General of the United States 
to conduct such an audit of DSCA's programs and develop 
recommendations on how to improve DSCA's current activities. 
The committee looks forward to reviewing the Comptroller 
General's findings and in a separate section of this report 
directs the Comptroller General to undertake additional work to 
address the Department's needs in this area.
    Therefore the committee recommends a decrease of $17.6 
million to OMDW for DSCA, consisting of a decrease of $15.0 
million to the Global Train and Equip program and a decrease of 
$2.6 million to the SCAO.

Defense-wide funding decrease for ahead of need request

    The budget request included $253.4 million in Operation and 
Maintenance, Defense-wide (OMDW), for the Office of Economic 
Adjustment (OEA), of which $139.4 million was for socioeconomic 
and water/wastewater infrastructure improvements related to the 
relocation of Marines to Guam.
    Given the reevaluation of the relocation of Marines to 
Guam, the committee is concerned that the funds requested for 
the OEA are ahead of need. Accordingly, the committee 
recommends a decrease of $139.4 million in OMDW for the OEA.

Enhanced intelligence, surveillance, and reconnaissance support to 
        Operation Observant Compass

    The budget request included classified amounts for United 
States Africa Command (AFRICOM) intelligence activities, 
including support to Operation Observant Compass (OOC). The 
committee recommends an increase of $50.0 million, in Operation 
and Maintenance, Defense-wide, line 280, to expand and enhance 
the intelligence, surveillance, and reconnaissance (ISR) 
support to AFRICOM's OOC--the ongoing operation to support the 
efforts of Ugandan and other regional militaries to remove 
senior leaders of the Lord's Resistance Army (LRA) from the 
battlefield in Central Africa.
    The committee supports AFRICOM's ongoing operation in 
Central Africa in support of partner nation militaries, and the 
committee is eager to ensure U.S. service members deployed to 
advise and assist these regional efforts are provided with the 
resources and unique enabling support required to ensure 
mission success. That is why--pursuant to the policy 
established by the Lord's Resistance Army Disarmament and 
Northern Uganda Recovery Act of 2009 (Public Law 111-172)--in 
the National Defense Authorization Act for Fiscal Year 2012 
(Public Law 112-81), the committee recommended and Congress 
approved a provision permitting the Secretary of Defense to 
provide not more than $35.0 million in logistics support, 
services, and supplies to the national militaries in the region 
conducting operations to disarm and remove senior elements of 
the LRA.
    The committee notes that AFRICOM has only limited 
contractor-owned and -operated ISR platforms deployed in 
support of OOC. These capabilities are inadequate in multiple 
respects, most notably their inability to loiter over areas of 
interest for extended periods of time and to collect and 
disseminate various forms of intelligence promptly. While the 
committee is aware of a number of temporary and rotational 
efforts underway to enhance ISR support to OOC, the committee 
believes that without additional resourcing the current 
operation is likely to remain constrained by poor intelligence 
support. Without adequate ISR resourcing and support the 
committee is concerned that OOC will suffer from a lack of 
critical tipping-and-cueing intelligence capability to find and 
locate LRA forces.
    The committee is concerned that AFRICOM's current 
resourcing of this mission through the Air Force Big Safari 
program office and its contractors is unnecessarily costly and 
is not meeting the needs of the supported forces. The committee 
directs the Under Secretary of Defense for Intelligence (USDI) 
and AFRICOM to evaluate alternative capability providers and 
contracting arrangements, both for existing and enhanced 
intelligence support.
    The committee also notes that there is enduring high demand 
for additional airborne ISR support for AFRICOM and U.S. 
special operations forces in this region beyond the 
requirements of the OOC mission. The committee directs USDI and 
AFRICOM to consider these needs when making decisions about 
platforms, sensors, basing, and manning.

Operation and Maintenance funding for impact aid

    The amount authorized to be appropriated for Operation and 
Maintenance, Defense-wide, includes the following changes from 
the budget request. The provisions underlying these changes in 
funding levels are discussed in greater detail in title V of 
this committee report.

                    [Changes in millions of dollars]

Impact aid for schools with military dependent students.            25.0
Impact aid for children with severe disabilities........             5.0
    Total...............................................            30.0

                       Items of Special Interest


Advanced predictive modeling and simulation methodologies

    The committee recognizes that early integration of advanced 
predictive modeling and simulation methodologies into program 
acquisition and life cycle planning can help to avoid cost, 
reduce cost, and increase operational readiness by reducing 
unscheduled maintenance. Accordingly, the committee directs the 
Secretary of Defense to examine the appropriate applications of 
advanced predictive modeling and simulation technologies in the 
acquisition process of major weapon system programs, including 
prior to Milestone B, and provide a report to the congressional 
defense committees by March 30, 2013.

Air Force strategic basing process

    In Senate report accompanying S. 1253 (S. Rept. 112-26) of 
the National Defense Authorization Act for Fiscal Year 2012, 
the committee directed the Air Force to consider the evaluation 
of relative flying operation costs for each candidate base 
during its strategic basing process. The committee commends 
recent efforts made by the Air Force to do so through the 
creation of the Air Refueling Received Demand Model. The model 
accounts for refueling demand from lower priority missions, 
such as the movement of air show assets, during recent years.
    The committee is concerned, however, that the new model 
excludes evaluation of the demand for the highest priority 
activities as determined by the Joint Chiefs of Staff, 
including events where the aircraft departs from and returns to 
its home station. The air refueling demand for Priority 1 and 
Priority 2 sorties includes wartime and counterdrug missions, 
missions directed by the President, the Secretary of Defense, 
or combatant commanders, Coronet missions, and the deployment 
of assets in support of homeland defense. In total, these 
events account for 16 percent of the total operational demand 
for air refueling platforms.
    Therefore, the committee directs the Secretary of the Air 
Force to report to Congress no later than 90 days after 
enactment of this Act, on how the demand for all refueling 
events in which the aircraft departs from and returns to home 
station, regardless of the events' relative Joint Chiefs of 
Staff Mission Priority, will be accounted for in the Air 
Refueling Receiver Demand Model in the strategic basing process 
and future basing decisions. The committee further encourages 
the Air Force to assign greater value to the demand for high-
priority missions, as established by the Joint Chiefs of Staff, 
in the model.

Canines in support of members of the armed forces

    The committee recognizes the outstanding contribution of 
military working dogs in Operation Enduring Freedom, Operation 
Iraqi Freedom, and other military contingency operations. These 
courageous and talented canines have saved lives, including 
those of service members, through their work in detecting 
intruders, drugs, and improvised explosive devices. The 
committee recognizes the value of these highly trained animals 
in performing critical and varied roles to support both service 
members and civilians. In particular, the committee 
acknowledges the sacrifices of those military working dogs 
killed, wounded, or missing in action. The committee therefore 
encourages the Secretary of Defense to honor the service of all 
military working dogs, and especially those who perform 
exceptionally meritorious service, through appropriate 
recognition of their service.

Comptroller General of the United States assessment of Department of 
        Defense security cooperation activities

    Over the past decade, the Department of Defense (DOD) has 
expanded significantly its security cooperation activities. 
According to the Defense Security Cooperation Agency, more than 
$5.0 billion is spent on the DOD security cooperation program 
annually. DOD acknowledges openly its current inability to 
assess the impact of these activities in the medium- and long-
term. The committee, however, recognizes that the impact of 
security cooperation programs, many of which are the 
cornerstone of our military-to-military relations with our key 
allies and partners around the globe, is difficult to measure. 
As such, the committee directs the Comptroller General of the 
United States to conduct a review of DOD's security cooperation 
programs to examine the effectiveness, efficiency, and medium- 
and long-term results of DOD's programs in this area to 
consider the return on investment for these programs, and to 
make recommendations to optimize future security cooperation 
investments and policies targeted at achieving foreign policy 
objectives.
    The committee hopes the Comptroller General's review will 
increase the efficiency and effectiveness of DOD's security 
cooperation programs over time, maximize their value to the 
geographic combatant command commanders and U.S. foreign 
partners, and allow DOD to design and implement security 
cooperation programs optimized to meet requirements established 
by the Secretary of Defense and Chairman of the Joint Chiefs of 
Staff.
    The committee encourages the Comptroller General to consult 
with the Assistant Secretary of Defense for Special Operations/
Low Intensity Conflict to identify priority security 
cooperation programs of mutual concern. The Comptroller General 
shall provide routine briefings to the Committees on Armed 
Services of the Senate and the House of Representatives.

Consideration of fuel cell systems

    The committee is encouraged by many of the findings and 
recommendations included in the Defense Logistics Agency (DLA) 
sponsored report, ``Beyond Demonstration: The Role of Fuel 
Cells in DoD's Energy Strategy,'' published on October 19, 
2011. Among other things, this report recommended that 
Department of Defense (DOD) headquarters organizations and the 
military services: (1) develop and implement procurement models 
that enable more efficient acquisition of fuel cell systems; 
(2) consider fuel cell systems for meeting electric power, 
heating, and cooling demands whenever new facilities and major 
renovations are planned and designed; (3) consider fuel cell 
systems when planning and designing backup power capability for 
DOD sites; and (4) consider fuel cell power for material 
handling equipment. The committee directs the DOD to report 
back to the congressional defense committees no later than June 
1, 2013, on the steps being taken to implement the 
recommendations of the DLA report, or if the DOD does not 
intend to implement any of the recommendations, to explain the 
reasons behind those decisions.

Corrosion prevention

    Corrosion prevention at the Department of Defense (DOD) has 
been a priority for the committee because of its potential to 
increase readiness, improve operational safety, and reduce 
costs.
    One tactic that has been used to prevent or reduce 
corrosion is the application of protective coatings and paints 
that are applied to DOD weapon systems, military equipment, and 
infrastructure. The committee understands that several DOD 
components currently require that such coatings be applied by 
certified contractors using personnel who have been qualified 
through approved training programs.
    The committee directs the Director of Corrosion Policy and 
Oversight to review the use of such certification requirements 
and determine whether the broader application of qualification 
standards would be in the best interest of the Department. The 
Director shall notify the congressional defense committees on 
the findings and recommendations of this review no later than 
180 days after enactment of this Act.

Corrosion projects' return on investment and funding for corrosion-
        related activities

    While the committee supports efforts by the Department of 
Defense (DOD) to adequately address the problem of corrosion 
and resulting materiel degradation in the design, development 
and testing of new major weapon systems, the committee is 
concerned about the accuracy of the return on investment (ROI) 
that the DOD has reported on its corrosion projects. In the 
DOD's March 2012 Report to Congress on DOD Corrosion Policy and 
Oversight Budget Materials, it projected an average ROI for 
projects approved to date as in excess of 50:1. The corrosion 
program ROI is primarily calculated on those projects that are 
funded, after they are nominated by the military departments 
and reviewed for approval by the Office of the Secretary of 
Defense and the Joint Staff, and to a lesser degree on the 
activities funded.
    In December 2010, the Government Accountability Office 
(GAO), however, reported that the military departments are late 
in validating ROIs for some completed projects. The DOD's 
Corrosion Prevention and Mitigation Strategic Plan suggests 
that follow-on reviews with validated ROIs are required for 
completed projects within 3 years after full project 
implementation. In 2012, the GAO identified that some validated 
ROIs have been completed, but that the DOD did not update the 
projected ROI in its Report to Congress on DOD Corrosion Policy 
and Oversight Budget Materials to account for a validated ROI. 
As long as the DOD continues to report only the average 
projected ROIs and does not include information about the 
validated ROIs, Congress will lack full visibility into the 
results of the DOD's efforts to prevent and mitigate corrosion.
    Therefore, the committee directs the DOD Office of 
Corrosion Policy and Oversight to account for validated ROIs, 
when available, in its annual corrosion budget materials report 
to Congress so that it will have the best information on which 
to base funding-decisions and the DOD has more factual data to 
determine how to best invest corrosion prevention funds.
    The committee is also concerned about the lack of 
transparency about how the DOD is spending the additional funds 
provided to support unfunded requirements. The DOD has 
consistently identified in its annual Report to Congress on DOD 
Corrosion Policy and Oversight Budget Materials the lack of 
funding for projects as comprising the majority of its unfunded 
Corrosion Prevention and Control (CPC) requirement. For the 
past several years, the DOD has also received funding over its 
CPC budget request and in most years DOD has not used the funds 
to undertake all acceptable military corrosion projects. The 
DOD has used the funding for corrosion projects as well as 
other activities such as research through the Technical 
Corrosion Collaboration (TCC) pilot program. The DOD is 
required to report the amount of funds requested in the budget 
for each project and activity. But, while the DOD's annual 
report mentions the TCC as an activity, it has not included 
specific information on the funding amounts for this pilot 
program.
    Therefore, the committee directs the DOD Office of 
Corrosion Policy and Oversight to include in its Report to 
Congress on DOD Corrosion Policy and Oversight Budget Materials 
the amount of funds used for military corrosion projects, the 
TCC pilot program, and other corrosion-related activities for 
the preceding fiscal year.

Critical manufacturing capabilities and capacities

    The committee maintains the view that expanded authority 
for all military industrial facilities to designate Centers of 
Industrial and Technical Excellence significantly improves the 
Department of Defense's core competencies, repair capabilities, 
and manufacturing functions. As operational tempo declines from 
drawdowns associated with combat operations in Iraq and 
Afghanistan, the committee is concerned that sufficient 
workload is necessary to ensure cost efficiency and technical 
competence in peacetime, while preserving the ability to 
provide an effective and timely response to a mobilization, 
national defense contingency situations, and other emergency 
requirements.
    Accordingly, the committee directs the Secretary of Defense 
to identify critical manufacturing capabilities and capacities 
that should be government owned and government operated, 
identify the level of work needed to sustain capabilities, and 
report to the congressional defense committees on these matters 
no later than February 28, 2013.

Department of Defense inventory management

    Section 328 of the National Defense Authorization Act for 
Fiscal Year 2010 (Public Law 111-84) required the Department of 
Defense (DOD) to develop a comprehensive plan for improving DOD 
inventory management systems, with an objective of reducing the 
acquisition and storage of secondary inventory that is excess 
to requirements.
    In January 2011, the Government Accountability Office (GAO) 
reported that DOD's Comprehensive Inventory Management 
Improvement Plan addressed each of the eight elements required 
by section 328, but would be challenged to meet the aggressive 
timelines and benchmarks in the Plan.
    In May 2012, GAO reported that DOD has made progress in 
implementing the plan, but that significant challenges remain--
particularly in the areas of improving demand forecasting, 
multi-echelon modeling, and implementing revised guidance on 
retention management. GAO recommended that DOD: (1) 
periodically reexamine and update targets and timelines for 
reducing excess on-order and on-hand inventory; (2) incorporate 
comprehensive, standardized metrics into inventory management 
guidance; and (3) employ these metrics for monitoring the 
effectiveness of improved inventory management practices.
    The committee directs the Assistant Secretary of Defense 
for Logistics and Materiel Readiness to report to the 
congressional defense committees, no later than 3 months after 
the date of enactment of this Act, on the steps that DOD has 
taken to implement the GAO recommendations.

Energy performance savings contracts

    The committee understands that the Department of Defense 
(DOD) spends billions of dollars on energy costs each year and 
that financing large-scale energy projects can be cost-
prohibitive for the DOD. Energy Performance Savings Contracts 
(ESPC) enable the DOD to finance energy efficiency upgrades on 
military installations by funding various Energy Conservation 
Measures, through private investments, and receive a guarantee 
that the energy savings will pay for the project.
    The committee directs the Secretary of Defense to review 
the potential applicability of ESPC authority to construct 
power generating plants, and to acquire mobile sources, 
including electric and natural gas-powered vehicles and their 
associated charging stations on military installations, and to 
make recommendations to the congressional defense committees if 
changes in law or regulation are needed for the Department to 
pursue efficient and effective initiatives using ESPC 
authorities.

Essential role of rare earth materials

    Rare earth materials play an essential role in several 
critical weapons components and systems such as precision-
guided munitions, electric ship drives, command and control 
centers, and aircraft, tanks, and missile systems. The 
committee notes the predominance of unreliable foreign sources 
for rare earth materials, including China, which provides 
roughly 94 percent of the world's rare earth oxides and nearly 
all rare earth metal within the defense-related supply chain 
and which has repeatedly decreased export quotas and imposed 
embargoes of these critical materials. Even with the 
development of the domestic-supply chain there may be continued 
reliance on production of certain heavy rare earth elements 
from China. The importance of rare earth materials for national 
defense applications necessitates a thorough understanding of 
vulnerabilities in the rare earth supply chain and the 
development of pragmatic, actionable risk mitigation plans to 
reduce the likelihood of supply interruptions. The committee 
encourages the Department of Defense to carefully consider the 
role of U.S. producers and potential means to develop reliable 
domestic sources to meet Department rare earth materials 
requirements.

Funding shortfalls for minimum capital investment program, facilities 
        sustainment, restoration, and modernization, and base 
        operations support

    The committee remains concerned that the failure of the 
Department of Defense (DOD) to fully fund several critical 
readiness accounts over the last decade poses a continuing risk 
to the readiness, training and operational capability of 
military forces. Base operations support, capital investment 
program (CIP), and Facility Sustainment, Restoration and 
Modernization (FSRM) funding are all critical to maintaining 
durable facilities for the readiness, training, and operations 
of military forces. Underinvestment in these facilities can 
lead to increased military construction needs, which could 
otherwise be avoided.
    The Navy was the only military department to fail to fund 
the minimum 6 percent CIP in the Fiscal Year 2013 budget 
request. The committee continues to believe that investment 
funds included in the capital budget of an industrial facility 
should go to modernize or improve efficiency of facilities 
equipment, work environment, or processes in direct support of 
the facility's mission. The committee urges the military 
departments to allocate adequate resources to meet the 
congressionally-directed minimum 6 percent for CIP requirement.
    The committee is concerned that the level of FSRM funding 
for military installations is not sufficient to meet 
infrastructure needs. Recognizing in this tight budgeting 
environment that the DOD must weigh risks to infrastructure 
against equipping, training, and personnel demands, the cost to 
repair or replace facilities that have not received adequate 
investments is far greater than preventative or restorative 
maintenance. The committee strongly believes that the military 
departments should fund at least 90 percent of the amounts 
determined by the Facility Sustainment Model, while providing 
additional funding to support restoration and modernization 
requirements.
    The problem of inadequate funding is compounded in the case 
of joint bases where services calculate FSRM needs differently 
and the services owning the installation does not factor the 
alternative service's formula into the process leading to 
insufficient funding to address installation needs. The 
committee is also concerned that the adjustment of the 
allocation of FSRM funds provided to each military installation 
to address the unique and more costly requirements for 
facilities that are listed or eligible for the National 
Registry of Historic Places as required by the National 
Historic Preservation Act (NHPA) of 1966 may not accurately 
reflect the actual requirements imposed by the NHPA.
    The committee directs the DOD to review the allocation 
system for FSRM funding to ensure parity in the distribution of 
funds among the military departments and adequate adjustments 
for unique facility requirements, including joint bases and 
historical preservation. The committee further directs the 
Secretary of Defense to report to the congressional defense 
committees on the findings of the review no later than March 1, 
2013.

Ground combat and camouflage utility uniforms

    Section 352 of the National Defense Authorization Act for 
Fiscal Year 2010 (Public Law 111-84) established that the 
design and fielding of all future ground combat and camouflage 
utility uniforms of the armed forces may uniquely reflect the 
identity of the individual military services, provided that the 
ground combat and utility uniforms, to the maximum extent 
practicable, provide members of every service an equivalent 
level of performance, functionality, and protection 
commensurate with their respective assigned combat missions, 
minimize the risk to the individual, and provide 
interoperability with other components of individual warfighter 
systems. Section 352 also required the secretaries of the 
military departments to establish joint criteria for future 
combat uniforms in coordination with the results of a review 
conducted by the Government Accountability Office (GAO).
    In a report to the committee, the Department of Defense 
(DOD) acknowledged that the Department ``can do more and is 
taking the necessary steps to further promote and enhance both 
ongoing inter-service collaboration and life-cycle coordination 
with the Defense Logistics Agency.''
    However, the committee is concerned that the joint criteria 
required by section 352 has not yet been issued and the DOD-
established Joint Clothing and Textile Governance Board (JCTGB) 
has not yet established ``a common set of parameters for basic 
performance characteristics such as protection, concealment, 
reliability, durability, sensor mitigation, survivability, and 
network readiness.''
    This delay is problematic because the Army is currently in 
the final stages of developing a ``family'' of camouflage 
patterns for its next ground combat uniform. The committee 
understands that the Army currently plans to make its final 
selection for this uniform in 2013, before the JCTGB is 
expected to finalize the common parameters for uniform 
performance characteristics.
    The committee also understands that the Department of the 
Navy has chosen to equip its sailors and marines with different 
varieties of ground combat uniforms, providing significantly 
different levels of protection. Specifically, while marines and 
naval special warfare have been issued digital camouflage 
patterns, all other Navy units continue to wear an inferior 
camouflage pattern that was developed in the early 1980s 
possibly leaving sailors in a combat environment at an 
increased tactical risk.
    The committee concludes that uniforms incorporating the 
most advanced levels of protection should be available to all 
men and women in uniform, regardless of the military service in 
which they serve. Accordingly, the committee directs the 
Secretary of Defense to take steps to ensure that: (1) common 
parameters established by the JCTGB are reflected in the Army's 
next ground combat uniform prior to fielding; and (2) uniforms 
providing an appropriate level of protection are available to 
all Navy units serving in areas of combat operation. The 
Secretary of Defense shall notify the congressional defense 
committees of the steps taken to address these issues no later 
than 60 days after enactment of this Act.

Lack of competition in Air Force C-17 engine maintenance contracting

    The committee remains concerned that the Air Force has 
failed to maximize competition in planned maintenance of the C-
17's F117 engine, losing the benefit of the most effective 
mechanism to reduce costs, manage risk, and maximize efficiency 
in supply chain management (SCM). Because the F117 engine is 91 
percent similar to the commercial family of engines in the 
PW2000, multiple competitors should be available to provide 
support, maintenance, and sustainment for these engines. 
However, the F117 sustainment strategy timeline briefed to the 
committee would phase in competition slowly and would not 
commit the Air Force to competition in all areas of SCM and 
sustaining engineering.
    The committee urges the Secretary of the Air Force to 
exercise competitive approaches to the support, maintenance, 
and sustainment of F117 engines to the maximum extent 
practicable. The committee directs the Secretary of the Air 
Force to brief the congressional defense committees on steps 
that will be taken to enhance competition in this area and to 
notify the congressional defense committees of: (1) any 
deviation from the F117 sustainment strategy timeline; and (2) 
any significant change in projected yearly savings with respect 
to SCM or sustaining engineering.

Marine Corps depot maintenance activity group

    Recent analysis of the Marine Corps depot maintenance 
activity group (DMAG) conducted by the Government 
Accountability Office (GAO) revealed that there is room for 
improvement with respect to the budgeting and management of 
carryover. The committee commends the Marine Corps for properly 
managing carryover amounts below the allowable limits, 
especially when compared to the other services' working capital 
funds. However, the committee is concerned that the Marine 
Corps underestimated the DMAG's new orders every year during 
the 6-year period of review by the GAO, from a low of 51 
percent to a high of 175 percent. Accordingly, the committee 
encourages the Marine Corps DMAG to improve the budgeting and 
management of carryover by comparing budgeted to actual 
information on carryover and orders and making adjustments to 
budget estimates as appropriate.

Modernizing the aging fleet

    The committee notes that the Department of Defense's new 
strategic guidance, and future-years defense program, place 
increased demand on legacy Air Force platforms to counter 
contemporary threats and meet global mission requirements. 
These aging aircraft fleets, many of which were procured 
decades ago, are extremely expensive to maintain and lack 
dedicated technology insertion programs to replace outdated 
materials, product forms, and parts that dramatically increase 
operation and maintenance (O&M) costs and limit mission 
availability.
    The committee is aware that commercial aircraft fleets have 
employed structural aluminum alloys, advanced manufacturing 
processes, and joining technologies. The committee believes 
that the low-risk transition of these proven commercial 
technologies, products, and best practices could help the Air 
Force to increase mission availability and reduce O&M costs for 
the aging fleet. The committee encourages the Air Force to 
leverage commercially developed and proven technologies and 
products within its modernization and sustainment activities in 
order to increase mission availability, reduce total ownership 
costs, and resolve supply chain issues.

Rapid equipping and fielding initiatives

    The committee recognizes that combat operations in Iraq and 
Afghanistan have resulted in substantial improvements and 
compression in the processes used to develop and field urgent 
needs for combatant commanders, including organizational 
clothing and individual equipment. Following the drawdown of 
Afghanistan, the committee encourages the Department of Defense 
to consider maintaining key elements of the Army Rapid Fielding 
Initiative, the Rapid Equipping Force, and combatant commander 
level purchasing authority to enable agile responses to future 
threats.

Readiness support for unfunded requirements

    The committee remains concerned that in an era of fiscal 
constraints coupled with high operational tempo, the services 
have chosen to fund readiness accounts below their requirements 
and heavily rely upon Overseas Contingency Operations funding 
to temporarily maintain operational readiness. Furthermore, as 
a result of almost a decade of combat operations, backlogs of 
deferred ship and aircraft depot maintenance remain unexecuted 
by the services. The committee notes that a failure to address 
this backlog for active and reserve ships and aircraft will 
continue to jeopardize and erode materiel readiness, further 
reduce the service life of the fleet, increase long-term 
sustainment costs, and further increase strategic risk for the 
Nation.
    Despite these backlogs, the services continue to underfund 
critical readiness accounts and fail to request any unfunded 
requirements by the service chiefs in support of the fiscal 
year 2013 budget request. The committee acknowledges the 
Department of the Navy's budget request to fully fund their 
ship depot maintenance account to meet 100 percent of their 
known requirements, and encourages the Department to ensure 
those funds are carried out for their budgeted purpose in 
fiscal year 2013.
    Accordingly, the committee directs the Secretary of Defense 
to examine and quantify the existing deferred depot maintenance 
backlogs of the services and provide a report to the 
congressional defense committees by March 30, 2013, with a plan 
to address the existing deferred maintenance backlogs of the 
services with proposed completion timelines and specific 
funding amounts.

Report on Defense Science Board climate change recommendations

    In October 2011, the Defense Science Board issued its 
report on Trends and Implications of Climate Change for 
National and International Security (``DSB report''). The DSB 
report, prepared at the direction of the Under Secretary of 
Defense for Acquisition, Technology and Logistics, describes 
observable consequences of climate change and offers 
recommendations on the role of the Department of Defense, and 
other agencies, in adapting and responding to the effects on 
U.S. national security interests.
    The committee is interested in the disposition of the 
recommendations contained in the DSB report and directs the 
Secretary of Defense to submit to the Committees on Armed 
Services of the Senate and the House of Representatives, by 
November 1, 2012, a report addressing the recommendations 
contained in the DSB report. Specifically, the Secretary's 
report shall:
          1. address the recommendations of the DSB report with 
        regard to the roles of the Department of Defense, the 
        military departments, and the combatant commands in 
        addressing the matters that the DSB report identified 
        as having adverse implications for national and 
        international security;
          2. describe the actions taken on each of the DSB 
        recommendations on the role of the Department of 
        Defense; and
          3. identify such changes in law, if any, that would 
        be required to fully implement the recommendations of 
        the DSB report.
    In preparing the report, the Secretary should consider the 
Intelligence Community Assessment number ICA 2012-08, ``Global 
Water Security'', and any other reports or information he deems 
appropriate, and shall consult with the Chairman of the Joint 
Chiefs of Staff, the Secretary of State, the Director of 
National Intelligence, and such other officials, agencies, or 
organizations as he deems appropriate. The report shall be in 
unclassified form, but may include a classified annex, if 
warranted.
              TITLE IV--MILITARY PERSONNEL AUTHORIZATIONS

                       Subtitle A--Active Forces

End strengths for active forces (sec. 401)
    The committee recommends a provision that would authorize 
active-duty end strengths for fiscal year 2013, as shown below:

----------------------------------------------------------------------------------------------------------------
                                                                     FY 2013                  Change from
                                                  FY 2012  -----------------------------------------------------
                    Service                     authorized                              FY 2013       FY 2012
                                                             Request   Recommendation   request     authorized
----------------------------------------------------------------------------------------------------------------
Army..........................................     562,000    552,100         552,100          0          -9,900
Navy..........................................     325,700    322,700         322,700          0          -3,000
Marine Corps..................................     202,100    197,300         197,300          0          -4,800
Air Force.....................................     332,800    328,900         329,597        697          -3,203
                                               -----------------------------------------------------------------
      DOD Total...............................   1,422,600  1,401,000       1,401,697        697         -20,903
----------------------------------------------------------------------------------------------------------------

    The committee supports the Department of Defense fiscal 
year 2013 request for active-duty end strengths, with the 
exception of additional Air Force end strength to support force 
structure changes adopted by the committee. The funding to 
support this end strength is contained in title XVII of this 
Act.
    The committee remains concerned about the impact of the 
drawdown while the Army and Marine Corps in particular remain 
engaged in ground combat operations. Adequate dwell time to 
deployment ratios remain key to ensuring that service members 
receive sufficient time at home to rejuvenate and recover 
physically and mentally from arduous and repeated combat 
deployments. In addition, sufficient time between deployments 
allows units to repair equipment, train for the full spectrum 
of future potential missions, and build the Nation's strategic 
depth to respond to unforeseen contingencies. For these 
reasons, insufficient dwell time undermines readiness and 
increases risk.
    The committee directs the Secretary of Defense to include 
with the budget submission in each of fiscal years 2014 through 
2017 a statement of estimated deployment to dwell ratios for 
both active and reserve component personnel for that fiscal 
year based on expected operational demand and requested end 
strength levels. The statement shall include the average unit 
and individual deployed to dwell ratios, as of the end of the 
fiscal year preceding the budget submission, for the active and 
reserve components of the Army and Marine Corps. The statement 
shall also identify the Army and Marine Corps military 
occupational specialties and types of units which did not 
achieve the respective service's dwell time goals. For each of 
these specialties and units, the Army and Marine Corps shall 
identify the average deployed to dwell ratios.
    Additionally, for each of fiscal years 2014 through 2017, 
the committee directs the Secretary of Defense to include with 
the budget submission an assessment of whether requested 
reductions in active-duty end strength are reversible within 1 
year, including through increased use of the reserve 
components, if demand assumptions prove incorrect and 
additional active forces are needed during that fiscal year.

                       Subtitle B--Reserve Forces

End strengths for Selected Reserve (sec. 411)
    The committee recommends a provision that would authorize 
Selected Reserve end strengths for fiscal year 2013, as shown 
below:

----------------------------------------------------------------------------------------------------------------
                                                                     FY 2013                  Change from
                                                  FY 2012  -----------------------------------------------------
                    Service                     authorized                              FY 2013       FY 2012
                                                             Request   Recommendation   request     authorized
----------------------------------------------------------------------------------------------------------------
Army National Guard...........................     358,200    358,200         358,200          0               0
Army Reserve..................................     205,000    205,000         205,000          0               0
Navy Reserve..................................      66,200     62,500          62,500          0          -3,700
Marine Corps Reserve..........................      39,600     39,600          39,600          0               0
Air National Guard............................     106,700    101,600         106,435      4,835            -265
Air Force Reserve.............................      71,400     70,500          72,428      1,928           1,028
                                               -----------------------------------------------------------------
      DOD Total...............................     847,100    837,400         844,163      6,763          -2,937

Coast Guard Reserve...........................      10,000      9,000           9,000          0          -1,000
----------------------------------------------------------------------------------------------------------------

    The committee supports the Department of Defense fiscal 
year 2013 request for reserve component end strengths, with the 
exception of additional Air National Guard and Air Force 
Reserve end strength to support force structure changes adopted 
by the committee. The funding to support this end strength is 
contained in title XVII of this Act.

 End strengths for reserves on active duty in support of the reserves 
                               (sec. 412)

    The committee recommends a provision that would authorize 
full-time support end strengths for fiscal year 2013, as shown 
below:

----------------------------------------------------------------------------------------------------------------
                                                                     FY 2013                  Change from
                                                  FY 2012  -----------------------------------------------------
                    Service                     authorized                              FY 2013       FY 2012
                                                             Request   Recommendation   request     authorized
----------------------------------------------------------------------------------------------------------------
Army National Guard...........................      32,060     32,060          32,060          0               0
Army Reserve..................................      16,261     16,277          16,277          0              16
Navy Reserve..................................      10,337     10,114          10,114          0            -223
Marine Corps Reserve..........................       2,261      2,261           2,261          0               0
Air National Guard............................      14,833     14,305          14,871        566              38
Air Force Reserve.............................       2,662      2,888           2,888          0             226
                                               -----------------------------------------------------------------
      DOD Total...............................      78,414     77,905          78,471        566              57
----------------------------------------------------------------------------------------------------------------

    The committee supports the Department of Defense fiscal 
year 2013 request for full-time support end strengths, with the 
exception of additional Air National Guard full-time end 
strength to support force structure changes adopted by the 
committee. The funding to support this end strength is 
contained in title XVII of this Act.

    End strengths for military technicians (dual status) (sec. 413)

    The committee recommends a provision that would establish 
the minimum number of military technicians (dual status) for 
the reserve components of the Army and Air Force as of the last 
day of fiscal year 2013, as shown below:

----------------------------------------------------------------------------------------------------------------
                                                                     FY 2013                  Change from
                                                  FY 2012  -----------------------------------------------------
                    Service                     authorized                              FY 2013       FY 2012
                                                             Request   Recommendation   request     authorized
----------------------------------------------------------------------------------------------------------------
Army Reserve..................................       8,395      8,445           8,445          0              50
Army National Guard...........................      27,210     28,380          28,380          0           1,170
Air Force Reserve.............................      10,777     10,283          10,716        433             -61
Air National Guard............................      22,509     21,101          22,313      1,212            -196
                                               -----------------------------------------------------------------
      DOD Total...............................      68,891     68,209          69,854      1,645             963
----------------------------------------------------------------------------------------------------------------

    The committee supports the Department of Defense fiscal 
year 2013 request for dual status technicians, with the 
exception of additional Air Force Reserve and Air National 
Guard technicians to support force structure changes adopted by 
the committee. The funding to support this end strength is 
contained in title XVII of this Act.
Fiscal year 2013 limitation on number of non-dual status technicians 
        (sec. 414)
    The committee recommends a provision that would establish 
limits on the number of non-dual status technicians who may be 
employed in the Department of Defense as of September 30, 2013, 
as shown below:

----------------------------------------------------------------------------------------------------------------
                                                                     FY 2013                  Change from
                                                  FY 2012  -----------------------------------------------------
                    Service                     authorized                              FY 2013       FY 2012
                                                             Request   Recommendation   request     authorized
----------------------------------------------------------------------------------------------------------------
Army National Guard...........................       1,600      1,600           1,600          0               0
Air National Guard............................         350        350             350          0               0
Army Reserve..................................         595        595             595          0               0
Air Force Reserve.............................          90         90              90          0               0
                                               -----------------------------------------------------------------
      DOD Total...............................       2,635      2,635           2,635          0               0
----------------------------------------------------------------------------------------------------------------

Maximum number of reserve personnel authorized to be on active duty for 
        operational support (sec. 415)
    The committee recommends a provision that would establish 
limits on the number of Reserve personnel authorized to be on 
active duty for operational support under section 115(b) of 
title 10, United States Code, as of September 30, 2013, as 
shown below:

----------------------------------------------------------------------------------------------------------------
                                                                     FY 2013                  Change from
                                                  FY 2012  -----------------------------------------------------
                    Service                     authorized                              FY 2013       FY 2012
                                                             Request   Recommendation   request     authorized
----------------------------------------------------------------------------------------------------------------
Army National Guard...........................      17,000     17,000          17,000          0               0
Army Reserve..................................      13,000     13,000          13,000          0               0
Navy Reserve..................................       6,200      6,200           6,200          0               0
Marine Corps Reserve..........................       3,000      3,000           3,000          0               0
Air National Guard............................      16,000     16,000          16,000          0               0
Air Force Reserve.............................      14,000     14,000          14,000          0               0
                                               -----------------------------------------------------------------
      DOD Total...............................      69,200     69,200          69,200          0               0
----------------------------------------------------------------------------------------------------------------

              Subtitle C--Authorization of Appropriations

Military personnel (sec. 421)
    The committee recommends a provision that would authorize 
appropriations for military personnel at the levels identified 
in section 4401 of division D of this Act.

                              Budget Item

Military personnel funding changes
    The amount authorized to be appropriated for military 
personnel programs in section 421 of this Act includes the 
following changes from the budget request:

                    [Changes in millions of dollars]

Basic allowance for housing for full-time National Guard 
    transition....................................................   6.0
    Total.........................................................   6.0

    The committee recommends an increase of $6.0 million in 
Military Personnel funding, pursuant to a legislative provision 
regarding the payment of the basic allowance for housing for 
Army and Air National Guard members transitioning between 
active-duty service under title 10, United States Code, and 
full-time National Guard service under title 32, United States 
Code. The provision appears in title VI of this Act.
                   TITLE V--MILITARY PERSONNEL POLICY

                       Subtitle A--Officer Policy

Extension of relaxation of limitation on selective early discharges 
        (sec. 501)
    The committee recommends a provision that would amend 
section 638a(d)(2) of title 10 to extend until December 31, 
2018, the authority to convene selection boards to consider the 
discharge of regular officers below the grade of lieutenant 
colonel or commander who have served on active duty for at 
least 1 year in their current grade, are not on a promotion 
list, and are not eligible for retirement.
Exception to 30-year retirement for regular Navy warrant officers in 
        the grade of chief warrant officer, W-5 (sec. 502)
    The committee recommends a provision proposed by the 
Department of Defense that would amend section 1305(a) of title 
10, United States Code, to increase the total active military 
service a Navy warrant officer in the grade of chief warrant 
officer, W-5, may serve from 30 to 33 years before being 
statutorily retired for length of service.
Modification of definition of joint duty assignment to include all 
        instructor assignments for joint training and education (sec. 
        503)
    The committee recommends a provision proposed by the 
Department of Defense that would amend section 668(b)(1)(B) of 
title 10, United States Code, to remove the limitations on the 
types of instructors included in the definition of ``joint duty 
assignment''. The current law excludes instructor positions 
that may provide an officer significant experience in joint 
matters from inclusion on the joint duty assignment list and 
provides undue deference to Joint Professional Military 
Education Phase II (JPME II) positions. This change would allow 
the Department of Defense to judge all positions based on the 
significant experience the position provides an officer in 
joint matters.
    The committee believes that instructor duty assignments at 
the three service academies should be structured to the maximum 
extent possible to allow officers who serve in these capacities 
to accrue joint experience and credit. Completion of joint 
professional military requirements while assigned to the 
faculties or officer assignments at the academies should be 
encouraged, and exchange tours and temporary assignments during 
tours of duty at the service academies should be made available 
in order to enhance the career progression of officers who 
volunteer for instructor duty at the service academies.
Sense of Senate on inclusion of assignments as academic instructor at 
        the military service academies as joint duty assignments (sec. 
        504)
    The committee recommends a provision that would express a 
sense of the Senate that the Secretary of Defense should 
include assignments in which military officers are assigned as 
instructors responsible for preparing and presenting academic 
courses on the faculty of the United States Military Academy, 
the United States Naval Academy, or the United States Air Force 
Academy as joint duty assignments.

                Subtitle B--Reserve Component Management

Authority for appointment of persons who are lawful permanent residents 
        as officers of the National Guard (sec. 511)
    The committee recommends a provision proposed by the 
Department of Defense that would amend section 313(b)(1) of 
title 32, United States Code, to allow a lawful permanent 
resident to be eligible for appointment as an officer into the 
National Guard. Section 12201(b)(1) of title 10, United States 
Code, currently makes lawful permanent residents eligible for 
appointment as officers in the Reserves.
Reserve component suicide prevention and resilience program (sec. 512)
    The committee recommends a provision that would amend 
chapter 1007 of title 10, United States Code, to codify the 
Suicide Prevention and Community Healing and Response Program 
for National Guard and reserve component members, and to move 
it from within the Office for Reintegration Programs to the 
Office of the Secretary of Defense.

                Subtitle C--General Service Authorities

Diversity in the armed forces and related reporting requirements (sec. 
        521)
    The committee recommends a provision that would require the 
Secretary of Defense to develop and implement a plan to 
accurately measure the efforts of the Department of Defense to 
achieve the goal of having a sustainable and dynamic pipeline 
that yields a diverse officer and enlisted corps for the armed 
forces that reflects the population of the United States 
eligible for military service. The provision would require the 
service secretaries, in consultation with the Secretary of 
Defense, to develop a definition of diversity for their 
respective military services that reflects the culture, 
mission, and core values of each military service. Finally, the 
provision would require biennial reports to the congressional 
defense committees beginning July 1, 2013, through July 1, 
2017, on the Department's progress in achieving its diversity 
goals.
Modification of authority to conduct programs on career flexibility to 
        enhance retention of members of the armed forces (sec. 522)
    The committee recommends a provision proposed by the 
Department of Defense that would amend section 533 of the 
Duncan Hunter National Defense Authorization Act for Fiscal 
Year 2009 (Public Law 110-417) to include full-time active 
guard and reserve members in the population eligible for the 
career intermission pilot program, to clarify that accrued 
leave may be carried forward through the period of inactive 
service, and to clarify that participants in the program who 
become ill or injured during their period of inactive service 
may be processed for retirement or separation under chapters 55 
and 61 of title 10, United States Code.
Authority for additional behavioral health professionals to conduct 
        pre-separation medical examinations for post-traumatic stress 
        disorder (sec. 523)
    The committee recommends a provision that would amend 
section 1177(a) of title 10, United States Code, to expand the 
scope of providers that may conduct pre-administrative 
separation medical examinations for post-traumatic stress 
disorder to include licensed clinical social workers and 
psychiatric nurse practitioners. Under current law, only 
physicians, clinical psychologists, or psychiatrists may 
perform these examinations. This language was requested by the 
Department of Defense, and does not affect the statutory 
requirement that these examinations be reviewed by appropriate 
authorities responsible for reviewing and approving separation 
cases.
Quarterly reports on involuntary separation of members of the armed 
        forces (sec. 524)
    The committee recommends a provision that would require the 
service secretaries to submit to the Committees on Armed 
Services of the Senate and the House of Representatives, not 
later than 30 days after the end of each quarter of the 
calendar year in 2013 and 2014, a report on members of the 
regular components who were involuntarily separated from active 
duty. The report would include the total number of service 
members involuntarily separated; the number of members 
separated set forth by grade, by total years of service, and by 
occupational specialty or rating; the number separated who 
received involuntary separation pay or temporary retired pay; 
the number who completed transition assistance programs 
relating to future employment; and the average number of months 
deployed to overseas contingencies by grade.
Review of eligibility of victims of domestic terrorism for award of the 
        Purple Heart and the Defense Medal of Freedom (sec. 525)
    The committee recommends a provision that would require the 
Secretary of Defense, in coordination with the service 
secretaries, to submit to the Committees on Armed Services of 
the Senate and the House of Representatives, not later than 
March 1, 2013, a report on the advisability of modifying the 
criteria for the award of the Purple Heart to military 
personnel, and the Defense Medal of Freedom to civilian 
personnel, who are killed or wounded in a terrorist attack 
within the United States that is determined to be inspired by 
ideological, political, or religious beliefs that give rise to 
terrorism.

        Subtitle D--Military Justice and Legal Matters Generally

Clarification and enhancement of the role of the Staff Judge Advocate 
        to the Commandant of the Marine Corps (sec. 531)
    The committee recommends a provision proposed by the 
Department of Defense that would amend sections 806(a) (article 
6(a) of the Uniform Code of Military Justice), 5041, and 
5046(a) of title 10, United States Code, to clarify and enhance 
the role of the Staff Judge Advocate to the Commandant of the 
Marine Corps. The provision would require that an officer 
appointed as Staff Judge Advocate to the Commandant of the 
Marine Corps be appointed in the grade of major general and 
authorize the Staff Judge Advocate to supervise the 
administration of military justice and delivery of legal 
assistance services in the Marine Corps, and provide 
professional supervision over all Marine Corps judge advocates.
    The committee notes that this provision reflects the 
recommendations contained in the Final Report of the 
Independent Review Panel to Study the Judge Advocate 
Requirements of the Department of the Navy, dated February 22, 
2011. The Independent Panel was established, in part, to 
address concerns about the administration of military justice 
in the Navy and Marine Corps. The committee is grateful for the 
work of the Independent Panel and expects that the 
clarification and enhancement of the role of the Staff Judge 
Advocate to the Commandant will result in greater 
accountability at every level for ensuring that the procedural 
requirements of the Uniform Code of Military Justice are 
complied with.
Additional information in reports on annual surveys of the 
Committee on the Uniform Code of Military Justice (sec. 532)
    The committee recommends a provision that would amend 
subsection (c)(2) of section 946 of title 10, United States 
Code (article 146 of the Uniform Code of Military Justice), to 
require the Code Committee to address the following additional 
matters in its annual report: compliance with processing time 
goals; cases in which court-martial convictions are reversed as 
a result of command influence or denial of the right to a 
speedy review; any provision of the Uniform Code of Military 
Justice that is held unconstitutional; developments in 
appellate case law relating to courts-martial involving 
allegations of sexual misconduct; issues associated with 
implementing legislatively directed changes to the Uniform Code 
of Military Justice or the Manual for Courts-Martial; measures 
implemented to ensure the ability of judge advocates to 
competently participate as trial and defense counsel in, and 
preside as military judges over, capital cases, national 
security cases, sexual assault cases, and proceedings of 
military commissions; and the independent views of the Judge 
Advocates General and the Staff Judge Advocate to the 
Commandant of the Marine Corps on the sufficiency of resources 
within their service to perform military justice functions.

        Subtitle E--Sexual Assault, Hazing, and Related Matters

Authority to retain or recall to active duty reserve component members 
        who are victims of sexual assault while on active duty (sec. 
        541)
    The committee recommends a provision that would amend 
chapter 1209 of title 10, United States Code, to authorize 
service secretaries, upon the request of the member concerned, 
to retain on active duty or return to active duty for 
completion of a line of duty determination reserve component 
members who are alleged victims of sexual assault while on 
active duty.
Additional elements in comprehensive Department of Defense policy on 
        sexual assault prevention and response (sec. 542)
    The committee recommends a provision that reflects the 
recommendations of the Secretary of Defense and that would 
require the Secretary of Defense to modify the revised 
comprehensive policy for the Department of Defense sexual 
assault prevention and response program required by section 
1602 of the Ike Skelton National Defense Authorization Act for 
Fiscal year 2011 (Public Law 111-183). The provision would 
direct the following additions to existing policies: (1) a 
requirement to establish within each military department an 
enhanced capability for the investigation, prosecution, and 
defense of designated special victim offenses, (2) a 
requirement that each military department initiate and retain 
for a period prescribed by the Secretary of Defense a record of 
the disposition of allegations of sexual assault using forms 
and procedures prescribed by the Secretary of Defense, (3) a 
requirement that all commanders and commanding officers receive 
training on sexual assault prevention, response, and policies 
before, or shortly after, assuming command, (4) a requirement 
that all new members of the armed forces receive training 
during initial entry training on sexual assault prevention and 
response, (5) a requirement for specified military commands and 
units to conduct periodic climate assessments, (6) a 
requirement to post and widely disseminate information about 
resources available to report and respond to sexual assaults, 
and (7) a requirement to assign responsibility to receive and 
investigate complaints of a violation of or failure to provide 
the rights of a crime victim.
    The committee believes that the recommendations of the 
Secretary of Defense for changes to the Department's sexual 
assault prevention and response program can and preferably 
should be implemented through changes to existing regulations. 
The complexity of the various matters addressed in this 
provision, including, for example, the investigation and 
adjudication of serious offenses under the Uniform Code of 
Military Justice; the collection, retention, and use of 
sensitive, and in some cases restricted access and personal 
information; and the obligation to establish, enforce, and hold 
military leaders accountable for compliance with training and 
education requirements while operating under wartime 
conditions, demand adequate time and flexibility for the 
Department and the services to develop legally sufficient 
policies. The Secretary of Defense and service leaders have 
reiterated their commitment to the stated goals of preventing 
and responding appropriately to sexual assaults; this is 
demonstrated in the information provided in the Department's 
recent Comprehensive Policy Report Update required pursuant to 
section 1602(a) of the Ike Skelton National Defense 
Authorization Act for Fiscal Year 2011 (Public Law 111-383). 
This provision is fully consistent with the expectation they 
will fulfill that commitment.
    The committee is pleased that the Secretary of Defense has 
exercised his authority to ensure that initial disposition 
authority over specified sexual offenses is elevated to senior 
commanders who are required to consult with a judge advocate. 
This action will make certain that these serious offenses are 
addressed by an appropriate level of command. The committee 
looks forward to receiving regular briefings on the impact this 
policy change has on the disposition of sexual assault cases.
Hazing in the armed forces (sec. 543)
    The committee recommends a provision that would require the 
service secretaries, in consultation with their respective 
service chiefs, to submit a report not later than 180 days 
after the date of enactment of this Act on hazing in their 
service.
    The committee believes that preventing and responding to 
incidents of hazing is a leadership issue and that the service 
secretaries, assisted by their service chiefs, should be looked 
to for policies and procedures that will appropriately respond 
to hazing incidents.

                   Subtitle F--Education and Training

Inclusion of the School of Advanced Military Studies Senior Level 
        Course as a senior level service school (sec. 551)
    The committee recommends a provision proposed by the 
Department of Defense that would amend section 2151(b)(1) of 
title 10, United States Code, to authorize the Senior Level 
Course of the School of Advanced Military Studies of the Army 
Command and General Staff College to offer Joint Professional 
Military Education Phase II instruction and credit.
Modification of eligibility for associate degree programs under the 
        Community College of the Air Force (sec. 552)
    The committee recommends a provision proposed by the 
Department of Defense that would amend section 9315(b) of title 
10, United States Code, to authorize enlisted members of the 
armed forces other than the Air Force participating in joint-
service medical training and education or serving as 
instructors in such training and education to participate in 
associate degree programs of the Community College of the Air 
Force.
Support of Naval Academy Athletic Programs (sec. 553)
    The committee recommends a provision that would amend 
chapter 603 of title 10, United States Code, to authorize the 
Secretary of the Navy to enter into contracts, cooperative 
agreements, and leases with the Naval Academy Athletic 
Association (Association) for the purpose of supporting the 
athletic and physical fitness programs of the Naval Academy. 
The provision would authorize the Association to use Navy 
property; the Navy to accept funds, supplies, and services from 
the Association, and funds from the National Collegiate 
Athletic Association; and the Association to enter into certain 
licensing, marketing, and sponsorship agreements relating to 
trademarks and service marks identifying the Naval Academy.
Grade of commissioned officers in uniformed medical accession programs 
        (sec. 554)
    The committee recommends a provision that would amend 
sections 2114(b) and 2121(c) of title 10, United States Code, 
to eliminate the requirement that officers serve in the grade 
of O-1 throughout their medical education. The provision would 
authorize medical students attending the Uniformed Services 
University of the Health Sciences (USUHS) and students 
participating in the armed forces Health Professions 
Scholarship and Financial Assistance Programs (HPSP), while on 
active duty, to serve in pay grade O-1, or in pay grade O-2 if 
they meet specified promotion criteria prescribed by the 
service secretary. The provision would also amend section 2004a 
of title 10, United States Code, to provide that an officer 
detailed as a student at a medical school would serve on active 
duty in the same grade with the same entitlement to pay as 
specified in section 2114(b) of title 10, United States Code.
    The Academic Review Subcommittee of the Board of Regents of 
the USUHS issued a report in June 2011, that found that the 
current policy of requiring medical students at USUHS to serve 
in the grade of second lieutenant or ensign until graduation 
``fosters the misperception that medical officers are different 
from their non-medical peers in matters of officership.'' This 
Subcommittee recommended that medical students be promoted to 
the rank of first lieutenant or lieutenant (junior grade) at 
the end of the second year of their training ``if their 
performance indicates they are ready to assume the duties of 
the higher rank.''
    The committee believes that requiring medical students who 
are commissioned officers to remain in the rank of ensign or 
second lieutenant throughout their medical education undermines 
the goal of producing medical officers who are motivated and 
dedicated to a career in the uniformed services and is 
inconsistent with virtually every other military officer 
development program. The service secretaries, in consultation 
with the Surgeons General and the President of USUHS, should 
establish criteria for promotion of medical students to the 
rank of lieutenant (junior grade) and first lieutenant and 
assign greater leadership responsibilities to those officers 
who earn promotions while assigned to USUHS or the HPSP.
Authority for service commitment for Reservists who accept fellowships, 
        scholarships, or grants to be performed in the Selected Reserve 
        (sec. 555)
    The committee recommends a provision proposed by the 
Department of Defense that would amend section 2603(b) of title 
10, United States Code, to authorize members of the Selected 
Reserve to fulfill a service obligation incurred for acceptance 
of a fellowship, scholarship, or grant by serving on active 
duty for a period of at least three times the length of the 
period of the education or training, or in the Selected Reserve 
for a period of at least five times the length of the period of 
the education or training.
Repeal of requirement for eligibility for in-state tuition of at least 
        50 percent of participants in Senior Reserve Officers' Training 
        Corps program (sec. 556)
    The committee recommends a provision proposed by the 
Department of Defense that would amend section 2107(c)(1) of 
title 10, United States Code, to repeal the requirement that at 
least 50 percent of midshipmen and cadets appointed under 
section 2107 of title 10, United States Code, qualify for and 
receive in-state tuition rates at their respective 
institutions. This provision would provide greater latitude to 
assign Senior Reserve Officers' Training Corps participants to 
institutions with educational programs that meet military 
service needs.
Modification of requirements on plan to increase the number of units of 
        the Junior Reserve Officers' Training Corps (sec. 557)
    The committee recommends a provision that would amend 
section 548 of the Duncan Hunter National Defense Authorization 
Act for Fiscal Year 2009 (Public Law 110-417) to modify the 
requirement that the Secretary of Defense develop and implement 
a plan to establish and support not less than 3,700 units of 
the Junior Reserve Officers' Training Corps (JROTC) not later 
than September 20, 2020, to a requirement for not less than 
3,000 and not more than 3,700 units by September 20, 2020; to 
authorize service secretaries to determine that all support 
provided to youth development programs in the armed forces is 
consistent with funding limitations and the achievement of the 
objectives of such programs; and to change the annual reporting 
requirement after 2012 to require reports not later than March 
31, 2015, 2018, and 2020.
    The committee recognizes the value of the JROTC program but 
believes that the services require greater flexibility and 
discretion in supporting not only JROTC but also various other 
youth-oriented programs using appropriated funds. Meritorious 
programs such as National Guard Youth Challenge, Naval Sea 
Cadets Corps, Young Marines, Civil Air Patrol, STARBASE, and 
others have received substantial amounts of appropriated funds 
or in-kind support and the services should have great latitude 
in deciding how best to use operations and maintenance funds 
available to them in the current fiscal environment.
    Information received from the Department of Defense in the 
JROTC annual reports for 2009 and 2010 shows that the current 
congressional mandate to establish over 250 new units by 2020 
is not realistic and should be repealed. In this regard, the 
committee applauds the initiative of the Department of the Navy 
in establishing the National Defense Cadet Corps, an 
alternative to JROTC, that has identical citizenship goals and 
can be supported by many high schools that cannot meet the 
requirements for establishing a JROTC unit. All of these units 
and efforts should be considered in assessing the contribution 
of the Department of Defense and the services to youth 
development.
Consolidation of military department authority to issue arms, tentage, 
        and equipment to educational institutions not maintaining units 
        of the Junior ROTC (sec. 558)
    The committee recommends a provision proposed by the 
Department of Defense that would amend chapter 152 of title 10, 
United States Code, to consolidate under one section of law all 
military department authority to issue arms, tentage, and 
equipment to educational institutions not maintaining units of 
the Junior Reserve Officers' Training Corps. This provision 
would require the educational institution to offer a course in 
military instruction and to have a student body of at least 50 
students in a grade above the eighth grade.
Modification of requirement for reports in Federal Register on 
        institutions of higher education ineligible for contracts and 
        grants for denial of ROTC or military recruiter access to 
        campus (sec. 559)
    The committee recommends a provision proposed by the 
Department of Defense that would amend section 983 of title 10, 
United States Code, to delete the requirement for the Secretary 
of Defense to publish in the Federal Register once every 6 
months a list of each institution of higher education that is 
ineligible for contracts and grants because the Secretary has 
determined that the institution has a policy or practice that 
prohibits or prevents the establishment of a Senior Reserve 
Officer Training Corps (SROTC) unit or a student at that 
institution from enrolling in a SROTC unit at another 
institution of higher education. The Secretary would still be 
required to publish a notice in the Federal Register whenever 
the Secretary makes a determination that an institution should 
be denied federal funds because the institution has a policy or 
practice that prohibits or prevents the establishment of a 
SROTC unit or a student at that institution from enrolling in a 
SROTC unit at another institution of higher education.
Comptroller General of the United States report on the Reserve 
        Officers' Training Corps (sec. 560)
    The committee recommends a provision that would require the 
Comptroller General of the United States to submit to the 
congressional defense committees not later than 1 year after 
the date of enactment of this Act a report on (1) whether the 
Reserve Officers' Training Corps (ROTC) programs of the 
Departments of the Army, Navy, and Air Force are effectively 
meeting current and projected requirements for newly 
commissioned officers in the armed forces, and (2) the cost-
effectiveness and productivity of current ROTC programs.
    The committee believes that the significant proposed 
reductions in active-duty end strength require an objective 
assessment of the Services' planning for reduced requirements 
for newly commissioned officers. The United States General 
Accounting Office completed such an assessment in May 1991, and 
its report (``Less Need for Officers Provides Opportunity for 
Significant Savings'') should be used as a model.

Subtitle G--Defense Dependents' Education and Military Family Readiness 
                                Matters

Impact aid for children with severe disabilities (sec. 571)
    The committee recommends a provision that would authorize 
$5.0 million in Operation and Maintenance, Defense-wide, for 
impact aid payments for children with disabilities under 
section 8003(d) of the Elementary and Secondary Education Act 
of 1965 (20 U.S.C. 7703(d)), using the formula set forth in 
section 363 of the Floyd D. Spence National Defense 
Authorization Act for Fiscal Year 2001 (Public Law 106-398), 
for continuation of Department of Defense assistance to local 
educational agencies that benefit eligible dependents with 
severe disabilities.
Continuation of authority to assist local educational agencies that 
        benefit dependents of members of the armed forces and 
        Department of Defense civilian employees (sec. 572)
    The committee recommends a provision that would authorize 
$25.0 million in Operation and Maintenance, Defense-wide, for 
continuation of the Department of Defense assistance program to 
local educational agencies that are impacted by enrollment of 
dependent children of military members and civilian employees 
of the Department of Defense.
Amendments to the impact aid program (sec. 573)
    The committee recommends a provision that would amend title 
VIII of the Elementary and Secondary Education Act of 1965 (20 
U.S.C. 7701 et seq.) to: simplify the calculation to determine 
the payment owed to federal property districts; clarify how to 
calculate eligible children displaced from housing located on 
federal property; and accelerate the deadline for the 
Department of Education to make final payments to districts.
Military spouses (sec. 574)
    The committee recommends a provision that would codify and 
expand authority for non-competitive hiring in the civilian 
workforce of certain military spouses.
Modification of authority to allow Department of Defense domestic 
        dependent elementary and secondary schools to enroll certain 
        students (sec. 575)
    The committee recommends a provision that would amend 
section 2164 of title 10, United States Code, to authorize the 
enrollment in Department of Defense (DOD) elementary and 
secondary schools (DDESS) of dependents who have left a school 
overseas pursuant to an authorized departure or evacuation 
order, and whose safe haven location is within commuting 
distance of a DDESS school. The provision would also authorize 
the Secretary of Defense to allow enrollment of dependents of 
active-duty service members located in the United States that 
are transitioning from a DOD overseas school to be able to take 
courses in the Department of Defense Education Activity Virtual 
School.
Sense of Congress regarding support for Yellow Ribbon Day (sec. 576)
    The committee recommends a provision that would express the 
Sense of Congress in support of Yellow Ribbon Day.

                       Subtitle H--Other Matters

Family briefings concerning accountings for members of the armed forces 
        and Department of Defense civilian employees listed as missing 
        (sec. 581)
    The committee recommends a provision requested by the 
Department of Defense that would amend section 1501 of title 
10, United States Code, to require the Deputy Assistant 
Secretary of Defense for Prisoner of War/Missing Personnel 
Affairs to conduct periodic briefings for families of missing 
persons on Department activities to account for those persons.
Enhancement of authority to accept gifts and services (sec. 582)
    The committee recommends a provision that would amend 
sections 2601(i)(2), 1588(a), and chapter 155 of title 10, 
United States Code, to authorize the acceptance of voluntary 
services to facilitate accounting for missing persons and to 
authorize military museums and military education programs to 
enter into cooperative agreements with certain nonprofit 
entities.
    Service secretaries currently have authority to accept 
voluntary services for military museums and military education 
programs under section 1588 of title 10, United States Code, 
and to accept gifts for the benefit of schools and museums 
under section 2601 of title 10, United States Code. The 
committee believes that the authority under section 1588 of 
title 10, United States Code, to accept voluntary services from 
any person includes authority to accept services from nonprofit 
entities and academic institutions.
Clarification of authorized Fisher House residents at the Fisher House 
        for the Families of the Fallen and Meditation Pavilion at Dover 
        Air Force Base, Delaware (sec. 583)
    The committee recommends a provision proposed by the 
Department of Defense that would amend subsection (a) of 
section 2493 of title 10, United States Code, to clarify that 
primary next of kin, other family members, and escorts of 
family members of service members who die while located or 
serving overseas are authorized users of the Fisher House for 
the Families of the Fallen and Meditation Pavilion at Dover Air 
Force Base, Delaware.
Report on accuracy of data in the Defense Enrollment Eligibility 
        Reporting System (sec. 584)
    The committee recommends a provision that would require the 
Secretary of Defense to submit to the Committees on Armed 
Services of the Senate and the House of Representatives not 
later than 90 days after the date of enactment of this Act a 
plan to improve the completeness and accuracy of the data 
contained in the Defense Enrollment Eligibility Reporting 
System (DEERS).
    The committee is concerned by the findings of the 
Department of Defense (DOD) Inspector General (IG) in its April 
2012 report titled, ``Action is Needed to Improve the 
Completeness and Accuracy of DEERS Beneficiary Data.'' The IG 
found that the Defense Manpower Data Center, the organization 
responsible for management of DEERS, lacked critical supporting 
documentation needed to verify the eligibility of users of DOD 
benefits, including health care, government facilities, and 
other privileges. For example, the report states that ``DEERS 
supporting documentation was not adequate to verify the 
identity of 2.1 million beneficiaries in DEERS.'' The IG found 
that discrepancies exist in the date of birth, gender, name, or 
relationship of nearly 200,000 beneficiaries. The TRICARE 
Management Activity identified 2,495 instances in which 
ineligible users received health care benefits totaling $11.2 
million.
    Accuracy of the DEERS database is essential to ensure that 
eligible users have timely access to health care and other DOD 
benefits. Accuracy of eligibility data is equally necessary to 
prevent fraud and abuse of critical Department of Defense 
programs. The committee urges the Secretary to act promptly to 
address the Inspector General's findings and recommendations.

                       Items of Special Interest

American Bar Association Military Pro Bono Project
    The committee is grateful for the support provided to 
military members by the American Bar Association's (ABA) 
Military Pro Bono Project. Established in 2008, this initiative 
of the ABA's Standing Committee on Legal Assistance for 
Military Personnel has provided legal services in civil law 
matters to over 1,000 service members, many of whom were 
deployed overseas in Iraq and Afghanistan. The Military Pro 
Bono Project has provided military legal assistance attorneys 
with a centralized referral point for pro bono counsel and 
overseen an efficient complement to existing military legal 
assistance programs. The Judge Advocates General of the Army, 
Navy, Air Force, and Coast Guard, and the Staff Judge Advocate 
to the Commandant of the Marine Corps have formally expressed 
their thanks and appreciation for the ABA's role in developing 
a network of legal support for service members where 
representation is essential by civilian practitioners.
    The committee believes that the General Counsel of the 
Department of Defense should lead an effort to identify ways in 
which the Department and the services can expand the support 
they provide to the Military Pro Bono Project in a budget-
neutral manner. More can and should be done to supplement the 
ongoing efforts of the ABA to consolidate state and local 
programs aimed at expanding the availability of highly 
qualified civilian attorneys with service members who are most 
in need of pro bono assistance. The committee directs the 
Secretary of Defense to study this issue and, in coordination 
with the services, submit a letter report no later than March 
1, 2013, discussing issues that should be considered and 
recommended methods through which additional resources and 
support can be given to the Military Pro Bono Project.
Army's sexual assault and special investigation training
    The committee is aware of the efforts that the Department 
of Defense has made to reduce sexual assaults across our 
military services. The committee applauds these steps. However, 
the committee recognizes that more work needs to be done to 
reduce the occurrence of sexual assaults in the military. The 
committee is particularly interested in how sexual assault 
crimes are investigated, prosecuted, and defended.
    The committee notes that the Army has established special 
investigation courses at the Army's Military Police School at 
Fort Leonard Wood, Missouri, that are dedicated to new 
investigative and interviewing techniques, such as Forensic 
Experiential Trauma Interviews. These new techniques can 
possibly assist in prosecuting these often difficult cases. The 
committee also notes that the Army has established a robust 
career-spanning sexual assault training program for Army trial 
lawyers and military justice practitioners. The steps the Army 
has taken are commendable.
    The committee encourages the Department and the military 
services to adopt the best practices of the Army model and 
immediately implement any and all lessons learned that are 
viable to the Department as a whole or to a particular service.
Assessment of skills and abilities to enhance transition from military 
        service
    The committee recognizes the value of using varied 
approaches to prepare departing service members for transition 
from military service to the classroom or civilian employment. 
Members eligible for retirement, for example, may need 
different tools than younger veterans who volunteered for 
service after completing high school or after a few semesters 
of college. For all new veterans, however, providing accurate 
assessments of skills, aptitudes, and interests and matching 
them with educational options or with the requirements of 
potential employers can assist new veterans in choosing 
successful career options. The committee encourages the 
Department of Defense, as part of its ongoing effort to improve 
existing transition assistance programs, to identify and 
develop methods to assess the inventory of talents and 
abilities of departing service members to match them with 
viable career opportunities. Members should have available to 
them, well before separation or retirement, testing vehicles 
comparable in purpose to the Armed Services Vocational Aptitude 
Battery, to align their interests and abilities with the needs 
of public and private sector employers and appropriate 
educational pursuits.
Crime Victims' Rights Act
    The Crime Victims' Rights Act (18 U.S.C 3771) affords 
victims of crimes specific enumerated rights, most of which are 
afforded by Department of Defense Directive 1030.01, April 13, 
2004, to victims involved in cases tried by military courts-
martial. However, this Directive does not include the victim's 
rights to be heard during public proceedings and the right to 
proceedings free from unreasonable delay. In addition, there is 
no specified procedure for victims to seek redress for failure 
to be afforded these rights.
    The committee directs the Secretary of Defense to report to 
the Committees on Armed Services of the Senate and the House of 
Representatives not later than January 7, 2013, on the 
practicability and advisability of extending these additional 
rights to victims involved in cases tried by courts-martial and 
a means for seeking redress for failure to be afforded their 
rights.
Department of Defense Inspector General oversight of investigations of 
        sexual assault
    In June, 2011, the United States Government Accountability 
Office (GAO) issued a report entitled: MILITARY JUSTICE: 
Oversight and Better Collaboration Needed for Sexual Assault 
Investigations and Adjudications (GAO-11-579) in which the GAO 
recommended that the Department of Defense Inspector General 
(DOD IG) develop and implement a policy that specifies 
procedures for conducting sexual assault investigations and 
establish clear goals, objectives, and performance data for 
monitoring and evaluating the services' sexual assault 
investigations and related training. The committee directs 
that, not later than December 3, 2012, the Secretary of Defense 
provide the Committees on Armed Services of the Senate and the 
House of Representatives a report on the DOD IG's 
implementation of the GAO's recommendations, including an 
implementation timeline.
Inclusion of synthetic drug compounds in the Uniform Code of Military 
        Justice
    The committee recognizes the harmful impact that synthetic-
drug abuse poses on good order and discipline in the military. 
Since 2008, there has been a rise in reported incidents of 
military personnel disciplined due to the use, distribution, 
and possession of synthetic-drugs, specifically synthetic 
cannabinoids, synthetic cathinones, and synthetic psychedelic 
hallucinogens. As such, the committee directs the Secretary of 
Defense, in consultation with the Attorney General and 
specifically the Drug Enforcement Agency (DEA), to report to 
the Committees on Armed Services of the Senate and the House of 
Representatives on issues that exist in prosecuting synthetic 
drug offenses including the utility and impact of listing 
synthetic-drug compounds as controlled substances in the 
Uniform Code of Military Justice. The report should, at a 
minimum, assess all compounds that have been found in DEA 
domestic investigations. This report is required no later than 
60 days after the enactment of this Act.
Joint Professional Military Education special areas of emphasis
    The committee is aware that the Chairman of the Joint 
Chiefs of Staff provides annual guidance to the Joint 
Professional Military Education (JPME) institutions regarding 
special areas of emphasis for curriculum development and 
teaching that span a broad range of topics that are of current 
and longer-term strategic importance. In 2010, the guidance 
recommended nine topical areas including Countering Violent 
Extremism, Net-Centric Information Sharing, Strategic 
Communication, Psychological Health Awareness, and Space as a 
Contested Environment. However, it is not clear what feedback 
and assessment mechanisms exist to ensure that the guidance is 
being followed and to monitor the quality of the instruction. 
The committee directs the Chairman to provide to the Committees 
on Armed Services of the Senate and the House of 
Representatives no later than 180 days after the enactment of 
this Act an assessment of the JPME institutions' implementation 
of the Chairman's annual guidance.
Recruiting for cyber-related career fields
    The committee believes that every effort must be made to 
successfully recruit, train, and motivate for military service 
young people with computer skills to operate and defend the 
Department of Defense's computer networks and infrastructure. 
The committee believes that innovative measures and incentives 
should be taken to reach out to highly capable young men and 
women to encourage them to volunteer for military service in 
career fields specializing in cyber warfare and defense.
    The committee directs the Secretary of Defense to provide a 
letter report to the Committees on Armed Services of the Senate 
and the House of Representatives within 180 days of enactment 
of this Act that describes current programs for identifying, 
recruiting, training, and retaining young people with 
outstanding computer skills for military service; reports any 
human capital or specialty shortfalls in cyber defense career 
fields; and describes bonuses or any non-traditional or non-
standard recruiting practices that are employed by the military 
services to locate and recruit young people for cyber-related 
career fields.
Report on assignment policies concerning women in the armed forces and 
        the characterization of certain combat-related service
    The committee notes that in February 2012 the Department of 
Defense released a report to Congress, required by section 535 
of the Ike Skelton National Defense Authorization Act for 
Fiscal Year 2011 (Public Law 111-383), reviewing the laws and 
policies restricting the service of female members of the armed 
forces, and provided notice to Congress that the Department 
would open positions in ground combat units at the battalion 
level to women in occupational specialties for which they are 
already qualified to serve, and would eliminate the so-called 
co-location policy. According to the report, the changes will 
result in over 14,000 positions being opened to women that were 
previously denied. The committee believes this is a small step 
in the right direction, but that more work must be done.
    The committee understands that the Department and the 
services continue to evaluate additional options that would 
increase service opportunities by women, and that the services 
must report to the Secretary of Defense later this year on the 
viability of these options.
    The committee strongly encourages the services to continue 
these efforts. More than 75 percent of the Nation's youth do 
not qualify for enlistment in the military. Maintaining 
unnecessary barriers to service of those who are qualified and 
motivated to serve magnifies the challenge in recruiting the 
most qualified individuals for service in the All-Volunteer 
Force. By limiting their use of the talents of female service 
members, the Department and the services are handicapping 
efforts to field the highest quality force possible.
    Finally, the committee remains concerned that assignment 
policies restricting service by women may continue to result in 
inaccurate characterizations of their service in combat, 
denying them earned benefits and in some cases needed care and 
services. According to the Department of Defense, over 284,000 
female service members have deployed to Iraq or Afghanistan in 
the past decade. Of those women, 881 have been wounded and 144 
have died.
    The committee directs the Secretary of Defense to report to 
the congressional defense committees no later than February 1, 
2013, on its implementation of the policy changes announced in 
the February 2012 report, its assessment and evaluation of 
additional options to increase service and career opportunities 
for women, and the current practice of the Department and the 
services in recognizing, recording, and characterizing combat-
related service by female service members. The report should 
make recommendations for regulatory and statutory change that 
the Secretary considers appropriate to increase service 
opportunities for women in the armed forces.
Report on specialized graduate programs
    The committee recognizes the important role the Department 
of Defense specialized graduate programs in engineering, 
applied sciences, and management have in preparing military and 
civilian personnel to perform and manage its technology 
programs. With current and potentially continued budget 
pressures, the committee encourages the Department to 
thoroughly evaluate the requirement for and sufficiency of 
these graduate programs. At a minimum, this review should 
include the current and projected demand within the Department 
for military and civilian personnel with advanced degrees in 
engineering, applied sciences, and management; an analysis of 
the sources by which the Department and the military services' 
and civilian personnel obtain such advanced degrees; the need 
for educational institutions under the Department to meet its 
demands; the costs and benefits of maintaining such educational 
institutions, including costs relating to directed research; 
the ability of private institutions or distance-learning 
programs to meet the Department's needs; existing 
organizational structures, including reporting chains within 
the services to manage the specialized graduate programs; and 
recommendations for improving the ability of the Department to 
identify, mange, and source its specialized graduate education 
needs.
Requirement for Council of Governors views on legislative proposals 
        addressing child custody litigation involving members of the 
        armed forces
    The committee directs the Secretary of Defense to request 
the views and recommendations of the Council of Governors 
regarding legislative proposals to amend title II of the 
Servicemembers Civil Relief Act (50 U.S.C. App. 521 et seq.) 
(SCRA), or otherwise to establish federal law that would 
prohibit State courts from considering the absence of a service 
member by reason of deployment, or the possibility of 
deployment, in determining the best interest of the child in 
cases involving child custody.
    As the Supreme Court noted in Ex parte Burrus, 136 U.S. 586 
(1890), over a century ago, ``the whole subject of the domestic 
relations of husband and wife, parent and child, belongs to the 
laws of the states and not to the law of the United States.''
    The committee is concerned that the implications of 
preemptive legislation that would extend beyond existing 
procedural protections in the SCRA and that would create a 
standard for adjudicating child custody disputes are not 
warranted either by case law or the proactive legislation 
enacted by more than 40 States. A federal legal standard would 
preempt the efforts of the States over a matter traditionally 
left to State courts. State Governors should be afforded the 
opportunity to formally express their views prior to 
congressional action being taken.
    In presenting the request for views, the Secretary shall 
provide the Council of Governors with the report required by 
section 572 of the National Defense Authorization Act for 
Fiscal Year 2010 (Public Law 111-84) on child custody 
litigation involving service of members of the armed forces and 
current views of interested organizations and associations 
including the Adjutants General Association of the United 
States, the National Governors Association, and the Uniform Law 
Commission of the National Conference of Commissioners on 
Uniform State Laws, among others. The Secretary shall take 
necessary steps to ensure that the views and recommendations of 
the Council of Governors are submitted to the Committees on 
Armed Services and Committees on Veterans' Affairs of the 
Senate and the House of Representatives no later than March 1, 
2013.
Social media and operational security
    The committee recognizes the increasing integration of 
social media into the daily lives of Americans, to include the 
military community. According to a recent survey, more than 90 
percent of military families use social media with over three-
quarters of military families using social media to stay 
connected to a deployed service member. If used judiciously, 
social media platforms have the potential to reap positive 
benefits.
    Service members who use social media to communicate must 
practice and maintain operational security. This is of 
particular importance during deployments, as location, mission 
and other sensitive information must be safeguarded, and not 
shared via social media.
    The committee applauds the Department of Defense (DOD) for 
developing and releasing ``Social Media and the Uniform Code of 
Military Justice'' and other guidance documents aimed to inform 
and instruct service members, DOD civilians, and military 
families as to the safe use of social media.
    The committee directs the Secretary of Defense to devise 
enterprise standards of best practice and procedures for: 1) 
the use of social media by DOD employees and contractors; 2) 
the development of secure DOD applications using social media 
platforms; 3) the monitoring and enforcement of current DOD 
rules and regulations; 4) a periodic review and revision of 
current standards and procedures; and 5) the ability to educate 
and disseminate these policies across DOD and the broader 
military community.
    The Secretary of Defense should deliver a report to the 
Committees on Armed Services of the Senate and the House of 
Representatives on the development of such standards no later 
than 180 days after the enactment of this Act.
Special Operations Force Generation
    The committee notes that the previous Commander of U.S. 
Special Operations Command (USSOCOM) initiated a Pressure on 
the Force and Families study to examine the effects of high 
operational tempo on special operations personnel and their 
families and provide recommendations on mitigating the stress 
caused by repeated deployments. According to the current 
Commander of USSOCOM, ``the lack of predictability resulting 
from a demanding operational tempo'' was identified as a 
primary source of stress on special operations personnel and 
their families.
    The committee supports the efforts of USSOCOM to develop a 
Special Operations Force Generation (SOFORGEN) system to track 
the operational tempo down to the level of the individual 
special operator and provide for more predictable deployments. 
The committee also supports USSOCOM's efforts to more 
accurately account for training and other events that interrupt 
time at home for special operations personnel. The committee 
believes addressing these issues will improve USSOCOM's ability 
to internally manage the readiness of its force and reduce the 
stress on special operations personnel and their families.
    The committee also understands the SOFORGEN system is 
designed to provide USSOCOM with a tool to better forecast and 
alert the services of enabling capabilities that will be needed 
from the general purpose forces to support the training and 
deployment of special operations personnel. This issue remains 
of concern to the committee, especially in light of current 
budget constraints and the potentially negative impact on the 
maintenance of such capabilities by the services. The committee 
reiterates the requirement in section 904 of the National 
Defense Authorization Act for Fiscal Year 2012 (Public Law 112-
81) that the services and USSOCOM reach written agreement, not 
later than 180 days after enactment, on the procedures by which 
the availability of the enabling capabilities of the general 
purpose forces will be synchronized with the training and 
deployment cycle of special operations forces.
          TITLE VI--COMPENSATION AND OTHER PERSONNEL BENEFITS

                     Subtitle A--Pay and Allowances

Rates of basic allowance for housing for Army National Guard and Air 
        National Guard members on full-time National Guard duty (sec. 
        601)
    The committee recommends a provision that would amend 
section 403(g) of title 37, United States Code, to clarify that 
the basic allowance for housing for members of the Army and Air 
National Guards on full-time duty shall be based on their duty 
location, and may not be modified upon the transition of the 
member between active duty under title 10, United States Code, 
and full-time National Guard duty under title 32, United States 
Code, so long as the transition occurs without a break in 
active service.

           Subtitle B--Bonuses and Special and Incentive Pays

One-year extension of certain bonus and special pay authorities for 
        reserve forces (sec. 611)
    The committee recommends a provision that would extend for 
1 year the authority to pay the Selected Reserve reenlistment 
bonus, the Selected Reserve affiliation or enlistment bonus, 
special pay for enlisted members assigned to certain high-
priority units, the Ready Reserve enlistment bonus for persons 
without prior service, the Ready Reserve enlistment and 
reenlistment bonus for persons with prior service, the Selected 
Reserve enlistment and reenlistment bonus for persons with 
prior service, and income replacement for reserve component 
members experiencing extended and frequent mobilization for 
active duty service.
One-year extension of certain bonus and special pay authorities for 
        health care professionals (sec. 612)
    The committee recommends a provision that would extend for 
1 year the authority to pay the nurse officer candidate 
accession bonus, education loan repayment for certain health 
professionals who serve in the Selected Reserve, accession and 
retention bonuses for psychologists, the accession bonus for 
registered nurses, incentive special pay for nurse 
anesthetists, special pay for Selected Reserve health 
professionals in critically short wartime specialties, the 
accession bonus for dental officers, the accession bonus for 
pharmacy officers, the accession bonus for medical officers in 
critically short wartime specialties, and the accession bonus 
for dental specialist officers in critically short wartime 
specialties.
One-year extension of special pay and bonus authorities for nuclear 
        officers (sec. 613)
    The committee recommends a provision that would extend for 
1 year the authority to pay the special pay for nuclear-
qualified officers extending period of active service, the 
nuclear career accession bonus, and the nuclear career annual 
incentive bonus.
One-year extension of authorities relating to title 37 consolidated 
        special pay, incentive pay, and bonus authorities (sec. 614)
    The committee recommends a provision that would extend for 
1 year the general bonus authority for enlisted members, the 
general bonus authority for officers, special bonus and 
incentive pay authorities for nuclear officers, special 
aviation incentive pay and bonus authorities for officers, and 
special bonus and incentive pay authorities for officers in 
health professions. The provision would also extend for 1 year 
the authority to pay hazardous duty pay, assignment or special 
duty pay, skill incentive pay or proficiency bonus, and 
retention incentives for members qualified in critical military 
skills or assigned to high priority units.
One-year extension of authorities relating to payment of other title 37 
        bonuses and special pays (sec. 615)
    The committee recommends a provision that would extend for 
1 year the authority to pay the aviation officer retention 
bonus, assignment incentive pay, the reenlistment bonus for 
active members, the enlistment bonus, the accession bonus for 
new officers in critical skills, the incentive bonus for 
conversion to military occupational specialty to ease personnel 
shortage, the incentive bonus for transfer between armed 
forces, and the accession bonus for officer candidates.
Increase in amount of officer affiliation bonus for officers in the 
        Selected Reserve (sec. 616)
    The committee recommends a provision proposed by the 
Department of Defense that would increase the maximum annual 
amount of the officer affiliation bonus for officers in the 
Selected Reserve from $10,000 to $20,000.
Increase in maximum amount of incentive bonus for reserve component 
        members who convert military occupational specialty to ease 
        personnel shortages (sec. 617)
    The committee recommends a provision proposed by the 
Department of Defense that would amend section 326 of title 37, 
United States Code, to increase the maximum amount of the 
incentive bonus to convert military occupational specialty to 
ease personnel shortages from $2,000 to $4,000 in the case of a 
member of a reserve component.

            Subtitle C--Travel and Transportation Allowances

Permanent change of station allowances for members of Selected Reserve 
        units filling a vacancy in another unit after being 
        involuntarily separated (sec. 631)
    The committee recommends a provision that would amend 
sections 474 and 476 of title 37, United States Code, to 
authorize the payment of travel and transportation allowances 
for certain members of the Selected Reserve, their dependents, 
and household effects when the member is involuntarily 
separated due to force structure reductions between October 1, 
2012, and December 31, 2018, and fills a critical vacancy in 
another unit of the Selected Reserve that is at least 150 miles 
from the member's residence.
Authority for comprehensive program for space-available travel on 
        Department of Defense aircraft (sec. 632)
    The committee recommends a provision that would add a new 
section 2641c to title 10, United States Code, that would 
codify the authority of the Secretary of Defense to establish a 
program to provide transportation to active and reserve 
component members, retirees, and dependents on Department of 
Defense (DOD) aircraft on a space-available basis beginning 
January 1, 2014, or such earlier date as determined by the 
Secretary of Defense pursuant to regulation.
    The committee notes that the purpose of no-cost, space-
available travel on military aircraft is to assist military 
members and their families in responding to emergent personal 
circumstances and arduous duty conditions and to provide a 
means of respite from the rigors of active duty for military 
families, of both the active and reserve components. The option 
to seek space-available travel has also been offered, at a 
lower priority, to military retirees in recognition of their 
careers of service and to authorized members of the Selected 
Reserve. While the committee supports expanding the eligibility 
for space-available travel, doing so should not adversely 
affect the ability of military personnel to travel, for 
example, on emergency leave or on environmental and morale 
leave from remote duty locations. Expansion must also avoid 
placing additional costs and burdens on the personnel and 
facilities of the Air Mobility Command and the military 
services.
    Expansion of the space-available benefit should also be 
preceded by the dissemination of accurate information about the 
hardships aspiring space-available travelers are likely to 
experience. The Department noted in its December 2007 report to 
Congress on space-available travel that ``current eligible 
Space-A travelers often experience disillusionment because of 
the contrast between the perceived promises of Space-A travel 
as a benefit of military service and the reality of arduous 
conditions often encountered when using the system.'' The 
committee believes that the Department should do more to 
educate potential travelers on these realities and implement 
policies that will continue to ensure safe and acceptable 
conditions for eligible space-available travelers.

       Subtitle D--Disability, Retired Pay, and Survivor Benefits

Repeal of requirement for payment of Survivor Benefit Plan premiums 
        when participant waives retired pay to provide a survivor 
        annuity under Federal Employees Retirement System and 
        termination of payment of Survivor Benefit Plan annuity (sec. 
        641)
    The committee recommends a provision proposed by the 
Department of Defense that would amend sections 1450 and 1452 
of title 10, United States Code, to clarify that military 
retirees who have elected to participate in the Survivor 
Benefit Plan (SBP) and who subsequently elect to waive their 
military retired pay in favor of a survivor annuity under the 
Federal Employees Retirement System, do not have to continue 
paying premiums under SBP.
Repeal of automatic enrollment in Family Servicemembers' Group Life 
        Insurance for members of the armed forces married to other 
        members (sec. 642)
    The committee recommends a provision that would amend 
section 1967 of title 38, United States Code, to remove service 
members from automatic enrollment as a dependent under the 
Family Servicemembers' Group Life Insurance program when they 
are insured on their own behalf under the Servicemembers' Group 
Life Insurance program.

                  Subtitle E--Military Lending Matters

Enhancement of protections on consumer credit for members of the armed 
        forces and their dependents (sec. 651)
    The committee recommends a provision that would amend 
section 987 of title 10, United States Code, to require that 
vehicle title loans and payday loans, regardless of duration or 
whether they are open or closed end, are included within the 
definition of ``consumer credit'' contained in regulations 
promulgated by the Secretary of Defense pursuant to that 
section. The provision would also require the Secretary to 
develop a policy to address the harmful effects of credit 
offered to service members and their dependents through 
installment loans through improved financial literacy and a 
greater awareness of more beneficial sources of credit.
Additional enhancements of protections on consumer credit for members 
        of the armed forces and their dependents (sec. 652)
    The committee recommends a provision that would amend 
section 987 of title 10, United States Code, to clarify that 
the prohibition against charging out of state military members 
higher interest rates on loans than what is allowed under State 
law for residents of the State applies also to other forms of 
consumer credit regulated by the Secretary of Defense under the 
authority provided in section 987. The provision would also 
require the Secretary of Defense to consult with federal 
regulators at least once every 2 years in carrying out duties 
under section 987.
    The provision would be effective no later than 1 year from 
the date of enactment of this Act, or such earlier date as 
determined by the Secretary of Defense in regulation.
Relief in civil actions for violations of protections on consumer 
        credit extended to members of the armed forces and their 
        dependents (sec. 653)
    The committee recommends a provision that would amend 
section 987 of title 10, United States Code, to provide for 
civil liability in United States district court for violations 
of consumer protections for service members and dependents 
under that section.
Modification of definition of dependent for purposes of limitations on 
        terms of consumer credit extended to members of the armed 
        forces and their dependents (sec. 654)
    The committee recommends a provision proposed by the 
Department of Defense that would amend section 987(i) of title 
10, United States Code, to conform the definition of dependent 
under that section with the definition of dependent contained 
in section 401(a) of title 37, United States Code.

                       Subtitle F--Other Matters

Transitional compensation for dependent children who are carried during 
        pregnancy at time of dependent-abuse offense (sec. 661)
    The committee recommends a provision proposed by the 
Department of Defense that would amend section 1059 of title 
10, United States Code, to include children who were carried 
during pregnancy at the time of a dependent abuse offense 
within the program to provide transitional compensation for 
spouses and dependents of service members separated for such 
offenses. The child would only become entitled to benefits 
after birth. The provision would also clarify that spouses and 
dependents who are not residing with the service member at the 
time of the abuse offense are eligible for the compensation.
                   TITLE VII--HEALTH CARE PROVISIONS

                      Subtitle A--TRICARE Program

Extension of TRICARE Standard coverage and TRICARE dental program for 
        members of the Selected Reserve who are involuntarily separated 
        (sec. 701)
    The committee recommends a provision that would amend 
section 1076d(b) of title 10, United States Code, to authorize 
coverage under TRICARE Standard for up to 180 days for members 
of the Selected Reserve who are involuntarily separated without 
cause under other than adverse conditions.
    The provision would also amend section 1076a(a)(1) of title 
10, United States Code, to authorize these same involuntarily 
separated Selected Reserve members coverage under the TRICARE 
dental program for at least 180 days.
Inclusion of certain over-the-counter drugs in TRICARE uniform 
        formulary (sec. 702)
    The committee recommends a provision that would amend 
section 1074g of title 10, United States Code, to authorize the 
Department of Defense to place selected over-the-counter drugs 
on the uniform formulary and make such drugs available to 
eligible beneficiaries. An over-the-counter drug would only be 
included on the uniform formulary if the Pharmacy and 
Therapeutics Committee finds that the drug is cost-effective 
and clinically effective.
    The provision would also authorize the Secretary of Defense 
to establish a copayment amount for these drugs, if 
appropriate.
Expansion of evaluation of the effectiveness of the TRICARE program 
        (sec. 703)
    The committee recommends a provision that would amend 
section 717(a) of the National Defense Authorization Act for 
Fiscal Year 1996 (Public Law 104-106) to update the reporting 
requirements of the Department of Defense report, ``Evaluation 
of the TRICARE Program: Access, Cost, and Quality,'' to reflect 
the Department's practice of reporting on access, cost, and 
quality broadly for the military health care system, not solely 
for retirees as required by current law. The provision would 
also require the Department to evaluate access, cost, and 
quality for military dependent children under the age of 21 and 
for dependents of active-duty members with severe disabilities 
and special needs.
    The committee appreciates the comprehensiveness of the 
Department's annual evaluation of the TRICARE program. This 
provision would enhance current reporting requirements to 
include information on access, quality, and care for young 
children and beneficiaries with special needs. Beneficiary 
advocates have informed the committee that special needs 
benefits under the Department's Extended Health Care Option 
(ECHO) program can be difficult to access. Therefore, the 
committee directs the Department to assess participation in the 
ECHO program by eligible dependents with special needs, and to 
explore options to provide more flexible benefits under that 
program without increasing costs to the Department. The 
Department should consult with ECHO-eligible families and work 
groups created to address children's health care needs in its 
assessment of the program. The committee expects the Department 
to submit its report no later than February 1, 2013.

                 Subtitle B--Other Health Care Benefits

Use of Department of Defense funds for abortions in cases of rape and 
        incest (sec. 711)
    The committee recommends a provision that would authorize 
use of Department of Defense funds for abortions in cases of 
rape or incest.
Availability of certain fertility preservation treatments for members 
        of the armed forces on active duty (sec. 712)
    The committee recommends a provision that would provide 
fertility preservation treatments for service members who have 
been diagnosed with a condition for which the recommended 
course of treatment could cause infertility.
Modification of requirements on mental health assessments for members 
        of the armed forces deployed in connection with a contingency 
        operation (sec. 713)
    The committee recommends a provision that would amend 
section 1074m(a) of title 10, United States Code, to align 
mandatory person-to-person mental health assessments for 
certain deployed service members with other existing health 
assessments. The provision would also limit the pre-deployment 
mental health assessments required under this section to those 
service members who will be subjected or exposed to operational 
risk factors during deployment in a contingency operation, and 
for post-deployment assessments to those who were exposed to 
operational risk factors during deployment in a contingency 
operation. The committee expects that the determination of 
operational risk by the Secretary of Defense shall include any 
service member at such risk, regardless of military occupation, 
to include support personnel, who may be exposed to such risk 
in support of a contingency operation.

                 Subtitle C--Health Care Administration

Clarification of applicability of certain authority and requirements to 
        subcontractors employed to provide health care services to the 
        Department of Defense (sec. 721)
    The committee recommends a provision that would amend 
section 1089(a) of title 10, United States Code, to clarify 
that subcontractors providing health care under personal 
services contracts are covered for medical malpractice purposes 
under the Federal Tort Claims Act in the same manner as 
government employees providing the same services, as requested 
by the Department of Defense.
Research program to enhance Department of Defense efforts on mental 
        health in the National Guard and reserves through community 
        partnerships (sec. 722)
    The committee recommends a provision that would authorize 
the Secretary of Defense to carry out a research program with 
community partners to enhance Department of Defense efforts in 
research, treatment, education, and outreach on mental health, 
substance use disorders, and traumatic brain injury in National 
Guard and reserve members, their families, and their 
caregivers.

                 Subtitle D--Reports and Other Matters

Reports on performance data on Warriors in Transition programs (sec. 
        731)
    The committee recommends a provision that would require the 
Secretary of Defense to submit to Congress not later than 180 
days after the date of enactment of this Act and every 180 days 
thereafter until September 30, 2017, data on the longitudinal 
status of service members participating in a Warriors in 
Transition program. The data would document the performance of 
the Department of Defense in addressing the physical health, 
mental and behavioral health, educational and vocational 
aptitude and capabilities, and other appropriate matters, at 
specified periods during the members' participation in the 
program.
    Independent entities such as the Department of Defense 
Inspector General, Government Accountability Office, and the 
Department of Defense Recovering Warrior Task Force continue to 
identify problems faced by service members and their families 
with access to needed medical care, including care for post-
traumatic stress and traumatic brain injury, lengthy processing 
times for transition to civilian life, inadequate communication 
among care managers, and a confusing plethora of support 
programs that lack specific measures of effectiveness. The 
committee believes that the service secretaries should develop 
quantifiable and transparent performance goals and measures to 
achieve high quality, fairness and comprehensive support of 
service members who incur wounds, illness, or injury in service 
to our country.
Report on Department of Defense support of members of the armed forces 
        who experience traumatic injury as a result of vaccinations 
        required by the Department (sec. 732)
    The committee recommends a provision that would require the 
Secretary of Defense, in consultation with the secretaries of 
the military departments, to report on the adequacy and 
effectiveness of the policies, procedures, and systems of the 
Department of Defense in providing support to service members 
who experience traumatic injury as a result of a vaccination 
required by the Department.
Plan to eliminate gaps and redundancies in programs of the Department 
        of Defense on psychological health and traumatic brain injury 
        among members of the armed forces (sec. 733)
    The committee recommends a provision that would require the 
Secretary of Defense to develop and report to the Committees on 
Armed Services of the Senate and the House of Representatives 
on a plan to streamline Department of Defense (DOD) programs 
that address psychological health and traumatic brain injury.
    The committee is concerned about the effective management 
of programs and resources provided to the Department for 
psychological health, including post traumatic stress, and 
traumatic brain injury. In 2011, a technical report prepared 
for the Office of the Secretary by the RAND Corporation, 
``Programs Addressing Psychological Health and Traumatic Brain 
Injury Among U.S. Military Servicemembers and Their Families,'' 
identified more than 200 Department of Defense sponsored or 
funded programs to address psychological health and traumatic 
brain injury, and found ``duplication of effort across 
programs, both within and across branches of service.'' The 
report concluded that although the attention given to programs 
to address these conditions is laudable, ``the proliferation of 
programs creates a high risk of a poor investment of DoD 
resources,'' as a result of both duplication of effort and 
unproven approaches. In January 2012, the Government 
Accountability Office published a report (GAO-12-154) citing 
both a lack of quality control mechanisms and accountability 
for psychological health and traumatic brain injury 
expenditures within the Department, and the ``lack of a single 
organization devoted to ensuring that accurate and timely data 
are available on DOD's psychological health and traumatic brain 
injury activities or coordinating these activities.''
    The committee recognizes that care for psychological 
conditions and traumatic brain injury will be an enduring 
requirement for years to come, and encourages the Secretary to 
promptly take action to ensure that service members and their 
families have access to programs of proven quality and 
effectiveness as they recover from illness and injury sustained 
in service to their country. In addition, the committee urges 
the Department to continue to make effective use of social 
media opportunities to improve access to Department resources, 
including those for psychological health and traumatic brain 
injury.
Report on implementation of recommendations of the Comptroller General 
        of the United States on prevention of hearing loss among 
        members of the armed forces (sec. 734)
    The committee recommends a provision that would require the 
Secretary of Defense to report to the Committees on Armed 
Services of the Senate and the House of Representatives on the 
status of implementation of the recommendations of the 
Comptroller General of the United States in the report 
``Hearing Loss Prevention: Improvements to DOD Hearing 
Conservation Programs Could Lead to Better Outcomes'' (GAO-11-
114, January 2011).
    The committee notes that the President's budget request for 
fiscal year 2013 includes $12.6 million to support activities 
of the Hearing Center of Excellence, and is encouraged that the 
Center's concept of operations reflects a commitment to 
``create efficiencies, reduce redundancies and reduce costs'' 
within existing hearing conservation programs. The committee 
expects the Secretary of Defense to prioritize efforts 
throughout the Department to enhance training, treatment, and 
research to reduce the incidence of preventable hearing 
impairments among service members.

                       Items of Special Interest

Comptroller General study on Department of Defense health care 
        contracting
    The Department of Defense (DOD) budget for the Unified 
Medical Program has grown rapidly in recent years. According to 
the President's budget request for fiscal year 2013, health 
care represents 10 percent of the overall DOD top-line. In 
light of this growth in costs, it is imperative that DOD 
identify opportunities for savings and efficiencies wherever 
possible.
    Private sector care contracts employed by DOD to deliver 
health care under its TRICARE program are a potential avenue 
for identifying savings and efficiencies. In recent years, 
beneficiaries have relied more on the purchased-care system of 
civilian providers than on DOD's direct-care system of military 
hospitals and clinics. In its 2012 ``Report to Congress: 
Evaluation of the TRICARE Program'', DOD reported that about 65 
percent of total inpatient admissions and 57 percent of total 
outpatient visits were in the purchased-care system.
    Although TRICARE remains primarily a benefits program, DOD 
utilizes contractors to manage the program, as well as to 
provide pharmacy and dental benefits. DOD also uses other 
contracts to deliver health care to its beneficiary population, 
including contracts mandated by section 722 of the National 
Defense Authorization Act for 1997 (Public Law 104-201) with 
designated providers under the Uniformed Services Family Health 
Plan.
    TRICARE management contracts are of significant size within 
the Department. Although most of the money flows through to 
TRICARE providers in the form of reimbursements for medical 
services provided to beneficiaries, there is a major 
contracting component to the program. The third generation of 
TRICARE management contracts, which was to have been 
implemented in 2010, has yet to be fully implemented in all 
regions due to bid protests.
    The committee directs the Comptroller General to conduct a 
comprehensive review of DOD's private sector care contracts. At 
a minimum, the review should assess the following:
           How requirements are determined and to what 
        extent are they consistent within and among the TRICARE 
        regions and all categories of beneficiaries;
           How efficient DOD's health care contracting 
        procedures are, and whether contracting personnel are 
        adequately prepared to contract for health care 
        services of high quality at reasonable cost;
           Whether the processes for determining 
        requirements and entering into contracts are 
        appropriately transparent;
           What opportunities exist for savings and 
        efficiencies in DOD health care contracting, including 
        but not limited to opportunities for consolidation, 
        streamlined processes, collaboration with the 
        Department of Veterans Affairs, and increased 
        competition; and
           The extent to which health care contracting 
        under TRICARE is conducted in a manner consistent with 
        proscriptions and principles of DOD's ``Better Buying 
        Power'' initiative.
    The committee expects the Comptroller General's analysis to 
include an assessment of the planning activities that are 
currently taking place for the fourth generation of TRICARE 
management contracts and make appropriate recommendations for 
any improvements that should be considered for incorporation 
into the development of requirements and the solicitation 
process for these contracts. The committee further expects the 
Comptroller General to engage in dialogue with stakeholders, 
including contractors, designated providers and beneficiary 
organizations in the course of assessing DOD health care 
contracting requirements and procedures.
Cooperative health care agreements
    Under current law (10 U.S.C. 1073 note), the Secretary of 
Defense is authorized to enter into cooperative health care 
agreements between military installations and local and 
regional non-military health care entities. The committee 
understands that the implementation of this authority is 
delegable, including certain actions taken by the military 
departments.
    The committee believes that, should the Secretary of 
Defense choose to delegate this authority to enter into 
cooperative health care agreements with local health care 
entities, such delegation should be exercised with appropriate 
oversight and coordination in order to ensure uniform standards 
for the continued provision of a quality health care benefit 
across each of the services.
Health care provider appointment and compensation authorities
    The committee remains concerned about gaps in shortage 
category and critical need health care occupations in the 
Department of Defense (DOD), and believes that the current and 
projected increases of nationwide shortfalls in certain health 
care occupations should not preclude the delivery of timely, 
high-quality care to service members, including wounded 
warriors. Several authorities currently exist that the DOD can 
exercise on its own, or with the approval of the Office of 
Personnel Management (OPM), to address the challenges in 
maintaining a trained, experienced workforce in critically 
needed health care occupations. These include the authority to 
appoint and pay for critical health care personnel under 
chapter 74 of title 38, United States Code, as authorized for 
DOD use by section 1599c(a) of title 10, United States Code, 
and the discretionary use of classification, pay, and hours of 
work provisions under chapter 74 of title 38. It is the 
committee's understanding that under the delegation agreement 
with OPM to exercise this authority, DOD may use the Department 
of Veterans Affairs' title 38 authorities to establish special 
rates to recruit and retain employees in a broad range of 
health care occupations, as well as approve alternative work 
schedules and special premium payments for nurses and other 
health care employees, establish qualifications and a 
qualifications-based grade system for nurses and other types of 
health care occupations, and pay nurses locality pay. 
Utilization of this authority is not limited to physicians and 
dentists. Finally, OPM has the authority to establish special 
pay rates under section 5305 of title 5, United States Code, if 
requested by the Department of Defense.
    The committee is concerned that authorities which could 
improve hiring and compensation of health care personnel may be 
exercised inadequately or unevenly, possibly creating disparity 
in access to care for wounded, ill, or injured service members 
or resulting in unnecessary turnover of needed health care 
professionals. The committee encourages the Secretary of 
Defense and the Director of OPM to consider the use of all 
existing authorities for critical health care personnel 
shortage fields to the maximum extent necessary to attract and 
retain high quality providers, thereby ensuring timely access 
to care and treatment for service members and their families 
and support of the medical readiness goals of DOD.
    The committee directs the Secretary of Defense, in 
consultation with the Director of OPM, to provide a report to 
the congressional defense committees, the Senate Committee on 
Homeland Security and Governmental Affairs, and the House of 
Representatives Committee on Oversight and Government Reform, 
no later than 120 days after enactment of this Act that 
describes the use of these authorities, and to conduct an 
assessment of additional authorities that may be needed. The 
report shall include a side-by-side comparison of authorities 
available to and exercised by the Department of Veterans 
Affairs and within the Department of Defense, including each of 
the military services, for each health care shortage category 
or critical need occupation. The Secretary of Defense shall 
update the report annually by September 30, until such time 
that the Secretary can certify that no shortage category 
occupation has existed for at least 365 days.
Medication therapy management
    The committee recognizes that the cost of providing health 
care to service members, retirees, and their families through 
the TRICARE program continues to rise, as does the cost of 
providing health care in the private sector, and believes that 
initiatives to increase the quality of patient health while 
reducing the cost of care should be explored. An article 
published in the New England Journal of Medicine (April 29, 
2010, Vol. 362 No. 17) indicates that ``as many as half of all 
patients do not adhere faithfully to their prescription-
medication regimens,'' resulting in over $100.0 billion each 
year being spent on avoidable hospitalizations.
    The committee understands that the Department of Defense 
currently provides a broad range of medication therapy 
management (MTM) services through many of its military 
treatment facilities, and that these services may improve 
patient health and clinical outcomes while lowering total 
health care costs. Therefore, the committee directs the 
Secretary of Defense to conduct a comprehensive review of its 
MTM services, to include a discussion of MTM implementation to 
date, cost savings realized from utilization of MTM thus far, 
plans for future expansion, and an assessment of the 
feasibility and advisability of including this evolving 
standard of care into the broader TRICARE pharmacy program. The 
committee expects the Department to submit its report to the 
Committees on Armed Services of the Senate and the House of 
Representatives no later than February 1, 2013.
Standards for production and performance of prostheses and prosthetic 
        sockets for military amputees
    The committee applauds the work of Department of Defense 
medical and technical personnel who, in partnership with 
industry, are providing superior individualized prostheses to 
military amputees at each Department of Defense location of the 
Extremity Injury and Amputation Center of Excellence 
established pursuant to section 723 of the Duncan Hunter 
National Defense Authorization Act for 2009 (Public Law 110-
417).
    According to a published report in The Journal of Trauma 
Injury, Infection, and Critical Care, Volume 68, Number 6, June 
2010, ``The number of amputees returning to duty has increased 
significantly, from 2.3% to 16.5%, due to advancements in 
combat casualty care and the establishment of centralized 
amputee centers.'' The committee believes that as an increasing 
number of service members remain on active duty and even deploy 
with prostheses, it is of vital importance that the Department 
of Defense have uniform standards of production and performance 
for prostheses and prosthetic sockets.
    Therefore, the committee encourages the Department to 
continue clinical and technological research and development 
for prostheses, which are critical to enabling service members 
who have lost one or more limbs in service to our country to 
achieve their highest goals for recovery, rehabilitation, and 
performance.
    In light of these objectives, the committee directs the 
Secretary of Defense to provide a report to the Committees on 
Armed Services of the Senate and the House of Representatives, 
not later than 180 days after the enactment of this Act, 
outlining:
          (1) The establishment or verification of consistent, 
        acceptable standards of quality for the design and 
        fabrication of military prostheses and prosthetic 
        sockets;
          (2) The identification of standards for human 
        performance using limb loss and limb salvage prostheses 
        and prosthetic socket performance based on the 
        individual mobility level, size, weight, functional 
        goals, and occupational specialty of members of the 
        armed forces;
          (3) The processes in place for the demonstration and 
        validation of prostheses and prosthetic socket 
        manufacturing techniques that reduce weight, reduce 
        cost, and strengthen key load-bearing areas of the 
        socket to reduce the risk of failure and enhance 
        mobility; and
          (4) An overview of the Department's efforts to 
        document each prosthetic, prosthetic socket, alignment, 
        and associated fabrication settings for all military 
        amputees in their electronic health record.

TRICARE efficiencies

    The committee acknowledges efforts undertaken by the 
Department of Defense to achieve internal efficiencies, such as 
decreasing administrative overhead, provider payment reform, 
purchasing pharmaceuticals, supplies and equipment at lower 
prices, and providing incentives for beneficiaries to obtain 
prescriptions from the Department's mail order pharmaceutical 
program. These have already resulted in significant savings to 
the Department.
    The committee notes with concern the Comptroller General 
report of April 2012, ``Defense Health Care: Applying Key 
Management Practices Should Help Achieve Efficiencies within 
the Military Health System,'' (GAO-12-224) which faulted the 
Department for developing specific plans, goals and 
accountability for only 1 of 11 health care initiatives aimed 
at slowing the growth of health care costs.
    The committee acknowledges that the Department's efforts to 
streamline the military health system governance and 
consolidate common functions, as described in its March 2012 
``Report on the Governance of the Military Health System'', 
were delayed by section 716 of the National Defense 
Authorization Act for Fiscal Year 2012 (Public Law 112-81) 
which prohibited the Secretary from reorganizing the military 
health system until 120 days after the Comptroller General of 
the United States submits a report to Congress evaluating 
options considered and potential costs or cost savings. 
However, the committee expects the Secretary to continue to 
work toward increased efficiencies to assure that Department 
goals to reduce health care cost growth are achieved. Elsewhere 
in this report, the committee directs the Comptroller General 
to undertake an assessment of Department health care 
contracting requirements and processes in order to identify 
additional efficiencies.
  TITLE VIII--ACQUISITION POLICY, ACQUISITION MANAGEMENT, AND RELATED 
                                MATTERS

 Subtitle A--Provisions Relating to Major Defense Acquisition Programs

Limitation on use of cost-type contracts (sec. 801)
    The committee recommends a provision that would prohibit 
the Department of Defense (DOD) from using cost-type contracts 
for the production of major defense acquisition programs, 
unless the Under Secretary of Defense for Acquisition, 
Technology, and Logistics, after consultation with the Director 
of Cost Assessment and Program Evaluation, certifies to 
Congress that a cost-type contract is needed to provide a 
required capability in a timely and cost-effective manner.
    Section 818 of the John Warner National Defense 
Authorization Act for Fiscal Year 2007 (Public Law 109-364) 
already limits the circumstances under which DOD may enter a 
cost-type contract for the development of major defense 
acquisition programs. However, no comparable limitation 
currently exists for the production of such programs.
    The committee takes the position that DOD should select the 
contract type for a production program that is consistent with 
the level of program risk for the program. Consistent with 
sound acquisition practice, however, very few major defense 
acquisition programs should be in production unless program 
risk has already been reduced to a manageable level. The 
committee expects the Department to ensure that the authority 
to waive this requirement is exercised only in exceptional 
circumstances.
Acquisition strategies for major subsystems and subassemblies on major 
        defense acquisition programs (sec. 802)
    The committee recommends a provision that would require the 
Secretary of Defense to ensure that the acquisition strategy 
for each major defense acquisition program (MDAP) provides for 
robust competition at the subsystem and subassembly level by 
breaking out major subsystems and subassemblies, where 
appropriate, for separate competition.
    Section 202(c) of the Weapon Systems Acquisition Reform Act 
of 2009 (Public Law 111-23) requires that the Department of 
Defense (DOD) to ensure competition, or the option of 
competition, at both the prime contract level and the 
subcontract level of MDAPs, but does not specifically address 
the break-out of subsystems and subassemblies. In some cases, 
the government's interest in competition is likely to be best 
served if DOD runs its own competition for a subsystem or 
subassembly and provides it to the prime contractor as 
government-furnished equipment.
Management structure for developmental test and evaluation (sec. 803)
    The committee recommends a provision that would clarify the 
oversight and supervisory responsibilities of the Deputy 
Assistant Secretary of Defense for Developmental Test and 
Evaluation (DASD-DT&E) over the chief developmental testers and 
lead developmental test evaluation organizations of the 
military departments.
    The DASD-DT&E is responsible for establishing policies and 
guidance for, and monitoring and reviewing the performance of, 
all developmental test components of the Department of Defense 
(DOD). The committee expects the components to adhere to 
relevant guidance established by the DASD-DT&E and to promptly 
transmit any records or data (including but not limited to 
quick-look assessments and other internal reports and 
supporting data prepared by the program offices, chief 
developmental testers, and lead developmental test evaluation 
organizations of the military departments) directly to the 
DASD-DT&E upon request.
    The Weapon Systems Acquisition Reform Act of 2009 (WSARA) 
(Public Law 111-23) established the position of DASD-DT&E 
because of a recognition that developmental testing and 
evaluation plays a critical role in identifying and correcting 
problems in major weapon systems early, before they lead to 
excessive cost overruns and schedule delays. For this reason, 
the committee is troubled that DOD does not appear to have 
given adequate attention to shortcomings identified by DASD-
DT&E in developmental testing.
    Since the enactment of WSARA, the DASD-DT&E has concluded 
on the basis of assessments of operational test readiness 
(AOTR) that four major weapons programs were not ready to 
proceed to initial operational testing and evaluation (IOT&E). 
In each case, the program was allowed to proceed to IOT&E 
despite the findings of the AOTR, and in each case, IOT&E 
identified significant problems that could and should have been 
corrected at an earlier stage of the program.
    The committee directs the Under Secretary of Defense for 
Acquisition, Technology and Logistics to report to the 
congressional defense committees on each case in fiscal year 
2012 and fiscal year 2013 in which a major defense acquisition 
program proceeds to IOT&E despite an AOTR finding that it is 
not ready to proceed to this stage. For each such case, the 
report should explain why the program proceeded to IOT&E 
despite the findings of the AOTR; what aspects of the approved 
testing and evaluation master plan had to be set aside to 
enable the program to proceed to IOT&E under these 
circumstances; how the program addressed the specific areas of 
concern raised in the AOTR; and whether IOT&E identified any 
significant shortcomings in the program. The required report 
should be provided to the congressional defense committees by 
not later than 60 days after the end of fiscal year 2013.
Assessments of potential termination liability of contracts for the 
        development or production of major defense acquisition programs 
        (sec. 804)
    The committee recommends a provision that would require the 
Under Secretary of Defense for Acquisition, Technology, and 
Logistics (USD-AT&L) to provide the congressional defense 
committees with an assessment of potential termination 
liability for each contract entered by the Department of 
Defense (DOD) for the development or production of a major 
defense acquisition program for which the USD-AT&L is the 
milestone decision authority.
    In recent years, DOD decisions to terminate contracts for 
the development or production of major defense acquisition 
programs--such as the VH-71 Presidential helicopter replacement 
program, the Future Combat Systems (FCS) program, and the 
Medium Extended Air Defense System program--have raised 
questions about the relative costs and benefits of program 
termination and program completion. The Government 
Accountability Office (GAO) reviewed this issue in 2008 and 
concluded that it cost more to complete programs than to 
terminate them and that contract termination costs were 
generally not a major factor in DOD decisions to terminate 
weapons programs.
    GAO concluded that program terminations could be a valuable 
tool to ``create trade space'' in limited budgets and respond 
to to long-term fiscal imbalances and unexpected events. To 
make the most effective use of this tool, GAO stated, decision-
makers ``need to be able to anticipate and plan for possible 
terminations and have a sound understanding of costs, benefits, 
and legal requirements.'' For this reason, GAO recommended that 
DOD review, and as needed amend, guidance on terminations 
across all the military departments and defense agencies to 
ensure that the guidance identifies the conditions under which 
it would be appropriate to end programs or contracts, and 
provides knowledge needed to use terminations as an investment 
portfolio tool.
    The committee directs the Comptroller General to update the 
2008 GAO report with an assessment of: (1) the extent to which 
DOD has implemented the recommendations of the 2008 report; (2) 
the actual costs and savings resulting from the termination of 
programs reviewed in the 2008 report and the extent to which 
technologies and facilities from these programs were 
effectively leveraged or transferred to other programs; and (3) 
the estimated costs and benefits of the termination of the VH-
71 and FCS programs.
Technical change regarding programs experiencing critical cost growth 
        due to change in quantity purchased (sec. 805)
    The committee recommends a provision that would correct a 
paragraph reference in section 2433a of title 10, United States 
Code, as amended by section 831 of the National Defense 
Authorization Act for Fiscal Year 2012 (Public Law 112-81), to 
clarify that the Secretary of Defense is not required to 
conduct continuing reviews of programs that exceed thresholds 
for critical cost growth due only to a change in the quantity 
of items to be purchased.
Repeal of requirement to review ongoing programs initiated before 
        enactment of Milestone B certification and approval process 
        (sec. 806)
    The committee recommends a provision that would repeal 
section 205(b) of the Weapon Systems Acquisition Reform Act of 
2009 (WSARA) (Public Law 111-23), as recommended by the 
Department of Defense (DOD). Section 205(b) requires the annual 
review of programs initiated before the enactment of the 
certification requirements in section 2366b of title 10, United 
States Code, in 2006, to determine whether or not they meet 
certification requirements under that section.
    The committee notes that section 819(a) of the National 
Defense Authorization Act for Fiscal Year 2012 (Public Law 112-
81) repealed section 204(c) of WSARA, which established the 
requirement for so-called ``catch-up'' certifications for 
programs initiated prior to the enactment of WSARA. As DOD 
points out, however, the repeal of section 204(c) does not 
reduce the burden on the Department unless the ``essentially 
redundant obligation under section 205(b)'' is also repealed.

             Subtitle B--Acquisition Policy and Management

One-year extension of temporary limitation on aggregate annual amount 
        available for contract services (sec. 821)
    The committee recommends a provision that would extend for 
1 year the goals and objectives established in section 808 of 
the National Defense Authorization Act for Fiscal Year 2012 
(Public Law 112-81), including: (1) a cap on spending for 
contract services at the fiscal year 2010 level; (2) a cap on 
contractor labor rates and overhead rates at fiscal year 2010 
levels; (3) an approval requirement for contracts and task 
orders exceeding fiscal year 2010 levels; and (4) a reduction 
in funding for staff augmentation contracts and contracts for 
functions closely associated with inherently governmental 
functions.
    The committee is encouraged by measures that the military 
departments have taken to achieve efficiencies in the area of 
contract services.
    Last year the committee noted that the Air Force, which has 
been more aggressive than the other military departments in 
implementing required management structures for contract 
services, conducted a disciplined review of $5.6 billion of 
service contracts over the last year and identified $1.4 
billion of expected savings over an 8-year period. This year, 
the Air Force informed the committee that it has achieved an 
additional $3.8 billion in savings over the future years 
defense program in the area of Weapon System Sustainment alone.
    The Army has now established portfolio managers for 
functional categories of services and instituted a management 
review process through which it has identified potential cost 
savings of $4.6 billion in the base budget.
    The committee is also aware that in October 2011, the Naval 
Sea Systems Command (NAVSEA) instituted a Services Requirements 
Review Board--commonly referred to as a ``services court'' or 
``contractor court''--pursuant to which senior officials of the 
command have assumed personal responsibility for reviewing all 
significant services contracts in the command to identify 
opportunities for service acquisition efficiencies, process 
improvements, and cost savings. The process also includes 
``tripwires'' to trigger more in depth review of particular 
contracts. The committee understands that this new process has 
enabled NAVSEA to achieve savings of as much as 20 percent on 
its service contracts in the first year alone and that the 
Assistant Secretary of the Navy for Research, Development, and 
Acquisition has directed that the process be institutionalized 
across the Navy.
    The committee concludes that the Navy process is a ``best 
practice'' and urges all of the military departments and 
defense agencies to undertake similar initiatives to achieve 
greater efficiencies in the area of services contracting.
Prohibition of excessive pass-through contracts and charges in the 
        acquisition of services (sec. 822)
    The committee recommends a provision that would prohibit 
the Department of Defense (DOD) from awarding a contract for 
the performance of services (other than a firm, fixed price 
contract that is either competitively awarded or for commercial 
services) unless the contractor agrees that at least 50 percent 
of the direct labor on the contract will be performed by the 
contractor or by a subcontractor that is specifically 
identified in the contract.
    Section 852 of the John Warner National Defense 
Authorization Act for Fiscal Year 2007 (Public Law 109-364) was 
intended to address the problem of excessive ``pass-through'' 
charges--charges for profit and overhead from a contractor who 
provides little or no value added on work performed by a lower-
tier contractor or subcontractor. Despite the enactment of this 
legislation, DOD continues to pay profit and overhead for 
multiple layers of contractors in cases where work is performed 
by lower-tier contractors and subcontractors--in some cases, 
because prime contractor overhead is considered ``value 
added,'' in other cases, because prime contractor overhead and 
profits are built directly into labor rates included in the 
contract.
    The committee notes that section 15(o) of the Small 
Business Act (15 U.S.C. section 644(o)) already requires that 
small businesses agree to perform at least 50 percent of the 
work under their DOD contracts. The committee concludes that a 
similar standard applicable to contractors of all sizes would 
serve to protect DOD from paying multiple layers of contractors 
for profit and overhead on work performed by subcontractors.
Availability of amounts in Defense Acquisition Workforce Development 
        Fund for temporary members of workforce (sec. 823)
    The committee recommends a provision that would amend 
section 1705 of title 10, United States Code, to clarify the 
extent to which the Defense Acquisition Workforce Development 
Fund (DAWDF) may be used to support temporary members of the 
acquisition workforce. Under the amendment, DAWDF funds could 
be used for temporary personnel only for the limited purpose of 
providing training for such personnel in the performance of 
acquisition-related functions and duties. The provision would 
also amend section 1705 to extend direct hiring authority for 
the acquisition workforce for an additional 2 years.
    The committee notes that senior acquisition officials of 
the Department of Defense (DOD) have uniformly cited DAWDF as 
an essential tool to strengthen the acquisition workforce and 
help the Department overcome significant shortcomings in the 
management and oversight of its contracts. The committee 
continues to believe that robust funding of the DAWDF will 
result in improved DOD acquisition practices and substantial 
long-term savings.
    At the same time, however, the committee notes that the 
funding levels in section 1705(d)(2)(C) were established in 
section 832 of the National Defense Authorization Act for 
Fiscal Year 2010 (Public Law 111-84), to reflect the 
requirements of the hiring plan announced by the Secretary of 
Defense in 2009, and do not take into account the substantial 
changes in DOD funding and force structure that have taken 
place since that time.
    The committee notes that the Statement of Managers 
accompanying H.R. 2055, the Consolidated Appropriations Act, 
2012 (Public Law 112-74), directed the Secretary of Defense to 
reassess the annual funding floors for the DAWDF and provide 
recommendations for appropriate funding levels to the 
congressional defense committees within 180 days of enactment. 
The committee endorses this review and concludes that while DOD 
has a continued need for DAWDF funding, funding levels should 
be established on the basis of a 2012 hiring plan, not a 2009 
hiring plan.
Department of Defense policy on contractor profits (sec. 824)
    The committee recommends a provision that would require the 
Secretary of Defense to review the profit guidelines for 
Department of Defense (DOD) contracts to ensure an appropriate 
link between contractor profit and contractor performance.
    The committee understands that contractor profit levels 
play an important role in attracting and sustaining investment 
in the defense industry. In a time of constrained budgets, 
however, DOD cannot afford to pay excessive profits to 
contractors who perform poorly. Rather, the Department must use 
all available tools--including profit policy--to incentivize 
the timely and cost-effective delivery of quality products and 
services by DOD contractors.
    Section 814 of the John Warner National Defense 
Authorization Act for Fiscal Year 2007 (Public Law 109-364) 
required the Secretary to ensure that award and incentive fees 
are linked to acquisition outcomes (defined in terms of program 
cost, schedule, and performance) in DOD acquisition programs. 
The committee concludes that a similar link is needed between 
contractor profits and contractor performance.
Modification of authorities on internal controls for procurements on 
        behalf of the Department of Defense by certain non-defense 
        agencies (sec. 825)
    The committee recommends a provision that would repeal the 
requirement for the Department of Defense Inspector General to 
submit additional follow-up reports on internal controls for 
procurements made by the Department of Defense through other 
federal agencies. The Inspector General has indicated that 
previous reviews have shown a significant decrease in reported 
problems with regard to such procurements. The committee 
concludes that the Inspector General should have greater 
flexibility to direct audit resources to areas in which they 
are most needed.
Extension of pilot program on management of supply-chain risk (sec. 
        826)
    The committee recommends a provision that would extend for 
2 years the pilot authority for the Department of Defense (DOD) 
to manage supply-chain risk under section 806 of the Ike 
Skelton National Defense Authorization Act for Fiscal Year 2011 
(Public Law 111-383).
    The committee is aware that DOD has performed a number of 
exercises to develop effective supply-chain risk management 
strategies and that lessons learned from these exercises will 
be incorporated into implementing guidance that is expected to 
be issued this summer. The committee understands the complexity 
of these issues, but is disappointed by the projected 18-month 
delay in the issuance of this guidance.
    The committee urges DOD to issue guidance and begin the 
implementation of section 806 as soon as possible, so that this 
authority can be used as intended, to reduce supply-chain risk 
in the acquisition of sensitive information technology systems 
that are incorporated into intelligence or cryptologic systems, 
are used in command and control of military forces, or form an 
integral part of a weapon system.

  Subtitle C--Amendments Relating to General Contracting Authorities, 
                      Procedures, and Limitations

Applicability of Truth in Negotiations Act to major systems and related 
        subsystems, components, and support services (sec. 841)
    The committee recommends a provision that would authorize 
the Department of Defense (DOD) to request additional 
contractor data, where necessary to evaluate the price 
reasonableness of commercial items (other than commercially 
available off-the-shelf items and other items that are 
developed exclusively at private expense) that are procured for 
the support of a major weapon system.
    The Administration requested legislation that would amend 
the definition of commercial items in section 103 of title 41, 
United States Code, to exclude items that are merely ``offered 
for sale'' or ``of a type'' offered for sale in the commercial 
marketplace. The committee declines to make this change. The 
Federal Acquisition Streamlining Act of 1994 (FASA) (Public Law 
103-355) adopted a broad definition of commercial items to 
ensure that federal agencies would have ready access to 
products that are available in the commercial marketplace--
including new products and modified products that are just 
becoming available. Such access remains particularly critical 
in fast moving commercial markets, including the markets for 
information technology and other advanced products.
    At the same time, the committee shares the Administration's 
concern that some contractors have abused the commercial item 
definition to obscure cost and price information with regard to 
spare parts and components for DOD weapon systems. As DOD has 
pointed out, the Government Accountability Office and the DOD 
Inspector General have both criticized the Department for using 
commercial item procedures to procure items that are 
misclassified as commercial items and are not subject to 
competitive price pressure in the commercial marketplace. In 
2011, the DOD Inspector General found that non-competitive 
spare parts provided by two different contractors were 
significantly overpriced because of inadequate and inaccurate 
data supplied by the contractors.
    The provision recommended by the committee would provide 
the Department with additional tools to collect needed data for 
products and services that may arguably qualify as commercial 
items, without undermining the widely accepted definition of 
commercial items.
Maximum amount of allowable costs of compensation of contractor 
        employees (sec. 842)
    The committee recommends a provision that would amend 
section 2324(e)(1)(P) of title 10, United States Code, to 
reduce the limitation on allowable compensation for defense 
contractor employees from the median amount of compensation 
provided to senior executives in large United States 
corporations (currently 763,000) to the maximum level of 
compensation for federal employees, which is set at the annual 
salary of the Vice President of the United States (currently 
$230,700).
    Section 808 of the National Defense Authorization Act for 
Fiscal Year 1998 (Public Law 108-85) limited the amount of 
contractor executive compensation allowable for reimbursement 
under federal contracts to a benchmark based on the median 
amount of compensation provided to senior executives in large 
United States corporations, as calculated by the Office of 
Federal Procurement Policy (OFPP). The OFPP website indicates 
that the benchmark amount, which was set at $432,851 on January 
1, 2004, was increased to $763,029 on April 22, 2012--an 
increase of more than 75 percent in just 8 years.
    At a time when most Americans are seeing little or no 
increase in their paychecks and budget constraints require the 
Department of Defense to find efficiencies in all areas, the 
committee concludes that increases of this magnitude are 
unsupportable. The committee notes that section 2324(e)(1)(P) 
authorizes the Secretary of Defense to establish narrowly 
targeted exceptions to the limitation on allowable 
compensation, where such exceptions are needed to ensure that 
the Department of Defense has continued access to scientists, 
engineers, and others with unique and needed skills and 
capabilities.
Department of Defense access to and use of contractor internal audit 
        reports (sec. 843)
    The committee recommends a provision that would clarify 
Defense Contract Audit Agency (DCAA) access to defense 
contractor internal audit reports and supporting materials for 
the purpose of assessing risk and evaluating the efficacy of 
contractor internal controls and the reliability of associated 
contractor business systems. Under the provision, a 
contractor's refusal to permit access to internal audit reports 
and supporting materials could be taken into account in any 
assessment of the adequacy of contractor business systems 
pursuant to section 893 of the Ike Skelton National Defense 
Authorization Act for Fiscal Year 2011 (Public Law 111-383).
    In December 2011, the Government Accountability Office 
(GAO) reported on a review of DCAA access to and use of defense 
contractor internal audit reports. GAO reported that generally 
accepted government auditing standards require evaluation and 
testing of contractor internal controls, including the work of 
the contractor's internal audit activity. However, GAO found 
that DCAA access to internal audits was uneven, and that one 
contractor refused to provide DCAA with any access to such 
audits at all. The report states:

          ``DCAA does not generally track its requests or 
        denials for internal audit reports. GAO found that the 
        number of DCAA requests for internal audit reports is 
        small relative to the number of internal audits GAO 
        identified as relevant to defense contract oversight. 
        In explaining why few reports are requested, DCAA 
        auditors noted obstacles such as not being able to 
        identify internal audits relevant to their work and 
        uncertainty as to how useful those reports could be. By 
        not routinely obtaining access to relevant company 
        internal audits, DCAA auditors are hindered in their 
        ability to effectively plan work and meet auditing 
        standards for evaluating internal controls.''

    GAO recommended that DCAA issue guidance on how and under 
what circumstances company internal audit reports can be 
accessed; establish a central point of contact for each company 
to coordinate issues pertaining to internal audits; and track 
and assess information regarding access to such audits.
    On March 30, 2012, the Director of DCAA issued the Agency's 
first annual report to Congress. The report requests that 
Congress clarify DCAA's access to contractor internal controls 
and business systems to assess whether the systems and controls 
are adequate to ensure the reliability of contractor data. The 
report states:

          ``It is essential for DCAA to have access to 
        contractor reviews, inquiries, investigations, and 
        internal audits in order to evaluate contractor 
        business systems. DCAA audits contractor accounting 
        systems before and after contract award to assess 
        whether the systems are adequate for accumulating and 
        billing costs that comply with contract requirements. 
        For major contractors, DCAA audits contractor business 
        systems as a basis for relying on those systems during 
        other DCAA audits.''
Enhancement of whistleblower protections for contractor employees (sec. 
        844)
    The committee recommends a provision that would amend 
section 2409 of title 10, United States Code, to significantly 
enhance whistleblower protections for contractor employees. The 
provision recommended by the committee would: (1) extend 
coverage to employees of subcontractors; (2) extend coverage to 
disclosures that are made to management officials of the 
contractor; (3) extend coverage to abuses of authority that 
undermine performance of a contract; (4) extend coverage to 
reprisal actions that are taken in concert with the contracting 
agency; (5) revise the standard of proof to match the standard 
already applicable in federal employee cases; (6) provide that 
whistleblower rights under the provision may not be waived by 
an arbitration agreement; (7) clarify that contractor legal 
fees are not allowable if the contractor is determined to have 
engaged in a reprisal; and (8) establish statutes of limitation 
for complaints and appeals.
    The committee understands that over a 3-year period from 
2009 through 2011, 163 complaints were filed under section 2409 
and only 5 of these complaints were investigated by the 
Department of Defense Inspector General. In December 2011, a 
representative of the Inspector General testified that many of 
these complaints were outside the scope of the statute because 
the alleged wrongdoing was reported by subcontractor employees 
or was reported to company management. The provision 
recommended by the committee would correct these and other 
shortcomings in the existing law.
Extension of contractor conflict of interest limitations (sec. 845)
    The committee recommends a provision that would require the 
Secretary of Defense to determine whether guidance developed 
pursuant to section 841(a) of the Duncan Hunter National 
Defense Authorization Act for Fiscal Year 2009 (Public Law 110-
417) regarding personal conflicts for contractor employees 
performing acquisition functions closely associated with 
inherently governmental functions should be extended to 
contractor personnel engaged in: (1) functions other than 
acquisition functions that are closely associated with 
inherently governmental functions; (2) personal services 
contracts; or (3) contracts for staff augmentation services.
Repeal of sunset for certain protests of task and delivery order 
        contracts (sec. 846)
    The committee recommends a provision that would repeal the 
sunset date for the authority to file bid protests for task and 
delivery orders in excess of $5.0 million pursuant to section 
2304c(e) of title 10, United States Code.
    The committee notes that: (1) the expansion of bid protests 
to task and delivery orders in excess of $5.0 million provides 
an increased assurance of fairness and regularity in the award 
of such task and delivery orders; (2) the Government 
Accountability Office has not reported an excessive increase in 
the number of bid protests as a result of this authority; and 
(3) the potential expiration of a previous sunset date for this 
authority produced significant confusion and uncertainty in the 
acquisition system over the last 2 years.

         Subtitle D--Provisions Relating to Wartime Contracting

Responsibility within Department of Defense for contract support for 
        overseas contingency operations (sec. 861)
    The committee recommends a provision that would require the 
Secretary of Defense to prescribe in regulations the chain of 
authority and responsibility within the Department of Defense 
(DOD) for policy, planning, and execution of contract support 
for overseas contingency operations (OCO).
    The Commission on Wartime Contracting in Iraq and 
Afghanistan (CWC) established pursuant to section 841 of the 
National Defense Authorization Act for Fiscal Year 2008 (Public 
Law 110-181) found that DOD lacks ``the organizational 
structure needed to force important lessons learned through the 
system and the authority to enable resource shift to support 
the acquisition process.'' The CWC recommended the 
establishment of a new directorate within the Joint Staff to 
specifically focus on contingency contracting.
    The committee recognizes that DOD has made significant 
improvements over the last 8 years in the way that it has 
organized itself to plan and manage OCO contract support. The 
provision recommended by the committee would require the 
Department to institutionalize these changes and ensure that 
the DOD's management structure provides clear authority and 
responsibility for the planning of contract support; the 
establishment and validation of contract requirements; the 
identification of resources and prioritization of funding 
needs; the award and execution of contracts; and the oversight 
and management of contractors in the field.

Annual reports on contract support for overseas contingency operations 
        involving combat operations (sec. 862)

    The committee recommends a provision that would require the 
Secretary of Defense to submit an annual report on contract 
support for any overseas contingency operation that includes 
combat operations and for which annual contract obligations 
exceed $250.0 million. The committee notes that the reports 
required by this provision are identical to the reports already 
provided for contracting in Iraq and Afghanistan pursuant to 
section 863 of the National Defense Authorization Act for 2008 
(Public Law 110-181), as amended by section 835 of the Ike 
Skelton National Defense Authorization Act for Fiscal Year 2011 
(Public Law 111-383).

Inclusion of contract support in certain requirements for Department of 
        Defense planning, joint professional military education, and 
        management structure (sec. 863)

    The committee recommends a provision that would require the 
consideration of issues arising out of contract support for 
contingency operations in the Department of Defense (DOD) 
readiness reporting system, the contingency planning functions 
of the Chairman of the Joint Chiefs of Staff, the curriculum 
for joint professional military education, and the DOD 
structure for the management of contracts for services.

Risk assessment and mitigation for contractor performance of critical 
        functions in support of overseas contingency operations (sec. 
        864)

    The committee recommends a provision that would require the 
Department of Defense (DOD) to perform a comprehensive risk 
assessment and develop a risk mitigation plan for operational 
and political risks associated with contractor performance of 
critical functions in support of a contingency operation that 
is expected to continue for more than 1 year and require the 
expenditure of more than $250.0 million for contract support.
    The provision defines critical functions to include private 
security functions, training of foreign government personnel, 
intelligence and information operations, and other functions 
closely associated with inherently governmental functions. The 
assessment and mitigation plan would be required to address 
risks relating to the goals and objectives of the operation, 
the continuity of the operation, the safety of military and 
civilian personnel, DOD's managerial control over the 
operation, DOD's critical organic or core capabilities, and 
DOD's ability to control costs and minimize waste, fraud, and 
abuse.
    The Commission on Wartime Contracting in Iraq and 
Afghanistan (CWC) established pursuant to section 841 of the 
National Defense Authorization Act for Fiscal Year 2008 (Public 
Law 110-181) reported that DOD and other federal agencies have 
too often made acquisition decisions that are expedient in the 
short-term without adequate consideration of the long-term 
risks. The final report of the CWC states:

          ``Ten years of war in Iraq and Afghanistan have seen 
        the United States using too many contractors for too 
        many functions with too little forethought and control. 
        . . . Events in Iraq and Afghanistan have shown that 
        systematic consideration of operational, political, and 
        financial risks must be a factor in judging 
        appropriateness. All too often, officials assume that 
        any task deemed not inherently governmental is 
        therefore automatically suitable for performance by 
        contractors. . . . For functions performed in a war 
        zone, prudent decisions on contracting include 
        assessing the level of risk associated with 
        contracting, and judging whether that level is or can 
        be mitigated to an acceptable level. . . . If 
        mitigation or control measures leave the residual risks 
        of using contractors at a level that outweighs the 
        expected benefits, then the government needs timely and 
        deployable options to support the contingency 
        mission.''

    The provision recommended by the committee would not 
preclude contractors from performing any specific functions. 
Rather, it would require DOD to systematically consider the 
potential risks associated with contractor performance of 
particular functions in an area of combat operations and take 
appropriate actions to mitigate or avoid such risks.

Extension and modification of reports on contracting in Iraq and 
        Afghanistan (sec. 865)

    The committee recommends a provision that would extend for 
2 years the requirement for an annual report on contracting in 
Iraq and Afghanistan pursuant to section 863 of the National 
Defense Authorization Act for Fiscal Year 2008 (Public Law 110-
181), as amended by section 835 of the Ike Skelton National 
Defense Authorization Act for Fiscal Year 2011 (Public Law 111-
383). The provision would also repeal the requirement for the 
Government Accountability Office (GAO) to review the annual 
reports.
    The committee directs the Under Secretary of Defense for 
Acquisition, Technology, and Logistics to report to the 
congressional defense committees not later than 180 days after 
the date of the enactment of this Act on the steps that the 
Department of Defense has taken and plans to take to address 
data and system deficiencies identified in previous GAO reports 
required by section 863 and to ensure the accuracy and 
completeness of contracting data available to the Department in 
current and future contingency operations.

Extension of temporary authority to acquire products and services in 
        countries along a major route of supply to Afghanistan (sec. 
        866)

    The committee recommends a provision that would extend 
through December 31, 2014, the authority for the Department of 
Defense (DOD) to acquire products and services on a non-
competitive basis in countries along a major route of supply to 
Afghanistan. This authority was requested by DOD to help build 
partnerships and support in countries along critical supply 
routes, and to help bolster stability in the region.

Compliance with Berry amendment required for uniform components 
        supplied to Afghanistan military or Afghanistan National Police 
        (sec. 867)

    The committee recommends a provision that would require the 
Department of Defense to comply with the requirements of the 
Berry amendment, section 2533a of title 10, United States Code, 
in the case of any textile components supplied by the 
Department to the Afghan National Army or the Afghanistan 
National Police for purposes of production of uniforms.

Sense of the Senate on the contributions of Latvia and other North 
        Atlantic Treaty Organization member nations to the success of 
        the Northern Distribution Network (sec. 868)

    The committee recommends a provision that would commend 
Latvia and other North Atlantic Treaty Organization (NATO) 
member nations along the Northern Distribution Network (NDN) 
for their contributions to ensuring that U.S. and coalition 
forces in Afghanistan have reliable lines of supply. The 
provision would also encourage the Department of Defense to 
make significant efforts to procure goods locally from Latvia 
and other NATO member nations along the NDN when quality 
products at competitive prices are available.

                       Subtitle E--Other Matters


Requirements and limitations for suspension and debarment officials of 
        the Department of Defense (sec. 881)

    The committee recommends a provision that would require the 
Suspension and Debarment Officials of the Department of the 
Army, the Department of the Navy, the Department of the Air 
Force, and the Defense Logistics Agency to be independent of 
acquisition officials, to be engaged only in suspension and 
debarment activities and other fraud-remedies activities, to 
document final decisions, and to develop written policies for 
the consideration of referrals.
    The provision would also require automatic referral for 
consideration of suspension or debarment of any person who has 
been charged with a federal criminal offense in connection with 
a Department of Defense (DOD) contract; been alleged in a 
criminal or civil proceeding brought by the United States to 
have engaged in fraudulent activities in connection with a DOD 
contract; or is the subject of a final determination that the 
person has failed to pay or refund money due or owed to the 
Federal Government in connection with a DOD contract.
    The committee understands that suspension and debarment 
generally apply to all divisions and other organizational 
elements of a contractor, unless the suspension or debarment 
decision is limited by its terms to specific divisions, 
organizational elements, or commodities. The committee further 
understands that in any case where the misconduct on which a 
suspension or debarment is based is systemic in nature, a 
narrow limitation would be inappropriate.

Uniform contract writing system requirements for the Department of 
        Defense (sec. 882)

    The committee recommends a provision that would require the 
Department of Defense (DOD) to establish uniform data 
standards, internal control requirements, independent 
verification and validation requirements, and business process 
rules for the processing of procurement requests, contracts, 
receipts, and invoices, and to ensure that all DOD contracts 
are entered through electronic contract writing systems that 
meet those requirements.

Comptroller General of the United States review of use by the 
        Department of Defense of urgent and compelling exception to 
        competition (sec. 883)

    The committee recommends a provision that would require the 
Government Accountability Office (GAO) to review the use by the 
Department of Defense (DOD) of the unusual and compelling 
urgency exception to full and open competition provided in 
section 2304(c)(2) of title 10, United States Code. The GAO 
report would be required to determine patterns in the use of 
the exception, whether justifications for the use of the 
exception meet statutory requirements, the extent to which 
decisions to solicit bids or proposals from only one source 
have been appropriately documented and justified, and whether 
DOD The has complied with limitations on the duration of 
contracts entered pursuant to the exception.

Authority to provide fee-for-service inspection and testing by Defense 
        Contract Management Agency for certain critical equipment in 
        the absence of a procurement contract (sec. 884)

    The committee recommends a provision that would authorize 
the Defense Contract Management Agency to accept reimbursement 
from a manufacturer or assembler for testing and inspection of 
an item when the nature of the item requires such inspection or 
testing as a precondition to government acceptance of the item 
under a future government contract. The Department of Defense 
requested this authority to expedite the testing and inspection 
of items that are determined to be critical to defense 
acquisition programs.

Disestablishment of Defense Materiel Readiness Board (sec. 885)

    The committee recommends a provision that would 
disestablish the Defense Materiel Readiness Board created by 
section 871 of the National Defense Authorization Act for 
Fiscal Year 2008 (Public Law 110-181), as requested by the 
Department of Defense.

Modification of period of wait following notice to Congress of intent 
        to contract for leases of certain vessels and vehicles (sec. 
        886)

    The committee recommends a provision that would amend 
section 2401(h) of title 10, United States Code, to eliminate 
the requirement of notification of Congress and then having to 
wait for 30 days of a continuous session of Congress to pass 
before a vessel lease contract may be made. The proposed change 
would ensure that Congress continues to receive a 30-day notice 
of proposed charters, but would eliminate the uncertainty that 
results from a congressional schedule that seldom provides a 
period of 30 days of continuous session.

Extension of other transaction authority (sec. 887)

    The committee recommends a provision that would amend 
section 845 of the National Defense Authorization Act for 
Fiscal Year 1994 (Public Law 103-160) to extend for 5 years the 
authority for the Secretary of Defense to carry out a pilot 
program for the acquisition of certain prototypes pursuant to 
``other transactions.''

                       Items of Special Interest


Competition in the development and procurement of training systems for 
        major ground and airborne vehicle programs

    Section 202(d) of the Weapon Systems Acquisition Reform Act 
of 2009 (Public Law 111-23) requires the Secretary of Defense 
to take actions to ensure that, to the maximum extent 
practicable and consistent with statutory requirements, 
contracts for the maintenance and sustainment of a major weapon 
system are awarded on a competitive basis that gives full 
consideration to all potential sources. This provision reflects 
the committee's view that competition, where it is feasible, 
results in reduced costs and improved contractor performance.
    The committee believes that competition can have a similar 
beneficial impact in the area of training systems for major 
ground and airborne vehicle programs. The committee is aware 
that original equipment manufacturers may have rights in 
technical data that are essential to the development of 
effective training systems. However, the same impediment is 
faced--and has been overcome--in the area of maintenance and 
sustainment of major weapon systems. The committee urges the 
military departments to actively explore the expanded use of 
competition as a tool to drive down costs and improve 
performance in the acquisition of training systems for major 
ground and airborne vehicle programs.

Engagement with independent experts and interested parties in 
        implementation of counterfeit parts legislation

    Section 818 of the National Defense Authorization Act for 
Fiscal Year 2012 (Public Law 112-81) requires the Department of 
Defense (DOD) to adopt comprehensive guidance and processes for 
the detection and avoidance of counterfeit parts. In 
particular, the provision requires DOD to: (1) revise 
acquisition rules to ensure that the cost of replacement and 
rework required by the use of suspect counterfeit parts is paid 
for by the contractor responsible; (2) ensure that DOD and its 
suppliers purchase electronic parts from manufacturers and 
their authorized dealers or from qualified, trusted suppliers; 
(3) require DOD officials and contractors who become aware of 
counterfeit parts in the supply chain to provide appropriate 
written notification of the problem; and (4) ensure that DOD 
and its largest contractors establish effective systems and 
procedures to detect and avoid counterfeit parts.
    The committee expects the DOD to implement these 
requirements quickly and aggressively. At the same time, 
however, the committee is aware of a number of complex issues 
that must be addressed. For example, which requirements of 
section 818 apply only to ``covered contractors''--contractors 
who are subject to the cost accounting standards--and which 
requirements apply more broadly? To what extent should 
suppliers of commercial, off-the-shelf end items be excluded 
from coverage pursuant to the authority of section 1907 of 
title 41, United States Code? Should the provision disallowing 
costs of rework or corrective action that may be required to 
remedy the use or inclusion of counterfeit parts apply to parts 
that are supplied to contractors as government-furnished 
equipment?
    The committee encourages DOD to solicit the views of both 
independent experts and interested parties--including 
representatives of original equipment manufacturers, DOD prime 
contractors, and lower-tier contractors in affected 
industries--as it works to address these and other 
implementation issues.

Implementation of section 811 of the National Defense Authorization Act 
        for Fiscal Year 2010

    Section 811 of the National Defense Authorization Act for 
Fiscal Year 2010 (Public Law 111-84) requires a written 
justification and approval (J&A) for any sole-source contract 
awarded by a federal agency in excess of $20.0 million. The 
Senate report accompanying S. 1235 (S. Rept. 112-26) of the 
National Defense Authorization Act for Fiscal Year 2012 
directed the Secretary of Defense to provide Congress with 
specific data on the implementation of section 811 by the 
Department of Defense (DOD). The Senate subsequently directed 
the Government Accountability Office (GAO) to review the DOD 
reports and provide its assessment of the effectiveness of the 
implementation of section 811.
    Because of a long delay in the rulemaking process, section 
811 was not fully implemented until more than a year after its 
enactment. During the period prior to full implementation, 
federal agencies including DOD continued to award contracts 
without the required J&As. The most recent reports from DOD and 
GAO do not segregate data on contract awards into awards that 
were made before, and awards that were made after, full 
implementation. As a result, the data provided the committee on 
the implementation of section 811 remains inconclusive and 
incomplete.
    For this reason, the committee extends the reporting 
requirements for both the Secretary of Defense and the 
Comptroller General for 1 more year, through March 1, 2014. The 
Secretary's 2013 and 2014 reports should provide the 
Secretary's assessment of the steps taken by the military 
departments to implement section 811 and the efficacy of that 
implementation.

Inventories and reviews of contracts for services

    Section 2330a of title 10, United States Code, as first 
enacted in section 801 of the National Defense Authorization 
Act for Fiscal Year 2002 (Public Law 107-107), required the 
Department of Defense (DOD) to establish a data collection 
system to provide management information with regard to DOD 
purchases of contract services. In 2007, the Senate Committee 
on Armed Services expressed frustration that this requirement 
had yet to be fully implemented. The Senate report accompanying 
S. 1574 (S. Rept. 110-77) of the National Defense Authorization 
Act for Fiscal Year 2008 (FY 2008 NDAA) stated: ``Five years 
later, the Department's expenditures for contract services have 
nearly doubled, but DOD still has not conducted a comprehensive 
analysis of its spending on these services.'' Section 807 of 
the FY 2008 NDAA amended and strengthened section 2330a, 
requiring the Department to produce an annual inventory of 
contract services.
    Since the enactment of section 807, DOD has continued to 
drag its feet. Of the three military departments, only the Army 
has developed an effective inventory system. Section 936 of the 
National Defense Authorization Act for Fiscal Year 2012 (Public 
Law 112-81) required DOD to adopt an approach similar to that 
already developed by the Army. The Statement of Managers on the 
conference report explained:

          ``[T]he inventory, when fully developed in accordance 
        with statutory requirements, will provide the 
        Department with useful workforce information for 
        identifying inherently governmental functions 
        inappropriately performed under contract, informing 
        strategic human capital planning, and facilitating an 
        appropriate mix of military, civilian, and contractor 
        personnel. At the same time, a compliant inventory will 
        be an important acquisition tool, enabling the 
        Department to better leverage its buying power, 
        rationalize its supplier base, foster competitive 
        procurements, and ensure the best value for the 
        taxpayers' dollar. The conferees are disappointed that 
        the Department has yet to take the steps needed to 
        achieve full compliance with the statutory 
        requirements.''

    The Statement of Managers noted that the Department had 
recently developed a plan to comply with the statutory 
requirements. Unfortunately, this plan has been sidetracked for 
a number of months by DOD's decision to submit the implementing 
procedures for review by the Office of Management and Budget 
(OMB) and by the refusal of OMB to address the matter as an 
expedited, ``emergency'' requirement. As a result, more than 10 
years after section 2330a was first enacted, DOD still lacks an 
effective database to manage the $200.0 billion a year that it 
spends on contract services.
    The committee directs the Under Secretary of Defense for 
Acquisition, Technology, and Logistics to report to the 
congressional defense committees by no later than July 15, 
2012, on the status of the Department's efforts to implement 
section 2330a and the timeline for full implementation of the 
requirements of this provision.

Joint Urgent Operational Needs and Joint Emergent Operational Needs

    Section 804(b) of the Ike Skelton National Defense 
Authorization Act for Fiscal Year 2011 (Public Law 111-383) 
required the Secretary of Defense to establish an expedited 
review process to determine whether capabilities proposed as 
urgent operational needs are appropriate for fielding through 
rapid acquisition processes. The provision requires that, 
subject to exceptions determined to be appropriate by the 
Secretary, rapid fielding of capabilities in response to urgent 
operational needs is appropriate only for capabilities that: 
(A) can be fielded within 2 years; (B) do not require 
substantial development effort; (C) are based on technologies 
that are proven and available; and (D) can appropriately be 
acquired under fixed price contracts. The Senate report 
accompanying S. 3454 (S. Rept. 111-201) of the National Defense 
Authorization Act for Fiscal Year 2011 on this provision 
explains:

          ``In some cases, it appears that the military 
        services have stretched the boundaries of rapid 
        acquisition authorities to undertake large and complex 
        acquisition programs that would be more suitable to the 
        traditional acquisition process. . . . In view of the 
        high development risk associated with some of these 
        programs and the fact that a number of them appear to 
        be redundant or duplicative of existing programs, the 
        committee concludes that the Department needs stronger 
        guidance on the proper application of rapid acquisition 
        processes.''

    The Department of Defense has proposed legislation to 
repeal the requirement that the rapid fielding process be 
limited to capabilities that can appropriately be acquired 
under fixed price contracts. The proposed change is unnecessary 
because section 804(b) already authorizes the Secretary of 
Defense to adopt such exceptions to the requirement as he 
determines to be necessary. The change would be unwise because 
capabilities that cannot appropriately be acquired under fixed 
price contracts are likely to include significant development 
risk that renders them unsuitable for rapid fielding. The 
committee concludes that section 804(b) already provides the 
Department with the flexibility to use other than fixed price 
contracts, and that this flexibility should be used only in 
unusual and compelling circumstances.
    The committee also notes that Chairman of the Joint Chiefs 
of Staff Instruction 3170.01H, issued January 10, 2012, and the 
Manual for the Operation of the Joint Capabilities Integration 
and Development System, issued January 19, 2012, which 
implement the requirements of section 804(b) with regard to 
Joint Urgent Operational Needs (JUON), also establish a new 
category of requirement, known as Joint Emergent Operational 
Needs (JEON). Under the Instruction and the Manual, both JUONs 
and JEONs may be acquired through rapid fielding processes. 
Unlike JUONs, however, JEONs are not limited to capabilities 
that can be fielded within 2 years, do not require extensive 
development, are based on proven technologies, and can be 
appropriately acquired through fixed price contracts.
    The committee acknowledges that it is appropriate for the 
Department of Defense to establish a ``middle tier'' of 
acquisition for capabilities that are not suitable for rapid 
fielding, but need not be subject to the full range of 
requirements applicable to major defense acquisition programs. 
However, this ``middle tier'' must be more than a process for 
avoiding the limitations established in section 804(b) and the 
requirements of the Weapon Systems Acquisition Reform Act of 
2009 (WSARA) (Public Law 111-23).
    The fundamental premise of WSARA is that acquisition 
programs must be put on sound footing from the outset through 
sound up-front analysis and cost-performance trade-offs; the 
establishment of reasonable cost, schedule, and performance 
expectations; an insistence on strong systems engineering; and 
the use of appropriately mature technologies. In the view of 
the committee the initiation of a significant acquisition 
program without such up-front work is a formula for cost 
overruns, schedule delays, and performance deficiencies.
    As presently structured, the JEON process requires a 1-day 
initial review, followed by a 30-day validation period. After 
that, the Instruction and the Manual appear to make no 
distinction between JUONs and JEONs: both go through the same 
rapid acquisition process, both are authorized to use the same 
expedited alternatives to Analyses of Alternatives, both are 
permitted to proceed directly to procurement ``without the need 
to develop and validate any of the other associated JCIDS 
[Joint Capabilities Integration Development System] 
documents''; and both are assessed for long-term operational 
utility only after they have been fielded.
    The committee notes that while the JUON rapid acquisition 
process has been established to provide an urgent capability 
for ongoing contingency operations within 2 years that is 
unconstrained by the relatively slow pace of the defense budget 
process, the Department's guidance for the JEON process allows 
for the emerging capability to be fielded within up to 5 years 
in support of an anticipated contingency operation. The 
committee questions how the Department will be able to firmly 
identify an anticipated contingency, and how the Department 
will assess the urgency of the emerging capability as a 
justification for using the JEON process as opposed to the 
traditional budget and acquisition process.
    The committee concludes that additional protections are 
needed to ensure that the JEON process is not abused. 
Accordingly, the committee directs the Under Secretary of 
Defense for Acquisition, Technology, and Logistics, in 
coordination with the Vice Chairman of the Joint Chiefs of 
Staff, to develop additional guidance for JEONs, including:
           criteria for assessing the urgency of 
        requirements (including a determination of the 
        likelihood of ``an anticipated or pending contingency 
        operation'');
           standards for ensuring that technologies are 
        sufficiently mature to be suitable for rapid 
        acquisition;
           procedures for ensuring the appropriate 
        consideration of alternative solutions; and
           processes for ensuring appropriate cost-
        performance trade-offs, sound cost estimates, and 
        robust testing and systems engineering.
    In the absence of well-developed protections along these 
lines, the committee is likely to be skeptical of requests to 
fund JEONs on an expedited basis.

Recommendations by Chairman of the Joint Chiefs of Staff on the 
        involvement by the service chiefs in the acquisition of major 
        weapon systems

    In April 2012, the Defense Business Board (DBB) recommended 
that the chiefs of the military services should be more engaged 
and accountable in the acquisition process. The DBB stated that 
just as input by the Under Secretary of Defense for 
Acquisition, Technology, and Logistics ``is critical in the 
requirements process in order to ensure that affordability and 
technological capability are considered,'' service chief 
involvement ``is critical in the acquisition process in order 
to ensure that military needs are met.'' For this reason, the 
DBB indicated that ``DOD needs to create a partnership across 
budget, requirements, and acquisition leaders to create a 
linked and streamlined'' acquisition process.
    The committee agrees that the engagement of the service 
chiefs in the overall process by which DOD acquires major 
weapon systems is important to ensuring that the process is 
responsive to the needs of the military. For example, the cost, 
schedule, and performance trade-offs required by the Weapon 
Systems Acquisition Reform Act of 2009 (WSARA) (Public Law 111-
23) would be impossible without continuous engagement between 
senior military leaders and the acquisition community. 
Similarly, the Configuration Steering Boards established in 
accordance with the requirements of section 814 of the Duncan 
Hunter National Defense Authorization Act for Fiscal Year 2009 
(Public Law 110-417) to control costs and requirements on major 
defense acquisition programs could not be effective without the 
engagement of senior military leaders.
    For these reasons, section 2547 of title 10, United States 
Code, enacted by section 861 of the Ike Skelton National 
Defense Authorization Act for Fiscal Year 2011 (Public Law 111-
383), established a permanent role for the chiefs of the armed 
forces in the acquisition process; section 908 of the National 
Defense Authorization Act for 2008 (Public Law 110-181) 
required each of the military departments to appoint a three-
star military deputy to the department's service acquisition 
executive; and section 105 of the WSARA required that the Joint 
Requirements Oversight Council seek and consider input from the 
commanders of the combatant commands in identifying joint 
military requirements.
    Because of the continuing importance of this issue, the 
committee directs the Chairman of the Joint Chiefs of Staff to 
provide to the Committees on Armed Services of the Senate and 
the House of Representatives, no later than 180 days after 
enactment of this Act, any recommendations he may have to 
ensure the full engagement of the service chiefs in the 
acquisition of major weapon systems, consistent with the 
objectives stated in this provision.

Reverse auctions

    The committee is aware that the military departments have 
increasingly used online reverse auctions for the procurement 
of commodities and simple services. When used appropriately, 
this approach has been effective in lowering the cost of such 
commodities and services by stimulating aggressive competition 
between vendors. It has also proved beneficial to small 
businesses, which receive a large majority of the purchases.
    The committee encourages the military departments to expand 
their use of reverse auctions for appropriate types of 
commodities and simple services, whenever doing so would be 
expected to result in savings.

Strategic sourcing and spend analyses

    For more than a decade, the committee has been urging the 
Department of Defense (DOD) to do a better job of managing its 
contracts for services. The Senate report accompanying S. 1438 
(S. Rept. 107-62) of the National Defense Authorization Act for 
Fiscal Year 2002 stated:

          ``[T]he Department has never conducted a 
        comprehensive spending analysis of its services 
        contracts and has made little effort to leverage its 
        buying power, improve the performance of its services 
        contractors, rationalize its supplier base, or 
        otherwise ensure that its dollars are well spent. . . . 
        The GAO has informed the committee that a number of 
        companies in the private sector have achieved 
        significant savings without any reduction in services 
        by instituting best practices such as centralizing key 
        functions, promoting strategic orientation, improving 
        personnel skills and capabilities, conducting spending 
        analyses, rationalizing supplier bases, and expanding 
        the use of cross-functional, commodity-based teams.''

    In May 2003, DOD established a Department-wide Strategic 
Sourcing Program in an effort to leverage the Department's 
purchasing power and rationalize its spending for both services 
and commodities. In 2005, the Office of Federal Procurement 
Policy followed with a government-wide strategic sourcing 
initiative. Over the last 5 years, the military departments 
have continued to perform spending analyses and develop 
strategic sourcing initiatives for specific service and 
commodity portfolios with positive results.
    Nonetheless, more remains to be done. In January 2011, a 
task force of the Defense Science Board found that DOD could 
save billions of dollars if it incorporates ``more robust 
strategic sourcing best practices'' into its operations and 
business models. Similarly, in March 2011, the Government 
Accountability Office reported that the Federal Government 
could save billions of dollars by applying strategic sourcing 
best practices on a broader basis. The committee believes that 
there are additional commodity areas in which DOD could achieve 
significant savings by rationalizing its supplier base and 
better leveraging its buying power. The committee urges the 
Department to take advantage of these opportunities.

Treatment of procurements on behalf of the Department of Defense in 
        accordance with the interagency agreement between the 
        Department of Defense and the Department of Energy

    The Department of Energy (DOE) has expressed the view that 
section 801 of the National Defense Authorization Act for 
Fiscal Year 2008 (Public Law 110-181) requires DOE to comply 
with ``defense procurement requirements'' and that this 
requirement ``has the potential to hinder critical national 
security activities supported by the DOE.'' For this reason, 
DOE has requested an exemption from section 801.
    DOE's interpretation of section 801 is incorrect. Section 
801, as amended by section 817 of the National Defense 
Authorization Act for Fiscal Year 2012 (Public Law 112-81), 
requires DOE and other federal agencies that make purchases on 
behalf of the Department of Defense (DOD) to comply with: (1) 
the Federal Acquisition Regulation (FAR); and (2) laws and 
regulations that apply to DOD procurements through other 
federal agencies. The committee notes that in September 2010, 
DOD and DOE entered a Memorandum of Agreement (2010 MOA) 
establishing the regulatory framework for DOD work undertaken 
under the DOE ``Work for Others'' (WFO) program. These 
requirements were further elaborated in a September 2011 
Memorandum issued by the Director of Defense Procurement Policy 
(2011 Memorandum).
    For this reason, DOD procurements through the WFO program 
that are conducted in accordance with the FAR, the 2010 MOA, 
and the 2011 Memorandum are also in compliance with the 
requirements of section 801, as amended. The committee 
concludes that DOD and DOE can and should comply with the 
requirements of section 801, and that no waiver or exemption 
should be necessary for this purpose. The committee expects the 
Inspectors General of DOD and DOE to continue to audit DOD 
procurements through DOE for compliance with the requirements 
of the FAR, the 2010 MOA, and the 2011 Memorandum, as required 
by section 801.
      TITLE IX--DEPARTMENT OF DEFENSE ORGANIZATION AND MANAGEMENT

              Subtitle A--Department of Defense Management

Definition and report on terms ``preparation of the environment'' and 
        ``operational preparation of the environment'' for joint 
        doctrine purposes (sec. 901)
    The committee recommends a provision that would require the 
Department of Defense to formally define the terms 
``preparation of the environment (PE)'' and ``operational 
preparation of the environment (OPE)'' for the purposes of 
Joint Doctrine and provide the Committees on Armed Services of 
the Senate and House of Representatives a report, including: 
the definitions of PE and OPE, examples of PE and OPE 
activities highlighting application of the concepts and drawing 
distinctions between the two types of activities, and an 
assessment of the respective roles of special operations and 
general purpose forces in conducting PE and OPE activities.
    The committee is concerned that, despite their frequent 
use, the terms PE and OPE are not accurately or clearly 
understood, and are often used interchangeably to describe 
various activities by special operations and general purpose 
forces.
    The term PE is currently defined in Joint Doctrine (Joint 
Publication 1-02) as ``an umbrella term for operations and 
activities conducted by selectively trained special operations 
forces to develop an environment for potential future special 
operations.'' The committee notes that this definition is 
inadequate and misleading because, in practice, PE activities 
are not restricted to special operations forces or operations 
and are carried out by and in support of general purpose 
forces.
    The committee also notes that the term OPE is not currently 
defined in Joint Doctrine, despite the term appearing in 
various department publications, directives, and orders. The 
committee believes the inadequate definition of these terms has 
resulted in confusion within the military, friction in the 
interagency coordination process, and reduced congressional 
oversight.
Expansion of duties and responsibilities of the Nuclear Weapons Council 
        (sec. 902)
    The committee recommends a provision that would amend the 
statute authorizing the Nuclear Weapons Council (10 U.S.C. 179) 
to require that concurrent with the President's budget 
submission, that the Council certify in writing that the budget 
for the National Nuclear Security Administration (NNSA) meets 
both the nuclear stockpile and the stockpile stewardship 
requirements. Dissenting opinions shall be provided with the 
written certification.
    The provision also requires the Council to notify the 
congressional defense committees on the impacts of any 
authorization or appropriation bill adopted by either the 
Senate or the House of Representatives that in the view of the 
Council fails to adequately fund the nuclear stockpile and 
nuclear stockpile stewardship requirements.

                      Subtitle B--Space Activities

Operationally Responsive Space Program Office (sec. 911)
    The committee recommends a provision that would amend 
section 2273a of title 10, United States Code, authorizing the 
Operationally Responsive Space (ORS) program. This provision 
would require the ORS Program Office to report to the Air 
Force's Director of Space and Missile Systems Center and that 
the Office be geographically separate from the Headquarters of 
the Center, similar to what General Schriever required for the 
Space Test Program in 1965. The provision gives acquisition 
authority to the Program Element Office for Space. The 
provision would require an Executive Committee made up of the 
Commander of the Air Force Space Command, the Under Secretary 
of Defense for Acquisition, Technology, and Logistics, the 
Commander of U.S. Strategic Command, and the Executive Agent 
for Space, which would chair the board. The committee directs, 
no later than 60 days after enactment of this Act, a copy of 
the terms of reference of the Executive Committee. The 
committee grants authority to transfer up to $60.0 million from 
the Weather Follow On Satellite Program, to the extent provided 
in appropriations acts to other higher priority programs, 
including having the ORS Office produce a low cost follow on 
satellite. If funding is transferred for a low cost weather 
satellite, the committee directs the Secretary of the Air Force 
to report to Congress no later than December 31, 2012, on the 
total cost and launch date for the satellite. The committee 
expects a similar ORS-1 type payload, low cost, technologically 
simple, and launched within 3 years.
    For fiscal year 2013, the Department of Defense proposed to 
eliminate the ORS Program Office. The Department proposes to 
transition the Program's success and knowledge into the other 
satellite acquisition programs. The committee finds the 
Department's rationale, to cancel a program because it is 
successful--curious. The committee rejects the proposed 
termination. The purpose of the Office is to lower the cost and 
time to launch tactically responsive satellites. Such 
satellites do not need perfection, they need to be responsive, 
the satellite ORS-1 met the challenge. It is an imaging 
satellite designed, built, and launched on the order of $225.0 
million in less than 32 months. The satellite is tasked 
directly by U.S. Central Command (CENTCOM), which the committee 
understands is pleased with the satellite's performance.
    U.S. Pacific Command (PACOM) on February 28, 2012, 
responded to a question from the Senate Committee on Armed 
Services regarding the utility of ORS-1 and said: ``Based on 
CENTCOM's success with that system, we've had recent 
discussions with the Operational Responsive Space Program on 
developing an ORS-1 system for PACOM as well. These systems 
will be particularly useful in enhancing PACOM's ability to 
collect in denied areas that we cannot reach with airborne 
systems.'' In response to another question about the ORS 
ability to field this class of satellites to increase the 
resiliency and responsiveness of PACOM's space capabilities, 
PACOM's response was: ``The future potential for rapid 
reconstitution of overhead systems in the face of adversary 
counter-space capabilities is very important to increasing the 
resiliency and responsiveness of PACOM's space capabilities. 
PACOM is a strong proponent of ORS-class satellites.''
    When the venture capital community is investigating 
launching modified cell phones into space for a reconfigurable, 
low cost communications constellation, there is much to be 
learned from the ORS Program and much more that it can impart 
into the Department of Defense to lower the cost, where 
practicable, of access to space.
Commercial space launch cooperation (sec. 912)
    The committee recommends a provision that would provide for 
a private entity using DOD launch ranges and facilities to 
contribute to their maintenance.
Reports on integration of acquisition and capability delivery schedules 
        for components for major satellite acquisition programs and 
        funding for such programs (sec. 913)
    The committee recommends a provision that would require the 
Under Secretary of Defense for Acquisition, Technology, and 
Logistics to track concurrently the development of both the 
satellite and ground systems and to report to Congress 
corrective measures that will be taken when the satellite and 
ground systems are more than 1 year apart in synchronization.
    The committee has found that the Department of Defense is 
bringing a number of large satellite systems into operation 
without having the ground systems to use it. Examples of 
systems in this category are the Advanced Extremely High 
Frequency Satellite, the Space Based Infrared System, the 
Mobile User Objective System, and the GPS III. Department of 
Defense representation in dispute resolution regarding 
surrender of Department of Defense bands of electromagnetic 
frequencies (sec. 914)
    The committee recommends a provision that would amend 
section 1062(b)(1) of the National Defense Authorization Act 
for Fiscal Year 2000 (Public Law 106-65, 47 U.S.C. 921 note) to 
require that the Department of Defense be adequately 
represented to convey its views.

           Subtitle C--Intelligence-Related and Cyber Matters

Authority to provide geospatial intelligence support to security 
        alliances and international and regional organizations (sec. 
        921)
    The committee recommends a provision that would extend the 
authority of the National Geospatial Intelligence Agency to 
provide imagery intelligence and geospatial information support 
to security alliances and international organizations of which 
the United States is a member, and to regional organizations 
with defense or security components. This provision was 
requested by the administration.
Army Distributed Common Ground System (sec. 922)
    The committee recommends a provision that would direct the 
Secretary of the Army to assign oversight of the DCGS-Army 
cloud acquisition effort to the Army's Chief Information 
Officer (CIO)/G-6. The provision would require the CIO to 
conduct an audit of the program and provide an assessment and 
recommendations to the Secretary of the Army and Chief of Staff 
of the Army by December 1, 2012.
    In mid-2010, the Deputy Chief of Staff for Intelligence for 
U.S. Forces-Afghanistan (USFOR-A), signed a Joint Urgent 
Operational Needs Statement (JUONS) requesting the rapid 
fielding to all echelons in Afghanistan of a commercially 
available analyst toolkit, which he had evaluated, that he 
believed would dramatically improve intelligence analysis in 
theater.
    The Army at the time was accelerating the development, with 
the National Security Agency, of a cloud-computing system for 
the Distributed Common Ground System (DCGS) that the Army G-2 
believed would transform intelligence analysis capabilities. Up 
to this point, the Army had been seriously considering 
integrating the commercial toolset requested in the USFOR-A 
JUONS with the DCGS cloud system. The thought was that, while 
the Army cloud was rapidly maturing the ability to ingest, 
correlate, store, and distribute vast amounts of disparate 
data, the effort to produce new types of analyst tools for data 
query, manipulation, and display was lagging. Commercial 
analyst tools, in contrast, provided rich analyst support, but 
were perceived to lack the large-scale data handling ability of 
cloud architectures.
    Ultimately, however, the Army decided not to support the 
USFOR-A JUONS by acquiring the requested commercial toolset, 
despite its ability to complement the Army cloud program. 
Instead, the Army asserted that its own analyst tool 
development program would be ready as fast as the proposed 
commercial product deployment, and would provide equal 
capabilities. This decision generated much controversy within 
the Department of Defense, and concern in Congress, but the 
Army was given the opportunity to prove that it could deliver 
the promised capabilities. In the 2 years that have ensued, the 
Army periodically re-examined the option of integrating 
multiple commercial front-end analyst tools (such as Analyst 
Notebook, Palantir, Centrifuge, Semantica, etc.) into its cloud 
architecture, but has always elected to stick with its internal 
development.
    Meanwhile, the Marine Corps and even some Army units in 
Afghanistan proceeded to deploy commercial products. Overall, 
the feedback from these units and an independent assessment by 
the Deputy Secretary of Defense-chartered National Assessment 
Group has been very positive on these commercial products. 
Unfortunately, the Army cloud's analyst support appears to 
continue to lag behind promised performance. In testimony to 
Congress in late 2011, the Army indicated that only 115 
analysts in Afghanistan are using the Army's DCGS cloud analyst 
tools, despite years of development and considerable expense.
    The committee lacks confidence that the three groups trying 
to jointly manage the Army's DCGS modernization--the G-2's 
office, the Intelligence and Security Command, and the 
Intelligence and Information Warfare Directorate of the 
Communications-Electronics Research and Development Center--are 
going to deliver a fully capable, end-to-end system to support 
the warfighter on an acceptable schedule and cost.
Rationalization of cyber networks and cyber personnel of the Department 
        of Defense (sec. 923)
    The committee recommends a provision that would require 
network consolidation and re-design to free up personnel to 
achieve an appropriate balance between U.S. Cyber Command's 
mission capabilities. In the event that the rate at which 
personnel freed up from network consolidation is insufficient, 
or if the personnel available are not able to meet the 
requirements for supporting Cyber Command's offensive missions, 
the provision would require the Secretary of Defense to take 
appropriate action to provide qualified personnel in the 
required timeframe.
    General Alexander, the Commander of U.S. Cyber Command, in 
speeches, testimony to the committee, and within the Department 
of Defense (DOD) has declared that DOD networks are not 
defensible due to the proliferation of sub-networks, each with 
its own security barriers, which prevents visibility and 
control by commanders. Although the committee cannot 
substantiate the claim that there are ``15,000'' such sub-
networks, there is no dispute that there are far too many such 
enclaves with features that today hinder rather than promote 
information security.
    General Alexander's testimony also confirmed that the 
personnel assigned to Cyber Command and its components are 
overwhelmingly allocated to network management and defense. A 
small percentage of the workforce attends to the Command's 
offensive missions and responsibilities. General Alexander 
confirmed that this ratio reflects an imbalance in capabilities 
and must be rectified.
    General Alexander and others in DOD agree that both issues 
could be at least partially rectified by dramatically reducing 
the number of separate network enclaves in the Department, 
which should yield significant manpower savings, and re-train 
and re-assign that manpower to supporting offensive missions.
    In the past, DOD sought to secure information and regulate 
access to information by controlling access to the network 
itself. DOD rules encouraged or even required organizations to 
erect access and security barriers as a condition for 
connecting to the backbone network. The result is a 
proliferation of ``virtual private networks'' with firewalls 
and intrusion detection systems, and administrators and 
analysts to manage and protect them. Desktops and servers 
behind those barriers are hidden from view and from management. 
In addition to hampering the work of Cyber Command, this 
network balkanization makes it hard to share information, to 
collaborate, and to access common enterprise services.
    Network rationalization and the use of identity- and 
attribute-based access controls should enable improved 
performance, better security, and more efficient use of 
personnel.
Next-generation host-based cyber security system for the Department of 
        Defense (sec. 924)
    The committee recommends a provision that would require the 
Department of Defense (DOD) Chief Information Officer and the 
Under Secretary of Defense for Acquisition, Technology, and 
Logistics to develop a strategy to acquire next-generation 
host-based cybersecurity tools and capabilities, and provide 
that strategy to Congress in conjunction with the budget 
request for fiscal year 2015.
    The DOD is now completing deployment of the Host Based 
Security System (HBSS) that provides cybersecurity capabilities 
for millions of endpoint or host computing devices across the 
Department. This deployment took a long time, cost 
significantly more than expected, and proved to be a 
complicated and very difficult undertaking.
    This experience has instilled a ``never again'' attitude 
among DOD's cybersecurity leadership regarding enterprise-scale 
endpoint security solutions. Instead, DOD appears to be hoping 
that network-level security enhancements will not only overcome 
the weaknesses in the current HBSS, but enable the Department 
to meet future cybersecurity threats. The Commander of U.S. 
Cyber Command has also publicly characterized endpoint security 
for today's ``thick-client'' desktop, laptop, and mobile device 
computers as an exercise in futility on the grounds that it is 
impossible to coherently manage, monitor, and update millions 
of such devices distributed across the globe. In addition, the 
Commander of U.S. Cyber Command points out that the Command 
currently does not even have visibility or the ability to 
directly control those endpoints because (as noted elsewhere in 
this report) they are typically ``hidden'' behind enclave 
firewalls and other security devices. The Commander argues 
publicly that ``endpoint security'' will be viable only in a 
cloud environment where endpoint computing is virtualized and 
provisioning and control are centralized and fully automated.
    The HBSS system itself is fundamentally based on anti-virus 
technology, which works only when the signature of an attack is 
already known. This requires that HBSS-protected computers 
store a large and ever-growing file of malware signatures. The 
communications load necessary to keep HBSS up-to-date in the 
field in some circumstances forces commanders with low 
communications capacity to choose between operating HBSS and 
performing their tactical missions, which results in HBSS being 
turned off.
    The committee is concerned that these views are short-
sighted from multiple perspectives. Constant, rapid malware 
morphing is a reality, and the growing use of encryption (for 
example, the Hypertext Transfer Protocol Secure), suggest that 
endpoint security solutions will remain essential. Further, 
industry is now rapidly developing and marketing endpoint 
security solutions that do not rely on signatures and 
potentially could vastly reduce the ``overhead'' associated 
with HBSS. Some of these technologies enable ``discovery'' of 
previously unseen cyber threats at the endpoint, which could 
transform host computers into a much improved sensor grid for 
the enterprise.
    Moreover, as noted elsewhere in this report, DOD must soon 
rationalize its networks to reduce the number of segmented 
enclaves, which should extend visibility and easier 
provisioning and control to endpoints. Finally, although the 
Commander of U.S. Cyber Command is promoting a fast transition 
to a cloud-hosting environment, it may take a long time to 
replace millions and millions of desktops, laptops, mobile 
devices, and other distributed computers with thin-client 
devices served exclusively from the cloud.
    This provision would require the strategy to address the 
limitations of the current HBSS system, and to include 
exploitation of emerging technologies for behavior-based threat 
detection, insider threat detection, data loss prevention, 
dynamic encryption of data-at-rest, remediation following 
infections, and continuous monitoring and configuration 
management. The provision encourages building on the 
integration framework featured in HBSS to enable ``plug-and-
play'' of tools into an open architecture. This capability 
would permit constant insertion of new, competitively developed 
tools, as well as tailored or non-standard deployments.
Improvements of security, quality, and competition in computer software 
        procured by the Department of Defense (sec. 925)
    The committee recommends a provision that would mandate 
multiple actions to improve the security and quality of 
computer software code, and enhance the ability of the 
Department of Defense to compete software maintenance and 
upgrades.
    The Department of Defense (DOD) suffers from constant cyber 
attacks. A significant route for intruders is through 
vulnerabilities in the software that DOD paid contractors to 
develop, which often includes integration of custom software 
code with commercial software packages.
    Cybersecurity in important respects begins with secure 
software. DOD's software is riddled with common and easily 
preventable vulnerabilities. DOD spends enormous resources then 
trying to protect that code from being exploited, discovering 
when it is compromised, and dealing with the consequences of 
infections. If the code was written properly in the first 
place, defending DOD information systems would be much easier.
    DOD needs to insist that the code it pays for be secure, 
and to implement concrete methods and means to achieve that 
objective. One method for improving code security is to use 
automated test tools to identify vulnerabilities and to 
remediate them in development. Most current software code 
vulnerability testing tools work only on source code. To ensure 
maximum access to source code for quality and security 
analysis, DOD needs to exercise its legal rights to technical 
data.
    The government has other strong interests in exercising 
these data rights, including software re-use and competition 
for system maintenance, upgrade, and capability insertion. DOD 
has demonstrated dramatic savings by forcing open complex 
software-based systems to competition. But achieving success is 
difficult, and software re-use historically has not been very 
successful. The committee believes that modern approaches to 
software repositories, open architecture design, advanced tools 
for analyzing and understanding software code, improved 
software development standards and processes, and collaborative 
software development environments have the potential to 
significantly improve cybersecurity and increase competition.
    This provision would require the Under Secretary of Defense 
for Acquisition, Technology, and Logistics (USD(AT&L)), in 
coordination with the Chief Information Officer (CIO) to 
sponsor a major update and improvement to capability maturity 
models for development and acquisition. The goal of this effort 
would be to sharpen the best practices for software development 
and to provide significantly better means to measure whether 
organizations are actually implementing the processes and 
practices at the level expected for the maturity level at which 
they have been assessed.
    The provision also would require USD(AT&L) and the CIO to 
solidify requirements for secure software development practices 
and standards. Chief among these is the need to require, rather 
than just ``highly recommend,'' the use of static software 
analysis tools in the development process, and in evaluating 
the code in development and operational tests. These tools are 
widely available commercially, but are rarely used even though 
they have proven capabilities to detect a large percentage of 
the most commonly exploited vulnerabilities. It is true that 
these tools generate a large number of false positives in order 
to achieve the lowest possible rate of false negatives. But 
high false positive rates are not a significant problem in the 
development stage, when the developer can build and test 
incrementally. U.S. Transportation Command and the Military 
Health Service already have successful experience with this 
approach.
    The Defense Information Systems Agency's (DISA's) Security 
Technical Implementation Guide (STIG) requires the use of 
coding standards, but not specifically including secure coding 
standards, and the references listed in the STIG are best 
characterized as style guides rather than coding standards. 
This provision would require that the STIG be modified 
accordingly, and that appropriate guidance be developed for 
requiring the use of secure software coding plans in statements 
of work.
    This provision would require the USD(AT&L) and the CIO to 
develop appropriate guidance for program managers to require 
evidence that software developers are actually conforming to 
secure coding standards, best-practice development models, and 
vulnerability testing requirements, and, in so doing, make 
appropriate use of software code assessment centers that 
already exist or could be created in government organizations, 
federally funded research and development centers (FFRDC), and 
contractor facilities.
    This provision would require investigation of additional 
means to incentivize the development of secure, high-quality 
software through the imposition of liabilities, warranties, and 
liability protections. The committee is aware of commercial 
software companies that are now offering defect-free warranties 
for software code bases up to 600,000 lines of code. The 
professional judgment of the Software Engineering Institute, a 
FFRDC funded by DOD, is that writing high-quality, secure code 
should not cost any more than the vulnerable code the 
government is buying today. It simply requires competence and 
diligence.
    Finally, the provision would require DOD to designate 
software repositories and collaborative software development 
environments, such as those existing today in DISA's Forge.mil 
and at U.S. Transportation Command. The objective is to expand 
the use of such facilities to store code that the government 
owns or to which it has use rights; to enable program offices 
to use common development infrastructure instead of buying new 
equipment for every new program; to foster collaboration and 
the use of proven software development practices; and to enable 
program managers and prospective bidders to discover code for 
re-use, to assess its quality and security, or to research code 
characteristics and functionality to compete on upgrades, 
capability insertions, and maintenance.
    The committee considers it critically important for DOD to 
provide these repositories' users with access to advanced 
software reverse engineering and analysis tools and to static 
and dynamic vulnerability testing capabilities that work both 
on source code and code binaries. As noted previously, there 
are many capable commercial tools available for source code 
analysis. Industry is working on binary code analysis tools, 
but these are not yet mature or comprehensive in functionality. 
NSA has devoted much effort to software reverse engineering 
capabilities to support its signals intelligence mission that 
run the gamut from source code to machine code, and from 
functionality analysis to vulnerability detection. Depending on 
maturity, scalability, and ease of use, these National Security 
Agency (NSA) tools could be extremely useful to the DOD 
acquisition community to improve not only software security, 
but also software re-use and competition by enabling program 
managers and prospective bidders to better understand code.
    The committee directs the USD(AT&L), the CIO, and the 
Director of NSA to carefully assess the tools that NSA has and 
is developing and determine what could be utilized in the DOD 
acquisition system. The Intelligence Advanced Research Projects 
Agency is also developing advanced machine code analysis 
capabilities that DOD should carefully track.
    The importance of better automated code analysis to the 
cyber mission is clear. The Clinton administration's Critical 
Infrastructure Protection Plan called for the development of 
advanced tools for code vulnerability analysis. In 2003, the 
NSA Information Assurance Director testified before the 
Subcommittee on Cybersecurity, Science, and Research and 
Development of the Select Committee on Homeland Security of the 
House of Representatives that ``a significant cybersecurity 
improvement over the next decade will be found in enhancing our 
ability to find and eliminate malicious code in large software 
applications . . . There is little coordinated effort today to 
develop tools and techniques to examine effectively either 
source or executable software. I believe that this problem is 
significant enough to warrant a considerable effort.''
    Yet DOD has never invested in tool development. The 
committee directs the USD(AT&L) to evaluate the state of the 
art in commercial and government tools for automated software 
code analysis and reverse engineering, and determine whether 
DOD should initiate a focused tool development program. The 
committee requests a briefing on this evaluation at the time of 
the submission of the budget request for fiscal year 2014.
Competition in connection with Department of Defense data link systems 
        (sec. 926)
    The committee recommends a provision that would require the 
Under Secretary of Defense for Acquisition, Technology, and 
Logistics (USD)(AT&L)):
          (1) To develop an inventory of all data links in use 
        and in development in the Department of Defense;
          (2) To conduct a business case analysis of each data 
        link program and make a determination whether there is 
        adequate competition in development, maintenance, 
        upgrade, and new procurement, and if not, whether the 
        program should be opened up to competition;
          (3) For each data link program that is identified for 
        increased competition, to develop a plan that addresses 
        how any policy, legal, programmatic, or technical 
        barriers to competition will be overcome; and
          (4) For each program where competition is determined 
        to be inadvisable, to prepare a justification for that 
        conclusion.
    The committee expects the Under Secretary to develop a 
working definition of the term ``data link systems'', 
consistent with existing understanding, for the purpose of 
identifying systems to be included in the inventory required by 
this provision.
    In conducting the business case analyses, this provision 
would require the USD(AT&L) to solicit the views of industry on 
the merits and feasibility of opening up programs to 
competition. This provision would require the USD(AT&L) to 
provide a report to Congress in conjunction with the submission 
of the fiscal year 2015 budget request. Finally, the provision 
would require the Comptroller General to provide an assessment 
of the report to Congress.
Integration of critical signals intelligence capabilities (sec. 927)
    The committee recommends a provision that would require the 
Director of the Intelligence, Surveillance, and Reconnaissance 
(ISR) Task Force to develop a plan to integrate multiple 
technical signals intelligence (SIGINT) capabilities together 
to satisfy requirements to detect, identify, track, and 
precisely locate communications equipment from airborne 
platforms. Multiple program offices in multiple organizations 
are working on this problem, and each of them has developed 
technology with separate industry partners that solve a piece--
but only a piece--of the overall problem.
    One of the programs provides full identification but 
inaccurate geolocation and no tracking. Another provides 
partial identification and precise location, but only sporadic 
tracking. A third approach provides tracking and precise 
location but no identification. The Defense Advanced Research 
Projects Agency and the Army are working on one approach with 
one vendor, another part of the Army is pursuing another with a 
second company, and the Air Force is exploiting technology 
developed by Massachusetts Institute of Technology Lincoln 
Laboratory.
    ISR Task Force staff are aware of the need for an 
integrated capability, and understand that a joint technical or 
operational solution is needed if none of the alternatives can 
be readily modified to achieve the ability to detect and 
prosecute high-value targets. This SIGINT capability would be 
able to instantly cue an imaging sensor, such as a full-motion 
video or wide-area motion imagery camera, to enable persistent 
tracking.
    The provision recommended by the committee would require 
the separate services and organizations sponsoring the 
different but complementary approaches to support the ISR Task 
Force Director in developing the plan. Finally, the provision 
reiterates the mission and role played by the ISR Task Force in 
identifying and overseeing ISR initiatives in support of 
deployed forces.
Collection and analysis of network flow data (sec. 928)
    The committee recommends a provision that would require the 
Department of Defense (DOD) Chief Information Officer (CIO), in 
coordination with the Under Secretary of Defense for 
Intelligence (USDI), and the Under Secretary of Defense for 
Policy to take advantage of the research and development 
activities and capabilities of the Community Data Center (CDC) 
managed by the Defense Information Systems Agency (DISA) to 
enhance DOD's capabilities to collect, analyze, and store so-
called network flow data records. The purpose of the provision 
is to improve DOD's capabilities to handle its own voluminous 
flow data records, and to potentially make this technology 
available for the defense of the country voluntarily through 
the Tier 1 Internet Service Providers (ISPs).
    In a report to Congress required by section 934 of the Ike 
Skelton National Defense Authorization Act for Fiscal Year 2011 
(Public Law 111-383), the Secretary of Defense stated that 
``the Department recognizes that deterring malicious actors 
from conducting cyber attacks is complicated by the difficulty 
of verifying the location from which an attack was launched and 
by the need to identify the attacker from among a wide variety 
and high number of potential actors.'' This attribution problem 
stems from lack of visibility into events and traffic taking 
place on the Internet.
    In speeches and testimony to the committee, General 
Alexander, Commander of U.S. Cyber Command, has clearly stated 
that the government is not going to be monitoring the 
communications entering, leaving, or traversing the United 
States to detect cyber attacks. The committee concurs that such 
monitoring would be inappropriate and, in many cases, unlawful. 
However, General Alexander has also indicated clearly his 
conviction that, in the event of a nation-state attack on the 
country that Cyber Command is called upon to defeat, it is 
essential that Cyber Command be able to ``see [the attack] in 
time to stop it.'' If Cyber Command cannot see the attack 
developing, ``we're not going to block it.'' General Alexander 
has indicated that the government will rely on the private 
sector--including the ISPs--to help provide that detection 
capability and warning.
    The problem is that the ISPs currently do not collect the 
data necessary to reliably perform this type of early warning 
and attack assessment function. In traditional telephone 
service, the service providers collect and retain records of 
every call that is made--the ``to/from,'' the time of the call, 
its duration, and the like. Under Federal Communications 
Commission rules, such call data records are comprehensively 
collected and retained for a long period.
    In the case of the Internet, the analogue to the call data 
record is network flow data--for example, the ``to/from'' of an 
email, the time it was sent, its size, and so forth. However, 
in contrast to telephony, the ISPs do not routinely or 
comprehensively collect or keep this net flow data, because 
there has never been a business reason for doing so. Over time, 
the ISPs have learned that such records are useful for 
cybersecurity, and have invested in dedicated equipment and 
specially developed analysis tools to capture and analyze them. 
But the amount of metadata for Internet traffic is staggering--
orders of magnitude larger than telephony--and so even today 
the ISPs only gather records on a relatively small percentage 
of the traffic traversing their networks. What they do collect 
is immensely useful for cybersecurity, to be sure--this 
capability is a mainstay of ISP managed security services, used 
for identifying intrusions and compromised computers. But 
because the traffic records are only sampled, it is impossible 
to reliably and comprehensively detect threats, identify the 
origin of attacks, identify the command and control nodes 
controlling the operations, and provide early warning and 
characterization of major attacks in real time.
    Providing warning and situational awareness for defending 
DOD networks, federal and state government networks, and those 
of critical infrastructure will require substantially greater 
net flow data collection and analysis. It is incumbent on DOD 
to invest in technology to make it easier and less expensive to 
achieve the scale required for the private sector to 
potentially assist the government in defending the country.
    DISA's CDC is already the focus for DOD's research on the 
comprehensive collection and analysis of flow data records on 
the traffic that enters and leaves the Department. The CDC 
hosts technologies developed and being investigated by DISA and 
USDI. The committee believes that other commercial companies 
have additional capabilities to apply to this problem.
Department of Defense use of National Security Agency cloud computing 
        database and intelligence community cloud computing 
        infrastructure and services (sec. 929)
    The committee recommends a provision that would prohibit 
the use of the National Security Agency's (NSA) Accumulo cloud 
computing database by other Department of Defense (DOD) 
components after September 30, 2013, unless the Chief 
Information Officer certifies that there are no viable 
commercial open source databases that have the security 
features of Accumulo, or that Accumulo itself has become a 
successful open source database project. The provision also 
would require that Department of Defense and intelligence 
community officials coordinate fully on the use by DOD 
components of cloud computing infrastructure and services 
offered by the intelligence community for purposes other than 
intelligence analysis to ensure consistency with the DOD 
information technology efficiencies initiative, data center and 
server consolidation plans, and cybersecurity plans and 
policies.
    The committee applauds NSA's decision to adopt open source 
architectures and software for most of its cloud computing 
development. However, the committee disagrees with NSA's 
decision to develop its own cloud computing database--called 
Accumulo--rather than adapt an open source version of the 
Google BigTable product. The committee understands that NSA 
decided to build a government solution several years ago 
because the open source systems lacked security features that 
NSA considers essential. In hindsight, the committee believes 
it would have been smarter for NSA to have worked with industry 
and the open source community to add NSA's security features to 
the open source database systems. Indeed, the committee 
believes that NSA should pursue that course now.
    The downside of using a government-unique database is that, 
compared to open source products, there will be far fewer 
developers contributing to technology advances, and all of the 
applications, analytic tools, and functionality that the open 
source community and commercial industry are developing for 
cloud computing will not be compatible or interoperable with 
the NSA database, depriving the government of valuable 
innovation. The committee believes it is very likely that the 
rapidly expanding and innovating cloud computing industry will 
pass NSA by in a hurry, with lagging performance and higher 
costs. The consequences would not be confined to NSA, since the 
Army intelligence community has already adopted the NSA cloud 
architecture, and NSA is strongly urging the entire Department 
of Defense to do likewise. One of NSA's arguments is that the 
security features of Accumulo are essential for the 
cybersecurity of DOD as a whole.
    NSA is making an effort to heal its divergence from the 
open source community by proposing Accumulo as an open source 
project under the Apache Foundation as a competitor to existing 
Apache Foundation open source databases like HBase and 
Cassandra, which are widely used and supported in industry.
    The committee believes it is important to ensure that there 
are options available if Accumulo does not in fact become a 
viable and widely supported open source project. The committee 
is aware of commercial interest in the cell-level data tagging 
security features that NSA built into Accumulo. These features 
should be as useful to industry clients who need to protect and 
control access to the data resident in cloud facilities as they 
are to the intelligence community and DOD.
    If Accumulo is successful, or if the commercial open source 
community produces nothing comparable to Accumulo's security 
features, this provision would permit Accumulo to be used in 
DOD outside of NSA. But if Accumulo is not an open source 
success, and if industry follows NSA's security lead, the 
Department should use a commercial product. This provision 
would give NSA almost 2 years since it made the Accumulo open 
source proposal to Apache to succeed. The deadline in this 
provision is also sufficiently distant to enable DOD components 
and industry to plan accordingly.
    Under the direction of the Director of National 
Intelligence, the Central Intelligence Agency (CIA) and NSA are 
planning to provide cloud infrastructure and software ``as a 
service'' to all of the intelligence community. As noted, NSA 
is offering a government implementation of open source 
standards. CIA is offering a competitively awarded commercial 
solution. These cloud services would cover all manner of 
computing needs and capabilities, not just intelligence 
analysis. This provision is also intended to ensure that DOD 
components' use of these cloud services is consistent with DOD 
information technology policies and plans. The committee notes 
that the software services that the CIA may offer to DOD 
customers could include analytic databases like HBase and 
Cassandra, and other commercial open source products, 
potentially providing an alternative to Accumulo.

Electro-optical imagery (sec. 930)

    The committee recommends a provision that would require the 
Secretary of Defense and the Director of National Intelligence 
to sustain through fiscal year 2013 the commercial imagery 
collection capacity planned under the Enhanced View program 
approved in the National Defense Authorization Act for Fiscal 
Year 2012 (Public Law 112-81).
    This provision would require the Vice Chairman of the Joint 
Chiefs of Staff to conduct a comprehensive analysis of imagery 
requirements for the Department of Defense (DOD). The provision 
would also require a study of the potential role of commercial-
class imagery in meeting the needs of the government. This 
provision would require the completion of these studies in time 
to inform decisions on the fiscal year 2014 budget and the 
fiscal year 2015 budget request.
    This provision would require the Congressional Budget 
Office (CBO) Director to examine whether the administration's 
proposed actions on commercial imagery are consistent with 
Presidential policy directives, the Federal Acquisition 
Regulation (FAR), and statute, all of which use similar 
language regarding the use of commercial products and 
capabilities. The President's most recent National Space 
Policy, for example, directs the Executive Branch to ``purchase 
and use commercial space capabilities and services to the 
maximum practical extent when such capabilities and services 
are available in the marketplace and meet United States 
Government requirements [and] modify commercial space 
capabilities and services to meet government requirements when 
existing commercial capabilities and services do not fully meet 
these requirements and the potential modification represents a 
more cost-effective and timely acquisition approach for the 
government.''
    Similarly, the FAR requires government agencies to 
``determine if commercial items or, to the extent commercial 
items suitable to meet the agency's needs are not available, 
nondevelopmental items are available that meet the agency's 
requirements, could be modified to meet the agency's 
requirements, or could meet the agency's requirements if those 
requirements were modified to a reasonable extent.'' Very 
similar language is contained in section 2377 of title 10, 
United States Code.
    The committee has been unhappy with Executive Branch 
planning for imagery collection from space for years. A series 
of very expensive programmatic debacles by the National 
Reconnaissance Office (NRO) was followed by years of chaotic 
lurches in policy and program planning that reflected deep 
conflicts among the organizations responsible for operational 
requirements, acquisition oversight in DOD, oversight of 
intelligence in DOD, the imagery functional manager in the 
intelligence community, the NRO, and the Office of the Director 
of National Intelligence (ODNI).
    Several years ago, the Vice Chairman of the Joint Chiefs of 
Staff and Chairman of the Joint Requirements Oversight Council 
stated that DOD required a more survivable wartime capability 
to collect wide-area imagery at moderate resolution, and 
advocated a larger constellation of commercial satellites to 
meet this requirement.
    The Vice Chairman subsequently proposed that commercial 
satellites, with some performance modifications, be acquired as 
the primary means of collecting electro-optical imagery from 
space for DOD and the intelligence community, based on modeling 
and analysis conducted through the Joint Staff.
    The Director of National Intelligence (DNI) rejected that 
proposal in favor of evolving legacy government-developed 
capabilities and attempting to rapidly develop new ones. This 
debate was carried to the White House before it was short-
circuited by an agreement struck between the DNI and the 
Secretary of Defense. The Secretary of Defense agreed that DOD 
would not challenge the NRO's plan to acquire new imaging 
capabilities. But the Secretary of Defense concluded that the 
DNI's plan presented significant risks of gaps in capability 
and that prudence dictated an expansion of commercial imaging 
capability to meet DOD wartime requirements and to mitigate the 
risk of collection shortfalls.
    This plan was put into effect at a vigorous pace. The 
government appealed to the commercial data provider companies 
to more than double their on-orbit collection capacity in a 
short time with the promise that the government would consume a 
large proportion of that capacity over a 10-year period. The 
commercial data providers, on the basis of this government 
commitment, proceeded towards adding the equivalent of two more 
satellites that would be available to meet government 
requirements.
    Meanwhile, the Senate Select Committee on Intelligence 
(SSCI) continued to study the potential for commercial-class 
satellites to meet all of the government's needs. The committee 
commissioned an evaluation by its scientific advisory body, 
building on the previous assessments of the former Vice 
Chairman of the Joint Chiefs of Staff, that concluded that 
enhanced commercial satellites could meet or exceed the 
overwhelming majority of electro-optical imaging requirements 
at less cost and risk, and that such an approach would provide 
greater resilience and survivability, and a broader, 
competitive industrial base.
    The DNI then sponsored its own analysis, which concluded 
that a larger number of smaller commercial satellites would not 
be less expensive than the satellite capabilities the 
government planned to acquire. The Senate Committee on Armed 
Services directed an additional analysis by the Joint Staff and 
the Cost Assessment and Program Evaluation office to establish 
a new requirements baseline and the cost of meeting those 
requirements with alternative spacecraft designs in the 
classified annex to the National Defense Authorization Act for 
Fiscal Year 2012 (Public Law 112-81). DOD declined to conduct 
this analysis.
    After deciding that commercial-class imaging satellites 
should not replace the satellites built under NRO program 
management, the ODNI and the Under Secretary of Defense for 
Intelligence (USDI) in late 2011 took the position that the 
commercial augmentation program approved by former Secretary of 
Defense Gates was not needed and should be terminated in order 
to save money. This proposal was not based on a new 
requirements assessment, or a risk assessment, but nonetheless 
was presented to Congress in the President's budget request for 
fiscal year 2013. The Office of Management and Budget allowed 
the drastic cutback to commercial imagery to be presented to 
Congress with the fiscal year 2013 budget, but directed ODNI, 
USDI, and the Joint Staff to study whether this action was 
warranted.
    This obviously reverses the proper order of events. 
Appropriate reexamination of the foundation for a major program 
established by the Secretary of Defense and the Vice Chairman 
of the Joint Chiefs of Staff should precede a decision to 
terminate it.
    The need for care is underscored by the fact that the plan 
presented in the budget request would result in the elimination 
of one of the two competing commercial data provider companies 
from government procurement, and could result in the collapse 
of one of the companies or a merger or acquisition. In that 
eventuality, it appears that the government's impetuous actions 
would be the determining cause: it was the government that 
encouraged the two companies to dramatically expand their 
collection capacity, including by borrowing money to accelerate 
satellite acquisitions; and when the government then just as 
suddenly announced that it no longer wanted this additional 
capacity, the stock price of both companies plummeted. While 
the government is not legally liable, the government's wild 
swing in demand has exposed two healthy companies to financial 
risk, and, if one is forced to exit the business, will lead to 
a monopoly in the market and a narrowing of the government's 
options for future procurements.
    The committee believes that the status quo ante should be 
restored, as far as possible, until additional studies are 
conducted to allow both the Executive Branch and Congress to 
make informed decisions.
    The committee believes that there is ample evidence that 
commercial imaging capabilities could today satisfy a large 
majority of military requirements, and, if modified for 
enhancements, could meet all but the most stressing 
requirements. In the case of the most stressing requirements, 
the question is whether the benefit of meeting them is 
justified by the marginal cost of doing so. As noted above, the 
ODNI study concluded that meeting the government's needs for 
electro-optical imagery from space can be accomplished better 
and at somewhat less cost by a government acquisition of a 
different design. The committee believes that additional, 
independent analysis of this contention is essential.
    The ODNI and USDI concluded that the government is 
acquiring capabilities to collect more imagery than is 
required, and recommended lopping off commercial acquisitions. 
In light of the pressures on the budget, and the policy 
expressed by former Secretary of Defense Gates to seek the ``80 
percent solution'' rather than ``exquisite'' ones, three 
questions need to be addressed:
    (1) Is the originally planned collection capacity actually 
in excess of DOD's wartime requirements?
    (2) If yes, is the correct response to reduce commercial 
acquisitions or to scale back or eliminate the government-
developed solution? and
    (3) If no, should the original Enhanced View commercial 
imagery program be restored and sustained or should the 
government-developed solution be expanded?
    The committee also directs the CBO Director to make use of 
performance modeling results and analyses already available 
from the Joint Staff, industry, and the SSCI; and cost 
modeling, existing cost estimates, and actuals from ongoing 
programs in government and industry. As necessary and 
appropriate, the Director should conduct new cost modeling and 
estimating to ensure that a variety of reasonable assumptions 
and acquisition approaches are considered to achieve confidence 
in cost comparisons.
    This provision would authorize $125.0 million to sustain 
the level of commercial imagery collection at roughly the level 
that will be maintained throughout fiscal year 2012 and through 
the first quarter of fiscal year 2013 through existing Service 
Level Agreements.

Software licenses of the Department of Defense (sec. 931)

    The Department of Defense's (DOD) $37.0 billion information 
technology (IT) budget request constitutes almost half of the 
Federal Government's overall IT budget for fiscal year 2013. 
Given the size of this investment, it is important that the 
Department rationalize current IT outlays and identify those 
investments that need to be integrated with other solutions or 
curtailed to ensure the most efficient use of resources. One 
area of duplication and inefficiency identified by the 
Government Accountability Office and by the Department is that 
of software licenses. In addition, the committee has recognized 
that application and software reduction is a key component of 
IT efficiencies, as referenced in section 2867 (b)(1)(A)(v) of 
the National Defense Authorization Act for Fiscal Year 2012 
(Public Law 112-81).
    The committee recommends a provision that requires the DOD 
Chief Information Officer (CIO) to conduct, within 180 days of 
the enactment of this Act, a Department-wide inventory of 
software licenses, examine license utilization rates, and 
assess the current and future Departmental need for software 
licenses. Based on the results of this assessment, the CIO 
shall establish a plan to align the number and type of software 
licenses with the needs of the Department. Upon completion of 
the inventory and assessment, the CIO or their designee shall 
brief the results to the congressional defense committees.
    Immediately upon completion of the inventory and 
assessment, the CIO is directed to provide the data and 
findings to the Comptroller General of the United States. Not 
later than May 1, 2014, the Comptroller General will deliver to 
the congressional defense committees a review of the 
Department's assessment and performance plan.
    The committee recognizes that defining the scope of 
software license duplication throughout the military 
departments, components, and major commands will be 
challenging, and urges the CIO to apply the utmost diligence in 
the undertaking of this inventory and assessment. Lastly, the 
committee acknowledges that the CIO may need the ability to 
grant exceptions to certain instances of software, depending 
upon individual circumstances, such as classification.

Defense Clandestine Service (sec. 932)

    The committee recommends a provision that would prohibit 
the obligation of appropriated Military Intelligence Program 
(MIP) funds in fiscal year 2013 to exceed the number of 
personnel conducting or supporting human intelligence within 
the Department of Defense (DOD) as of April 20, 2012. This 
provision would also require the Office of Cost Assessment and 
Program Evaluation (CAPE) to provide an estimate of the total 
cost of the Defense Clandestine Service (DCS) to the 
congressional defense and intelligence committees. This cost 
estimate should look at the total costs of the DCS, including 
whether that cost is incurred in the MIP, in the National 
Intelligence Program, or in other non-intelligence funding for 
the Department of Defense (e.g. Major Force Program 11 funding 
for U.S. Special Operations Command (USSOCOM)). The estimate 
should include costs in the out years of the future-years 
defense program and beyond, especially those associated with 
closing existing personnel basing; creating new basing 
arrangements; and supporting overseas deployments.
    The provision also would require the Under Secretary of 
Defense for Intelligence (USDI) to provide a report to the 
congressional defense and intelligence committees by February 
1, 2013, that provides or explains:
           where DOD case officers will be deployed or 
        based and a schedule for those deployments;
           certification that the prospective locations 
        can and will accommodate these deployments;
           the objectives established for each military 
        service, USSOCOM, and the Defense Intelligence Agency 
        (DIA) to improve career management for case officers, 
        and the plans to achieve the objectives of the DCS; and
           any Memoranda of Agreement or Understanding 
        necessary to implement planned reforms with other 
        departments and agencies and between DOD components.
    The committee appreciates the fact that the USDI and the 
Director of the DIA, in initiating the DCS, intend to make 
reforms to the Defense Human Intelligence (HUMINT) Service to 
correct longstanding problems. These problems include 
inefficient utilization of personnel trained at significant 
expense to conduct clandestine HUMINT; poor or non-existent 
career management for trained HUMINT personnel; cover 
challenges; and unproductive deployment locations. Multiple 
studies since the end of the Cold War document these 
deficiencies, and they led the Commission on the Roles and 
Capabilities of the United States Intelligence Community, 
chaired by two former Secretaries of Defense, to recommend 
transferring to the Central Intelligence Agency (CIA) all 
responsibilities for the clandestine recruitment of human 
sources, utilizing military personnel on detail from the DOD as 
necessary.
    The committee notes that President Bush authorized 50 
percent growth in the CIA's case officer workforce, which 
followed significant growth under President Clinton. Since 9/
11, DOD's case officer ranks have grown substantially as well. 
The committee is concerned that, despite this expansion and the 
winding down of two overseas conflicts that required large 
HUMINT resources, DOD believes that its needs are not being 
met.
    The committee concludes that DOD needs to demonstrate that 
it can improve the management of clandestine HUMINT before 
undertaking any further expansion. Furthermore, if DOD is able 
to utilize existing resources much more effectively, the case 
could be made that investment in this area could decline, 
rather than remain steady or grow, to assist the Department in 
managing its fiscal and personnel challenges.

Authority for short-term extension of lease for aircraft supporting the 
        Blue Devil intelligence, surveillance, and reconnaissance 
        program (sec. 933)

    The committee recommends a provision that would allow the 
Secretary of the Air Force to extend or renew the current lease 
of aircraft to support the Blue Devil intelligence, 
surveillance, and reconnaissance (ISR) program. Section 2401 of 
title 10, United States Code, limits such leases to 5 years. 
The lease for the Air Force Blue Devil ISR aircraft deployed 
first in Iraq and now in Afghanistan will expire in September 
2013. This ISR system is extremely useful, having contributed 
directly to the take-down of large numbers of high-value 
targets in the Kandahar region. Theater commanders have 
requested that this asset be sustained indefinitely in theater. 
The committee is deeply concerned that, despite a year's notice 
from the committee that plans had to be made to address this 
lease expiration, the Department of Defense has yet to decide 
on a definite course of action to sustain this capability.
    The committee understands that the Air Force leadership and 
the ISR Task Force are seriously examining alternatives to 
comply with section 2401, including buying the existing Blue 
Devil aircraft, buying new C-12 aircraft, modifying existing 
Liberty aircraft, and modifying the Reaper unmanned aerial 
vehicles equipped with Gorgon Stare wide-area motion imagery 
systems.
    Based on information that the Air Force provided to the 
committee, the most attractive option is to purchase additional 
C-12 aircraft. This option would deliver the needed capability 
the soonest. All other options under consideration take 
considerably more time, or would entail reducing deployed ISR 
support in order to modify existing aircraft, or would not 
satisfy requirements.
    The committee directs the Secretary of the Air Force, in 
coordination with the Director of the ISR Task Force, to 
provide a recommendation on a way forward by September 1, 2012, 
along with a program schedule that would enable Congress to set 
an appropriate end date for the lease extension.

Sense of the Senate on potential security risks to Department of 
        Defense networks (sec. 934)

    The committee recommends a provision that would express the 
sense of the Senate regarding potential risks to the security 
of Department of Defense (DOD) networks from the incorporation 
of equipment and software from foreign sources, and the need 
for DOD authority and processes to mitigate such risks beyond 
those that already exist for covered National Security Systems 
acquired by DOD. The committee provided existing authority to 
address cybersecurity supply chain risks to DOD National 
Security Systems in section 806 of the National Defense 
Authorization Act for Fiscal Year 2011 (Public Law 111-383).
    The provision acknowledges the difficulty involved in 
blocking sales of information technology systems and services 
due to concerns about cybersecurity while maintaining our 
commitment to free trade and fair and transparent competition.

                       Subtitle D--Other Matters


National Language Service Corps (sec. 941)

    The committee recommends a provision that would amend the 
David L. Boren National Security Education Act of 1991 (52 
U.S.C. 1901 et seq.) to authorize the Secretary of Defense to 
establish and maintain a National Language Service Corps to 
provide a pool of civilian personnel with foreign language 
skills who agree to provide foreign language services to the 
Department of Defense or another department or agency of the 
United States.

Report on education and training and promotion rates for pilots of 
        remotely piloted aircraft (sec. 942)

    The committee recommends a provision that would require the 
Secretary and the Chief of Staff of the Air Force to provide a 
report to the congressional defense committees by January 31, 
2013, on remotely piloted aircraft (RPA), pilot promotion, and 
education rates. The provision specifies that the report 
includes the following elements: an in-depth analysis of the 
causes for persistently lower average promotion and education 
rates of RPA pilots; the long-term impact on the Air Force if 
these low rates are sustained; a plan to remedy these 
imbalances; and near-term and longer-term actions the Air Force 
intends to undertake to implement the plan. The report must 
also provide an explanation of any direct or indirect impact of 
plan implementation on the achievement and sustainment of the 
65 RPA combat air patrol objective.
    The committee is very concerned about the consistently 
downward trend in promotion rates of RPA operators. Over the 
course of the last 5 years, promotion percentages from Majors 
Promotion Boards have declined from 96 percent to 78 percent, 
compared to a consistent range of between 96 and 91 percent for 
their peers. Education rates also consistently lag those for 
manned aircraft pilots at all levels. It is simply unacceptable 
for service as an RPA operator to be relegated to substandard 
status in terms of personnel qualifications or treatment. The 
committee expects the Air Force to vigorously address this 
problem.

                              Budget Items


Operationally Responsive Space Funding

    For Fiscal Year 2013, the Department of Defense proposed to 
de-authorize the Operationally Responsive Space Office and move 
$10,000,000 from the Operationally Responsive Space (ORS) 
program (PE 0604857F, line 54) to three other programs, 
$3,000,000 to the Technology Transition Program, PE 0604858F, 
line 55, $2 million to the Space Based Infrared Program, 
PE0604441F, line 69, $2,000,000 to Space Control Technology, PE 
0603438F, line 32, $1,500,000 to Advanced Extremely High 
Frequency satellite program, PE 0603430F, line 30 and 
$1,500,000 to the Global Positioning System III Operational 
Control Segment, PE 0603423F, line 112. The Committee rejects 
this transfer and restores the $10,000,000 to the ORS PE 
0604857F.
    The Committee increases PE 0604857F by $35,000,000 to 
$45,000,000 total to continue working with the COCOMs and in 
particular PACOM on building responsive low cost satellites 
similar to ORS-1. This is in addition to the legislative 
provision which direct the ORS program to build a low cost 
weather satellite from the weather satellite follow on program 
funding.

Space Test Program

    The budget request for fiscal year 2013 included 
$10,051,000 in PE 65864F for the Space Test Program. This is a 
decrease in funding from the $47,926,000 requested and 
authorized for fiscal year 2012. The Department of Defense has 
also proposed to terminate the program. This low cost program, 
created by the Commander, Air Force Systems Command, General 
Schriever, in 1965, has been the principal mechanism that has 
put experimental payloads into space. By offering low cost 
access to space this program has led to a family of important 
civil and military satellite systems we rely on today, 
including Milstar, Advanced Extremely High Frequency, Global 
Positioning System, Defense Support Program, Defense Satellite 
Communications System, Tracking & Data Relay Satellite, and the 
Defense Meteorological Satellite Program. More importantly this 
program serves as the space gateway to universities and 
military academies, and for their students to put payloads into 
space and in turn create our future cadre of space leaders. 
When combined with the proposed termination of the 
Operationally Responsive Space program, the termination of 
these two efforts amounts to no more than $170.0 million but 
has many times the impact on the ability of the Department of 
Defense to innovate and lower the cost of future satellite 
systems. The committee rejects the proposed termination of the 
Space Test Program and increases the program by $37,875,000 to 
restore it to the prior fiscal year's funding level.
    The committee admonishes the Department to look carefully 
at the combined effects of terminating two programs that have 
synergistically worked together to lead innovations in national 
security space while dramatically reducing costs.

                       Items of Special Interest


Determination of accuracy of spectrum auction proceeds

    The committee directs the Government Accountability Office 
(GAO) to review past spectrum auctions (including those for 
national security systems) performed by Executive Branch 
agencies to determine historical differences between initial 
relocation cost estimates and actual auction proceeds. As part 
of this review, the committee directs the GAO to update its 
2001 report to the congressional defense committees on the 
auction of the 1755-1850 MHz band. The committee asks the GAO 
to determine if the cost of vacating or sharing subsets of the 
1755-1850 MHz band is sufficiently captured in estimates and 
whether auction proceeds are able to compensate vacating such 
subsets. The committee directs an initial briefing no later 
than February 28, 2013.

Development of cyber security expertise and partnerships

    The committee encourages the Department of Defense to 
continue to support multi-disciplinary programs of study and 
research that focus on developing U.S. cyber security expertise 
and tackling vital cyber security issues, such as the 
protection of critical infrastructure on which the Department 
of Defense relies for critical mission capability, and which 
the Department would be called upon to defend in the event of a 
cyber attack on the United States.
    Special effort should be made to glean best practices from 
already established programs, nationally and internationally, 
at military and civilian organizations and institutions of 
higher education. The committee directs the Secretary of 
Defense to provide a report to the congressional defense 
committees within 180 days of the enactment of this Act on 
potential partnerships and methods for gleaning best practices 
for personnel development.

Evolved Expendable Launch Vehicle Program

    Since the committee first raised concerns about the 
Department of Defense's strategy to acquire space launch under 
the Evolved Expendable Launch Vehicle (EELV) program last year, 
the Department has moved in a positive direction. First, 
whereas the space portfolio appeared disconnected from the Air 
Force's acquisition oversight apparatus, this portfolio is now 
properly aligned under the Air Force senior acquisition 
executive. This will help ensure that space launch programs are 
subjected to appropriate oversight and acquisition discipline. 
Second, the newly designated Program Executive Officer (PEO) 
for Space Launch will be able to focus more on cost, schedule, 
and performance than before, when the PEO space portfolio 
encompassed space launch and did not allow for sufficient focus 
on EELV issues. Third, whereas the System Program Director 
(SPD) and program managers in this portfolio previously focused 
on operational mission success, there now appears to be an 
interest in achieving a proper balance on both mission success 
and cost. Finally, whereas the SPD tended to have a ``stand-
off'' approach to potential new entrants and little interest in 
creating a competitive environment conducive to driving the 
costs of space launch down, today the Air Force appears 
amendable to embracing new entrants and the prospect of 
competition more and has developed a path to certification.
    The committee's original concerns arose from concerns 
raised by prospective new entrants that the 2011 proposed block 
buy of launch vehicles from the incumbent EELV provider would 
effectively freeze them out of the EELV launch market until 
2020. This concern was magnified by a Government Accountability 
Office (GAO) report in September 2011, that recommended that 
the Department assess engine costs and mission assurance 
activities; reassess the length of the proposed block buy; and 
consider how to address broader launch acquisition and 
technology development issues. With the Department having 
generally concurred with GAO's recommendations, Congress 
required the Department to explain how it intends to implement 
each of GAO's recommendations, or explain how it will otherwise 
address the deficiencies identified in GAO's report. The 
Department's deadline was March 31, 2012, and the report was 
delivered to Congress April 19, 2012. The committee understands 
that GAO is currently assessing the information contained in 
the report as required by section 839 of the National Defense 
Authorization Act for Fiscal Year 2012 (Public Law 112-81).
    In complying with the requirement under section 839 that 
EELV be re-designated as a major defense acquisition program 
(MDAP) or otherwise provide to Congress and the Under Secretary 
of Defense for Acquisition, Technology, and Logistics all of 
the reports on cost, schedule, and performance that would be 
required if it were designated as an MDAP, on April 12, 2012, 
the Department notified the committee that the EELV program 
exceeded the ``critical'' cost thresholds specified under 
section 2433 of title 10, United States Code (``Nunn-McCurdy'') 
for both Program Acquisition Unit Cost and Average Procurement 
Cost. The breach was based on the program's 2007 current 
baseline estimate and the 2004 original baseline estimate 
exceeding 25 and 50 percent respectively. The committee 
understands that the Department will certify to Congress by 
July 13, 2012, that the necessary steps have been taken to meet 
the requirements of section 2433(b) of title 10, United States 
Code.
    As part of the Department's effort to restructure the EELV 
program to provide cost transparency and promote competition 
from new entrants, the Department has issued a Request for 
Proposal (RFP) to the incumbent EELV contractor that will allow 
it to obtain and carefully analyze certified cost data to build 
a pricing matrix consisting of the number of cores versus years 
over the future-years defense program (FYDP). This matrix will 
help the Department structure a contract to achieve optimal 
pricing while allowing for ``on-ramps'' of new entrants who 
meet the Department's new entrant mission assurance criteria.
    The Department has told the committee that it is 
restructuring the Launch Services contract from a stand-alone 
contract with the incumbent EELV provider to one that is 
integrated with the acquisition of the booster, mission 
support, and payload integration to reflect the total cost to 
launch. This integrated contract will be used to compare 
amongst multiple competitors. The committee has been concerned 
about the distinction between Launch Capability and Launch 
Services that have been structured into the EELV program and 
how this distinction renders opaque to congressional oversight 
of the program's true overall costs. For this reason, the 
committee will ensure that whatever decision is made by the Air 
Force regarding the next EELV contract is not analytically 
based inappropriately on this distinction. The committee 
intends to closely examine how the Air Force addresses this 
issue more broadly as its effort to restructure this program to 
accommodate competition matures, and will address this issue 
further as needed.
    To further assist new entrants into the EELV market, the 
Department will use a bridging contract called ``Orbital 
Suborbital Program-3'' or ``OSP-3'' which will be used to 
launch low-risk national security payloads and in turn step the 
new entrants through the Department's mission assurance 
criteria.
    Generally, the committee is encouraged by the steps that 
the Department has taken to help control EELV costs and 
encourage new entrants to provide competition in the EELV 
market. The committee has been informed that the Department 
will have a final EELV contract structure in July 2012, that 
they believe will optimize cost per launch with the incumbent 
EELV contractor while providing ``on-ramps'' for new entrants 
who satisfy mission assurance criteria under the OSP-3 
contract. Given the utility of competition to ensuring the 
affordability of access to space, the committee believes that 
whatever contracting structure is ultimately selected must be 
sufficiently flexible to provide meaningful and realistic 
opportunities for duly certified new entrants to participate in 
the EELV program at any point within the selected contract 
duration that a new entrant (if any) is duly certified within 
that selected contract duration.
    The committee will carefully review the restructured EELV 
contract that the Department will present in July 2012, in 
light of all of the concerns it has raised to date to ensure 
that national security access to space is maintained, while 
balanced by bringing competition into the EELV launch market.

Navigation location and tracking in GPS-denied environments

    Global Positioning Satellite (GPS) based navigation systems 
have become critical to mission success for the Department of 
Defense in areas such as situational awareness and precision 
weapon employment. Command and control of U.S. forces is 
dependent on reliable and accurate GPS signal reception. Our 
forces are currently operating in complex terrain and 
environments which can, on occasion, introduce unreliable GPS 
navigation signals for the warfighter. Current GPS navigation 
systems can be challenged with line-of-sight constraints such 
as mountains, dense tree cover, and complex structured 
environments and have minimal, if any, ability to navigate and/
or track inside buildings, caves, underground structures and 
other challenging locations.
    Additionally, future force initiatives recognize the 
possibility that a technologically advanced foe could disrupt 
satellite based systems such as GPS. Reliable location through 
the GPS satellite constellation facilitates uninterrupted use 
of ground-to-ground precision missiles, navigation, and command 
and control. Recent events have pointed to hostile nation 
states introducing jamming in an effort to block or degrade GPS 
signals. The Department of Defense must develop and incorporate 
training and contingency operations in a GPS denial environment 
to ensure mission success.

Reports on airborne intelligence, surveillance, and reconnaissance 
        requirements and investment strategy

    The committee is aware of the increased demand for 
persistent intelligence, surveillance, and reconnaissance (ISR) 
resources to meet each combatant command's full range of 
military operations. The committee acknowledges the Department 
of Defense has had to make difficult decisions on the 
acquisition, procurement, and allocation of its persistent ISR 
assets due to fiscal constraints alone.
    However, Congress has not been provided a formal report 
outlining the Department of Defense's long-term investment 
strategy to develop, procure, and sustain the necessary ISR 
platforms to meet these ISR collection requirements.
    Therefore, the committee directs the Chairman of the Joint 
Chiefs of Staff, working in conjunction with the combatant 
commands, to provide the congressional defense and intelligence 
committees a classified report, not later than 120 days after 
the enactment of this Act, that identifies the enduring 
requirements for persistent ISR collection in support of each 
combatant command's full range of military operations. Further, 
the committee directs the Under Secretary of Defense for 
Acquisition, Technology, and Logistics and the Under Secretary 
of Defense for Intelligence, working in conjunction with the 
service secretaries, to provide a long-term investment 
strategy, describing the fixed-wing persistent ISR capabilities 
necessary in both permissive and non-permissive environments to 
meet those collection requirements and the resources necessary 
to develop, procure or sustain those platforms. This investment 
strategy shall also be provided concurrently in a written 
classified report to the congressional defense and intelligence 
committees not later than 120 days after the enactment of this 
Act.

Report on cost savings in the Joint Space Operations Center Mission 
        System Program

    The committee believes that improvements to the space 
situational awareness and space command and control 
capabilities of the United States are critical, and the 
Department of Defense has the opportunity to achieve efficiency 
and cost effectiveness by utilizing, to the maximum extent 
possible, readily available commercial and government-developed 
capabilities. The committee is aware that the Air Force has 
made changes in its acquisition process, and the committee 
fully expects the Air Force to pursue a tailored incremental 
information technology approach with priority given to 
transition from the legacy Space Defense Operations Center 
system by 2014. The committee also expects the Air Force to 
utilize and achieve cost savings by pursuing a tailored 
incremental acquisition approach that leverages investment in 
existing government prototypes and industry applications to 
rapidly deliver needed capabilities.
    The committee directs the Air Force to provide a report 
within 180 days of enactment of this Act that: (1) describes 
the government and commercial technologies that can be 
incorporated into the Joint Space Operations Center Mission 
System Program; (2) quantifies the cost savings that can be 
achieved by using commercial items to the maximum extent 
practical; and (3) summarizes how the acquisition strategy will 
incorporate commercial technologies.
                      TITLE X--GENERAL PROVISIONS

                     Subtitle A--Financial Matters

General transfer authority (sec. 1001)
    The committee recommends a provision that would authorize 
the transfer of up to $5.0 billion of funds authorized in 
division A of this Act to unforeseen higher priority needs in 
accordance with normal reprogramming procedures. Transfers of 
funds between military personnel authorizations would not be 
counted toward the dollar limitation in this provision.

Authority to transfer of funds to the National Nuclear Security 
        Administration to sustain nuclear weapons modernization (sec. 
        1002)

    The committee recommends a provision that would authorize 
the transfer of, subject to regular reprogramming guidelines, 
$150.0 million from the Department of Defense to the National 
Nuclear Security Administration if the fiscal year 2013 
authorization and appropriations levels fall below the level 
outlined for fiscal year 2013 as found in the report from 
section 1251 of the National Defense Authorization Act for 
Fiscal Year 2010 (Public Law 111-84), which is $7.9 billion.

Audit readiness of Department of Defense statements of budgetary 
        resources (sec. 1003)

    The committee recommends a provision that would amend 
section 1003 of the National Defense Authorization Act for 
Fiscal Year 2010 (Public Law 111-84) to incorporate the goal 
established by the Secretary of Defense of validating the 
statement of budgetary resources of the Department of Defense 
(DOD) as ready for audit by the end of fiscal year 2014. The 
provision would require the DOD Chief Management Officer and 
the Chief Management Officers of the military departments to 
ensure that the plans to achieve this goal minimize one-time 
fixes and manual work-arounds, are sustainable and affordable, 
and will not delay full auditability of DOD's financial 
statements.

Report on effects of budget sequestration on the Department of Defense 
        (sec. 1004)

    The committee recommends a provision that would make 
certain findings and require the Secretary of Defense to submit 
to the congressional defense committees a report no later than 
August 15, 2012 on the impact on the Department of Defense of 
the sequestration of funds authorized and appropriated for 
fiscal year 2013 for the Department if automatically triggered 
on January 2, 2013.

                  Subtitle B--Counter-Drug Activities


Extension of authority for joint task forces to provide support to law 
        enforcement agencies conducting counter-terrorism activities 
        (sec. 1011)

    The committee recommends a provision that would extend by 1 
fiscal year the support by joint task forces under section 
1022(b) of the National Defense Authorization Act (NDAA) for 
Fiscal Year 2004 (Public Law 108-136), as most recently amended 
by section 1004 of the NDAA for Fiscal Year 2012 (Public Law 
112-81).
    The committee notes that the Department of Defense is 
currently using this authority to conduct only one operation. 
While the committee is pleased to learn of the Department's 
judicious use of this authority, the committee also believes 
there are additional activities that could potentially be 
conducted, particularly in Northwest Africa.

Requirement for biennial certification on provision of support for 
        counter-drug activities to certain foreign governments (sec. 
        1012)

    This section would amend section 1033 of the National 
Defense Authorization Act for Fiscal Year 1998 (Public Law 105-
85), as most recently amended by section 1006 of the National 
Defense Authorization Act for Fiscal Year 2012 (Public Law 112-
81), to require biennial certification rather than annual 
certification for the Department of Defense to provide 
additional support for counterdrug activities to certain 
foreign governments.

Authority to support the unified counterdrug and counterterrorism 
        campaign in Colombia (sec. 1013)

    The committee recommends a provision that would permit, for 
1 fiscal year, the Secretary of Defense to expend not more than 
$50.0 million to support the unified counterdrug and 
counterterrorism campaign of the Government of Colombia. The 
provision would permit the Secretary to provide: (1) logistics 
support, services, and supplies; (2) the types of support 
authorized under section 1004(b) of the National Defense 
Authorization Act for Fiscal Year 1991 (Public Law 101-510), as 
amended; and (3) the types of support authorized under 1033(c) 
of the National Defense Authorization Act for Fiscal Year 1998 
(Public Law 105-85), as amended. The provision would prohibit 
U.S. personnel from participating in any combat operation in 
connection with assistance provided under this authority. 
Further, the provision would require the Secretary of Defense 
to submit a report on any assistance provided pursuant to this 
provision to the congressional defense committees on an annual 
basis.
    The committee notes that the provision is a modification of 
section 1021 of the Ronald W. Reagan National Defense 
Authorization Act for Fiscal Year 2005 (Public Law 108-375), as 
amended most recently by section 1007 of the National Defense 
Authorization Act for Fiscal Year 2012 (Public Law 112-81). The 
committee's intent is to permit the Secretary to continue all 
ongoing operations in support of the security forces of the 
Government of Colombia, including advise and assist operations 
which have been an important element of U.S. support to the 
Government of Colombia. The committee's underlying intent is to 
enhance congressional oversight of these activities and provide 
additional transparency to outside observers without degrading 
ongoing operations. The committee recognizes that, although the 
Government of Colombia has made significant progress combating 
narcotics trafficking and designated terrorist organizations, 
this authority is still required to assist the Government of 
Colombia consolidate the notable gains made over the past 
decade.

Quarterly reports on use of funds in the Drug Interdiction and Counter-
        Drug Activities, Defense-wide account (sec. 1014)

    The committee recommends a provision that would require the 
Secretary of Defense to submit on a quarterly basis reports to 
the congressional defense committees setting forth, by project 
code, a description of all of the expenditures of funds and 
expenditures to support foreign counterdrug activities from the 
Drug Interdiction and Counterdrug Activities Defense-wide 
account. Further, the provision would repeal section 1022 of 
the Floyd D. Spence National Defense Authorization Act for 
Fiscal Year 2001 (Public Law 106-398), as most recently amended 
by section 1008 of the National Defense Authorization Act for 
Fiscal Year 2012 (Public Law 112-81).

                Subtitle C--Naval Vessels and Shipyards


Retirement of naval vessels (sec. 1021)

    The committee recommends a provision that would require the 
Chief of Naval Operations to produce a report that would set 
forth a comprehensive description of the current requirements 
of the Navy for combatant vessels of the Navy, including 
submarines. The provision would also require that, if the 
number of these vessels is less than 313 ships, the report 
would have to include the justification of the Chief of Naval 
Operations for that smaller number, and an explanation of how 
that smaller number is consistent with the recently revised 
strategic guidance issued by the President and the Secretary of 
Defense in 2012.
    Section 1021 of the National Defense Authorization Act for 
Fiscal Year 2010 (Public Law 111-84) conveyed the sense of 
Congress that ``the Navy should meet its requirement for a 313-
ship fleet until such time that modifications to the Navy's 
ship fleet force structure are warranted, and the Secretary of 
the Navy provides Congress with a justification of any proposed 
modifications, supported by rigorous and sufficient warfighting 
analysis.'' The Chiefs of Naval Operations since 2006 have 
consistently stated that they need a fleet of 313 ships to do 
their jobs. Nevertheless, the Navy has not achieved this number 
of ships in the fleet since falling below that level in the 
1990s.
    In testimony before the congressional defense committees 
and other public remarks, senior Navy leaders, including the 
Secretary of the Navy, the Under Secretary of the Navy, and the 
Chief of Naval Operations, have noted that the Navy is 
conducting a new review of Navy force structure review. Navy 
officials say that they have not completed the review, but that 
it will probably reduce the goal for fleet size to 
approximately 300 ships.
    The committee is concerned that the Navy or the Department 
of Defense (DOD) may propose reductions in the Navy's ship 
fleet force structure without sufficient justification. The 
committee reminds the Navy and DOD that the statement of the 
sense of Congress remains in effect, and that the committee 
expects that any proposed change in goal for the size of the 
Navy's fleet will be accompanied by rigorous and sufficient 
analysis that is convincing.
    The committee doubts that neither a strategy shifting DOD's 
focus to the Pacific and Asia, nor the demands of current 
operational requirements, nor increased investment by potential 
adversaries in naval forces and anti-access and area-denial 
capabilities warrant a reduction in the required Navy fleet 
size.

Termination of a Maritime Prepositioning Ship squadron (sec. 1022)

    The committee recommends a provision that would limit 
funding to terminate a Maritime Prepositioning Ship Squadron 
until a report is received on the impact of the termination.

Sense of Congress on recapitalization for the Navy and Coast Guard 
        (sec. 1023)

    The committee recommends a provision that would express the 
sense of Congress that:
          (1) the sea services of the United States should be 
        funded and maintained to provide the broad spectrum of 
        capabilities required to protect the national security 
        of the United States;
          (2) such capabilities should include:
                  (a) the ability to project United States 
                power rapidly anywhere on the globe without the 
                need for host nation basing permission or long 
                and potentially vulnerable logistics supply 
                lines;
                  (b) the ability to land and recover maritime 
                forces from the sea for direct combat action, 
                to evacuate United States citizens from hostile 
                situations, and to provide humanitarian 
                assistance where needed;
                  (c) the ability to operate from the 
                subsurface with overpowering conventional 
                combat power, as well as strategic deterrence; 
                and
                  (d) the ability to operate in collaboration 
                with United States maritime partners in the 
                common interest of preventing piracy at sea and 
                maintaining the commercial sea lanes available 
                for global commerce.
          (3) the Secretary of Defense, in coordination with 
        the Secretary of the Navy, should maintain the 
        recapitalization plans for the Navy as a priority in 
        all future force structure decisions; and
          (4) the Secretary of Homeland Security should 
        maintain the recapitalization plans for the Coast Guard 
        as a priority in all future force structure decisions.

                      Subtitle D--Counterterrorism


Extension of certain prohibitions and requirements relating to 
        detainees at United States Naval Station, Guantanamo Bay, Cuba 
        (sec. 1031)

    The committee recommends a provision that would extend for 
fiscal year 2013 two restrictions relating to detainees at the 
military detention facility at Guantanamo Bay, Cuba.
    The provision would extend for 1 year the restriction in 
section 1026 of the National Defense Authorization Act for 
Fiscal Year 2012 (Public Law 112-81; 125 Stat. 1566) on the use 
of funds made available to the Department of Defense to build 
any facility in the United States to house Guantanamo 
detainees.
    The provision would also extend for 1 year the 
certification requirements for transfers of Guantanamo 
detainees to foreign countries and other foreign entities.

         Subtitle E--Miscellaneous Authorities and Limitations


Enhancement of responsibilities of the Chairman of the Joint Chiefs of 
        Staff regarding the National Military Strategy (sec. 1041)

    The committee recommends a provision that would amend 
section 153 of title 10, United States Code, to consolidate and 
clarify the requirements for the submission or update, if any, 
of the National Military Strategy, and the annual submission of 
the Chairman's Risk Assessment. The amendment would also 
clarify the requirement for a Secretary of Defense's Risk 
Mitigation Plan to accompany the risk assessment if the 
Chairman identifies significant risk in accomplishing the 
objectives of the National Military Strategy.

Modification of authority on training of special operations forces with 
        friendly foreign forces (sec. 1042)

    The committee recommends a provision that would modify 
section 2011 of title 10, United States Code, to state that the 
purposes of the Joint Combined Exchange Training (JCET) 
authority are to support the training of U.S. Special 
Operations Forces and the armed forces and other security 
forces of a friendly foreign country. Consistent with current 
practice, the recommended modification would also require the 
Secretary of Defense to coordinate with the Secretary of State 
prior to the initiation of any such training. Lastly, the 
recommended modification would authorize unspecified minor 
military construction projects, up to $250,000, that are in 
direct support of authorized training.
    The committee notes that the JCET authority is an effective 
tool for improving the language and cultural expertise of U.S. 
Special Operations Forces while providing opportunities to 
practice skills needed to conduct a variety of missions, 
including foreign internal defense, unconventional warfare, and 
counterterrorism. The committee also recognizes the inherent 
benefit of JCET events in building the capacity of foreign 
partners. The committee notes that the JCET authority allows 
flexibility for U.S. Special Operations Forces to engage with 
appropriate partner nation armed forces and other security 
forces, including those that conduct border and maritime 
security, internal defense and security, and counterterrorism 
operations.
    The committee believes the recommended modifications to the 
JCET authority more accurately reflect the current use of JCETs 
as a training and engagement tool for geographic combatant 
commanders and country teams. The committee notes that over the 
past decade the Department of Defense has used the JCET 
authority to support the development of national militaries and 
other security forces in key regions. In countries of 
particular concern, the Department has sought to be more 
persistently engaged with partners. The committee believes such 
persistent engagements support our broader counterterrorism 
interests, ensure U.S. access and placement in key regions, and 
enable foreign militaries to better support ongoing 
multilateral operations. The recommended modifications are 
intended to increase the flexibility of the JCET authority to 
facilitate more persistent and enduring engagement with partner 
nation security forces while continuing to provide a benefit, 
but not necessarily the primary benefit, to U.S. Special 
Operations Forces.

Extension of authority to provide assured business guarantees to 
        carriers participating in Civil Reserve Air Fleet (sec. 1043)

    Section 9515 of title 10, United States Code, provides 
authority for the Secretary of Defense to guarantee higher 
minimum levels of business than would otherwise be authorized 
by law to United States passenger carrying air carriers 
participating in the Civil Reserve Air Fleet. This authority 
will expire on December 31, 2015.
    The committee recommends a provision that would: (1) extend 
the sunset date to 2020; and (2) permit the Secretary to expand 
the possible uses of these assured business guarantees to cargo 
carrying air carriers.

Participation of veterans in the Transition Assistance Program of the 
        Department of Defense (sec. 1044)

    The committee recommends a provision that would authorize 
veterans to participate in the Transition Assistance Program of 
the Department of Defense for 1 year following discharge or 
separation from the armed forces.

Modification of the Ministry of Defense Advisors Program (sec. 1045)

    The committee recommends a provision that would modify the 
Ministry of Defense Advisors Program, established in section 
1081 of the National Defense Authorization Act for Fiscal Year 
2012 (Public Law 112-81), to permit the Secretary of Defense to 
assign civilian employees of the Department of Defense as 
advisors to regional organizations with defense or security 
components and international organizations of which the United 
States is a member.
    The committee believes that regional security and 
international security organizations play an important role in 
ensuring stability and security in a number of key regions 
around the globe. The committee further believes providing the 
Secretary with the authority to assign individuals to these 
organizations is in U.S. national security interests and will 
assist the Secretary in influencing decisions and outcomes in 
various regional and international security organizations.

Interagency collaboration on unmanned aircraft systems (sec. 1046)

    The committee recommends a provision that would: (1) amend 
section 1036(a) of the Duncan Hunter National Defense 
Authorization Act for Fiscal Year 2009 (Public Law 110-417) to 
encourage technical collaboration and sharing of personnel, 
resources, and information among the Department of Defense 
(DOD), the Federal Aviation Administration (FAA), and the 
National Aeronautics and Space Administration (NASA); (2) 
direct the Secretary of Defense to collaborate with the FAA and 
NASA Administrators on solutions to the challenges of unmanned 
aerial system (UAS) integration into the National Airspace 
System (NAS); and (3) require the Secretary of Defense to 
provide an annual report for a period of 5 years on the 
progress of research and development for UAS NAS integration 
and future funding requirements.
    UASs have clearly demonstrated their immense value to DOD 
military capabilities in the global war on terrorism. 
Increasingly, UASs are contributing to missions of other 
agencies and departments within the United States. Large 
numbers of UASs now deployed overseas may be returned to the 
United States as the conflict in Afghanistan and operations 
elsewhere wind down in coming years, and new UASs are under 
development. Without the ability to operate freely and 
routinely in the NAS, UAS development and training--and 
ultimately operational capabilities--will be severely impacted.
    As the committee has noted repeatedly in previous years, 
DOD's leadership belatedly realized how important and difficult 
UAS NAS integration would be. While progress has been made in 
the last 5 years, the pace of development must be accelerated; 
greater cross-agency collaboration and resource sharing will 
contribute to that objective.
    DOD has invested significantly in resolving the technical 
challenges of UAS NAS integration, and this research and 
development and associated resources should be utilized for the 
benefit of this government-wide initiative, where applicable. 
The committee is encouraged by the relationship built between 
DOD, the FAA, and NASA for coordinating research and 
development and planning for this integration. The committee 
also recognizes the contribution that the Joint Planning and 
Development Office's (JDPO) report, ``NextGen Unmanned Aircraft 
Systems Research, Development and Demonstration Roadmap,'' 
dated March 15, 2012, has made by providing a multi-agency 
perspective on the technology required to enable UAS operations 
and integration in the next-generation NAS. The committee 
supports and encourages a deeper collaborative relationship 
between DOD and its JPDO partners to expedite development of 
the necessary technologies and to avoid redundant activities.

Sense of Senate on notice to Congress on unfunded priorities (sec. 
        1047)

    The committee recommends a provision that would express the 
sense of the Senate that the service chiefs and the Commander 
of U.S. Special Operations Command should provide to Congress, 
through the Chairman of the Joint Chiefs of Staff and the 
Secretary of Defense, a list of unfunded priorities, if any, 
within 45 days of the submission of their annual budget 
request.

                          Subtitle F--Reports


Report on strategic airlift aircraft (sec. 1061)

    The committee recommends a provision that would direct the 
Secretary of Defense to submit to the congressional defense 
committees a report that sets forth various assessments related 
to: (1) possible Federal Aviation Administration certification 
for commercial use of a commercial variant of the C-17 
aircraft, a retired C-17A aircraft, and a retired C-5A 
aircraft; and (2) the Civil Reserve Air Fleet (CRAF) and the 
potential for using these aircraft to augment capability in 
participating CRAF air carriers. The Secretary would be 
required to submit that report not later than 90 days after the 
date of the enactment of this Act.

Repeal of biennial report on the Global Positioning System (sec. 1062)

    The committee recommends a provision that would repeal a 
biennial report on global positioning systems prepared by the 
Department of Defense. This information can readily be obtained 
from the biennial Federal Radionavigation Plan saving 
approximately $150,000 each year in federal funds.

Repeal of annual report on threat posed by weapons of mass destruction, 
        ballistic missiles, and cruise missiles (sec. 1063)

    The committee recommends a provision that would repeal an 
annual report that costs more than $1,000,000 annually to 
produce and such information can be obtained through normal 
requests to the intelligence agencies.

                      Subtitle G--Nuclear Matters


Strategic delivery system (sec. 1071)

    The committee recommends a provision that requires the 
President to certify to the congressional defense committees 
whether plans to modernize strategic delivery systems are 
funded at a level equal to or more than that outlined in the 
November 2010 update to the plan found in section 1251 of the 
National Defense Authorization Act for Fiscal Year 2010 (Public 
Law 111-84). If the level of funding is less than that found in 
the November 2010 update, then the President must submit as 
part of the reporting requirements under section 1043 of the 
National Defense Authorization Act for Fiscal Year 2012 (Public 
Law 112-81), whether a lack of full funding will result in a 
loss of military capability.
    If the President determines that the lack of full funding 
will result in a loss of military capability, he must submit 
with the section 1043 report a plan to preserve or retain the 
capability that would be lost, and a report that assesses the 
impact of the lack of full funding and a description of the 
funding required to restore or maintain the capability. In 
addition, a lack of full funding will require the President in 
the section 1043 report to certify adherence to declaration 12 
of the New START Treaty concerning nuclear modernization.

Requirements definition for combined warhead for certain missile 
        systems (sec. 1072)

    The committee recommends a provision that would require the 
Nuclear Weapons Council to define to Congress what a combined 
warhead is so that the 6.1 and 6.2 process will have clarity in 
the out-years.
    The committee has found that contrary to statements made by 
the administration during 2010 hearings for the New START 
Treaty regarding a combined W88/W78 warhead as a way to save 
maintenance costs, that, the concept remains ill defined at the 
present time. Recent discussions have focused on two warhead 
systems (the W88 and W78) that now have interchangeable 
components.

Congressional Budget Office estimate of costs of nuclear weapons and 
        delivery systems (sec. 1073)

    The committee recommends a provision that would require the 
Congressional Budget Office to obtain a 10 year cost estimate 
of nuclear weapons enterprise in the Departments of Defense and 
Energy.

                       Subtitle H--Other Matters


Redesignation of Center for Hemispheric Defense Studies as the William 
        J. Perry Center for Hemispheric Defense Studies (sec. 1081)

    The committee recommends a provision that would, as 
requested by the Department of Defense, redesignate the Center 
for Hemispheric Defense Studies as the William J. Perry Center 
for Hemispheric Defense Studies.

Technical amendments to repeal statutory references to United States 
        Joint Forces Command (sec. 1082)

    The committee recommends a provision, as requested by the 
Department of Defense, that would amend title 10, United States 
Code, to remove references to the United States Joint Forces 
Command (USJFCOM) in order to reflect the disestablishment of 
USJFCOM effective August 4, 2011.

Sense of Congress on non-United States citizens who are graduates of 
        United States educational institutions with advanced degrees in 
        science, technology, engineering, and mathematics (sec. 1083)

    The committee recommends a provision that would express a 
sense of Congress that would strongly urge the Department of 
Defense to investigate innovative mechanisms to access the pool 
of talent of non-United States citizens with advanced 
scientific and technical degrees from United States 
institutions of higher learning.
    The National Defense Authorization Act for Fiscal Year 2012 
(Public Law 112-81) contains a provision directing the 
Secretary of Defense to conduct an assessment of current and 
potential mechanisms to permit the Department of Defense to 
employ non-United States citizens with critical scientific and 
technical skills that are vital to the national security 
interests of the United States. The committee is awaiting this 
report, due by the end of calendar year 2012.
    In testimony before the Subcommittee on Emerging Threats 
and Capabilities of the Senate Committee on Armed Services on 
April 17, 2012, Department of Defense science and technology 
executives expressed concern over the possible unintended 
consequences of taking significant action on this front. The 
committee understands the trepidation expressed by the service 
executives, but feels strongly that the most substantial 
unintended consequence of lack of action will be the 
significant loss of technical talent to the country.

                       Items of Special Interest


Arctic region

    The committee recognizes the continued importance of the 
Arctic region to our broader national strategy. Declining ice 
cover continues to open the Arctic region and a concerted, 
systematic, and immediate effort should be undertaken to 
adequately protect the United States' security, environmental, 
energy, economic, and natural resource interests in the Arctic.
    The committee commends the Department of Defense (DOD) and, 
in particular, U.S. Northern Command and the Department of the 
Navy, and other federal agencies, such as the Department of 
Homeland Security (DHS), through the U.S. Coast Guard, the 
Department of Commerce, through the National Oceanic and 
Atmospheric Administration and the U.S. Arctic Research 
Commission, for their progress thus far in studying the region 
and defining the capabilities required to effectively operate 
in and protect the domain.
    International and interagency collaboration is also needed 
to develop the necessary mapping and charting resources 
required for safe navigation and to promote security and 
economic interests. As sea ice recedes, timely weather 
forecasts and disaster warnings along with more baseline data 
will be required to conduct successful search and rescue 
missions. Search and rescue coordination, planning, and 
training for the Artic should be thoroughly analyzed and 
developed to ensure forces can successfully operate in the 
domain.
    The committee recognizes the importance of DOD's 
involvement in interagency and international efforts to protect 
national security interests in the region and, accordingly, 
urges DOD to continue to work in concert with DHS to establish 
a formal chartered working group to pursue increasing Arctic 
capabilities in the areas of communications, maritime domain 
awareness, infrastructure, and presence, as was recommended by 
U.S. Northern Command and the U.S. Coast Guard in a joint White 
Paper dated March 13, 2012. The committee also urges the 
agencies to develop an investment strategy for funding emerging 
requirements in balance with a resource constrained 
environment.

B-52 Combat Network Communications Study

    The B-52 Combat Network Communications (CONECT) program has 
been executing on cost and schedule and has successfully 
completed all Milestone C criteria. The Senate has concerns 
with the Air Force's decision to restructure the CONECT program 
to only replace the current Multi-Function Displays located at 
each of the crew stations, making the temporary Evolutionary 
Data Link modification permanent, and demoding the CONECT test 
aircraft. The committee understands that after the budget was 
released the Commander of the Air Force Global Strike Command 
asked that the decision to restructure CONECT be reconsidered. 
The committee encourages the Secretary of the Air Force to do 
so and to provide the congressional defense committees with a 
report assessing the available B-52 modernization options no 
later than 180 days after the enactment of this Act.

B-52 Strategic Radar Replacement

    The committee recognizes that the analysis of alternatives 
for the current B-52 Strategic Radar Replacement (SR2) program 
certified that replacement of the 30 year APQ-166 is the best 
option. The APQ-166 Radar is increasingly expensive to 
maintain. The Air Force justification for the cancellation of 
the SR2 program in the fiscal year 2012 budget request is noted 
as funding being needed for higher priorities. However, the 
recent B-52 Strategic Radar Replacement Analysis of 
Alternatives (AoA) Final Report stated cost-effectiveness 
issues with the Air Force proposal. Maintaining the current 
radar system is more expensive than replacing it with a modern, 
in production, radar system as determined by the Air Force's 
Analysis of Alternatives. Therefore, the committee recommends 
pursuing the most cost-effective solution presented in the AOA.
    Not later than 90 days after the date of enactment of this 
Act, the Secretary of the Air Force shall submit to the 
congressional defense committees a plan to continue the effort 
in replacing the aging radar on B-52 aircraft.

Clarification of scope of requirements for periodic detention review of 
        individuals detained at United States Naval Station, Guantanamo 
        Bay, Cuba

    Section 1023 of the National Defense Authorization Act for 
Fiscal Year 2012 (Public Law 112-81) requires the Secretary of 
Defense to issue procedures implementing the periodic review 
process required by Executive Order 13567 for individuals 
detained at United States Naval Station, Guantanamo Bay, Cuba. 
The Department of Defense has requested legislation clarifying 
congressional intent that this provision does not require 
periodic review boards for Guantanamo detainees who have 
already been designated for transfer or conditional detention, 
or who have charges pending or a judgment of conviction.
    The committee concludes that such legislation is not 
needed. Section 1023(b)(3) requires the Executive branch to 
apply the periodic review process of Executive Order 13567 to 
any detainee who may be brought to Guantanamo Bay in the 
future, but does not change the scope of Executive Order 13567 
as to which detainees at Guantanamo Bay as of the date of 
enactment of the provision are required to be provided periodic 
review boards in accordance with that process. The committee 
understands that under section 3 of the Executive Order, a 
periodic review board must be provided to any current 
Guantanamo detainee who has been: (1) designated for continued 
law of war detention; or (2) referred for prosecution (except 
for those detainees against whom charges are pending or a 
judgment of conviction has been entered). Section 1023(b)(3) 
does not change these requirements.

Combat Network Communications Technology

    The President's budget request for fiscal year 2013 for the 
Combat Network Communications Technology was significantly 
restructured, delaying the production and deployment from 
fiscal year 2013 to fiscal year 2015. The committee is fully 
supportive of this important communications backbone to the B-
52 modernization program noting that it should be moved forward 
if possible to having production and deployment to fiscal year 
2014.

Funds transfers between Department of Defense accounts

    The committee notes that the President's budget request 
annually includes legislative provisions to authorize the 
Secretary of Defense to transfer up to certain amounts of funds 
authorized each year for each account to unforeseen higher 
priorities. Because the legislation results in the transfers to 
be deemed as additional authorizations outside the normal 
congressional authorization process, certain restrictions are 
imposed on its use by both Congress and the Department of 
Defense through policy guidance to ensure the transfers are 
carried out consistent with congressional intent. The 
Department is expressly prohibited from preparing or forwarding 
to Congress a prior approval reprogramming action except for 
higher priority items, based on unforeseen military 
requirements, than those for which originally appropriated and 
is determined to be necessary in the national interest.
    Despite these restrictions, the committee is concerned 
about the total amounts transferred among programs, much of 
which is not required to be counted against the General and 
Special Transfer Authorities granted by Congress each year. The 
Department is permitted to transfer funds between military 
personnel accounts, and has additional special transfer 
authorities for foreign currency fluctuations, intelligence 
programs, and certain operations and maintenance accounts. As a 
result, in fiscal year 2011 alone, the Department transferred 
nearly $27.0 billion among accounts, but only $11.1 billion or 
40 percent of these transfers were approved through the 
congressional reprogramming process prior to transfer. In 
addition, the total transfer authority contained in the Ike 
Skelton National Defense Authorization Bill for Fiscal Year 
2011 (Public Law 111-383) only totaled $8.0 billion, and the 
Department of Defense has used only $4.1 billion to date.
    The committee notes that the Department currently is 
authorized to transfer funding between accounts up to certain 
threshold amounts that do not require prior approval from 
Congress nor do they require the use of special transfer 
authorities. These below threshold reprogramming (BTR) amounts 
are limited to $10.0 million for each military personnel 
account, $15.0 million for operation and maintenance; $20.0 
million for procurement; and $10.0 million for research, 
development, test, and evaluation. During Fiscal Year 2011, the 
Department of Defense transferred over $7.0 billion, in 1,629 
budget lines using BTR authority and another $9.7 billion using 
other internal reprogramming authorities. All these transfers 
were approved by officials in the military services or defense 
agencies without any congressional review or oversight.
    In addition, in fiscal year 2011 the Department of Defense 
requested approval to transfer funds totaling over $1.0 billion 
in order to start new procurement and research, development, 
test and evaluation programs that were not previously 
authorized by Congress, even though the Department of Defense 
Financial Management Regulation entitled ``Reprogramming of 
Appropriated Funds'' states in regard to the new starts that 
``Congressional committees discourage the use of the 
reprogramming process to initiate programs.'' The committee is 
aware that urgent operational requirements, particularly those 
supporting on-going contingency operations, may result in the 
need to initiate a new program without prior congressional 
authorization or outside the traditional budget cycle. 
Therefore, the committee continues to discourage the use of 
transfer authority to initiate programs unless the requirement 
satisfies a validated emerging or urgent operational warfighter 
need, is the result of extraordinary situations, and for which 
the follow-on funding is budgeted.
    The committee grants a certain degree of flexibility to the 
Department of Defense in order to manage federal taxpayer funds 
efficiently and effectively in response to changing conditions 
and emerging requirements. On the other hand, this same 
flexibility facilitates a certain degree of budget 
gamesmanship, as certain accounts, such as operations and 
maintenance and base operations support that are intended to 
satisfy ``must-pay'' bills, are historically underfunded in the 
President's annual budget requests with the understanding that 
the Department will be able to transfer funds between accounts. 
This type of budget gamesmanship is a major reason why the 
Department is not able to produce annual financial statements 
that are auditable. It also facilitates the annual exercise of 
a rush to transfer funds at the end of the fiscal year to 
accounts for which contracts or task orders can be obligated 
quickly.
    The committee is concerned that, despite the efforts of the 
Department to rein in wasteful and unneeded spending, these 
internal reprogramming processes and year-end rushes do not 
allow for an objective assessment of the priority or urgency of 
the funding need. Instead, they encourage action to obligate 
all authorized funds before they expire or are returned to the 
General Treasury. The committee believes that in order for the 
Department to truly ensure efficient spending at every level of 
resource management, new standards of performance must be 
established for each resource manager that rewards the result 
of acquiring goods and services to meet validated requirements 
established for the fiscal year within amounts authorized for 
that account and then returning any unobligated balances back 
to the General Treasury in order to buy down the federal debt, 
as opposed to looking for other goods or services to purchase. 
Therefore, the committee directs the Secretary of Defense to 
submit a report to the congressional defense committees within 
90 days after enactment of this Act providing suggestions to 
increase the transparency and accountability of funds transfers 
that do not require the prior approval of Congress. The report 
should also include a description of policies, procedures, or 
guidance provided to each program manager in the Department to 
determine the urgency or priority of an unfunded requirement, 
and to establish a culture of fiscal frugality and efficiency 
that promotes the return of unobligated balances back to 
financial managers for the purchase of higher priority goods 
and services or a return of funds to the General Treasury.

Government Accountability Office report on duplication, overlap and 
        fragmentation in federal programs

    On February 28, 2012, the Government Accountability Office 
(GAO) issued a report entitled, ``Opportunities to Reduce 
Duplication, Overlap and Fragmentation, Achieve Savings, and 
Enhance Revenue,'' that identified 32 areas of duplication, 
overlap and fragmentation throughout the Federal Government, 
and 19 areas of potential cost-saving and revenue-enhancement 
opportunities in federal programs, agencies, offices and 
initiatives. This report identified 16 areas of duplication, 
overlap, or potential savings that relate to the programs and 
operations of the Department of Defense (DOD).
    In the current environment of fiscal austerity and 
constrained resources, DOD must take advantage of every 
opportunity to identify efficiencies and achieve savings in its 
programs and activities. For this reason, careful consideration 
of the areas of potential savings identified by the GAO 
report--such as electronic warfare, unmanned aircraft systems, 
counter-improvised explosive device efforts, defense language 
and culture training, stabilization and reconstruction 
operations, Air Force food service, defense headquarters, 
defense real property, military healthcare costs, and overseas 
defense posture--is imperative.
    The committee concludes that DOD should assess each area of 
duplication, overlap, or potential savings identified by GAO 
that relates to DOD programs and operations and, to the extent 
that it has not already done so, take appropriate steps to 
address any such areas for which DOD agrees with the GAO 
recommendations. For any areas as to which DOD concludes that 
the duplication, overlap, or potential savings identified by 
GAO are not valid, the committee directs the Secretary to 
provide the congressional defense committees with an 
explanation of the basis for this conclusion.

Government Accountability Office review of the Nuclear Command, 
        Control, and Communications System

    The U.S. nuclear command, control, and communications 
system (NC3) includes the activities, processes, and procedures 
performed by appropriate military commanders and support 
personnel to allow for senior-level decisions on nuclear 
weapons employment. The committee commends the Department of 
Defense (DOD) for directing a number of initiatives to improve 
the reliability of the NC3 system. However, the committee is 
concerned that the Department's efforts are being pursued in a 
piecemeal fashion rather than part of a coherent system 
architecture and investment strategy with consistent 
leadership. For example, a key Air Force modernization program 
that has been in development for a decade, the Family of 
Advanced Beyond Line-of-Sight Terminals (FAB-T) program, which 
is the base terminal for the Advanced Extremely High Frequency 
Satellite, has veered off track and it may take years longer 
than expected before any of the needed capability becomes part 
of the NC3 system, especially in the B-2 and B-52H fleet. This 
means that our strategic bombers, which can carry nuclear 
weapons, will not be able to use the very satellites designed 
for nuclear command and control.
    The committee directs that the Government Accountability 
Office (GAO) to assess DOD's efforts to sustain and improve the 
NC3 system. Specifically, the committee directs GAO to examine: 
(1) the DOD's efforts and activities underway or planned to 
upgrade and modernize the Nation's nuclear NC3 capabilities, 
including activities associated with cryptographic 
modernization; (2) the extent to which DOD's modernization and 
upgrade efforts are being coordinated as part of an overarching 
NC3 architecture and investment strategy; (3) whether there are 
NC3 gaps, shortcomings, technical challenges, or funding issues 
that need to be addressed currently; (4) the factors that 
caused the FAB-T program to go off track and the Air Force's 
plans to salvage the program, including how land and air 
platform integration challenges will be addressed; and (5) 
extent to which DOD has identified and addressed gaps or 
shortcomings in the NC3 system through its inspections, 
training, and exercise programs.

Hazard assessments related to new construction of obstructions on 
        military installations and operations

    Section 358 of the Ike Skelton National Defense 
Authorization Act for Fiscal Year 2011 (Public Law 111-383) 
required the Secretary of Defense to establish a systematic 
process and a comprehensive strategy for assessing and 
addressing military impacts of renewable energy projects and 
other energy projects with the objective of ensuring that the 
robust development of renewable energy sources and the 
expansion of the commercial electrical grid in the United 
States are conducted in a manner that minimize or mitigate any 
adverse impacts on military operations and readiness.
    The Department of Defense (DOD) has implemented the 
requirement of section 358 by establishing a Siting 
Clearinghouse to serve as a focal point for DOD consideration 
of proposed energy projects. The Clearinghouse has developed a 
consistent process for review of such projects, including 
evaluation criteria, operational impact assessment tools, and 
mitigation response teams. This process has enabled the 
Department to focus its attention on those projects that are 
likely to have adverse impacts on military missions and to 
conduct additional analysis needed to determine if mitigation 
is possible.
    The Clearinghouse has reviewed 249 renewable energy 
projects to date that were under consideration at the time 
section 358 was enacted, and has determined that 229 of them 
would have little or no impact to military missions. The 
remaining 20 have been assessed as potentially having an 
adverse impact on military test, readiness, and operational 
missions. While further study and negotiations with project 
developers are underway in consultation with appropriate 
federal agencies, no determination of an unacceptable risk to 
national security has yet been made with regard to any of these 
projects.
    The committee expects that any DOD hazard assessment under 
subsection (e) of section 358 will include an analysis of the 
electromagnetic interference that the proposed project would 
cause for the relevant military installation (including 
interference with military-owned or military-operated air 
traffic control radar sites, navigation aids, and approach 
systems), as well as any other adverse impacts on military 
operations, safety, and readiness (including adverse effects on 
instrument or visual flight operations). In the event that a 
potential risk is identified, the hazard assessment should 
consider the feasibility of the full range of mitigation 
measures. Such mitigation measures could include modifications 
to the proposed project (including changes in size, location, 
or technology), upgrades or modifications to existing DOD 
systems or procedures, acquisition and fielding of new systems 
by DOD or other federal agencies, and modifications to military 
operations.
    The committee also expects the Secretary of Defense to give 
careful consideration to the recommendations of senior military 
officers with primary responsibility for the affected military 
installation and affected military operations in making any 
final determination of unacceptable risk.
    The committee concludes that section 358 requires a set of 
established criteria in order to ensure the risk assessments 
are objective, rational, and justifiable. The committee also 
notes that final routes and sites may change after a 
determination is made, due to ongoing environmental studies, 
changes in developer plans, and the assessment of alternatives 
as part of mitigation efforts. In such cases, the Clearinghouse 
should have processes in place to reopen the review, continue 
the analysis, and amend the determination if the review results 
in a change in the determination.
    Therefore, the committee directs the Under Secretary of 
Defense for Acquisition, Technology, and Logistics to provide 
to the congressional defense committees by December 1, 2012, a 
description of the processes and criteria used to make the 
determination whether or not an energy project poses an 
unacceptable risk to national security.

Impacts of ``Sequestration'' on the Department of Defense

    The committee is aware that the Department of Defense is 
subject to automatic funding reductions known as 
``sequestration'' of $492.0 billion between 2013 and 2021 as 
required by section 251A of the Balanced Budget and Emergency 
Deficit Control Act of 1985 (2 U.S.C. 901a). These reductions 
are in addition to reductions of $487.0 billion already being 
implemented by the Department of Defense.
    The leaders of the Department of Defense have consistently 
testified that automatic reductions would have a detrimental 
impact on the Department's ability to maintain readiness. 
Secretary of Defense Leon Panetta said that these reductions 
would ``inflict severe damage to our national defense for 
generations'' and Chief Staff of the Army, General Raymond 
Odierno, warned that the cuts would force the Army to separate 
an additional 100,000 soldiers. Sequestration will also have a 
detrimental effect on the industrial base that supports the 
Department of Defense.
    Therefore, the committee directs that the Secretary of 
Defense submit to the congressional defense committees no later 
than August 15, 2012 a detailed report on the impact of the 
sequestration of funds authorized and appropriated for fiscal 
year 2013 for the Department of Defense. The report should 
include an assessment of the potential impact of sequestration 
on the readiness of the Armed Forces, on the ability of the 
Department to carry out the National Military Strategy, and any 
changes to the most recent Chairman's Risk Assessment.
    The committee is also aware that automatically triggered 
cuts would disrupt programs, projects, and activities across 
the military departments and components, potentially causing 
the termination or restructuring of hundreds of contracts. 
Therefore, the report should include an estimate of the number 
and value of all contracts that will be terminated or re-scoped 
due to sequestration, including an estimate of the resulting 
costs. Finally, the report should include an estimate of the 
number of civilian, contract, and uniformed personnel whose 
employment would be terminated due to sequestration.
    The committee urges the administration and Congress to work 
together, beginning immediately, to develop and introduce in 
both Houses of Congress not later than September 15, 2012, a 
proposal to replace the automatically triggered, across-the-
board reductions in fiscal year 2013 funding required by 
sequestration, in order to avoid the devastating consequences 
of continued inaction.

Resiliency and survivability for nuclear air-launched cruise and 
        missile basing

    As the United States reduces its deployed nuclear forces in 
the coming years to comply with limits established in the New 
Strategic Arms Reduction Treaty (New START), the resiliency and 
survivability of the Nation's enduring strategic nuclear 
deterrent assumes a new level of importance. Since the 
decertification of one Air Force Weapons Storage Area (WSA) in 
2007, the Air Force has relied upon a single WSA to meet U.S. 
Strategic Command's nuclear-armed air-launched cruise missile 
requirement. The committee notes that following serious Air 
Force security incidents in 2006 and 2007, the September 2008 
Phase 1 Report of the Secretary of Defense Task Force on DOD 
[Department of Defense] Nuclear Weapons Management concluded 
that, ``The closure of the WSA at one of the bomber bases was a 
significant mistake with a negative operational impact,'' and 
that ``[the closure] simplifies enemy targeting and creates 
more concentration of vulnerability for the B-52 bomber 
force.'' In response, the Air Force requested and Congress 
appropriated $73.0 million for activities to recertify and 
reopen the closed WSA.
    However, in testimony before the committee in February 
2011, Air Force Chief of Staff General Norton A. Schwartz 
stated that the Air Force had decided not to pursue these 
activities because of budget constraints. A reconstituted 
second WSA could enhance the resiliency of the bomber force, 
provide redundancy in a critical national security mission, and 
reduce operational risk. Consolidation of the old WSA's 
existing security perimeter and installation of modern 
detection and denial systems could reduce security personnel 
requirements and result in significant cost savings from 
original estimates. Accordingly, the committee encourages the 
Secretary of the Air Force to reexamine plans, including 
requirements and costs, for reconstituting a second nuclear 
weapons storage capability for nuclear-armed air-launched 
cruise missiles.

Roles of the Air Force Global Strike Command and Air Combat Command

    The Air Force Global Strike Command is a major command 
created in 2007 when the Air Force's ability to manage its 
portion of the nuclear weapons enterprise came into question. 
That Command's mission is to ``Develop and provide combat-ready 
forces for nuclear deterrence and global strike operations that 
are safe, secure and effective to support the President of the 
United States and combatant commanders''. The Command utilizes 
the fleet of B-2 and B-52 long-range heavy bombers in carrying 
out its mission. Air Combat Command also exercises some 
responsibilities for managing the B-2 and B-52 bomber fleets. 
It is not clear to the committee how the Air Force has 
apportioned responsibility for exercising authority, direction 
and control in regards to tasking and funding for the B-2 and 
B-52 training and operations between the Global Strike Command 
and the Air Combat Command.
    The committee directs the Secretary of the Air Force to 
provide a report describing how these functions are apportioned 
between the Global Strike Command and Air Combat Command no 
later than January 31, 2013.

Safety and security standards for Department of Defense hazardous 
        materials transport

    The committee is aware that the Department of Defense (DOD) 
is responsible for the transportation of nearly 70,000 separate 
shipments of security sensitive material every year. Trucks 
carrying these shipments travel tens of millions of miles on 
highways across all 50 States.
    The Defense Transportation Regulation establishes standards 
for the safe movement of hazardous materials. The committee 
understands that an industry group has proposed that DOD adopt 
enhanced safety standards for hazardous materials. The 
committee does not prejudge the adequacy of existing safety 
standards, but believes that it is essential that DOD ensure 
that transportation safety standards are commensurate with 
safety risk posed by the categories of cargo that are 
transported.
    Accordingly, the committee directs the Secretary of Defense 
to conduct an impartial analysis of its existing standards for 
the transportation of hazardous materials and submit that 
analysis to the congressional defense committees not later than 
45 days after the date of enactment of this Act. The 
Secretary's analysis should address past safety performance, 
number of transportation accidents and causes, accident rates, 
and standards used by DOD, the Department of Transportation, 
and other organizations and companies that transport similar 
hazardous cargo.
    The committee further directs the Department to implement 
such changes to existing regulations and standards (if any) as 
he determines to be needed on the basis of the review.

Use of general purpose forces and special operations forces for 
        security force assistance

    The committee notes that the guidance documents issued by 
the President and Department of Defense (DOD) have emphasized 
international security force assistance as an element of our 
broad security strategy captured in the National Security 
Strategy, Quadrennial Defense Review, National Strategy for 
Counterterrorism, and the recent Defense Strategic Guidance. 
Historically, special operations forces have conducted the 
majority of the DOD's activities to train, equip, advise, and 
assist international security forces. However, the fundamental 
role of building partner nation capability and capacities and 
the limited availability of special operations forces (SOF) for 
this mission have required DOD to build the capabilities and 
capacities of its general purpose forces (GPF) to conduct 
security force assistance.
    The Commander of U.S. Special Operations Command (USSOCOM) 
has projected that the current high demand for SOF will 
continue and that a ``steady state'' of approximately 12,000 
deployed SOF will be required to meet the future requirements 
of the geographic combatant commanders for security force 
assistance, counterterrorism, civil affairs, military 
information support, and other missions. At the same time, DOD 
and the military services are also taking steps to identify 
capability requirements, implementing new approaches to 
organizing units--including aligning certain GPF to specific 
regions, and adjusting training to enhance the ability of GPF 
to conduct security force assistance activities.
    The committee is aware of the Comptroller General's 
previous work on challenges DOD faces in defining its concept 
for security force assistance and guiding combatant commander 
and service efforts to plan and conduct related activities, as 
well as its work on challenges USSOCOM has faced in providing 
sufficient numbers of trained personnel to meet the demand for 
increased deployments.
    Given that high demand for SOF is projected to continue for 
the foreseeable future, as well as DOD's efforts to expand the 
capabilities of the GPF to perform security force assistance, 
the committee is concerned that the Department risks creating 
redundancies, investing funds, and utilizing personnel in 
creating duplicative capabilities when resources are 
increasingly limited and the size of the GPF is decreasing.
    In order to better understand the Department's plan for the 
security force assistance mission within both GPF and SOF, the 
committee directs the Comptroller General of the United States 
to provide a report to the congressional defense committees on 
its evaluation of DOD efforts in these areas, including the 
extent that DOD has delineated the roles and responsibilities 
of SOF and GPF; distinguished between the types of 
circumstances where the respective forces would be used to 
conduct security force assistance activities; and whether DOD 
has identified and prioritized the respective requirements and 
resource needs for building and sustaining the capabilities of 
both types of forces, and other matters the Comptroller General 
sees fit to include.

Vacancies in critical Inspector General positions

    The committee notes with concern that a number of critical 
Inspector General positions in the Federal Government have been 
vacant for an extended period of time. The position of 
Department of Defense Inspector General has been vacant since 
the beginning of the year, without a successor being nominated. 
In the view of the committee, continuing vacancies among the 
Inspectors General undermines needed oversight of critical 
national security functions and operations. While Acting 
Inspectors General often do an admirable job, they are unlikely 
to have the clout and influence of Senate-confirmed officials. 
The committee urges the Secretary of Defense to work with the 
President to identify and submit a highly-qualified nominee to 
be the Department of Defense Inspector General as soon as 
possible.

Working partnerships with State and local law enforcement authorities

    The committee is aware of significant jurisdictional gaps 
and overlaps between Department of Defense (DOD) law 
enforcement authorities on military installations and civilian 
law enforcement authorities in areas surrounding military 
installations. For example, the Department has expressed 
concern about its lack of jurisdiction over a growing 
population of non-DOD affiliated civilians living in privatized 
housing on DOD installations. Similar issues can arise in the 
case of DOD-leased facilities off of DOD installations.
    The committee also recognizes that information collection 
and sharing among law enforcement agencies is a critical 
element of effective force protection for military 
installations inside the United States. For this reason, the 
committee encourages active participation by both DOD law 
enforcement authorities and local law enforcement authorities 
in areas surrounding military installations in ongoing 
information-sharing programs managed and operated by the 
Federal Bureau of Investigation and the Department of Homeland 
Security.
    The committee concludes that DOD law enforcement 
authorities should actively work to develop working 
partnerships with law enforcement agencies in areas surrounding 
military installations, and to use such partnerships to address 
a wide range of issues of mutual interest, including force 
protection issues. The committee directs the Secretary of 
Defense to report to the congressional defense committees not 
later than 180 days after the enactment of this Act on steps 
that the Department has taken or plans to take to promote such 
partnerships.
                  TITLE XI--CIVILIAN PERSONNEL MATTERS

Authority for transportation of family household pets of civilian 
        personnel during evacuation of non-essential personnel (sec. 
        1101)
    The committee recommends a provision that would amend 
section 5725 of title 5, United States Code, to authorize the 
transport at government expense of family household pets of 
government employees during evacuations from permanent stations 
in foreign locations.
Expansion of experimental personnel program for scientific and 
        technical personnel at the Defense Advanced Research Projects 
        Agency (sec. 1102)
    The committee recommends a provision that would amend 
section 1101(b)(1)(A) of the Strom Thurmond National Defense 
Authorization Act for Fiscal Year 1999 (Public Law 105-261) to 
authorize the appointment of not more than 60 employees to 
scientific and engineering positions in the Defense Advanced 
Research Projects Agency (DARPA). The provision would not be 
construed as affecting any limitation on the numbers of 
personnel that may be employed at DARPA overall.
One-year extension of discretionary authority to grant allowances, 
        benefits, and gratuities to personnel on official duty in a 
        combat zone (sec. 1103)
    The committee recommends a provision that would authorize 
temporary discretionary authority to federal agencies to grant 
allowances, benefits, and gratuities comparable to those 
provided to members of the foreign service to an agency's 
civilian employees on official duty in a combat zone. This 
authority would expire at the end of fiscal year 2014.

                        Item of Special Interest

Department of Defense strategic workforce plan
    Section 115b of title 10, United States Code, requires the 
Secretary of Defense to prepare a strategic workforce plan to 
shape and improve the civilian employee workforce of the 
Department of Defense (DOD) on a biannual basis. The strategic 
workforce plan is required to include an assessment of the 
critical skills and competencies that will be needed to support 
national security requirements and effectively manage the 
Department and the appropriate mix of military, civilian, and 
contractor personnel capabilities needed to ensure the 
availability of such skills and capabilities.
    The most recent strategic workforce plan, submitted to the 
committee in March 2012, includes a comprehensive assessment of 
24 mission critical occupations and 4 cross-cutting mission 
critical functions in the DOD civilian workforce. The plan 
includes specific recruitment, retention, and development 
strategies to address identified gaps in these occupations and 
functions. While not yet fully compliant with the requirements 
of section 115b, the March 2012 strategic workforce plan is a 
significant improvement over earlier plans.
    At the same time, the plan is a massive document that DOD 
assesses is too big and complex to be a practical guide for 
workforce management. Because of deficiencies in the DOD 
inventory of contract services required by section 2330a of 
title 10, United States Code, the plan does not yet include 
meaningful data on the total workforce (including military, 
civilian, and contractor employees) that can be used to assess 
the appropriate workforce mix needed to perform critical 
functions.
    Moreover, the plan was submitted a year late and was based 
on forecasts completed in December 2010--before the Secretary 
announced efficiencies initiatives, including a freeze on the 
civilian workforce at fiscal year 2010 levels. It is not clear 
to what extent, if any, the military departments and defense 
agencies took the strategic workforce plan, and the critical 
capabilities and capabilities gaps identified in the plan, into 
account as they worked to implement these efficiencies.
    The committee directs the Under Secretary of Defense for 
Personnel and Readiness to review the requirements for the 
strategic workforce plan and the process used to develop and 
implement the plan and to identify steps, including any 
recommended legislative changes, that may be needed to 
streamline the planning process, enhance the utility of the 
plan, and ensure that it is implemented by the military 
departments and defense agencies in an operationally effective 
manner. The committee directs the Under Secretary to report the 
findings and recommendations of this review to the 
congressional defense committees by no later than 60 days after 
the date of the enactment of this Act.
             TITLE XII--MATTERS RELATING TO FOREIGN NATIONS

                  Subtitle A--Assistance and Training

Extension of authority to build the capacity of foreign military forces 
        and modification of notice in connection with initiation of 
        activities (sec. 1201)
    The committee recommends a provision that would extend 
through September 30, 2014, the authority under section 1206 of 
the National Defense Authorization Act for Fiscal Year 2006 
(Public Law 109-163; 119 Stat. 3456), as amended, for the 
Secretary of Defense, with the concurrence of the Secretary of 
State, to conduct a program to build the capacity of foreign 
military forces. The provision would also require the Secretary 
of Defense to provide, as part of the 15-day prior notification 
of the initiation of a project under this authority, additional 
information on assistance provided during the 3 preceding 
fiscal years to the country in which the project is to be 
initiated. The committee believes the provision of this 
additional information in the notification will facilitate 
congressional oversight of the train and equip program.
Extension of authority for non-reciprocal exchange of defense personnel 
        between the United States and foreign countries (sec. 1202)
    The committee recommends a provision that would extend for 
5 fiscal years the authority for the Department of Defense 
(DOD) to accept, on a non-reciprocal basis, defense personnel 
of the defense ministry of an ally or friendly foreign 
government.
    The committee notes that DOD has used this authority 
judiciously and only recently expanded its use to include 
countries outside of our traditional partners. The committee 
urges the Department to continue to use this authority and to 
consider using it to enhance--consistent with the new Defense 
Strategic Guidance--our partnerships in the Middle East and 
Asia Pacific.
Authority to build the capacity of certain counterterrorism forces in 
        Yemen and East Africa (sec. 1203)
    The committee recommends a provision that would authorize 
for 2 fiscal years the Secretary of Defense, with the 
concurrence of the Secretary of State, to provide training, 
equipment, supplies, and minor military construction to: (1) 
the Yemen Ministry of Interior (MOI) Counterterrorism Unit 
(CTU); (2) the national military forces, counterterrorism 
forces, security agencies that serve a similar defense 
function, and border security forces of Djibouti, Ethiopia, and 
Kenya; and (3) the national military forces of nations 
participating in the African Union Mission in Somalia; for the 
purpose of conducting counterterrorism operations against al 
Qaeda in the Arabian Peninsula in Yemen, and al Qaeda 
affiliates and al Shabaab in East Africa. The provision permits 
the Secretary of Defense to expend not more than $75.0 million 
in support of the Yemen MOI CTU, and not more than $75.0 
million in support of the named forces conducting 
counterterrorism operations in East Africa. The provision 
requires that any support pursuant to this section must be 
provided in a manner that promotes the observance of and 
respect for human rights and fundamental freedoms and for 
legitimate civilian authority in the country receiving such 
assistance.
    The committee notes that this authority is similar to 
section 1207(n) of the National Defense Authorization Act for 
Fiscal Year 2012 (Public Law 112-81) and that the Department 
requested an extension of that authority. The committee is 
supportive of the Department's request and associated efforts 
to better enable counterterrorism forces in East Africa and 
Yemen, but views this authority as a means to continue 
providing support to these forces until the Global Security 
Contingency Fund and its associated processes are fully 
operational. Further, the committee chose to create this 
authority as a standalone authority to correct a number of 
technical errors in section 1207(n) of the National Defense 
Authorization Act for Fiscal Year 2012.
    The committee believes these authorities will be critical 
to supporting counterterrorism efforts by partner nations 
against al Qaeda and al Shabaab in the coming 2 fiscal years as 
they work to consolidate and build upon recent gains in Somalia 
and prevent al Qaeda from establishing a safe haven in Yemen as 
the political process in Yemen continues to unfold.
Limitation on availability of funds for State Partnership Program (sec. 
        1204)
    The committee recommends a provision that would prohibit 
the Secretary of Defense from obligating or expending more than 
50 percent of the fiscal year 2013 funds for the State 
Partnership Program until the final regulations required 
pursuant to section 1210 of the National Defense Authorization 
Act for Fiscal Year 2010 (Public Law 111-84) are completed and 
the necessary regulatory adjustments have been completed to 
ensure compliance of the program with the Antideficiency Act 
(Public Law 97-258).

    Subtitle B--Matters Relating to Iraq, Afghanistan, and Pakistan

Commanders' Emergency Response Program in Afghanistan (sec. 1211)
    The committee recommends a provision that would make up to 
$200.0 million in Department of Defense funds available during 
fiscal year 2013 for the Commanders' Emergency Response Program 
(CERP) under section 1201 of the National Defense Authorization 
Act for Fiscal Year 2012 (Public Law 112-81; 125 Stat. 1619). 
As explained elsewhere in this report, this is $200.0 million 
less than the $400.0 million requested in the budget request. 
CERP enables commanders in Afghanistan to fund humanitarian 
relief and reconstruction projects that directly benefit the 
Afghan people.
Extension of authority to support operations and activities of the 
        Office of Security Cooperation in Iraq (sec. 1212)
    The committee recommends a provision that would extend for 
1 year the authority of section 1215 of the National Defense 
Authorization Act for Fiscal Year 2012 (Public Law 112-81; 125 
Stat. 1631; 10 U.S.C. 113 note) for the Secretary of Defense to 
support the operations and activities of the Office of Security 
Cooperation in Iraq and security assistance teams, including 
life support, transportation and personal security, and 
construction and renovation of facilities. The provision would 
limit the total amount of funds available for these purposes to 
$508.0 million.
One-year extension and modification of authority to use funds for 
        reintegration activities in Afghanistan (sec. 1213)
    The committee recommends a provision that extends for 1 
year the authority in section 1216 of the Ike Skelton National 
Defense Authorization Act for Fiscal Year 2011 (Public Law 111-
383; 124 Stat. 4392), as amended, to use Department of Defense 
funds to support a program for the reintegration of former 
insurgent fighters into Afghan society. The provision would 
authorize the use of up to $35.0 million for these purposes.
One-year extension and modification of authority for program to develop 
        and carry out infrastructure projects in Afghanistan (sec. 
        1214)
    The committee recommends a provision that would extend for 
fiscal year 2013 the authority under section 1217 of the Ike 
Skelton National Defense Authorization Act for Fiscal Year 2011 
(Public Law 111-383) for the Afghanistan Infrastructure Program 
(AIP) to develop and carry out infrastructure programs in 
Afghanistan that support the counterinsurgency campaign. 
Funding for the AIP is provided through a fund in the U.S. 
Treasury known as the Afghanistan Infrastructure Fund. The 
provision would authorize the Secretary of Defense to use up to 
$350.0 million in fiscal year 2013 for these purposes. The 
provision would also restrict the availability of funds 
authorized during fiscal year 2013 for the AIP to no more than 
50 percent of the authorized amount until the Secretary of 
Defense submits to Congress a plan for the allocation and use 
of funds under the program, including information on how each 
project to be initiated under the program would be sustained 
following its completion.
    The committee notes that a significant portion of the funds 
available to the Afghanistan Infrastructure Fund in fiscal 
years 2011 and 2012 have supported efforts by the Department of 
Defense and the U.S. Agency for International Development 
(USAID) to rebuild and improve the delivery of electricity to 
Kandahar and southern Afghanistan. During fiscal year 2013, 
over $100.0 million of funds authorized for this program will 
support Kandahar electrification. The committee recognizes this 
effort as a priority for the program. At the same time, the 
committee continues to have concerns about the sustainability 
of large-scale infrastructure projects initiated by the 
Department of Defense under the AIP. The committee believes 
that as the security, political, and economic transition 
progresses in Afghanistan, responsibility within the U.S. 
Government (USG) for any large-scale infrastructure projects in 
Afghanistan should shift away from the Department of Defense to 
USG civilian agencies, particularly the Department of State and 
USAID.
Extension of Pakistan Counterinsurgency Fund (sec. 1215)
    The committee recommends a provision that would extend for 
fiscal year 2013 the authorities of section 1224 of the 
National Defense Authorization Act for Fiscal Year 2010 (Public 
Law 111-84; 123 Stat. 2521), as amended, regarding the use of 
the Pakistan Counterinsurgency Fund (PCF) for building the 
capabilities of the Pakistan security forces. The provision 
would also extend for 1 year the provisions of section 1220 of 
the National Defense Authorization Act for Fiscal Year 2012 
(Public Law 112-81; 125 Stat. 1633) that restrict the 
availability of PCF funding to no more than 40 percent of 
amounts appropriated or transferred to the PCF during fiscal 
year 2013 until the Secretary of Defense submits a report to 
Congress on a strategy and metrics for use of the PCF and for 
enhancing Pakistan's efforts to counter improvised explosive 
devices.
    The committee notes that this Act does not authorize any 
additional funds for the PCF during fiscal year 2013. 
Accordingly, any additional funds for the PCF during fiscal 
year 2013 would have to be transferred to the PCF from amounts 
appropriated to the Department of State's Pakistan 
Counterinsurgency Capabilities Fund (PCCF). The committee 
further notes that section 7046(c)(1) of the Department of 
State, Foreign Operations, and Related Programs Appropriations 
Act, 2012, contained in Division I of the Consolidated 
Appropriations Act, 2012 (Public Law 112-74) restricts the 
availability of funds under the PCCF until the Secretary of 
State makes certain certifications to Congress regarding 
Pakistan, including that Pakistan is: (i) cooperating with the 
United States in counterterrorism efforts against the Haqqani 
Network, the Quetta Shura Taliban, Lashkar e-Tayyiba, Jaish-e-
Mohammed, al Qaeda, and other domestic and foreign terrorist 
organizations, including taking steps to end support for such 
groups and prevent them from basing and operating in Pakistan 
and carrying out cross border attacks into neighboring 
countries; (ii) not supporting terrorist activities against 
United States or coalition forces in Afghanistan, and that 
Pakistan's military and intelligence agencies are not 
intervening extra-judicially into political and judicial 
processes in Pakistan; and (iii) dismantling improvised 
explosive device (IED) networks and interdicting precursor 
chemicals used in the manufacture of IEDs. The Secretary of 
State may waive the certification requirement if doing so is in 
U.S. national security interests. In the event that the 
provisions of section 7046(c)(1) of Public Law 112-74 are not 
extended for fiscal year 2013 with respect to the PCCF, the 
committee directs the Secretary of Defense, in consultation 
with the Secretary of State, to provide the certification 
required by section 7046(c)(1)(A) of Public Law 112-74 prior to 
using any PCF funds from amounts transferred to the PCF from 
the PCCF during fiscal year 2013. The Secretary of Defense may 
waive this requirement if the Secretary determines that doing 
so is in the national security interests of the United States.
Extension and modification of authority for reimbursement of certain 
        coalition nations for support provided to United States 
        military operations (sec. 1216)
    The committee recommends a provision that would extend for 
1 year the authority of section 1233 of the National Defense 
Authorization Act for Fiscal Year 2008 (Public Law 110-181; 122 
Stat. 393), as amended, for the use of Department of Defense 
(DOD) funds (``Coalition Support Funds'') to reimburse key 
nations for logistical and military support provided to or in 
connection with Operation Enduring Freedom (OEF), or to use 
such funds to assist key nations by providing specialized 
training, or loaning specialized equipment, in connection with 
OEF. The provision would limit the aggregate amount of 
Coalition Support Funds that could be provided during fiscal 
year 2013 to $1.75 billion, except that reimbursements made to 
Pakistan for support provided prior to May 1, 2011, using 
Coalition Support Funds authorized and appropriated during a 
fiscal year prior to fiscal year 2013, would not count against 
that limitation.
    The provision would also prohibit any reimbursements to 
Pakistan for claims of support provided during the period when 
the ground lines of supply through Pakistan to Afghanistan were 
closed to the transshipment of equipment and supplies needed to 
support U.S. military operations in Afghanistan.
    The provision would also require the Secretary of Defense, 
prior to providing any reimbursement to Pakistan using 
Coalition Support Funds during fiscal year 2013, to certify to 
the congressional defense committees that: Pakistan has opened 
and is maintaining security along the ground lines of supply 
through Pakistan to Afghanistan; Pakistan is not supporting or 
providing safe haven to militant extremist groups, including 
the Haqqani Network and the Afghan Taliban Quetta Shura, that 
are located in Pakistan and that conduct cross-border attacks 
against U.S., coalition, and Afghan forces; Pakistan is 
committed to a strategy to counter improvised explosive devices 
(IED), including through the regulation of explosive materials 
used in IEDs; and that Pakistan is demonstrably cooperating 
with U.S. counterterrorism efforts, including by not detaining, 
prosecuting, or imprisoning Pakistani citizens as a result of 
their cooperation with U.S. counterterrorism efforts. In this 
regard, the Committee is particularly concerned and outraged by 
the case of Dr. Shakil Afridi, who was sentenced to 33 years in 
prison in connection with assistance he provided to U.S. 
efforts to locate Osama Bin Laden. The Secretary may waive this 
certification requirement if doing so would be in the national 
security interests of the United States.
Extension and modification of logistical support for coalition forces 
        supporting certain United States military operations (sec. 
        1217)
    The committee recommends a provision that would extend for 
fiscal year 2013 the authority provided in section 1234 of the 
National Defense Authorization Act for Fiscal Year 2008 (Public 
Law 111-181; 122 Stat. 394), as most recently amended by 
section 1211 of the National Defense Authorization Act for 
Fiscal Year 2012 (Public Law 112-81; 125 Stat. 1629), to 
provide logistical support to coalition forces. The provision 
would also amend that section to clarify that for fiscal year 
2013 logistical support is authorized for coalition forces 
supporting operations in Afghanistan only, and not Afghanistan 
and Iraq as in previous years.
Strategy for supporting the achievement of a secure presidential 
        election in Afghanistan in 2014 (sec. 1218)
    The committee recommends a provision that would require the 
Secretary of Defense, in consultation with the Secretary of 
State, to develop a strategy to support the Government of 
Afghanistan in its efforts to ensure the security of its 
presidential election in 2014. The strategy would include 
support to the Government of Afghanistan for: (1) training the 
Afghan security forces to provide security at polling stations 
and to protect election materials, election workers, and 
officials; (2) recruiting and training female Afghan security 
personnel to provide equitable access to polls for Afghan women 
and to secure polling stations and other election-related 
locations; and (3) securing the freedom of movement and 
communication for candidates before and during the election.
Independent assessment of the Afghan National Security Forces (sec. 
        1219)
    The committee recommends a provision that would require the 
Secretary of Defense to provide for the conduct of a detailed 
independent assessment of the strength, force structure, force 
posture, and capabilities required to enable the Afghan 
National Security Forces to provide security for their own 
country so as to prevent Afghanistan from ever again becoming a 
safe haven for terrorists that threaten Afghanistan, the 
region, and the world. As determined by the Secretary, the 
assessment would be conducted by either a federally-funded 
research and development center or an independent, non-
governmental institute with expertise in national security and 
military affairs. The provision would require that the 
assessment be completed and reported to the Secretary and the 
congressional defense committees by no later than 1 year after 
the date of enactment of this Act.
Report on Afghanistan Peace and Reintegration Program (sec. 1220)
    The committee recommends a provision that would require the 
Secretary of Defense to submit to the congressional defense 
committees and the Committee on Foreign Relations of the Senate 
and the Committee on Foreign Affairs of the House of 
Representatives a report on the Afghanistan Peace and 
Reconciliation Program (APRP). The report would be required 
within 120 days of the date of enactment of this Act.
    The committee notes that Department of Defense funds are 
authorized to be available during fiscal year 2013 to support 
the activities of the APRP to reintegrate former insurgents 
into Afghan society. The APRP has had notable success in 
formally reintegrating around 4,000 fighters who are willing to 
lay down their weapons and support the Afghan constitution. The 
APRP plays an important role in our political strategy in 
Afghanistan and the committee believes that a close assessment 
of the effectiveness of the APRP's activities in achieving the 
program's goals and objectives would help improve that 
strategy.

                          Subtitle C--Reports

Review and reports on Department of Defense efforts to build the 
        capacity of and partner with foreign security forces (sec. 
        1231)
    The committee recommends a provision that would require the 
Defense Policy Board to conduct a review, within 180 days of 
enactment of this Act, of Department of Defense (DOD) efforts 
to build the capacity of, or partner with, foreign security 
forces in support of national defense and security strategies. 
The Secretary of Defense would be required to report to the 
congressional defense committees on the results of the review.
    The provision would also require the Secretary of Defense, 
in coordination with the Chairman of the Joint Chiefs of Staff, 
to submit to the congressional defense committees, not later 
than 120 days after the completion of the Defense Policy Board 
review, a report setting forth strategic guidance for DOD 
efforts to build the capacity of, and partner with, foreign 
military forces in support of national defense and security 
strategies.
    The committee notes that the DOD 2010 Quadrennial Defense 
Review identified building partner capacity and partnership as 
one of the Department's core missions. Over the last several 
years, DOD authorities and programs involved in building 
partner capacity and partnership have multiplied significantly. 
These include, but are not limited to: the ``Section 1206'' 
global train and equip program; the Afghanistan Security Forces 
Fund; the Pakistan Counterinsurgency Fund; targeted authorities 
for building capacity in Yemen and East Africa; the Global 
Security Contingency Fund; the State Partnership Program; the 
Warsaw Initiative Fund; the Ministry of Defense Advisors 
program; and the DOD counternarcotics authorities. However, the 
Department has yet to clearly define the strategic ends toward 
which its efforts to build partner capacity and partner with 
foreign forces are directed, and how to prioritize among these 
efforts. The committee believes it is critical, particularly in 
a resource-constrained environment, that DOD provide clear 
guidance on the objectives and priorities of these efforts to 
ensure that these activities directly advance U.S. national 
defense and security interests and can be assessed for their 
effectiveness in achieving U.S. strategic goals.
Additional elements in annual report on military and security 
        developments involving the People's Republic of China (sec. 
        1232)
    The committee recommends a provision that would amend 
section 1202 of the National Defense Authorization Act for 
Fiscal Year 2000 (Public Law 106-65), as amended, by requiring 
the Secretary of Defense to include in the Annual Report on 
Military and Security Developments Involving the People's 
Republic of China, certain additional information relating to 
cyberwarfare, space and nuclear activities, maritime 
activities, and China's foreign military transactions and 
military-to-military relationships. Although some of this 
information has been included in past iterations of the annual 
report, the provision would codify the requirement and provide 
more specificity regarding the details which the committee 
would like to have included in future reports.

                       Subtitle D--Other Matters

Improved administration of the American, British, Canadian, and 
        Australian Armies' Program (sec. 1241)
    The committee recommends a provision that would authorize 
the Secretary of Defense, with the concurrence of the Secretary 
of State, to enter into agreements relating to U.S. 
participation in the land-force program known as the American, 
British, Canadian, and Australian (ABCA) Armies' Program. The 
ABCA Armies' Program is a multilateral organization for the 
purposes of promoting interoperability among the armies and 
Marine Corps of the participating countries. In addition to the 
United States, the countries participating in the program are 
Australia, Canada, New Zealand, and the United Kingdom. The 
provision would permit the negotiation of agreements to allow 
for the equitable sharing of costs associated with the ABCA 
Armies' Program, including administrative costs and the cost of 
any monetary claims resulting from participation in the 
program. The provision would allow the Department of Defense 
(DOD) to accept contributions to cover these costs from the 
participating nations and deposit those amounts into DOD 
accounts. The authority provided under this section would 
sunset at the end of 5 years.
United States participation in Headquarters Eurocorps (sec. 1242)
    The committee recommends a provision that would grant the 
Secretary of Defense, with the concurrence of the Secretary of 
State, the authority to allow members of the armed forces to 
participate as members of the staff of Headquarters Eurocorps, 
one of seven ``Rapid Deployable Corps'' associated with the 
North Atlantic Treaty Organization (NATO). Participation on 
this staff by U.S. Armed Forces members would only be 
authorized to support the NATO activities of that corps. The 
provision would limit United States participation on the staff 
of Headquarters Eurocorps to two service members until the 
Secretary of Defense submits a report to the Committees on 
Armed Services of the Senate and the House of Representatives 
on the plans, benefits, and costs of such participation.
    The committee understands that the Department of Defense is 
seeking to negotiate the arrangements for the United States to 
join Headquarters Eurocorps as a NATO associated nation. United 
States European Command (EUCOM) has indicated that 
participation in Headquarters Eurocorps would be part of its 
overall plans for participation in the NATO force structure, 
which also includes U.S participation in the other NATO Rapid 
Deployable Corps. While generally supportive of U.S. 
participation within the NATO force and command structures, the 
committee believes it requires more information on the costs 
and benefits of U.S. participation in the Headquarters 
Eurocorps before the Department assigns a number of personnel 
greater than the two members of the armed forces specified 
under this provision to participate in the Headquarters 
Eurocorps.
Department of Defense participation in European program on multilateral 
        exchange of air transportation and air refueling services (sec. 
        1243)
    The committee recommends a provision that would authorize 
the Secretary of Defense, with the concurrence of the Secretary 
of State, to enter into multilateral written agreements to 
provide for U.S. participation in the Air Transport, Air-to-Air 
Refueling and other Exchanges of Services (``ATARES'') program 
of the Movement Coordination Centre Europe. The ATARES program 
provides a multilateral framework among certain European 
countries for the multilateral exchange of air transportation 
and air refueling services. The program would allow for the 
exchange or transfer of these services on a reimbursable basis 
or by replacement in kind. The provision would limit the 
balance of executed flight hours, whether as credits or debits, 
that the United States can accumulate under the ATARES program 
to no more than 500 hours, of which the balance of executed 
flight hours for air refueling may not exceed 200 hours. The 
provision would also require the Comptroller General to submit 
to the congressional defense committees within 1 year a report 
assessing the ATARES program.
    The committee recognizes the value of multilateral 
cooperation in military transportation services and believes 
the ATARES program may offer opportunities for efficiencies and 
increased availability of additional transportation capacity to 
meet U.S. requirements. The committee would authorize U.S. 
participation in the ATARES program as a 5-year pilot program 
and intends to monitor closely the implementation of the 
program, including through the annual reports required under 
this provision.
Authority to establish program to provide assistance to foreign 
        civilians for harm incident to combat operations of the armed 
        forces in foreign countries (sec. 1244)
    The committee recommends a provision that would authorize 
the Secretary of Defense to establish a program, under such 
regulations as the Secretary may prescribe, to enable military 
commanders at their discretion to provide assistance to foreign 
civilians who are harmed incident to U.S. combat operations 
overseas.
    The committee notes that in armed conflicts in Iraq, 
Afghanistan, and elsewhere, the Department of Defense has drawn 
on a number of authorities, including authority to make solatia 
payments and condolence payments under the Commanders' 
Emergency Response Program, to provide assistance to civilians 
who have suffered damage, injury or death incident to U.S. 
combat operations, including for purposes of winning the hearts 
and minds of the local population, promoting stability, and 
enhancing the safety of U.S. personnel. Establishment of a 
program under this section, in coordination with programs 
administered by the U.S. Agency for International Development 
and Department of State, could help to promote friendly 
relations with civilian populations in combat zones and as a 
result contribute to the successful completion of the U.S. 
military mission in a future conflict.
Limitation on availability of funds for certain capital projects in 
        connection with overseas contingency operations (sec. 1245)
    The committee recommends a provision that would require 
that Department of Defense funds may not be obligated for 
certain large capital projects overseas for an overseas 
contingency operation until the Secretary of Defense carries 
out a detailed assessment of the sustainability and necessity 
of the project. Capital projects covered by this section would 
be: (1) any project for building the capability of indigenous 
security forces with an estimated value over $10.0 million; or 
any other project for the direct benefit of the host country 
with an estimated value over $2.0 million. The provision would 
also require quarterly reports to Congress on each assessment 
conducted under this section. The Secretary of Defense may 
waive the limitation of this section to initiate a project if 
doing so would be in the U.S. national security interests, but 
the assessment required under this section would have to be 
completed and reported to Congress not later than 180 days 
after issuance of the waiver.

                       Items of Special Interest

Insider threat
    Since 2007, a number of U.S., international coalition, and 
Afghan personnel have been killed or wounded in attacks by 
Afghan National Security Forces (ANSF) personnel or ANSF 
impersonators. Although such attacks are not indicative of the 
quality and dedication of the overwhelming majority of ANSF 
personnel who serve alongside coalition forces with honor and 
distinction, they raise concerns about the sufficiency of the 
procedures used to screen, vet, and monitor ANSF personnel, as 
well as whether there is a need for additional training of 
coalition service members on how to identify insider threats 
and on appropriate operational procedures while working with 
ANSF units.
    The committee supports ongoing efforts to reduce the risk 
of insider threat-related attacks on coalition and Afghan 
forces, including the use of preadmission screening procedures 
for ANSF candidates and plans to increase the number of 
counter-intelligence personnel within the ANSF. However, recent 
Government Accountability Office (GAO) reports indicate that 
there remain opportunities to eliminate gaps in the screening, 
vetting, and monitoring processes. Improvements, such as 
sharing data collected by coalition and ANSF forces, expanding 
counterintelligence capabilities, and improving the process by 
which elders recommend ANSF candidates will require cooperation 
from the Government of Afghanistan.
    As such, the committee directs the Department to submit a 
report, with a classified annex if necessary, not later than 
180 days after enactment of this Act, that assesses and 
categorizes the nature of insider attacks, and describes all 
measures taken to protect military and civilian personnel from 
future insider attacks. The report should include a description 
of specific programs included in pre-deployment training for 
civilian and military personnel of all ranks on identifying and 
reducing insider threats, actions taken by the Government of 
Afghanistan to prevent such attacks, and the status of 
negotiations with the Government of Afghanistan to address the 
issues raised by GAO.
North Atlantic Treaty Organization capabilities and burden-sharing
    The committee recognizes the North Atlantic Treaty 
Organization's (NATO) renewed focus on burden-sharing, 
interoperability, and the ``Smart Defense'' initiative. The 
committee welcomes these efforts and supports the ongoing work 
by NATO allies to pool and share resources to get more out of 
members' national defense budgets and notes that this approach 
could be enhanced by replicating successful NATO programs such 
as the Baltic Air Policing initiative and the Strategic Airlift 
Capability program. The committee also notes that the defense 
spending burden within the NATO alliance has fallen 
predominantly on the United States. According to NATO 
statistics, only 3 of 28 member countries met the requirement 
of spending 2 percent of their gross domestic product on 
defense in 2011. In addition, the U.S. share of total defense 
spending by NATO members increased from 57 percent to 69 
percent between 2001 and 2011. The committee recognizes that 
Europe is dealing with significant budget issues, but urges 
NATO members to work to ensure that national defense spending 
levels are sufficient and defense spending decisions are 
coordinated to the extent possible so as to address the 
Alliance's shared security requirements.
Review of United States-Egypt military-to-military relations
    The committee notes the importance of maintaining and 
strengthening the close partnership between the United States 
Armed Forces and the Egyptian Armed Forces. This long-standing 
relationship has helped to advance U.S. national security 
interests, such as counterterrorism and intelligence 
cooperation in the Middle East, the safeguarding of the Camp 
David Accords, the movement of U.S. forces in the region and 
through the Suez Canal, and support for internal stability 
during and after the departure of former President Hosni 
Mubarak. To enhance this military-to-military relationship, the 
U.S. Congress has authorized and appropriated approximately 
$1.3 billion in security assistance to the Egyptian military 
annually for more than 3 decades.
    The Egyptian revolution of 2011 has begun a transition to a 
democratically-elected, civilian government, which is expected 
to culminate with the transfer of executive authority from the 
Supreme Council of the Armed Forces to new civilian leaders in 
the coming months. Egypt will continue to experience political 
changes in the coming years, including in civil-military 
relations. Egypt's security will also be impacted by new and 
evolving developments stemming from growing instability in the 
Sinai region, domestic and foreign terrorist groups, unsecured 
border crossings, and the reform of security forces to ensure 
domestic law and order.
    The committee notes that the U.S.-Egypt military-to-
military relationship must account for the new challenges 
facing Egypt's newly-elected civilian government. Furthermore, 
the committee believes it is important for the United States to 
engage with the new Egyptian president and parliament as they 
review the military cooperation and security assistance 
relationship with the United States, including how to define 
their current national security priorities, what kinds of U.S. 
security assistance they wish to request, and what balance they 
desire between military and non-military assistance.
    In light of Egypt's political and security challenges, the 
committee believes the Secretary of Defense and Secretary of 
State should consult with Egypt's civilian and military leaders 
as part of a review of U.S. military-to-military engagement 
with Egypt. The goal of this review should be: (1) to ensure 
that U.S. military assistance, engagement, and arms sales are 
integrated into a strategy that responds to Egypt's current 
security challenges; (2) to assist the Egyptian government and 
military in aligning their acquisition of defense capabilities 
with their strategic requirements and security challenges; and 
(3) to reinforce the democratic principle of civilian control 
of the military in Egypt. The committee directs the Secretary 
of Defense to report periodically to the Committees on Armed 
Services of the Senate and the House of Representatives, as 
well as the Committee on Foreign Affairs of the House of 
Representatives, and the Committee on Foreign Relations of the 
Senate on the findings of this review.
Special operations security force assistance activities
    The committee notes that the defense strategic guidance 
titled ``Sustaining U.S. Global Leadership: Priorities for 21st 
Century Defense'' states ``Whenever possible, we will develop 
innovative, low-cost, and small footprint approaches to achieve 
our security objectives, relying on exercises, rotational 
presence, and advisory capabilities.'' The committee believes 
that U.S. Special Operations Forces, because of their combat 
experience, ability to operate independently, and unique 
cultural and language expertise, are well suited to implement 
this mandate.
    The committee is aware of concerns from the Commander of 
U.S. Special Operations Command and the commanders of the 
theater special operations commands that the bureaucratic 
processes associated with the Department of Defense's (DOD) 
security force assistance authorities may, in some cases, 
hamper the efforts of special operations forces to remain 
engaged persistently with partner nation security forces. The 
committee recognizes that such persistent engagement is 
important to building the capacity of and establishing an 
enduring relationship with special operations and other 
security forces in priority countries.
    The committee notes that Congress has made efforts in 
recent years to provide more flexible and responsive 
authorities to conduct security force assistance activities. 
The committee encourages DOD to make more effective use of 
existing authorities, including the Global Security Contingency 
Fund, ``section 1206'' global train and equip authority, and 
DOD counternarcotics authorities, to better support the 
security force assistance activities of special operations 
forces under the command of the theater special operations 
commands.
    Furthermore, the committee notes that section 1203 of the 
National Defense Authorization Act for Fiscal Year 2012 (Public 
Law 112-81) required the Secretary of Defense to provide a 
report due no later than 90 days after the enactment of that 
Act outlining the authorities that may be necessary for U.S. 
Special Operations Forces to adequately conduct 
counterterrorism, unconventional warfare, and irregular warfare 
in the future. That report has not been delivered to the 
committee. Additionally, elsewhere in this Act and accompanying 
report, the committee requires a report by the Comptroller 
General of the United States on the roles of general purpose 
and special operations forces in conducting security force 
assistance and a review by the Defense Policy Board on DOD 
efforts to build partnership capacity and partnership 
initiatives. The committee looks forward to the results of 
these reviews to guide future legislative or policy initiatives 
with respect to security force assistance activities.
                TITLE XIII--COOPERATIVE THREAT REDUCTION

Specification of Cooperative Threat Reduction programs and funds (sec. 
        1301)
    The committee recommends a provision that would define the 
Cooperative Threat Reduction (CTR) programs, define the funds 
as authorized to be appropriated in section 301 of this bill, 
and authorize CTR funds to be available for obligation for 3 
fiscal years.
Funding allocations (sec. 1302)
    The committee recommends a provision that would authorize 
$519.2 million, the amount of the budget request, for the 
Cooperative Threat Reduction (CTR) program. This provision 
would also authorize specific amounts for each CTR program 
element, require notification to Congress 30 days before the 
Secretary of Defense obligates and expends fiscal year 2013 
funds for a purpose other than a purpose listed in the 
provision, and require notification to Congress 15 days before 
the Secretary of Defense obligates and expends fiscal year 2013 
funds in excess of the specific amount authorized for each CTR 
program element.

                        Item of Special Interest

Metrics for Cooperative Threat Reduction
    Section 1308 of Floyd D. Spence National Defense 
Authorization Act for Fiscal Year 2001 (Public Law 106-398) 
requires the Cooperative Threat Reduction (CTR) Program to 
submit an annual report to Congress outlining a 5 year plan for 
the program. Section 1304(c)(3) of the National Defense 
Authorization Act of 2010 (Public Law 111-84) required the 
National Academies of Science to submit a report reviewing the 
metrics of the CTR Program. The report, ``Improving Metrics for 
the Department of Defense Cooperative Threat Reduction 
Program'', issued January 25, 2012, made a number of 
recommendations. The principal recommendation is that ``the DOD 
should include a concise statement of its objectives and how 
the program is intended to reduce threat or risk.'' The 
committee understands in response to the National Academies 
Report that the Department will brief Congress the summer of 
2012 on revised metrics that are ``program-specific and linked 
directly to overall CTR Program goals and objectives''.
    The committee directs the Department of Defense to include 
in its annual CTR report to Congress, a concise section on the 
revised program metrics the Department has developed and an 
easy to understand chart showing their progress in achieving 
the metrics. The committee also directs the Department to 
include in the annual CTR program report what will happen to a 
particular program once the metrics are achieved considering 
the following three options: (1) will the Department continue 
to sustain the program and if so what is the estimated cost 
over 5 years, (2) will the Department move the program in 
sustainment phase to the host government or another U.S. 
Government Agency, or (3) close out the program with no 
additional funding. The goal is to give clear resolution of the 
program once the metrics are achieved.
                    TITLE XIV--OTHER AUTHORIZATIONS

                     Subtitle A--Military Programs

Working Capital Funds (sec. 1401)
    The committee recommends a provision that would authorize 
appropriations for the Defense Working Capital Funds at the 
levels identified in section 4501 of division D of this Act.
National Defense Sealift Fund (sec. 1402)
    The committee recommends a provision that would authorize 
appropriations for the National Defense Sealift Fund at the 
levels identified in section 4501 of division D of this Act.
Defense Health Program (sec. 1403)
    The committee recommends a provision that would authorize 
appropriations for the Defense Health Program at the levels 
identified in section 4501 of division D of this Act.
Chemical agents and munitions destruction, defense (sec. 1404)
    The committee recommends a provision that would authorize 
appropriations for chemical agents and munitions destruction, 
defense, at the levels identified in section 4501 of division D 
of this Act.
Drug interdiction and counter-drug activities, defense-wide (sec. 1405)
    The committee recommends a provision that would authorize 
appropriations for drug interdiction and counterdrug 
activities, defense-wide, at the levels identified in section 
4501 of division D of this Act.
Defense Inspector General (sec. 1406)
    The committee recommends a provision that would authorize 
appropriations for the Office of the Inspector General of the 
Department of Defense at the levels identified in section 4501 
of division D of this Act.

                 Subtitle B--National Defense Stockpile

Release of materials needed for national defense purposes from the 
        Strategic and Critical Materials Stockpile (sec. 1411)
    The committee recommends a provision, as requested by the 
Department of Defense, which would authorize the President to 
delegate release authority of the National Defense Stockpile to 
the Undersecretary of Defense for Acquisition, Technology, and 
Logistics.

             Subtitle C--Chemical Demilitarization Matters

Supplemental chemical agent and munitions destruction technologies at 
        Pueblo Chemical Depot, Colorado, and Blue Grass Army Depot, 
        Kentucky (sec. 1421)
    The committee recommends a provision that would authorize 
the Secretary of Defense to consider using technologies to 
supplement the neutralization destruction of the stockpile of 
lethal chemical agents and munitions at Pueblo Chemical Depot, 
Colorado, and Blue Grass Army Depot, Kentucky. The provision 
would authorize the Secretary to consider explosive destruction 
technologies and any technologies developed for treatment and 
disposal of agent or energetic hydrolysates, if problems with 
the current on-site treatment of hydrolysates are encountered. 
The provision would also repeal an older provision of law that 
restricted the consideration of supplemental technologies at 
Pueblo Chemical Depot.
    Both the Pueblo and Blue Grass depots contain a limited 
number of chemical munitions that will be problematic and 
unsafe for the selected neutralization technology at each 
plant, including leaking munitions, reject munitions, and 
explosive components. By augmenting the neutralization 
technology at each plant with explosive destruction 
technologies, the Assembled Chemical Weapons Alternatives 
(ACWA) program would be able to destroy these problematic 
munitions safely and in a manner that could also save time and 
money.
    The committee notes that the ACWA program is currently 
constructing the Pueblo and Blue Grass chemical agent 
destruction plants, the last two facilities of the U.S. 
chemical weapons destruction program. The United States is 
obligated under the Chemical Weapons Convention to destroy its 
entire stockpile of chemical weapons by the extended treaty 
deadline of April 29, 2012. However, technical, cost and 
schedule issues have prevented the Pueblo and Blue Grass 
facilities from being built and operational in time to meet the 
treaty deadline. The committee notes that the United States has 
completed the destruction of some 90 percent of its stockpile 
of chemical weapons prior to the treaty deadline, and is 
proceeding with the ACWA sites as rapidly as is consistent with 
the requirements of law, including requirements to protect 
public health and safety.
    The committee observes that the ACWA program experienced a 
Nunn-McCurdy cost breach in 2011, and the Department of Defense 
has recently issued a new cost and schedule estimate for the 
program. If the two facilities are able to use explosive 
destruction technologies, it would avoid the significant risks 
that would arise from processing unsafe munitions through each 
plant, and help reduce the overall cost and schedule for 
completing destruction of their chemical munitions.
    In order to use such technologies, the ACWA program would 
first have to complete an Environmental Assessment for each 
site, including public review and comment, subject to the 
requirements of the National Environmental Policy Act (Public 
Law 91-190). The committee understands that the ACWA program is 
undertaking such an assessment for Pueblo, and plans to do the 
same at Blue Grass in the future. The committee also 
understands that the ACWA program has engaged the Citizens' 
Advisory Commissions at Pueblo and Blue Grass to inform them 
and obtain their input on issues related to explosive 
destruction technologies, and other technologies developed for 
treatment and disposal of hydrolysates, if problems with 
current on-site treatment of hydrolysates are encountered. The 
committee directs the Department to ensure that the Citizens' 
Advisory Commissions are kept fully informed and engaged on 
these issues as they move forward, and expects the Department 
to continue keeping Congress properly informed. The committee 
also urges the Department to seek opportunities to complete the 
destruction of all chemical agents and munitions at Pueblo and 
Blue Grass as close to the Chemical Weapons Convention deadline 
as possible, and as close to the additional December 31, 2017, 
deadline established by Congress, consistent with the 
requirements of law governing the chemical weapons destruction 
program.

                       Subtitle D--Other Matters

Authorization of appropriations for Armed Forces Retirement Home (sec. 
        1431)
    The committee recommends a provision that would authorize 
$67.6 million to be appropriated for fiscal year 2013 from the 
Armed Forces Retirement Home Trust Fund for the operation of 
the Armed Forces Retirement Home.
Additional Weapons of Mass Destruction Civil Support Teams (sec. 1432)
    The committee recommends a provision that would authorize, 
retroactively, the Secretary of Defense to have established two 
additional Weapons of Mass Destruction Civil Support Teams 
(WMD-CST) beyond the 55 previously authorized in law, and would 
prohibit the establishment of additional WMD-CSTs unless the 
Secretary of Defense requests the authority to establish such 
teams and their establishment is specifically authorized by 
law. The provision would also require the Secretary to submit a 
report on WMD-CSTs.
    The committee notes that section 1403 of the Bob Stump 
National Defense Authorization Act for Fiscal Year 2003 (Public 
Law 107-314), authorized a total of 55 WMD-CSTs, with a 
requirement for at least 1 team in each State and territory. 
The Department of Defense established the 55 WMD-CSTs and 
certified each one, as required in section 12310(c)(5) of title 
10, United States Code.
    Section 1082 of the National Defense Authorization Act for 
Fiscal Year 2008 (Public Law 110-181) required the Secretary of 
Defense to establish an advisory panel to carry out an 
assessment of the capabilities of the Department of Defense to 
provide support to civil authorities in the event of a 
chemical, biological, radiological, nuclear, or high-yield 
explosive event.
    Section 1034 of the National Defense Authorization Act for 
Fiscal Year 2010 (Public Law 111-84) required the advisory 
panel to assess and make recommendations on whether there 
should be any additional WMD-CSTs beyond the 55 already 
authorized and, if so, how many more and where they should be 
located.
    Prior to the September 15, 2010, report of the advisory 
panel, ``Report of the Advisory Panel on Department of Defense 
Capabilities for Support of Civil Authorities After Certain 
Incidents,'' the Department of Defense, using funds 
appropriated by Congress, established 2 additional WMD-CSTs 
beyond the 55 authorized, 1 in New York and 1 in Florida. In 
its report, the advisory panel concluded that the number of 
WMD-CSTs, including the 55 certified Civil Support Teams (CST) 
and the 2 new (as yet uncertified) CSTs in New York and 
Florida, was adequate, and recommended that the Secretary 
``neither authorize more Civil Support Teams nor change their 
locations at this time.''
    The Department of Defense certified the new CST in New York 
on November 29, 2010, and certified the new CST in Florida on 
November 4, 2011.
    The committee is disappointed that the Department 
established 2 additional CSTs that had not been authorized, 
but--given the advisory panel's conclusion that the 57 CSTs are 
the adequate number and in the correct locations, and that the 
2 new CSTs have been certified--the committee believes their 
authorization is warranted. However, in order to prevent the 
creation of future unauthorized CSTs, the committee has 
included the prohibition on establishing additional CSTs, 
beyond the 57 that would be authorized in the provision, unless 
they are specifically authorized in law.

                              Budget Items

Defense Health Program funding
    The amount authorized to be appropriated for the Defense 
Health Program includes the following change from the budget 
request. This addition would replace savings assumed by the 
Department of Defense (DOD) for proposed establishment of 
enrollment fees and increases to certain other TRICARE fees, 
which the committee did not adopt.

                    [Changes in millions of dollars]

Restore DOD assumed savings for TRICARE 
    proposals..................................................... 452.0
    Total..........................................................
      ............................................................ 452.0

Demand Reduction Program--expanded drug testing

    The budget request included $889.5 million for the 
Department of Defense's (DOD) Drug Interdiction and Counter-
drug Activities, Defense-wide, and $109.8 million for the DOD's 
Drug Demand Reduction Program. The committee recommends a 
decrease of $25.9 million in Drug Interdiction and Counter-drug 
Activities, Defense-wide, and increase of $25.9 million in Drug 
Demand Reduction Program.
    The committee supports the ongoing efforts of the Under 
Secretary of Defense for Personnel and Readiness to expand the 
existing Drug Demand Reduction Program testing program to 
include prescription and synthetic drugs. Further, the 
committee directs the Secretary of Defense to program funding 
for these activities in future years.

Department of Defense Inspector General growth plan

    The budget request for the Department of Defense Office of 
the Inspector General (DODIG), included $273.8 million in 
Operation and Maintenance (O&M)--$73.1 million less than the 
fiscal year 2012 appropriated level and $76.5 million less than 
the amount required to carry out the DODIG's growth plan for 
fiscal year 2013. The committee recommends an increase of $59.1 
million in O&M for the DODIG.
    The committee recognizes that all elements of the 
Department of Defense (DOD) have been required to reduce 
staffing and expenditures and that a growth plan established in 
2008 requires reconsideration in light of new budgetary 
realities. The committee further recognizes that last year's 
appropriated funding included $14.0 million for expenses 
related to base realignment and closing (BRAC) that will not be 
needed this year.
    However, the independent audit and investigative functions 
of the DODIG play a critical role in identifying waste, fraud, 
and abuse in DOD programs and operations. In fiscal year 2011, 
DODIG audits and investigations resulted in $2.6 billion of 
savings, an average $8.79 saved for every dollar appropriated 
and $1.6 million saved per DODIG employee.
    The increase recommended by the committee would not fully 
fund the DODIG growth plan, but would restore DODIG funding to 
the fiscal year 2012 appropriated level, minus the $14.0 
million for BRAC funding that is no longer needed. The 
committee directs that the added funding be used by the DODIG 
to conduct oversight related to military operations in 
Afghanistan, review contract management and acquisitions, and 
support audits to identify potential waste, fraud, and abuse. 
The committee directs the DODIG to reevaluate the 2008 growth 
plan and establish future staffing objectives on the basis of 
audit and investigation need and current budgetary realities.
  TITLE XV--AUTHORIZATION OF APPROPRIATIONS FOR OVERSEAS CONTINGENCY 
                               OPERATIONS

              Subtitle A--Authorization of Appropriations

Purpose (sec. 1501)
    The committee recommends a provision that would establish 
this title and make authorization of appropriations available 
upon enactment of this Act for the Department of Defense, in 
additional to amounts otherwise authorized in this Act, to 
provide for additional costs due to overseas contingency 
operations.
Procurement (sec. 1502)
    The committee recommends a provision that would authorize 
additional appropriations for procurement at the levels 
identified in section 4102 of division D of this Act.

Research, development, test, and evaluation (sec. 1503)

    The committee recommends a provision that would authorize 
additional appropriations for research, development, test, and 
evaluation at the levels identified in section 4202 of division 
D of this Act.

Operation and maintenance (sec. 1504)

    The committee recommends a provision that would authorize 
additional appropriations for operation and maintenance at the 
levels identified in section 4302 of division D of this Act.

Military personnel (sec. 1505)

    The committee recommends a provision that would authorize 
additional appropriations for military personnel at the levels 
identified in section 4402 of division D of this Act.

Working capital funds (sec. 1506)

    The committee recommends a provision that would authorize 
additional appropriations for Defense Working Capital Funds at 
the levels identified in section 4502 of division D of this 
Act.

Defense Health Program (sec. 1507)

    The committee recommends a provision that would authorize 
additional appropriations for the Defense Health Program at the 
levels identified in section 4502 of division D of this Act.

Drug Interdiction and Counter-Drug Activities, Defense-wide (sec. 1508)

    The committee recommends a provision that would authorize 
additional appropriations for Drug Interdiction and Counter-
Drug Activities, Defense-wide, at the level identified in 
section 4502 of division D of this Act.

Defense Inspector General (sec. 1509)

    The committee recommends a provision that would authorize 
additional appropriations for the Office of the Inspector 
General at the levels identified in section 4502 of division D 
of this Act.

                     Subtitle B--Financial Matters


Treatment as additional authorizations (sec. 1521)

    The committee recommends a provision that would state that 
amounts authorized to be appropriated by this title are in 
addition to amounts otherwise authorized to be appropriated by 
this Act.

Special transfer authority (sec. 1522)

    The committee recommends a provision that would authorize 
the transfer of up to an additional $4.0 billion of war-related 
funding authorizations in this title among the accounts in this 
title.

               Subtitle C--Limitations and Other Matters


Afghanistan Security Forces Fund (sec. 1531)

    The committee recommends a provision that would require 
that funds made available to the Department of Defense for the 
Afghanistan Security Forces Fund (ASFF) for fiscal year 2013 
remain subject to certain conditions specified in section 1513 
of the National Defense Authorization Act for Fiscal Year 2008 
(Public law 110-181; 122 Stat. 428), as amended by section 
1531(b) of the Ike Skelton National Defense Authorization Act 
for Fiscal Year 2011 (Public Law 111-383; 124 Stat. 4424).
    The provision would also explicitly authorize the use of 
ASFF funds during fiscal year 2013 to increase the capacity of 
the Afghanistan Ministry of Interior to recruit, vet, train, 
and manage the Afghan Public Protection Force (APPF), the guard 
force established to take over the provision of certain 
security services from private security contractors. The 
committee is concerned by reports that the APPF lacks adequate 
capacity in both quantity and quality, and encourages the 
Department of Defense to take appropriate steps to help build 
the capacity of the APPF during this transition period. The 
committee also encourages the Department to continue to monitor 
and periodically assess the development of the APPF to help 
ensure that this force has the capacity to provide, and is 
providing, security to the U.S. military and civilian 
installations, convoys, and personnel that are under its 
protection.
    Additionally, the provision would require the Secretary of 
Defense to submit to the congressional defense committees a 
plan for continuing to use the ASFF to build and sustain the 
Afghanistan National Security Forces (ANSF) through September 
30, 2017. The committee believes the ASFF has proven effective 
for purposes of building the capacity of the ANSF and 
encourages the continued use of the fund to support the ANSF 
during and after the transition to an Afghan security lead in 
2014.

Joint Improvised Explosive Device Defeat Fund (sec. 1532)

    The committee recommends a provision that would extend, for 
1 fiscal year, the authority for the Secretary of Defense to 
use funds to investigate, develop, and provide equipment, 
supplies, services, personnel, and funds to assist efforts to 
defeat improvised explosive devices. The provision would also 
permit the Secretary to transfer funds from the Joint 
Improvised Explosive Device Defeat Fund to certain other 
accounts of the Department of Defense. Further, the provision 
would permit the Secretary to expend not more than $15.0 
million to provide training, equipment, services, and supplies 
to counter the flow of improvised explosive device precursor 
chemicals from Pakistan into locations in Afghanistan.

Plan for transition in funding of United States Special Operations 
        Command from supplemental funding for overseas contingency 
        operations to recurring funding under the future-years defense 
        program (sec. 1533)

    The committee notes that approximately one-quarter of the 
fiscal year 2013 budget request for U.S. Special Operations 
Command (USSOCOM) is Overseas Contingency Operations (OCO) 
funding. During testimony before the Committee on March 6, 
2012, the Commander of USSOCOM predicted ``Even with the 
conclusion of operations in Afghanistan, historical deployment 
data reveals a constant demand for a ``steady state'' deployed 
force of nearly 12,000 special operations forces (SOF) to 
support the Geographic Combatant Commanders' requirements.''
    In response to policy questions from the committee prior to 
his confirmation, the Commander of USSOCOM noted ``the new 
USSOCOM Commander will be challenged to deliver the required 
[SOF] capabilities in a fiscally constrained environment 
knowing the budget without OCO transition does not fully 
resource the Command.'' Furthermore, the Commander of USSOCOM 
indicated ``A decrease in the Command's budget level would 
severely impact my ability to meet the demand for SOF and 
significantly increase the risk to our Nation's security'' and 
``for some higher intensity SOF elements, the OCO percentage is 
greater than 75 percent. Without this transition, mission 
failure is a real possibility.''
    The committee is aware that the fiscal year 2013 budget 
request begins the initial migration of approximately $960.0 
million in USSOCOM funding from the OCO to the base budget to 
support enduring SOF requirements. However, the committee is 
concerned that the Department of Defense has not identified a 
plan to fully transition funding for enduring SOF requirements 
from the OCO to base budget in future years, potentially 
putting maintenance of SOF capabilities at risk. As such, the 
committee recommends a provision that would require the 
Secretary of Defense to provide the congressional defense 
committees, as part of the fiscal year 2014 budget request, 
with a plan to fully transition appropriate USSOCOM funding 
from the OCO to base budget over the future-years defense 
program to maintain critical and enduring SOF capabilities.

Extension of authority on Task Force for Business and Stability 
        Operations in Afghanistan (sec. 1534)

    The committee recommends a provision that would extend for 
fiscal year 2013 the authority under section 1535 of the Ike 
Skelton National Defense Authorization Act for Fiscal Year 2011 
(Public Law 111-383; 124 Stat. 4426), as amended, for the 
Department of Defense Task Force on Business and Stability 
Operations in Afghanistan. The provision would authorize the 
use of up to $93.0 million in Overseas Contingency Operations, 
Operation and Maintenance, for the Army, to support the Task 
Force's activities to support the counterinsurgency strategy 
through economic development and job creation.

Assessments of training activities and intelligence activities of the 
        Joint Improvised Explosive Device Defeat Organization (sec. 
        1535)

    The committee recommends a provision that would direct the 
Secretary of Defense to conduct assessments of the Joint 
Improvised Explosive Device Defeat Organization's (JIEDDO) 
training activities and intelligence activities.
    Six years after the Department of Defense (DOD) established 
JIEDDO as its coordinating agency to lead, advocate, and 
coordinate responses to the improvised explosive device (IED) 
threat across the Department, according to the Government 
Accountability Office, DOD continues to experience 
fragmentation, overlap, and duplication in its counter-IED 
efforts. Two areas where the committee is most concerned about 
these risks are in the JIEDDO intelligence analysis activities 
and its training activities. In the case of both of these 
activities, JIEDDO continues to conduct activities that are 
wholly duplicative of various elements of the military 
departments and the intelligence community. Before the 
committee recommends significant reductions in these 
activities, the committee hopes the Secretary of Defense--in 
consultation with the appropriate DOD elements--will identify 
areas of duplication and make an assessment of whether 
duplication of effort is necessary to ensure mission success.
    The committee hopes this internal assessment will result in 
JIEDDO divesting of its training activities no later than the 
end of fiscal year 2013. Further, the committee hopes JIEDDO 
will transfer the Counter-IED Operations Integration Center to 
the appropriate entities within the military departments, 
intelligence directorates, or to elements within the 
intelligence community no later than the end of fiscal year 
2013.

                              Budget Items


AH-64 Apache Block IIIB new build

    The budget request included $71.0 million in Aircraft 
Procurement, Army (APA) Overseas Contingency Operations (OCO), 
for AH-64 Apache Block IIIB new build aircraft as war 
replacements.
    The committee recommends a decrease of $71.0 million in APA 
OCO for AH-64 Apache Block IIIB aircraft. The committee 
continues to disagree, as noted in last year's Senate report 
accompanying S. 1253 (S. Rept. 112-26) the National Defense 
Authorization Act for Fiscal Year 2012, that procurement of 
this aircraft, while still in development and testing, is a 
legitimate war loss replacement.

Rapid equipping soldier support equipment

    The budget request included $98.2 million in Other 
Procurement, Army (OPA) Overseas Contingency Operations (OCO), 
for rapid equipping soldier support equipment (RESSE). The 
committee notes that significant balances of funds appropriated 
in prior years remain available for obligation in fiscal year 
2013. The committee recommends a decrease of $37.0 million in 
OPA OCO for RESSE.

Solar power units

    The budget request included $98.2 million in Other 
Procurement, Army (OPA), Overseas Contingency Operations (OCO), 
for rapid equipping soldier support equipment (RESSE). The 
committee notes that the Army's Rapid Equipping Force has 
initiated the procurement of solar power units that 
significantly increase the operational energy effectiveness and 
sustainability of remotely located units in Afghanistan. These 
solar power units will be deployed to support Village Stability 
Operations, and will substantially reduce the requirement for 
fuel delivery by ground convoy or by air. These units provide 
sustainable power for U.S. forces and the Afghan people. The 
committee recommends an increase of $30.0 million in OPA OCO 
for RESSE solar power units.

Afghanistan Infrastructure Fund

    The budget request included $62.5 billion for Operation and 
Maintenance (OM), Overseas Contingency Operations (OCO), of 
which $400.0 million was for the Afghanistan Infrastructure 
Fund (AIF) in fiscal year 2013 to support a program to develop 
and carry out large-scale infrastructure projects that support 
the counterinsurgency campaign in Afghanistan. The committee's 
concerns regarding the need to transition responsibility for 
large-scale infrastructure projects in Afghanistan from the 
U.S. Department of Defense to the U.S. Agency for International 
Development are discussed in the section of this report 
relating to title XII. The committee also continues to have 
concerns about the sustainability of large-scale infrastructure 
projects in Afghanistan as the Government of Afghanistan 
assumes increasing responsibility for Afghanistan's economic 
development.
    The committee recommends a decrease of $50.0 million for 
OM, OCO, for AIF, to a level of $350.0 million.

Commanders' Emergency Response Program

    The budget request included $400.0 million in Operation and 
Maintenance, Army (OMA), Overseas Contingency Operations (OCO) 
for the Commanders' Emergency Response Program (CERP) in 
Afghanistan for fiscal year 2013.
    The committee notes that a primary purpose of CERP is to 
enhance force protection for U.S. troops by enabling commanders 
to fund projects that directly address the humanitarian and 
reconstruction needs of the Afghan people, particularly in less 
secure areas of the country, thereby gaining the support of the 
local populace. As U.S. troop levels in Afghanistan decrease, 
the committee anticipates that the requirement for CERP will 
decrease at the same time, as occurred in Iraq. The committee 
also notes that the Commander, International Security 
Assistance Force, has issued new, more stringent guidelines for 
the use of CERP in Afghanistan. In part as a result of these 
new guidelines, the rate of expenditure of CERP funds in 
Afghanistan has decreased significantly. According to a Defense 
Department report, as of March 31, 2012, CERP in Afghanistan 
had committed $61.2 million, obligated $31.4 million, and 
disbursed $19.0 million of the $400.0 million authorized for 
the program during fiscal year 2012.
    Accordingly, the committee recommends a decrease of $200.0 
million in OMA, OCO, for CERP to a level of $200.0 million to 
be available for CERP in Afghanistan.

Installation information infrastructure support for United States 
        Southern Command

    The budget request included $393.2 million in the Operation 
and Maintenance, Army (OMA), in the Overseas Contingency 
Operations (OCO) account for Other Personnel Support. At the 
request of United States Southern Command (SOUTHCOM), the 
committee recommends a decrease of $40.0 million in OMA, OCO 
and an increase of $40.0 million in Other Procurement, Army, 
OCO for the Installation Information Infrastructure 
Modification Program to support the SOUTHCOM Commander's 
information infrastructure requirements.

Joint Improvised Explosive Device Defeat Fund

    The budget request included $1,675.4 million in the 
Overseas Contingency Operations (OCO) account for the Joint 
Improvised Explosive Device Defeat Fund (JIEDDF). This amount 
includes $950.5 million for the attack the network line of 
operation; $149.5 million for the train the force line of 
operation; and $400.0 million for the defeat the device line of 
operation.
    As noted in title I of this report, the committee 
recommended a transfer of $227.4 million from the JIEDDF's base 
budget request for staff and infrastructure to the OCO budget 
request. Adding these funds together, JIEDDF's total budget 
request is: $1,902.8 million.
    The committee remains deeply concerned about the threat 
posed by, and the deadly impact of, improvised explosive 
devices (IED) to the nearly 70,000 U.S. service members still 
deployed in Afghanistan. The committee will continue to support 
robust funding for these efforts as long as U.S. service 
members are deployed in Afghanistan.
    Through fiscal year 2012, Congress has authorized and 
appropriated over $20.0 billion to the Joint Improvised 
Explosive Device Defeat Organization (JIEDDO) to address the 
IED threat. In addition, other Department of Defense (DOD) 
components, including the military services, have spent 
billions of dollars from their own funds developing counter-IED 
capabilities.
    Six years after DOD established JIEDDO as its coordinating 
agency to lead, advocate, and coordinate responses to the IED 
threat across the Department, according to the Government 
Accountability Office (GAO), DOD continues to lack 
comprehensive visibility of its counter-IED expenditures and 
investments, including those from JIEDDO, the military 
services, and relevant DOD agencies.
    In March 2011, the GAO found that no fewer than 31 DOD 
entities, many of which started as ad hoc organizations, play a 
significant role in various urgent needs processes. For 
example, GAO reported, JIEDDO, the military services, and the 
Special Operations Command have all established their own 
processes and guidance on meeting specific urgent needs, and 
their own feedback mechanisms for assessing how well fielded 
solutions meet such needs.
    In the GAO's February 2012 report on DOD's counter-IED 
efforts, the Comptroller General warned, again, that DOD risks 
fragmentation, overlap, and duplication because it still does 
not have a comprehensive listing of DOD-wide counter-IED 
initiatives. Additionally, GAO reported that although JIEDDO 
recently issued its own strategic plan, it has not developed a 
DOD-wide plan. By not having a comprehensive DOD-wide strategic 
plan with results-oriented strategic goals, DOD is limited in 
its ability to evaluate the effectiveness of its counter-IED 
efforts and prioritize projects within future budget levels. 
Further, the committee is concerned that JIEDDO has hundreds of 
millions in unexpended authorized and appropriated funds.
    In light of these concerns, the committee recommends a 
total reduction of $200.0 million to the budget request for the 
JIEDDF. The reduction to each line of operation is reflected in 
the budget tables.

                       Items of Special Interest


Department of Defense procurement of Mi-17 helicopters through 
        Rosoboronexport

    The Department of Defense contract with Rosoboronexport, 
awarded by the Department of the Army on June 1, 2011, on a 
sole-source basis, procures at minimum 21 Mi-17 helicopters and 
spares for the Afghan military. The contract has a total value 
of nearly $1.0 billion and includes options for additional 
aircraft, spares, and support. The Department has indicated 
that the procurement of additional Mi-17 for the Afghan 
military may be required.
    The Department states that ``Rosoboronexport is the sole 
entity controlling export of military-use Mi-17 helicopters.'' 
The committee notes that in 2009 the Department of the Navy 
procured four commercial Mi-17 helicopters through a private 
U.S. broker following an open and competitive selection 
process. Those helicopters were produced by the original 
equipment manufacturer and are presently in service with the 
North Atlantic Treaty Organization (NATO) Air Training Command-
Afghanistan. On July 6, 2010, the Department of the Navy 
released a Request for Proposals for a second competitive 
procurement of Mi-17s, this time for 21 aircraft. On December 
20, 2010, prior to a contract award, the Department of Defense 
cancelled the procurement.
    The committee directs the Comptroller General of the United 
States to conduct a review of the Department's current process 
for procuring Mi-17 helicopters and parts through 
Rosoboronexport. The Comptroller should provide this report to 
the congressional defense committees by no later than 60 days 
after the date of enactment of this Act. The report shall be 
submitted in an unclassified format, but may include a 
classified annex if necessary. The review should, at a minimum, 
assess:
    1. The availability of alternative means for the Department 
of Defense to procure commercial or military versions of the 
Mi-17 helicopter and parts, rather than buying through 
Rosoboronexport.
    2. The feasibility of procuring a commercial version of the 
Mi-17 in lieu of the military version (including an assessment 
of any applicable legal restrictions on such procurement, the 
relative cost of military and commercial systems, and the 
operational significance of any differences between military 
and commercial systems).
    3. The impact that purchasing Mi-17 aircraft through 
Rosoboronexport can reasonably be expected to have on the risk 
of counterfeiting, access to technical data, and aircraft 
safety.
    4. The reasons for the Department of Defense's cancellation 
of the Navy's 2010 competitive procurement of 21 Mi-17 
helicopters.
    The report should include the Comptroller General's 
findings and recommendations, including findings as to the 
relative cost-effectiveness of the procurement approaches taken 
by the Department of the Army and the Department of the Navy, 
and any recommendations that the Comptroller General may have 
as to whether future procurements of Mi-17s should be made on a 
competitive basis, and whether sources other than 
Rosoboronexport should be considered.

Future size of the Afghan National Security Forces

    The committee believes that strong, capable, and sustained 
Afghan National Security Forces (ANSF) are a fundamental 
component of the long-term United States and coalition strategy 
in Afghanistan. To this end, the United States and coalition 
partners have invested substantial resources to build the ANSF 
to a force of 352,000 in 2012 and sustain that force over time 
so that, as U.S. and coalition forces draw down, Afghan forces 
will be sufficiently capable to maintain the hard-won gains 
that U.S., coalition, and Afghan forces have secured at great 
cost in both blood and treasure. To achieve this objective, the 
committee believes it is imperative that the ANSF is correctly 
sized, structured, and resourced to provide enduring security 
for their country.
    The committee notes with concern that news reports indicate 
administration officials are considering significant reductions 
in the size of the ANSF after 2014, by as much as one-third. 
These proposed reductions appear to be based on presumptions 
about future security conditions in Afghanistan and the 
affordability of sustaining these forces years from now. The 
committee believes that any decisions on the future size and 
composition of and funding for the ANSF after these forces 
assume the lead for security throughout Afghanistan in 2014 
must be driven principally by strategic considerations and the 
security conditions on the ground at that time. As such, the 
committee directs the Secretary of Defense to report 
periodically to the congressional defense committees with an 
assessment of the needs of the ANSF, to include metrics on 
factors that will influence decisions on the size and 
composition of this force. The report should also identify and 
assess risks to security and stability in Afghanistan 
associated with reductions to the size and changes in the 
composition of the ANSF.
    Finally, the committee believes that long-term funding for 
the ANSF should not be a U.S.-only effort and that all North 
Atlantic Treaty Organization allies and partners share an 
interest in supporting a strong ANSF that will be sufficiently 
capable of providing enduring security for the country of 
Afghanistan. As such, the committee commends those partners who 
have already committed financial support for this effort and 
urges the administration to continue its efforts to secure 
additional support from the international community.
     TITLE XVI--MILITARY COMPENSATION AND RETIREMENT MODERNIZATION 
                               COMMISSION

Short title (sec. 1601)
    The committee recommends a provision that would cite title 
XVI of this Act as the ``Military Compensation and Retirement 
Modernization Commission Act of 2012''.
Purpose (sec. 1602)
    The committee recommends a provision that would establish 
the purpose of the Military Compensation and Retirement 
Modernization Commission as (1) ensuring the long-term 
viability of the All-Volunteer Force; (2) enabling a high 
quality of life for military families; and (3) modernizing and 
achieving fiscal sustainability of the compensation and 
retirement systems.
Definitions (sec. 1603)
    The committee recommends a provision that would establish 
definitions for common terms used in the Military Compensation 
and Retirement Modernization Commission Act of 2012.
Military Compensation and Retirement Modernization Commission (sec. 
        1604)
    The committee recommends a provision that would establish 
in the Executive Branch an independent commission called the 
Military Compensation and Retirement Modernization Commission. 
The provision would provide that the Commission be composed of 
nine members appointed by the President, in consultation with 
the Chairmen and Ranking Members of the Committees on Armed 
Services of the Senate and House of Representatives. The 
provision would provide that the President designate one member 
as the Commission's Chairman. The provision would require that 
Commission members have significant expertise in federal 
compensation and retirement systems, including the military 
compensation and retirement systems, private sector 
compensation, retirement, or human resource systems, actuarial 
science, and be selected based on their knowledge and 
experience with the uniformed services and the military 
compensation and retirement systems. The provision would 
require that at least five members of the Commission have 
active-duty military experience, that at least one member have 
experience as an enlisted member of the armed forces, that at 
least one member have experience as a member of a reserve 
component, and that at least one member have been a spouse of a 
military member, or be someone with significant experience in 
military family issues. Finally, the provision would prohibit 
the appointment of individuals as members of the Commission who 
are, or were within the year preceding appointment, employed by 
a veterans service organization or military-related advocacy 
group or association.
Commission hearings and meetings (sec. 1605)
    The committee recommends a provision that would require the 
Military Compensation and Retirement Modernization Commission 
to conduct hearings on recommendations for legislative change 
under consideration, and that all hearings be open to the 
public, except those where classified information might be 
considered. The provision would require that any hearing open 
to the public be advertised on a federal website no less than 
14 days prior to the hearing. The provision would require the 
Commission to hold its initial meeting within 30 days of all 
members being appointed. The provision would establish that 
five members constitute a quorum of the Commission. Lastly, the 
provision would require the Commission to seek written public 
comment on recommendations under consideration.

Principles and procedure for commission recommendations (sec. 1606)

    The committee recommends a provision that would require the 
Military Compensation and Retirement Modernization Commission 
to conduct a review of the military retirement and compensation 
systems in the context of current compensation and retirement 
programs, force management objectives, and changes in life 
expectancy and the labor force. The provision would require the 
President, within 5 months of the establishment of the 
Commission, to establish and transmit to Congress and the 
Commission principles for modernizing the military compensation 
and retirement systems, including maintaining recruitment and 
retention of the best military personnel, modernizing the 
active and reserve military compensation and retirement 
systems, differentiating between active and reserve military 
service, differentiating between service in the armed forces 
and service in the other uniformed services, and ensuring the 
fiscal sustainability of the military compensation and 
retirement systems. The provision would require the Secretary 
of Defense, within 9 months of the establishment of the 
Commission, to transmit to Congress and the Commission the 
Secretary's recommendations for military compensation and 
retirement modernization, and would require the Secretary to 
consult the Secretaries of Health and Human Services, Commerce, 
and Homeland Security on recommendations that affect the Public 
Health Service, the National Oceanic and Atmospheric 
Administration, and the U.S. Coast Guard, respectively. The 
provision would require the Commission to conduct public 
hearings on the Secretary's recommendations. The provision 
would require the Commission, within 15 months of its 
establishment, to transmit to the President and Congress a 
report containing its findings, conclusions, and 
recommendations for modernizing the military compensation and 
retirement systems, and legislative proposals necessary to 
implement those recommendations.
    Finally, the provision would require that recommendations 
of the Commission grandfather the benefits of service members 
who first became a member of a uniformed service before the 
date of enactment of a military compensation and retirement 
modernization act pursuant to this title, except that such 
recommendations may include an opt-in mechanism for members who 
would choose to be covered by some or all of the provisions of 
a military compensation and retirement modernization act.

Consideration of commission recommendations by the President and 
        Congress (sec. 1607)

    The committee recommends a provision that would require the 
President, within 60 days of receiving the report of the 
Military Compensation and Retirement Modernization Commission 
required under section 1606 of this title, to transmit to 
Congress and the Commission a report approving or disapproving 
the Commission's recommendations. The provision would also 
provide for a procedure for the Commission to revise its 
recommendations in response to a Presidential disapproval. 
Finally, the provision would provide for expedited and 
protected consideration of military compensation and retirement 
modernization legislation in the Senate and the House of 
Representatives, without amendment, and without being subject 
to points of order, other than budget points of order.

Pay for members of the commission (sec. 1608)

    The committee recommends a provision that would establish 
the pay rate for members of the Military Compensation and 
Retirement Modernization Commission as the daily equivalent of 
the annual rate of basic pay for level IV of the Executive 
Schedule under section 5315 of title 5, United States Code. The 
provision would set the pay rate for the Chairman of the 
Commission as the daily equivalent of the annual rate of pay 
for level III of the Executive Schedule under section 5314 of 
title 5, United States Code.

Executive Director (sec. 1609)

    The committee recommends a provision that would require the 
Military Compensation and Retirement Modernization Commission 
to appoint, and fix the rate of pay of, an Executive Director 
in accordance with section 3161 of title 5, United States Code. 
The provision would prohibit the appointment as Executive 
Director of any person having served on active duty in the 
armed forces, as a civilian employee of the Department of 
Defense, or as an employee of a veterans service organization 
or military-related advocacy group or association during the 1-
year period preceding the date of appointment.

Staff (sec. 1610)

    The committee recommends a provision that would authorize 
the Military Compensation and Retirement Modernization 
Commission Executive Director to appoint and fix the rate of 
pay of additional personnel to serve as staff for the 
Commission. The provision would limit the number of Department 
of Defense personnel detailed to the Commission to no more than 
one-third of the total personnel employed as staff, and would 
prohibit the detail to the Commission staff of anyone employed 
by the Department of Defense who was involved in the formation 
of the recommendations of the Secretary of Defense to the 
Commission. The provision would limit the number of personnel 
eligible for military retired pay to no more than one-fourth of 
the total personnel serving as Commission staff. The provision 
would prohibit a person from serving on the Commission staff if 
that person had been employed by a veterans service 
organization or military-related advocacy group or association 
within the 1-year period preceding employment on the Commission 
staff. Finally, the provision would prohibit the service of any 
staff member to the Commission employed by or detailed from the 
Department of Defense from being considered in that staff 
member's efficiency or fitness report.

Contracting authority (sec. 1611)

    The committee recommends a provision that would authorize 
the Military Compensation and Retirement Modernization 
Commission to lease space and acquire personal property to the 
extent funds are available.

Judicial review precluded (sec. 1612)

    The committee recommends a provision that would preclude 
the actions of the President, the Secretary of Defense, and the 
Military Compensation and Retirement Modernization Commission 
under section 1606 of this title, and of the President under 
section 1607(a) of this title, from judicial review.

Termination (sec. 1613)

    The committee recommends a provision that would provide for 
the termination of the Military Compensation and Retirement 
Modernization Commission no later than 26 months after the 
Commission's establishment date.

Funding (sec. 1614)

    The committee recommends a provision that would require 
that of the amounts authorized to be appropriated for the 
Department of Defense for fiscal year 2013, $10.0 million be 
available to the Military Compensation and Retirement 
Modernization Commission until expended to carry out its duties 
under this title.
   TITLE XVII--NATIONAL COMMISSION ON THE STRUCTURE OF THE AIR FORCE

National commission on the structure of the Air Force (secs. 1701-1709)
    The committee recommends a provision that would create a 
commission to study the appropriate makeup of the Air Force, 
considering that the Department of the Air Force draws upon 
active-duty forces, the Air Force Reserve, and the Air National 
Guard.
    Included in the budget request was a plan by the Air Force 
to retire or realign various aviation units, and to cut 9.9 
thousand personnel from the rolls, including 3.9 thousand 
active duty personnel, 5.1 thousand from the Air National Guard 
and 0.9 thousand from the Air Force Reserve. These changes 
represent a percentage reduction of 1.2 percent, 4.8 percent, 
and 1.3 percent, respectively, of force structure for each 
component.
    The committee believes that there is little justification 
for the relative imbalance in the cuts applied to the Air 
National Guard. The Air Force and the Department of Defense 
have been negotiating potential compromise outcomes that would 
change the relative distribution of aircraft and personnel, but 
those negotiations have as yet been unproductive. Since the Air 
Force proposes to implement many of the planned moves in fiscal 
year 2013, the committee feels it must take action now to delay 
those actions that would be difficult or impossible to reverse, 
and instead place the Air Force's judgment on appropriate force 
structure mixes under the scrutiny of a national commission.
    The commission would be made up of four members appointed 
by leadership of the Committees on Armed Services of the Senate 
and the House of Representatives and four members appointed by 
the President. The commission, in considering possible force 
structure adjustments, would be directed to identify a 
structure that:
          (1) meets current and anticipated requirements of the 
        combatant commands;
          (2) achieves an appropriate balance between the 
        regular and reserve components of the Air Force, taking 
        advantage of the unique strengths and capabilities of 
        each;
          (3) ensures that the reserve components of the Air 
        Force have the capacity needed to support current and 
        anticipated homeland defense and disaster assistance 
        missions in the United States;
          (4) provides for sufficient numbers of regular 
        members of the Air Force to provide a base of trained 
        personnel from which the personnel of the reserve 
        components of the Air Force could be recruited;
          (5) maintains a peacetime rotation force to avoid 
        exceeding operational tempo goals of 1:2 for regular 
        members of the Air Forces and 1:5 for members of the 
        reserve components of the Air Force; and
          (6) maximizes achievable costs savings.
    The commission would be required to produce a report not 
later than March 31, 2013.
    The provision would also prevent the Air Force from using 
any fiscal year 2013 funds to divest, retire, or transfer, or 
prepare to divest, retire, or transfer, any aircraft of the Air 
Force assigned to units of the Air National Guard or Air Force 
Reserve as of May 31, 2012.
    The provision would allow an exception for the Secretary of 
the Air Force to divest or retire, or prepare to divest or 
retire, C-5A aircraft, if the Secretary were to replace that 
aircraft through a transfer of C-5B, C-5M, or C-17 aircraft so 
as to maintain all Air National Guard and Air Force Reserve 
units impacted by such divestment or retirement at current or 
higher assigned manpower levels to operate the transferred 
aircraft.
    The provision also includes authorization of an additional 
$1.4 billion for the purpose of freezing Air Force structure in 
place or as planned in order to reserve decision space for the 
National Commission.
    The amount of this additional authorization of 
appropriations is based on a rough estimate by the Department 
of the Air Force of the cost required to carry out this 
section. The committee expects that a review and analysis of 
the actions required to carry out this section may result in a 
cost to the Air Force that differs from the additional 
authorization of appropriation. The committee expects to be 
promptly notified once the Air Force determines the total cost 
to carry out this provision.
    The Air Force budget request for fiscal year 2013 assumed 
roughly $1.4 billion in savings that derived from retiring 
several systems, cutting the numbers of systems that remain, 
and realigning systems between the active and reserve 
components.
    The committee completely understands that the Air Force had 
to make tough choices in the budget. However, many of the 
choices the Air Force made are puzzling, and almost all are 
lacking sufficient analysis to support the conclusions in the 
budget. Some actually fly in the face of what the Air Force 
asserted just within the past couple of years. For example, a 
very troubling aspect of the budget proposal is that, within 
these force structure changes, the cuts in manpower and 
aircraft would fall disproportionately on the Air National 
Guard. In the fighter forces, the Air Force is planning for a 
cut of almost one third in the A-10 force, with that cut 
weighted heavily toward the Air National Guard. Original data 
provided by the Air Force showed that, simultaneously with 
making these cuts in A-10 force structure, the Air Force was 
planning to increase the size of the active-duty A-10 training 
squadrons.
    In tactical airlift programs, the Air Force had established 
a requirement, validated by the Joint Requirements Oversight 
Council, for 38 C-27 aircraft to provide direct support to Army 
ground forces. All of those aircraft were slated to go to the 
Guard. The committee observes that the Air Force joined what 
was a joint program with the Army, and then took sole ownership 
of it. Air Force officials testified that they needed to pursue 
the C-27 because the C-130 could not meet requirements. Now, 
the Air Force has reversed course, and claims that the C-130 is 
adequate for meeting the direct support mission for the Army.
    The committee believes that changing of Air Force force 
structure is too important to be approached with such a lack of 
rationale, unsupported by objective analysis. The committee has 
recommended two steps to improve this situation. For the near 
term, the committee is recommending creation of a National 
Commission on the Structure of the Air Force that would report 
recommendations next year on this matter. Elsewhere, for the 
longer term, the committee is recommending a provision that 
would direct the Comptroller General to develop recommendations 
for objective criteria to be used by the Department of Defense 
to make decisions relating to realignments of units employed at 
military installations that are not currently covered by 
section 2687 of title 10, United States Code.
    The committee is concerned that, in an effort to realign 
its force structure, valuable and necessary coordination 
between the Air Force, Army, and National Guard regarding the 
Air Force's fiscal year 2013 force structure modifications were 
overlooked. In addition, the committee is concerned that the 
Secretary of the Air Force has failed to provide accurate 
analysis on the effects of the Air Force modifications 
decision. Earlier this year, the Secretary of the Air Force 
sent a letter to committee members in an attempt to justify the 
Air Force's fiscal year 2013 force structure modifications that 
result in the reallocation of Air Force Reserve and Air 
National Guard units. However, the numbers provided in the 
Secretary's letter are vastly different from numbers received 
and coordinated between Air Force and Army personnel on-site at 
locations being affected.
    Therefore, the committee strongly urges the Secretary of 
the Air Force suspend all force structure adjustments until 
October, 1, 2013, to allow the committee to review the 
recommendations of the National Commission on the Structure of 
the Air Force as they pertain to: (1) fielding of integrated 
joint training, command and control, and essential 
capabilities; and (2) current and anticipated requirements that 
support current defense strategy.
Retention of core functions of the Electronic Systems Center at Hanscom 
        Air Force Base pending future structure study (sec. 1710)
    The committee recommends a provision that would require 
that the Secretary of the Air Force shall retain the current 
leadership rank and core functions of the Electronic Systems 
Center at Hanscom Air Force Base as existed as of November 1, 
2011, until 180 days after the National Commission on the 
Structure of the Air Force submits to the congressional defense 
committees the report required under section 1703.
    The committee is also puzzled by the Air Force's decision 
to realign manpower and core functions at the Electronic 
Systems Center (ESC). Last September, the Commander of Air 
Force Materiel Command and the Air Force Service Acquisition 
Executive asserted that the programs executed by ESC employ the 
largest acquisition workforce and noted that the delivery of 
integrated electronic capabilities, multifaceted command and 
control (C2) requirements, and cross-cutting affordable 
solutions in the cyber domain supported the current defense 
strategy. Therefore, the committee strongly urges the Secretary 
of the Air Force to retain until October 1, 2013, the current 
manpower and leadership authorizations as well as core 
functions of ESC with the same integrated mission elements, 
responsibilities, and capabilities as exists from November 1, 
2011. This would allow the committee to review the 
recommendations of the National Commission on the Structure of 
the Air Force as they pertain to: (1) acquisition and fielding 
of integrated C2 and cyber capabilities; or (2) current and 
anticipated requirements related to integration across multiple 
Program Executive Offices involved in solutions relating to 
command, control, communications, computers, and intelligence 
(C4I) mission areas, ground/air/space networks, datalinks, 
intelligence, surveillance, and reconnaissance, and electronic 
warfare that support current defense strategy.
    The committee also directs the Comptroller General to 
prepare an independent assessment of the impact of the 
reorganization of ESC as it relates to national defense 
including: (1) Air Force acquisition and fielding of integrated 
C2 and cyber capabilities; (2) Life Cycle Management Center 
Commander management, span of control, and integration across 
multiple Program Executive Offices involved in C4I mission 
areas, ground/air/space networks, datalinks, C2, intelligence, 
surveillance, and reconnaissance, and electronic warfare cyber; 
(3) enablers required to execute ESC's C4I mission, to include 
location of expertise, source of expertise, and identification 
of talent shortfalls; and (4) cycle time drivers for electronic 
system contractual actions and ultimate fielding timelines.
            DIVISION B--MILITARY CONSTRUCTION AUTHORIZATIONS

Summary and explanation of funding tables
    Division B of this Act authorizes funding for military 
construction projects of the Department of Defense (DOD). It 
includes funding authorizations for the construction and 
operation of military family housing as well as military 
construction for the reserve components, the defense agencies, 
and the North Atlantic Treaty Organization Security Investment 
Program. It also provides authorization for the base closure 
accounts that fund military construction, environmental 
cleanup, and other activities required to implement the 
decisions in base closure rounds.
    The tables contained in this act provide the project-level 
authorizations for the military construction funding authorized 
in Division B of this Act, other than the overseas contingency 
operations projects authorized in title XXIX, and summarize 
that funding by account. Funding for base closure projects is 
summarized in the table that follows, and is explained in 
additional detail in the table included in title XXVII of this 
report.
    The fiscal year 2013 budget requested $11.2 billion for 
military construction and housing programs. Of this amount, 
$8.7 billion was requested for military construction, $1.7 
billion for the construction and operation of family housing, 
and $476.7 million for base closure activities, including 
$126.7 million to implement the results of the 2005 Base 
Realignment and Closure round.
    The committee recommends authorization of appropriations 
for military construction and housing programs totaling $10.6 
billion. The total amount authorized for appropriations 
reflects the committee's continuing commitment to invest in the 
recapitalization of DOD facilities and infrastructure.
Short title (sec. 2001)
    The committee recommends a provision that would designate 
division B of this Act as the Military Construction 
Authorization Act for Fiscal Year 2013.
Expiration of authorizations and amounts required to be specified by 
        law (sec. 2002)
    The committee recommends a provision that would establish 
the expiration date for authorizations in this Act for military 
construction projects, land acquisition, family housing 
projects, and contributions to the North Atlantic Treaty 
Organization infrastructure program as October 1, 2015, or the 
date of enactment of an act authorizing funds for military 
construction for fiscal year 2016, whichever is later.
                 TITLE XXI--ARMY MILITARY CONSTRUCTION

Summary
    The budget request included authorization of appropriations 
of $1.9 billion for military construction and $534.7 million 
for family housing for the Army for fiscal year 2013.
    The committee recommends authorization of appropriations of 
$1.6 billion for military construction and $534.7 million for 
family housing for fiscal year 2013.
    The budget requested $192.0 million to construct a new 
barracks at the United States Military Academy (USMA). The 
committee has significant concerns about the condition of the 
current barracks at USMA. Their condition is reminiscent of 
other facilities that caused national outrage. The committee 
has been informed that the Army does not plan to renovate its 
existing barracks infrastructure until fiscal year 2018. The 
committee believes this is unacceptable and would support 
immediate action to begin renovations using available operation 
and maintenance funds.
    The budget requests $30.0 million for infrastructure at 
Fort Bragg, North Carolina to support construction of 
facilities for special operations forces. These projects are 
contained in this year's budget request.
    The committee recommends eliminating this infrastructure 
project since the resulting infrastructure would not constitute 
a ``complete and useable'' facility as required by statute. The 
committee recommends moving that $30.0 million to the 
facilities the infrastructure was expected to support, as 
inclusion in those facilities will yield complete and useable 
facilities.
    The committee directs the Special Operations Command 
(SOCOM) to provide updated DD form 1391s prior to final passage 
of the bill with these funds properly apportioned to the 
facilities requiring infrastructure. The committee further 
directs SOCOM to budget for complete and useable facilities 
that do not require supporting stand-alone infrastructure. The 
committee reiterates the requirement that military construction 
projects, even those supporting special forces, be complete and 
useable.
    The budget requests $84.0 million for the Millennium Site 
cemetery expansion at Arlington National Cemetery (ANC). The 
committee notes that the Army's military construction account 
has historically not been used to authorize construction at 
ANC, and the committee believes changing this precedent would 
not be in the best interest of Arlington National Cemetery.
    Further, the committee notes that the Appropriations 
committees of the Senate and the House of Representatives have 
moved funding from the Army's military construction accounts to 
Cemeterial Expenses. The request from Arlington National 
Cemetery has been fully funded in the Cemeterial Expenses 
account.
    The committee supports fully funding the Arlington National 
Cemetery request; however, to minimize disruption of the 
planned cemetery expansion and ensure the project is addressed 
in the appropriate budget line, the committee recommends 
removing this request from the military construction accounts 
consistent with the actions taken by the Senate and House 
Appropriations committees.
Authorized Army construction and land acquisition projects (sec. 2101)
    The committee recommends a provision that would authorize 
military construction projects for the active component of the 
Army for fiscal year 2013. The authorized amounts are listed on 
an installation-by-installation basis.
Family housing (sec. 2102)
    The committee recommends a provision that would authorize 
new construction, planning, and design of family housing units 
for the Army for fiscal year 2013. It would also authorize 
funds for facilities that support family housing, including 
housing management offices, housing maintenance, and storage 
facilities.
Authorization of appropriations, Army (sec. 2103)
    The committee recommends a provision that would authorize 
appropriations for the active component military construction 
and family housing projects of the Army authorized for 
construction for fiscal year 2013 in this Act. This provision 
would also provide an overall limit on the amount authorized 
for military construction and family housing projects for the 
active-duty component of the Army. The State list contained in 
this report is the binding list of the specific projects 
authorized at each location.
Modification of authority to carry out certain fiscal year 2010 project 
        (sec. 2104)
    The committee recommends a provision that would modify the 
authorization contained in the table in section 2101(a) of the 
Military Construction Authorization Act for Fiscal Year 2010 
(division B of Public Law 111-84; 123 Stat. 2628) to allow for 
the construction of a standard design Access Control Point at 
Fort Belvoir, Virginia.
Extension of authorizations of certain fiscal year 2009 projects (sec. 
        2105)
    The committee recommends a provision that would extend the 
authorization for two Army fiscal year 2009 military 
construction projects until October 1, 2013, or the date of 
enactment of an act authorizing funds for military construction 
for fiscal year 2014, whichever is later. This extension was 
requested by the Department of Defense.
Extension of authorizations of certain fiscal year 2010 projects (sec. 
        2106)
    The committee recommends a provision that would extend the 
authorization for five Army fiscal year 2010 military 
construction projects until October 1, 2013, or the date of 
enactment of an act authorizing funds for military construction 
for fiscal year 2014, whichever is later. This extension was 
requested by the Department of Defense.

Additional authority to carry out certain fiscal year 2013 project 
        (sec. 2107)

    The committee recommends a provision that would authorize a 
Cadet Barracks at the United States Military Academy, New York.
                 TITLE XXII--NAVY MILITARY CONSTRUCTION

Summary
    The budget request included authorization of appropriations 
of $1.7 billion for military construction and $480.4 million 
for family housing for the Department of the Navy for fiscal 
year 2013.
    The committee recommends authorization of appropriations of 
$1.7 billion for military construction and $480.4 million for 
family housing for fiscal year 2013.
    The budget requested $14.8 million for a Broad Area 
Maritime Surveillance Maintenance Training Facility at Point 
Mugu, California. The Department has requested a change in 
location for that project to Ventura County. This change would 
result in a $2.1 million reduction in the project. The 
committee recommends this change of location and reduction in 
funding.
    The budget requests $280.0 million for the second increment 
of the Explosives Handling Wharf #2 in Naval Base Kitsap, 
Washington. The committee understands that the Department will 
be unable to obligate and expend the full amount of the budget 
request and therefore recommends a $25.8 million reduction.
    The budget requests $25.9 million for the second increment 
of the North Ramp Parking at Andersen Air Force Base, Guam. 
Because of continuing concerns with the realignment of United 
States Marines from Okinawa to Guam, addressed later in a 
separate Item of Special Interest in this title, the committee 
recommends elimination of this project.
Authorized Navy construction and land acquisition projects (sec. 2201)
    The committee recommends a provision that would authorize 
Navy and Marine Corps military construction projects for fiscal 
year 2013. The authorized amounts are listed on an 
installation-by-installation basis.
Family housing (sec. 2202)
    The committee recommends a provision that would authorize 
new construction, planning, and design of family housing units 
for the Navy for fiscal year 2013. It would also authorize 
funds for facilities that support family housing, including 
housing management offices, housing maintenance, and storage 
facilities.
Improvements to military family housing units (sec. 2203)
    The committee recommends a provision that would authorize 
funding for fiscal year 2013 to improve existing Navy family 
housing units.
Authorization of appropriations, Navy (sec. 2204)
    The committee recommends a provision that would authorize 
appropriations for the active component military construction 
and family housing projects of the Department of the Navy 
authorized for construction for fiscal year 2013 in this Act. 
This provision would also provide an overall limit on the 
amount authorized for military construction and family housing 
projects for the active-duty components of the Navy and the 
Marine Corps. The State list contained in this report is the 
binding list of the specific projects authorized at each 
location.
Modification of authority to carry out certain fiscal year 2012 project 
        (sec. 2205)
    The committee recommends a provision that would modify the 
authorization contained in section 2201(a) of the Military 
Construction Authorization Act for Fiscal Year 2012 (division B 
of Public Law 112-81; 125 Stat. 1666) for construction of an 
Explosives Handling Wharf #2 at Naval Base Kitsap, Washington.
Extension of authorizations of certain fiscal year 2009 projects (sec. 
        2206)
    The committee recommends a provision that would extend the 
fiscal year 2009 authorization for three projects until October 
1, 2013, or the date of an act authorizing funds for military 
construction for fiscal year 2014, whichever is later.
Extension of authorizations of certain fiscal year 2010 projects (sec. 
        2207)
    The committee recommends a provision that would extend the 
fiscal year 2010 authorization for three projects until October 
1, 2013, or the date of an act authorizing funds for military 
construction for fiscal year 2014, whichever is later.
Realignment of Marines in the Asia-Pacific region (sec. 2208)
    The committee recommends a provision that would extend the 
prohibition on funds for construction activities to implement 
the realignment of Marine Corps' forces from Okinawa to other 
locations.

                       Items of Special Interest

Comptroller General of the United States assessment of the costs of 
        realignment of the Marines in the Asia-Pacific region
    On April 27, 2012, the U.S.-Japan Security Consultative 
Committee issued a joint statement in which they detailed plans 
for the realignment of marines on Okinawa. Specifically, the 
U.S. and Japan have decided to delink the realignment of 
marines from Okinawa to Guam from the construction of the 
Futenma Replacement Facility (FRF).
    The plan contemplates fewer marines moving from Okinawa to 
Guam than planned in the 2006 Roadmap to Realignment Agreement. 
This should result in a reduction of the size and scope of the 
Guam military buildup. Of the approximately 9,000 marines that 
will now eventually leave Okinawa, less than 5,000 would be 
moved to Guam and, of those, most would be rotational forces. 
The joint statement also refers to the plan to rotate marines 
to Australia and to restation marine forces on Hawaii.
    This joint statement describes the plan for marines in the 
Asia-Pacific in broad terms, but leaves unanswered many of the 
details, particularly with respect to cost and timing of the 
realignment. The Comptroller General has been involved in 
assessing the costs associated with the realignment of marines 
in the past, specifically in its report entitled, Comprehensive 
Cost Information and Analysis Alternatives Needed to Assess 
Military Posture in Asia (GAO-11-316), May 2011.
    The committee remains concerned with the lack of 
comprehensive cost and schedule data associated with this 
important U.S. force posture issue. The strategic implications 
of the realignment are the subject of an ongoing independent 
assessment commissioned by the Secretary of Defense pursuant to 
section 346 of the National Defense Authorization Act for 
Fiscal Year 2012 (Public Law 112-81).
    Accordingly, the committee directs the Comptroller General 
of the United States to assess the costs associated with the 
revised plan to realign marines in the Asia-Pacific region as 
set forth in the joint statement of the United States-Japan 
Security Consultative Committee dated April 27, 2012. The 
assessment shall identify and assess costs associated with the 
initiatives' projected movement of marines to Guam, Hawaii, and 
Australia. To the extent possible, the assessment shall 
distinguish between costs that are known, costs that are 
estimated, and costs that are not yet known and cannot yet be 
estimated. The assessment should also include an estimate of 
the recurring annual costs of the moves that will affect future 
budgets for the Department of the Defense, including costs for 
the sustainment of forces, base operating support, and other 
operations and maintenance requirements.
    The committee also directs the Secretary of Defense to 
ensure that the Comptroller General receives access to such 
information and other support as the General Comptroller 
requires to perform this assessment. The Comptroller General 
shall report to the Committees on Armed Services of the Senate 
and the House of Representatives no later than March 1, 2013, 
on the results of this assessment.
U.S. force posture in the Asia-Pacific and realignment of the U.S. 
        Marines on Okinawa
    The committee strongly supports a robust U.S. military 
force posture in the Asia-Pacific region as the cornerstone of 
peace and stability and to underwrite the development of new 
economic and security partnerships. As such, the stationing of 
U.S. military forces in the Asia-Pacific will stand as an 
unequivocal commitment to U.S. involvement in the region, and 
will secure our national interests as well as the mutual 
interests of our partners. To this end, the United States has 
embarked on a series of initiatives intended to realign its 
military force structure to respond to regional interests and 
it is essential that these initiatives are guided by sound 
strategic concepts and plans for force posture that are 
militarily effective, operationally supportable, and fiscally 
and politically sustainable.
    The committee notes that U.S. bilateral security 
arrangements in the region, especially with Japan and with 
South Korea, remain the foundation of our security posture and 
activities in Asia. One key initiative in the furtherance of 
the U.S.-Japan bilateral arrangement involves changes to the 
stationing of U.S. forces in Japan and specifically Okinawa. 
The Defense Policy Review Initiative, as further detailed in 
the U.S.-Japan Alliance Transformation and Realignment for the 
Future and the 2006 U.S.-Japan Roadmap for Realignment 
Implementation agreement (``Roadmap agreement''), laid out a 
series of U.S. force consolidations and base closures intended 
to improve the cooperation of the two allies and reduce the 
burden on local Japanese communities.
    Over the past few years, the committee has become 
increasingly concerned that terms of the Roadmap agreement as 
they related to the movement of marines from Okinawa to Guam 
and to the development of a replacement facility for the 
existing Marine Corps Air Station (MCAS) Futenma, were 
unrealistic, unworkable, and unaffordable. The committee also 
expressed concern last year about posture planning for U.S. 
forces in the Asia-Pacific; and specifically the strategic 
implications and costs of U.S. commitments throughout the 
region. Subsequently, Congress included legislative provisions 
in the National Defense Authorization Act for Fiscal Year 2012 
(Public Law 112-81) that required an independent assessment of 
the U.S. force posture in the Pacific Command area of 
responsibility and that prohibited the obligation of fiscal 
year 2012 funds or funds provided by the Government of Japan 
until certain requirements were met. The independent 
assessment, which is due to Congress in June 2012, was intended 
to help identify emerging opportunities to update the U.S. 
force posture for a better alignment with dynamic regional 
interests free of the inertia of past decisions.
    On April 27, 2012, the U.S.-Japan Security Consultative 
Committee issued a joint statement detailing changes to the 
plans for the realignment of marines on Okinawa. Specifically, 
the U.S. and Japan separated the requirement of tangible 
progress on the construction of the Futenma Replacement 
Facility (FRF) from other marine restationing efforts on 
Okinawa to return lands to local communities. Also, while the 
overall number of marines to leave Okinawa remained essentially 
the same as the previous agreement, at about 9,000, the new 
arrangement will result in fewer marines being restationed to 
Guam with the remainder of the forces being relocated to new 
locations in Australia, Hawaii, or to the west coast of the 
United States.
    The committee notes, however, that the parties have made no 
adjustment to the plan to build the FRF at Camp Schwab in the 
Henoko area of Okinawa and provided no timeline for the 
completion of construction of the FRF. In the meantime, the 
Marine Corps will continue to operate from MCAS Futenma, a 
heavily-encroached air base in the crowded Ginowan area of 
Okinawa, in facilities and infrastructure that are in 
deteriorated condition due to the deliberate decision over a 
number of years to defer maintenance, repairs, and renovations 
in light of the eventual base closure. The committee is 
concerned that any decision to further delay the construction 
of a FRF without a plan to provide for safe, secure facilities 
at MCAS Futenma will put marines and their families at risk. 
Accordingly, the committee strongly recommends that the U.S. 
and Japan establish a timeline for the identification of 
alternatives to the Henoko FRF plan, including the 
reconsideration of existing military air bases and other 
airport facilities in the area, in order to allow for prudent 
and critical investments in the current Marine Corps Air 
Station by both Governments.
    With respect to the plan announced in the April 27th joint 
statement, the committee has questions about the extent to 
which the updated initiatives are guided by strategic concepts 
and plans for force posture that are militarily effective, 
operationally supportable, and fiscally and politically 
sustainable. The committee also notes that the new distributed 
laydown proposed for Marine Corps forces will require the 
completion of a concept of operations, an analysis of logistics 
requirements, and basing plans to establish and employ full 
Marine Air Ground Task Force (MAGTF) capabilities at four 
geographically dispersed locations in Okinawa, Guam, Australia, 
and Hawaii. The committee is concerned that the agreement does 
not include any formal timelines for budgeting or for 
completion of the realignments. This uncertainty increases the 
risk that a delay in investments or construction prolonged over 
10 years or more will have a detrimental impact on the 
readiness and operational capabilities of the MAGTFs in the 
region. The committee also expects the independent assessment 
to contribute to the review and discussion by the committee of 
the proposed changes to the strategic framework for U.S. forces 
in the region. Until the committee is provided details to 
adequately assess the strategic impact, feasibility, and 
affordability of these initiatives, the committee is unwilling 
to authorize further obligations of funds for projects on Guam 
in support of the relocation, to include investments proposed 
for civilian facility and infrastructure requirements.
    Also, the committee recognizes that some environmental 
studies will be necessary to consider the effects of the new 
plans for Guam and for Hawaii. These environmental studies will 
inevitably take time, but must be expedited to the greatest 
extent feasible so that the realignments can begin as soon as 
practical. To this end, the Secretary of Defense shall ensure 
that the environmental studies associated with the movement of 
marines from Okinawa be given the highest priority within the 
Department and that every effort be made to expedite these 
studies, consistent with applicable laws and regulations.
    As the realignment of U.S. forces in the Pacific Command 
area of responsibility continues to be formalized through plans 
and agreements with our allies, the committee should receive 
regular updates from the Department of Defense on the process, 
particularly with regard to costs, timelines, planning, and 
logistics of this critical endeavor. Accordingly, the committee 
directs the Secretary of Defense to ensure that the Committees 
on Armed Services of the Senate and of the House of 
Representatives receive regular updates, at least once every 3 
months, if not more often, on the cost and timelines associated 
with the realignment of marines on Okinawa and on the 
environmental planning process for Guam, Australia, and Hawaii.
              TITLE XXIII--AIR FORCE MILITARY CONSTRUCTION

Summary
    The budget request included authorization of appropriations 
of $388.2 million for military construction and $581.7 million 
for family housing for the Air Force in fiscal year 2013.
    The committee recommends authorization of appropriations of 
$355.2 billion for military construction and $581.7 million for 
family housing for fiscal year 2013.
    The committee notes that the budget request for the Air 
Force for military construction is considerably reduced this 
fiscal year. The Air Force has described this reduction as a 
`strategic pause' in military construction. The committee is 
concerned that this reallocation of budget authority may 
endanger the Air Force's ability to meet future military 
construction requirements.
    The budget requests $161.0 million for the second increment 
of the U.S. Strategic Command (STRATCOM) Replacement Facility 
at Offutt Air Force Base, Nebraska. The committee is concerned 
that initial contractor bids received for the construction of 
this facility far exceeded the government's cost estimate and 
the congressional authorization of $564.0 million.
    The committee notes that in an era of budget austerity, the 
Department of Defense must ensure that only the most critical 
facility requirements needed to carry out the current missions 
are supported in new headquarters facilities. As the Department 
receives new bids for this facility, the committee is concerned 
that no critical facility requirements for U.S. STRATCOM be 
eliminated and that no costs are deferred to other funding 
streams; therefore, the committee directs the Department to 
submit an updated DD-1391 form, along with current manning 
requirements for the facility, that captures the complete and 
usable project to be awarded for the amount previously 
authorized by Congress.
    The committee further notes that the Department will be 
unable to obligate and expend the full amount of the budget 
request and therefore recommends a $33.0 million reduction.
Authorized Air Force construction and land acquisition projects (sec. 
        2301)
    The committee recommends a provision that would authorize 
Air Force military construction projects for fiscal year 2013. 
The authorized amounts are listed on an installation-by-
installation basis.
Family housing (sec. 2302)
    The committee recommends a provision that would authorize 
new construction and planning and design of family housing 
units for the Air Force for fiscal year 2013. It would also 
authorize funds for facilities that support family housing, 
including housing management offices, housing maintenance, and 
storage facilities.
Improvements to military family housing units (sec. 2303)
    The committee recommends a provision that would authorize 
funding for fiscal year 2013 to improve existing Air Force 
family housing units.
Authorization of appropriations, Air Force (sec. 2304)
    The committee recommends a provision that would authorize 
appropriations for the active component military construction 
and family housing projects of the Air Force authorized for 
construction for fiscal year 2013 in this Act. This provision 
would also provide an overall limit on the amount authorized 
for military construction and family housing projects for the 
active-duty component of the Air Force. The State list 
contained in this report is the binding list of the specific 
projects authorized at each location.
Extension of authorizations of certain fiscal year 2010 projects (sec. 
        2305)
    The committee recommends a provision that would extend the 
fiscal year 2010 authorization for two projects until October 
1, 2013, or the date of an act authorizing funds for military 
construction for fiscal year 2014, whichever is later.
           TITLE XXIV--DEFENSE AGENCIES MILITARY CONSTRUCTION

Summary
    The budget request included authorization of appropriations 
of $3.5 billion for military construction for the defense 
agencies, $150.0 million for energy conservation projects, 
$151.0 million for chemical demilitarization construction, and 
$54.0 million for family housing for the defense agencies, and 
the Family Housing Improvement Fund for fiscal year 2013.
    The committee recommends authorization of appropriations of 
$3.4 billion for military construction, $150.0 million for 
energy conservation projects, $151.0 million for chemical 
demilitarization construction, and $54.2 million for family 
housing for the defense agencies for fiscal year 2013.
    The budget requests $300.5 million for the second increment 
of the High Performance Computing Center at Fort Meade, 
Maryland. The committee understands that the National Security 
Agency (NSA) will be unable to obligate and expend the full 
amount of the budget request and therefore recommends a $75.0 
million reduction.
    The committee recommends a provision that would modify the 
authorization provided last year for this project. The 
committee required the NSA to validate the cost of the project. 
The original budget request for the project was $860.5 million. 
This year's request shows a reduction of approximately $68.3 
million in the project's value with no degradation in final 
performance or schedule.
    The budget requests $7.0 million for Base Installation 
Access/Appearance Plan at Bethesda Naval Hospital, Maryland. 
The supporting budget documents show that this requirement 
should be met with operations and maintenance funds and not 
military construction funds; therefore, the committee 
recommends this project be eliminated.
    The budget requests $207.4 million for the fourth increment 
of the Hospital Replacement at Fort Bliss, Texas. The committee 
understands that the Department will be unable to obligate and 
expend the full amount of the budget request and therefore 
recommends a $100.0 million reduction.

               Subtitle A--Defense Agency Authorizations

Authorized defense agencies construction and land acquisition projects 
        (sec. 2401)
    The committee recommends a provision that would authorize 
military construction projects for the defense agencies for 
fiscal year 2013. The authorized amounts are listed on an 
installation-by-installation basis.
Authorized energy conservation projects (sec. 2402)
    The committee recommends a provision that would authorize 
the Secretary of Defense to carry out energy conservation 
projects.
Authorization of appropriations, defense agencies (sec. 2403)
    The committee recommends a provision that would authorize 
appropriations for the military construction and family housing 
projects of the defense agencies authorized for construction 
for fiscal year 2013 in this Act. This provision would also 
provide an overall limit on the amount authorized for military 
construction and family housing projects for the defense 
agencies. The State list contained in this report is the 
binding list of the specific projects authorized at each 
location.
Extension of authorization of certain fiscal year 2010 project (sec. 
        2404)
    The committee recommends a provision that would extend the 
authorization for a project until October 1, 2013, or the date 
of enactment of an act authorizing funds for military 
construction for fiscal year 2014, whichever is later. This 
extension was requested by the Department of Defense.
Modification of authority to carry out certain fiscal year 2012 project 
        (sec. 2405)
    The committee recommends a provision that would modify the 
table in section 2401(a) of the Military Construction 
Authorization Act for Fiscal Year 2012 (division B of Public 
Law 112-81; 125 Stat. 1672), relating to Fort Meade, Maryland, 
by striking ``$29,640,000'' and inserting ``$792,200,000.''
Additional authority to carry out certain fiscal year 2013 project 
        (sec. 2406)
    The committee recommends a provision that would authorize 
an Upgrade Fuel Pipeline at Andersen Air Force Base with 
certain limitations.

          Subtitle B--Chemical Demilitarization Authorizations

Authorization of appropriations, chemical demilitarization 
        construction, defense-wide (sec. 2411)
    The committee recommends a provision that would authorize 
military construction projects for the chemical 
demilitarization program for fiscal year 2013. The authorized 
amounts are listed on an installation-by-installation basis.
Modification of authority to carry out certain fiscal year 1997 project 
        (sec. 2412)
    The committee recommends a provision that would modify the 
table in section 2401(a) of the Military Construction 
Authorization Act for Fiscal Year 1997 (division B of Public 
Law 104-201; 110 Stat. 2775), as amended.

                        Item of Special Interest

Excess overseas facilities for defense agencies
    The committee notes that the Department of Defense is in 
the process of reviewing U.S. military force posture in Europe 
and Asia with the intent of consolidating and aligning military 
forces to meet national security objectives in a fiscally 
constrained environment.
    The committee further notes that most of the attention and 
efforts to date have centered on the status and realignment of 
forces of the military departments even though the 16 major 
defense agencies of the Department maintain significant numbers 
of facilities and personnel overseas. The committee believes 
that a request by the Department of Defense for the authority 
to conduct a domestic Base Realignment and Closure round must 
be preceded by a comprehensive evaluation of opportunities to 
obtain efficiencies through the consolidation of the overseas 
operations of defense agencies and possible relocation back to 
the United States.
    Therefore, the committee directs the Deputy Secretary of 
Defense, as the Chief Management Officer of the Department, to 
evaluate the feasibility and cost-savings that may be realized 
by closing overseas facilities and consolidating operations of 
the 16 defense agencies to existing facilities and 
installations within the United States.
    The committee further directs the Deputy Secretary of 
Defense to submit a report to the congressional defense 
committees no later than February 1, 2013, on the results of 
the review, including the projected personnel realignments, 
facilities maintenance, and facilities modernization costs and 
savings that could be achieved by consolidating overseas 
operations and possibly relocating those functions to 
facilities located in the United States.
   TITLE XXV--NORTH ATLANTIC TREATY ORGANIZATION SECURITY INVESTMENT 
                                PROGRAM

Summary
    The Department of Defense requested authorization of 
appropriations of $254.2 million for military construction in 
fiscal year 2013 for the North Atlantic Treaty Organization 
facilities.
    The committee recommends a total of $254.2 million for 
military construction for the North Atlantic Treaty 
Organization facilities.
Authorized NATO construction and land acquisition projects (sec. 2501)
    The committee recommends a provision that would authorize 
the Secretary of Defense to make contributions to the North 
Atlantic Treaty Organization Security Investment Program in an 
amount equal to the sum of the amount specifically authorized 
in section 2502 of this title and the amount of recoupment due 
to the United States for construction previously financed by 
the United States.
Authorization of appropriations, NATO (sec. 2502)
    The committee recommends a provision that would authorize 
appropriations of $254.2 million for the United States' 
contribution to the North Atlantic Treaty Organization Security 
Investment Program for fiscal year 2013.
            TITLE XXVI--GUARD AND RESERVE FORCES FACILITIES

Summary
    The Department of Defense requested authorization of 
appropriations of $1.0 billion for military construction in 
fiscal year 2013 for facilities for the guard and reserve 
components. The committee recommends this amount. The detailed 
funding recommendations are contained in the State list table 
included in this report.

 Subtitle A--Project Authorizations and Authorization of Appropriations

Authorized Army National Guard construction and land acquisition 
        projects (sec. 2601)
    The committee recommends a provision that would authorize 
military construction projects for the Army National Guard for 
fiscal year 2013. The authorized amounts are listed on a 
location-by-location basis.
Authorized Army Reserve construction and land acquisition projects 
        (sec. 2602)
    The committee recommends a provision that would authorize 
military construction projects for the Army Reserve for fiscal 
year 2013. The authorized amounts are listed on a location-by-
location basis.
Authorized Navy Reserve and Marine Corps Reserve construction and land 
        acquisition projects (sec. 2603)
    The committee recommends a provision that would authorize 
military construction projects for the Navy Reserve and Marine 
Corps Reserve for fiscal year 2013. The authorized amounts are 
listed on a location-by-location basis.
Authorized Air National Guard construction and land acquisition 
        projects (sec. 2604)
    The committee recommends a provision that would authorize 
military construction projects for the Air National Guard for 
fiscal year 2013. The authorized amounts are listed on a 
location-by-location basis.
Authorized Air Force Reserve construction and land acquisition projects 
        (sec. 2605)
    The committee recommends a provision that would authorize 
military construction projects for the Air Force Reserve for 
fiscal year 2013. The authorized amounts are listed on a 
location-by-location basis.
Authorization of appropriations, National Guard and Reserve (sec. 2606)
    The committee recommends a provision that would authorize 
appropriations for the reserve component military construction 
projects authorized for construction for fiscal year 2013 in 
this Act. This provision would also provide an overall limit on 
the amount authorized for military construction projects for 
each of the reserve components of the military departments. The 
State list contained in this report is the binding list of the 
specific projects authorized at each location.

                       Subtitle B--Other Matters

Extension of authorization of certain fiscal year 2009 project (sec. 
        2611)
    The committee recommends a provision that would extend the 
fiscal year 2009 authorization for a project until October 1, 
2013, or the date of an act authorizing funds for military 
construction for fiscal year 2014, whichever is later.
Extension of authorization of certain fiscal year 2010 projects (sec. 
        2612)
    The committee recommends a provision that would extend the 
fiscal year 2010 authorization for three projects until October 
1, 2013, or the date of an act authorizing funds for military 
construction for fiscal year 2014, whichever is later.
          TITLE XXVII--BASE REALIGNMENT AND CLOSURE ACTIVITIES

Summary and explanation of tables
    The budget request included $349.3 million for the ongoing 
cost of environmental remediation and other activities 
necessary to continue implementation of the 1988, 1991, 1993, 
and 1995 Base Realignment and Closure (BRAC) rounds.
    In addition, the budget requested an authorization of 
appropriations of $126.7 million for implementation of the 2005 
BRAC round.
    The committee recommends funding at these levels.

Authorization of appropriations for base realignment and closure 
        activities funded through Department of Defense base closure 
        account 1990 (sec. 2701)

    The committee recommends a provision that would authorize 
appropriations for fiscal year 2013 for ongoing activities that 
are required to implement the decisions of the 1988, 1991, 
1993, and 1995 Base Realignment and Closure rounds.

Authorization of appropriations for base realignment and closure 
        activities funded through Department of Defense base closure 
        account 2005 (sec. 2702)

    The committee recommends a provision that would authorize 
appropriations for military construction projects for fiscal 
year 2013 that are required to implement the decisions of the 
2005 Base Realignment and Closure round. The table included in 
this title of the report lists the specific amounts authorized 
at each location.

Technical amendments to section 2702 of fiscal year 2012 Act (sec. 
        2703)

    The committee recommends a provision that would make a 
technical amendment and a conforming amendment to section 2702 
of the Military Construction Authorization Act for Fiscal Year 
2012 (division B of Public Law 112-81; 125 Stat. 1681).

Criteria for decisions involving certain base closure and realignment 
        activities (sec. 2704)

    The committee recommends a provision that would direct the 
Comptroller General to develop objective criteria to be used by 
the Department of Defense to make decisions relating to 
realignments of units employed at military installations that 
are not currently covered by section 2687 of title 10, United 
States Code.
    The provision would also include a 1-year moratorium on 
implementing any realignment that would result in a military 
installation covered under section 2687 to no longer be covered 
by section 2687. This moratorium could be waived by the 
Secretary of Defense if he certifies that the action is in the 
national security interests of the United States.

                        Item of Special Interest


Government Accountability Office review of the systems and processes 
        that the Department uses to identify the extent to which bases 
        or facilities are excess to needs

    The Department of Defense (DOD) has requested authorization 
for base realignment and closure (BRAC) rounds in 2013 and 
2015. In justifying this request, the Deputy Under Secretary of 
Defense for Installations and Environment, Dorothy Robyn, 
testified in March 2012, that ``given the cost of our 
installation infrastructure, we cannot afford to maintain 
excess capacity. Parametric techniques used to analyze various 
capacity measures in 2004 indicated that the Department had 24 
percent excess capacity overall relative to force structure 
plans developed by the Joint Staff. . . . Because BRAC 2005 
eliminated only about three percent of the Department's 
capacity, we believe we have significant excess capacity 
today.''
    The committee is concerned about the adequacy of the 
processes that DOD uses to determine excess infrastructure 
capacity based on a variety of conflicting statements from 
senior departmental officials.
    Senior Army officials have been quoted as stating that the 
Army has no interest in another BRAC round. Yet, recent 
briefings to the committee suggest that the Army does have 
excess capacity.
    Senior Air Force officers have been quoted as saying that 
the Air Force has too many bases thus suggesting the need for a 
BRAC round and yet the Service did not propose many significant 
base closures when it had the authority to propose such 
closures in BRAC 2005.
    A recent Government Accountability Office (GAO) report 
raises additional questions about the extent to which DOD 
actually knows how much excess capacity exists. Specifically, 
in Excess Facilities: DOD Needs More Complete Information and a 
Strategy to Guide Its Future Disposal Efforts (GAO-11-814) the 
GAO reported that the Air Force reported a utilization rate of 
0 percent for 22,563 buildings that were in an active status, 
DOD reported utilization rates for 32,999 facilities to the 
Federal Real Property Profile even though DOD's database which 
is the authoritative source of this information had no 
utilization information for these facilities, and DOD officials 
acknowledged an inability to accurately identify vacant and 
underutilized real property.
    Finally, the GAO reported in Defense Infrastructure: Army 
Needs to Improve Its Facility Planning Systems to Better 
Support Installations Experiencing Significant Growth (GAO-10-
602) that the Army planned to spend about $31.0 billion through 
fiscal year 2015 to meet facility needs but would still have 
shortages of some types of facilities thus raising questions 
about whether closing bases is the right strategy for coping 
with shortages of facilities.
    The committee directs the Comptroller General to conduct a 
review of the systems and processes that DOD uses to identify 
the extent to which bases or facilities are excess to needs. 
This review shall address the following:
          (1) How DOD identifies bases or other infrastructure 
        that are excess to its needs;
          (2) How well integrated DOD's force structure 
        planning processes are with its base infrastructure 
        planning processes;
          (3) To what extent concerns raised in prior GAO 
        reports about the ability of DOD to accurately identify 
        its utilization of bases and facilities have been 
        addressed; and
          (4) Any additional matters that the Comptroller 
        General determines to be relevant.
    The Comptroller General shall report the results of his 
study to the congressional defense committees by May 7, 2013.
         TITLE XXVIII--MILITARY CONSTRUCTION GENERAL PROVISIONS

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

Authorized cost and scope variations (sec. 2801)
    The committee recommends a provision that would amend 
section 2853 of title 10, United States Code, to clarify the 
authorizations for scope variations in military construction 
and family housing projects.
    The committee is extremely concerned by recent discoveries 
that contracts for the construction of Department of Defense 
(DOD) facilities resulted in military construction projects 
that exceeded the scope of work authorized by Congress. The 
committee was notified on April 30, 2012, that nine Army 
National Guard projects in various states of construction would 
result in facilities that will exceed the size specifically 
authorized by Congress in past National Defense Authorization 
Acts. Army National Guard representatives attributed the 
violations to ``human error'' and requested immediate 
legislative action to authorize the higher scope in order to 
preclude delays to the construction of the facilities.
    In addition, the Inspector General of the Department of 
Defense (DODIG) released a report on February 27, 2012, titled 
''Guidance Needed to Prevent Military Construction Projects 
From Exceeding the Approved Scope of Work (Report No. DODIG-
2012-057)'' which found that the design process for three 
military construction projects did not result in U.S. Army 
Corps of Engineers and Air Force Center for Engineering and the 
Environment (AFCEE) officials constructing facilities in 
accordance with facility sizes on the congressional request for 
authorization. Additionally, AFCEE officials improperly 
authorized the construction of facilities for one project, 
because they did not conduct scope verifications and perform 
proper contract administration. As a result, AFCEE officials 
improperly authorized the expenditure of at least $3.3 million.
    The DODIG concluded that ``this occurred because the scope 
of work variations permissible by section 2853, title 10, 
United States Code, from the congressional request for 
authorization are unclear and inconsistently applied.'' As a 
result, Department of Defense officials do not have assurances 
that military construction projects are built consistent with 
congressional intent and in accordance with legislative 
requirements.
    The committee expects that the Department of Defense has 
guidance and regulations in place to ensure compliance with 
military construction statutes and to ensure hundreds of 
military construction projects authorized each year are carried 
out consistent with congressional intent. Therefore, the 
committee directs the Secretary of Defense to incorporate the 
clarifications of section 2853 imposed by this provision into 
current Department regulations and to provide a report to the 
congressional defense committees not later than March 1, 2013, 
describing clear, concise, and comprehensive guidance and 
processes established with the Department to preclude any human 
errors from resulting in a violation of law.
Comptroller General report on in-kind payments (sec. 2802)
    The committee recommends a provision that would require the 
Comptroller General of the United States to submit a report on 
the construction or renovation of Department of Defense 
facilities with in-kind payments.
Extension of temporary, limited authority to use operation and 
        maintenance funds for construction projects in certain areas 
        outside the United States (sec. 2803)
    The committee recommends a provision that would reauthorize 
contingency contracting authority in certain areas outside the 
United States for one more year.

        Subtitle B--Real Property and Facilities Administration

Authority to accept as consideration for leases of non-excess property 
        of military departments and defense agencies real property 
        interests and natural resource management services related to 
        agreements to limit encroachment (sec. 2811)
    The committee recommends a provision that would amend 
section 2667 of title 10, United States Code, to allow the 
authorities available under the enhanced use lease program to 
be used to develop buffer areas around military installations 
to help prevent land uses that are incompatible with military 
operations and to preserve the environment under the Readiness 
and Environmental Protection Initiative codified in section 
2684a of title 10, United States Code.
Clarification of parties with whom Department of Defense may conduct 
        exchanges of real property at military installations (sec. 
        2812)
    The committee recommends a provision that would clarify 
with whom the Department of Defense may conduct exchanges of 
real property at military installations.

                      Subtitle C--Energy Security

Guidance on financing for renewable energy projects (sec. 2821)
    The committee recommends a provision that would require the 
Department of Defense to issue guidance for financing renewable 
energy projects.
Continuation of limitation on use of funds for Leadership in Energy and 
        Environmental Design (LEED) gold or platinum certification 
        (sec. 2822)
    The committee recommends a provision that would extend the 
prohibition on the use of funds for Leadership in Energy and 
Environmental Design (LEED) gold or platinum certification 
until 6 months after the report required in section 2830(b)(1) 
of the Military Construction Authorization Act for Fiscal Year 
2012 (division B of Public Law 112-81; 125 Stat. 1695) is 
submitted.
Prohibition on biofuel refinery construction (sec. 2823)
    The committee recommends a provision that would prohibit 
the Department of Defense from entering into a contract to 
plan, design, or construct a biofuel refinery or any other 
facility or infrastructure used to refine biofuels unless such 
planning, design, or construction is specifically authorized by 
law.

                      Subtitle D--Land Conveyances

Land conveyance, local training area for Browning Army Reserve Center, 
        Utah (sec. 2831)
    The committee recommends a provision that would authorize 
the conveyance of real property at Browning Army Reserve 
Center, Utah.
Use of proceeds, land conveyance, Tyndall Air Force Base, Florida (sec. 
        2832)
    The committee recommends a provision that would modify the 
authorities for use of proceeds of a land conveyance at Tyndall 
Air Force Base, Florida.

                       Subtitle E--Other Matters


Clarification of authority of Secretary to assist with development of 
        public infrastructure in connection with the establishment or 
        expansion of a military installation (sec. 2841)

    The committee recommends a provision that would require 
specific authorization of any grant, cooperative agreement, or 
supplement of funds available under federal programs 
administered by agencies other than the Department of Defense 
that result in the development of public infrastructure.

Petersburg National Battlefield boundary modification (sec. 2842)

    The committee recommends a provision that would modify the 
boundary of the Petersburg National Battlefield.

Congressional notification with respect to oversight and maintenance of 
        base cemeteries following closure of overseas military 
        installations (sec. 2843)

    The committee recommends a provision that would require 
notification with respect to oversight and maintenance of base 
cemeteries following the closure of overseas military 
installations.

 DIVISION C--DEPARTMENT OF ENERGY NATIONAL SECURITY AUTHORIZATIONS AND 
                          OTHER AUTHORIZATIONS

      TITLE XXXI--DEPARTMENT OF ENERGY NATIONAL SECURITY PROGRAMS

         Subtitle A--National Security Programs Authorizations

Overview
    Title XXXI authorizes appropriations for atomic energy 
defense activities of the Department of Energy for fiscal year 
2013, including: the purchase, construction, and acquisition of 
plant and capital equipment; research and development; nuclear 
weapons; naval nuclear propulsion; environmental restoration 
and waste management; operating expenses; and other expenses 
necessary to carry out the purposes of the Department of Energy 
Organization Act (Public Law 95-91). This title authorizes 
appropriations in three categories: (1) National Nuclear 
Security Administration (NNSA); (2) defense environmental 
cleanup; and (3) other defense activities.
    The budget request for atomic energy defense activities at 
the Department (rounded up to the first significant decimal 
point) totaled $17.9 billion. Of the total amount requested:
          (1) $11.6 billion is for NNSA, of which:
          (a) $7.6 billion is for weapons activities;
          (b) $2.5 billion is for defense nuclear 
        nonproliferation activities;
          (c) $1.1 billion is for naval reactors; and
          (d) $411.3 million is for the Office of the 
        Administrator;
          (2) $5.5 billion is for defense environmental 
        cleanup; and
          (3) $830.7 million is for other defense activities.
    The committee recommends $17.4 billion for atomic energy 
defense activities. Of the amounts authorized, the committee 
recommends:
          (1) $11.5 billion for NNSA, of which;
          (a) $7.6 billion is for weapons activities;
          (b) $2.5 billion is for defense nuclear 
        nonproliferation activities;
          (c) $1.2 billion is for naval reactors; and
          (d) $386.3 million is for the Office of the 
        Administrator;
          (2) $5.0 billion for defense environmental cleanup 
        activities; and
          (3) $828.7 million for other defense activities.
National Nuclear Security Administration (sec. 3101)
    The committee recommends a provision that would authorize a 
total of $11.5 billion for the Department of Energy (DOE) in 
fiscal year 2013 for the National Nuclear Security 
Administration (NNSA) to carry out programs necessary to 
national security.
Weapons activities
    The committee recommends $7.6 billion for weapons 
activities.
    The committee recommends funding for these programs as 
follows: $2.1 billion for directed stockpile work; $1.7 billion 
for campaigns; $2.2 billion for readiness in the technical base 
and facilities; $219.4 million for the secure transportation 
asset; $247.6 million for nuclear counterterrorism incident 
response; $88.3 million for site stewardship; $643.3 million 
for safeguards and security; and $10.0 million for national 
security applications.
    The committee notes that notwithstanding the congressional 
support for further modernization of the nuclear weapons 
complex infrastructure and the life extension programs, the 
committee urges the NNSA to find efficiencies where and 
whenever possible. The ability to sustain these increases 
during a time of decreasing federal and defense budgets will be 
increasingly difficult as time goes on. Good stewardship of the 
funding, as well as the nuclear weapons and the nuclear weapons 
complex, is critical to the long-term support for and 
sustainment of the projected increases.
Directed stockpile work
    The committee recommends $2.1 billion for directed 
stockpile work. The directed stockpile account supports work 
directly related to weapons in the stockpile, including day-to-
day maintenance as well as research, development, engineering, 
and certification activities to support planned life extension 
programs. This account also includes fabrication and assembly 
of weapons components, feasibility studies, weapons 
dismantlement and disposal, training, and support equipment.
    The committee understands that for fiscal year 2013, the W-
76 program was lowered by some $79,000,000 relative to fiscal 
year 2013 budgetary estimates in the fiscal year 2012 budget 
submission in order to pay for the increased costs of the B-61 
refurbishment. The reduced funding of the W-76 has led to a 
change in the mix of active verses hedge warheads delivered to 
the Navy by the Pantex plant. The result is that now only 
active warheads are to be delivered with hedge warheads in the 
out years after the submarine fleet has been refurbished. 
Testimony before the committee had indicated that the Navy, 
while concerned with this new delivery schedule, can 
accommodate the increased risk to the submarine fleet. It is 
the committee's understanding that for fiscal year 2013, the 
NNSA has actually underfunded the W-76 program such that it 
cannot even deliver the needed active warheads to the submarine 
fleet. After inquiries to the NNSA on which adjustments to 
budget lines must be made to accommodate for this error, the 
committee is told that the NNSA will not know what to adjust 
until they have a full cost estimate of the B-61 phase 2A study 
completed this summer, leading to a cascade of re-programming 
requests to Congress, all the while the Navy submarine fleet is 
left uncertain if this error will affect their home port 
maintenance schedules. The committee recommends an increase of 
$25,000,000 to the W-76 Directed Stockpile line taken from the 
NNSA Office of the Administrator line, which the committee 
understands is to be used for network integration.
Campaigns
    The committee recommends $1.8 billion for campaigns. The 
campaigns focus on science and engineering efforts involving 
the three nuclear weapons laboratories, the Nevada National 
Security Site, and the weapons production plants. Each campaign 
is focused on a specific activity to support and maintain the 
nuclear stockpile without underground nuclear weapons testing. 
These efforts form the scientific underpinning of the 
Department of Energy's annual certification that the stockpile 
remains safe, secure, and reliable without nuclear weapons 
testing.
    The committee remains concerned about the hurdles to 
ignition at the National Ignition Facility (NIF), which is 
still several orders of magnitude below the stated energy level 
to achieve it. The committee recognizes that the NIF has 
numerous other stockpile, defense related and non-defense 
related, missions and that important research remains to be 
done in these other areas. However, none rise to the level as 
understanding the physics of ignition for stockpile 
stewardship. The NNSA must strike a careful balance of ensuring 
there is still focus on this objective within the limited 
funding allocated for the machine and must not let lack of 
achieving ignition in the short-term cause long-term drifting 
to other missions to justify the funding.
    The committee recognizes the importance of having a 
domestic source for enriched uranium using U.S. technology to 
meet our Nation's future tritium requirements to ensure the 
safety and reliability of the U.S. nuclear arsenal consistent 
with the fiscal year 2013 budget request.
    The 2012 Stockpile Stewardship and Management plan defines 
the elements of the stockpile stewardship program including the 
careful planning that goes into designing and developing the 
science, technology, and engineering (STE) program. The STE 
program provides the physics based understanding needed to 
predict performance of various weapons components to support 
the life extension and surveillance programs. As stated in the 
report: ``these [STE capabilities] determine what can be 
engineered and the spectrum of changes that can be confidently 
assessed without UGT [underground testing.]'' Two of the key 
elements of the STE program are the Predictive Capability 
Framework (PCF) and the Component Maturation Framework (CMF). 
Each of these frameworks have a detailed, complementary 15-year 
plan. The PCF plan carefully balances the four key components 
of weapons assessment with the development of experimental and 
computation capabilities. The CMF develops the components 
needed for life extension based on the development of the 
knowledge and predicative capabilities derived from the PCF. As 
the plan states: ``These strategies are coupled because the CMF 
includes the maturation plans for development and production of 
stockpile sustainment components. PCF provides the tools and 
capabilities for establishing the environments that those 
components will witness and the qualification of those 
components in meeting performance specifications.''
Readiness in the technical base
    The committee recommends $2.4 billion for readiness in the 
technical base (RTBF). This account funds facilities and 
infrastructure in the nuclear weapons complex and includes 
construction funding for new facilities.
    The committee is concerned about the additional increase of 
$150,000,000 added to the budget for replacing building 9212 at 
the Y-12 plant. The committee is fully supportive of replacing 
building 9212 and building a Uranium Processing Facility. 
However, the committee understands that the Y-12 plant was not 
formally notified of the increase until February 13, 2012, the 
same day the deferral of the Chemistry and Metallurgy Research 
Replacement building was announced to Los Alamos. The way the 
NNSA announced this decision leads the committee to believe 
that this additional funding was made in haste. The structure 
of the contract to build the facility is now changing from 
integrated product design leading to final construction, to one 
of ``design build'' where the building is built first to show 
progress and then subcontracts are let from the main contractor 
to back fill the equipment and processes, which are inherently 
complicated. The committee notes that the ``design build'' 
concept was used at the Waste Treatment Project at Hanford, and 
is considered one of the largest cost overruns in the 
Department of Energy's history. Not more than $190,000,000 may 
be spent on project 06-D-141 (the amount identified for fiscal 
year 2013 in the fiscal year 2012 budget submission) until the 
NNSA reaches a 90-percent engineering design phase and submits 
to the congressional defense committees CD-2 baseline 
information and the structure of the contract to build and 
equip the Uranium Processing Facility.
    With the proposed cancellation of the Chemistry and 
Metallurgy Research Replacement (CMRR) building, the NNSA has 
proposed an alternative plutonium strategy. This alternative 
strategy concerns the committee.
    A good rule of thumb with plutonium is that its operations 
are centralized in one place. The committee's understanding is 
that the NNSA will de-inventory the Plutonium Facility (PF)-4 
building at Los Alamos where plutonium operations occur and 
store the plutonium at the Device Assembly Facility (DAF) at 
the Nevada National Security Site, which is 663 miles and more 
than 10 hours away from the PF-4. The committee understands 
that DAF needs upgrades to its safety systems for a material 
that is inherently exothermic in air. The committee understands 
that plutonium testing and operations at Lawrence Livermore 
National Laboratory will be reinstated--after the NNSA has told 
Congress they have saved money by lowering the security posture 
there and told the local communities that they have de-
inventoried the laboratory of plutonium. The committee 
understands that the NNSA is increasing the quantity of 
plutonium at the Radiological Laboratory Office Building 
(RLOUB) at Los Alamos, which is designed for small amounts of 
plutonium for radio-chemistry purposes (up to 26 grams) and 
questions what, if anything, increasing the quantity at RLOUB 
for analytical chemistry purposes gives towards helping the 
process flow issues inside PF-4 at Los Alamos where large 
quantities (kilograms) of plutonium are handled. There is a 
large excavation next to PF-4 where the CMRR Nuclear Facility 
(CMRR-NF) was to be built, the committee would like to know how 
the NNSA plans to maintain such a large excavation next to PF-4 
when it plans to defer CMRR-NF ``for at least 5 years''. 
Finally there is the issue of a tunnel connecting PF-4 to 
RLOUB, which must go past the large excavation for the CMRR-NF 
to help expedite the flow of small samples. This tunnel is 
larger than that from CMRR-NF to PF-4. The committee's 
understanding is the deferral of CMRR-NF will lead to in some 
cases a loss of materials characterization and materials 
compatibility tests for larger test samples of plutonium that 
cannot be duplicated elsewhere. Some of these capabilities, 
such as crystal growth, may be impossible to recreate 
elsewhere.
    Once it learned of the proposed cancellation, the committee 
asked the Department of Defense (DOD) if the requirement for 
50-80 pits a year was still valid and was told it was. How will 
transporting plutonium across the U.S. to different NNSA 
facilities be any more safe and secure and cost less than CMRR-
NF adjacent to PF-4? The committee also understands that 
without CMRR-NF, no plan exists for meeting the DOD 
requirements.
    The committee finds that the alternative plutonium strategy 
could cost upwards of $1.0 billion to delay the CMRR-NF by ``at 
least 5 years'' resulting if built, a 25-30 percent increase in 
the CMRR-NF cost or about another $2.0 billion. Unknown is the 
cost to re-start the CMRR-NF project or how the regulatory 
structure 5 or more years from now will have changed. The net 
result of this deferral is a cost escalation of some $3.0 
billion to the taxpayer with even more uncertainty on the 
Nation's plutonium strategy much less ensuring Los Alamos can 
retain the unique expertise and scientists it has had since the 
Manhattan Project to handle this vital national mission. If 
CMRR-NF is not built, the alternative plutonium strategy will 
simply shift increased pit costs from not using a single 
facility into future life extension programs in the out years.
    Given the magnitude of the consequences of the alternative 
plutonium proposal by the NNSA, the committee directs the 
Government Accountability Office, on an expedited basis, to 
review the NNSA's proposed plutonium strategy to determine 
relative to the CMRR-NF whether (1) it is safer than if CMRR-NF 
were started on its original schedule and if not, what are the 
added risks to public health and safety, (2) what is the added 
cost in addition to the deferral of CMRR-NF, especially to 
future life extension programs, (3) what burden will be placed 
on PF-4 in terms of process flow and ability to meet the DOD 
requirement (as compared to starting CMRR-NF on its original 
schedule), (4) what is the estimated cost and time of building 
an entirely new facility accomplishing both the functions of 
CMRR-NF and PF-4 at the least costly location in the NNSA 
complex, and (5) what would be the impact on the plutonium 
science mission at Los Alamos. The committee requests this 
study no later than January 31, 2013.
    The committee is supportive of the High Explosives Pressing 
Facility at Pantex and encourages the NNSA to make this 
facility a center of excellence in the NNSA for high explosives 
pressing and manufacturing.
Secure transportation asset
    The committee recommends $219.4 million for the secure 
transportation asset (STA). The secure transportation asset is 
responsible for the transportation of nuclear weapons, weapons 
materials, and components, and other materials requiring safe 
and secure transport. If the STA resumes consideration of a 
third-party leasing option, the committee expects STA to fully 
notify Congress of such arrangements in advance of executing 
any leases.
Nuclear counterterrorism incident response
    The committee recommends $247.6 million for nuclear 
counterterrorism incident response.
Site stewardship
    The committee recommends $90.0 million for site 
stewardship.
Safeguards and security
    The committee recommends $643.3 million for safeguards and 
security.
National security applications
    The committee recommends $10.0 million for national 
security applications.
Defense Nuclear Nonproliferation programs
    The committee recommends $2.6 billion for the Defense 
Nuclear Nonproliferation program. The NNSA has management and 
oversight responsibility for the nuclear nonproliferation 
programs at the DOE.
    The committee recommends funding for these programs as 
follows: $548.2 million for nonproliferation and verification 
research and development (R&D), which includes $150,000 for 
urnanium enrichment R&D; $150.1 million for nonproliferation 
and international security; $311.0 million for international 
nuclear materials production and cooperation; $92.3 million for 
fissile materials disposition; and $466.0 million for the 
global threat reduction initiative.
Nonproliferation and verification research and development
    The committee recommends $548.2 million for 
nonproliferation and verification research and development. The 
committee requests a 5 year road map for the nuclear detonation 
detection mission as integrated with the Department of Defense 
no later than January 31, 2013.
    The committee continues to support the valuable research 
and development work that is conducted under this program. The 
additional funding will support high priority research 
requirements including work to support the long-term ability of 
the United States to monitor and detect clandestine nuclear 
weapons development activity, and to attribute nuclear weapons, 
improvised nuclear devices, and radiological dispersal devices. 
Much of the work supported by NNSA is unique to the Federal 
Government and serves as the technical basis for work by many 
other agencies including the Department of Homeland Security 
and the Department of Defense.
Nonproliferation and international security
    The committee recommends $150.1 million for 
nonproliferation and international security. The committee 
recommends bringing the Global Initiatives for Proliferation 
Prevention program in Russia to a close at the end of 2012.

International nuclear materials protection and cooperation

    The committee recommends $311.0 million for international 
nuclear materials protection and cooperation.

Fissile materials disposition

    The committee recommends $921.3 million for fissile 
materials disposition. This fissile materials disposition 
program converts excess weapons grade plutonium to mixed oxide 
(MOX) fuel for use in commercial power reactors. The United 
States and Russia have signed an agreement where each country 
has agreed to the disposition of 34 metric tons of excess 
weapons grade plutonium, thus removing the possibility that 
this plutonium could be reused for weapons or fall into the 
hands of terrorists. The committee has learned of another 
adjustment to the baseline of this program due in the summer of 
2012, which has already grown substantially over the past 13 
years, in addition to the cancellation of the feedstock 
facility after $700,000,000 has been spent in various stages of 
design. The committee expects to be fully informed of this 
baseline adjustment. The committee directs the NNSA to report 
to the congressional defense committees a roadmap over the life 
of the program on how the NNSA will supply the 34 metric tons 
of feedstock to the MOX facility noting the capacity and 
lifetime of each facility to prepare feedstock with a detailed 
cost estimate in the first 15-year window. The report must take 
into account recent decisions at the PF-4 facility and CMRR-NF. 
This report is due no later than December 31, 2012. The 
committee also understands the MOX facility is before the 
Nuclear Regulatory Commission for license. The committee 
directs the development of a quarterly update reporting system 
be established by the Nuclear Regulatory Commission (NRC) to 
the congressional defense committees, with the first report due 
September 30, 2012, advising the committees on the status of 
license review as well as its fuel forms, identifying issues of 
concern to the NRC. The committee also understands the 
estimated operating costs for the MOX facility are increasing 
and directs the NNSA report to the congressional defense 
committees by July 30, 2012, a historical review of the 
estimated operating costs of the MOX facility to understand the 
cost growth and trend.

Global threat reduction initiative

    The committee recommends $566.0 million for the global 
threat reduction initiative. The committee supports this effort 
to secure within 4 years, vulnerable nuclear material that 
could be used in a dirty bomb or in an improvised nuclear 
device.

Naval reactors

    The committee recommends $1.1 billion for naval reactors, 
including a $37.9 million increase above the budget request for 
the Ohio-class replacement reactor program. This program was 
decreased by $70.0 million relative to the fiscal year 2012 
budget projection for fiscal year 2013. The committee notes 
that the Naval Reactors program is under strong pressure in the 
5-year budget profile to meet its design specifications for the 
Ohio-class replacement reactor and recommends that the NNSA 
support any necessary changes needed to the Ohio-class reactor 
replacement program to ensure it is properly synchronized with 
the main submarine program which has slipped by 2 years. The 
committee remains concerned by the 2-year delay of the Ohio-
class replacement program, and directs Naval Reactors to 
deviate as little as possible from the schedule identified in 
the fiscal year 2012 budget. The committee understands the 
replacement for the Idaho fuel cooling pool has slipped by 2 
years as well and requests no later than July 31, 2012, a 
status update on this effort.
    The committee recommends a provision that would authorize 
three new plant projects for the Department of Energy, Naval 
Reactors that are in the fiscal year 2013 budget request. The 
first project, 13-D-903, at the Kesselring Site, West Milton, 
New York, will build a staff building for handling the 
increased number of trainees at the Kesselring Site Prototype 
Training Reactor. The second project, 13-D-904, will build 
additional radiological workspace for the overhaul of the 
Prototype Training Reactor at the Kesselring Site. The third 
project, 13-D-905, will develop a low level waste disposal site 
at the Idaho National Laboratory where Naval Reactors examine 
spent naval fuel.

Office of the Administrator

    The committee recommends $386.3 million for the Office of 
the Administrator, this represents a $25,000,000 decrease due 
to transfer of funds to the weapons activities account for 
information technology and networks. An equivalent amount of 
funding ($25,000,000) was then added back into the 
Administrator's account leading to in-effect a double counting.

Defense environmental cleanup (sec. 3102)

    The committee recommends a provision that would authorize 
$5.0 billion for defense environmental cleanup activities at 
the Department of Energy (DOE) but does not as in past years, 
include the $463,000,000 request for the Uranium Enrichment 
Decontamination and Decommissioning Fund (section 1801 of the 
Atomic Energy Act of 1954 (Public Law 83-703), as amended) 
whose authorization expired in 2007. The fiscal year 2013 
budget assumption for the $463,000,000 requires legislation to 
be adopted outside the jurisdiction of this committee. The 
defense environmental cleanup activities support the cleanup of 
contaminated facilities, soil, ground, and surface water, and 
the treatment and disposal of radioactive and other waste 
generated through the production of nuclear weapons and weapons 
materials. The environmental management program was established 
in 1989 to clean up 50 years of Cold War waste from the 
production of nuclear weapons and materials including plutonium 
and highly enriched uranium.

Savannah River Site

    The committee recommends $1.2 billion for the Savannah 
River Site. The committee commends the National Nuclear 
Security Administration and the Office of Environmental 
Management for continuing operations at the H-Canyon, which is 
the only large scale reprocessing line left in the United 
States. Past experience has shown that the H-Canyon will be 
needed as new waste streams evolve and as the National Nuclear 
Security Administration continues to receive returned highly 
enriched uranium research reactor fuels. The committee requests 
a 10-year roadmap for the H-Canyon usage due no later than 
January 31, 2013.

Waste Treatment Plant

    The committee continues to follow the progress at the Waste 
Treatment Plant at the DOE Hanford Site in Richland, 
Washington. The August 2011 review of the project found that it 
will likely exceed by $900,000,000 the current total cost 
estimate of $12.3 billion and now that it is nearing initial 
operations, attention should be turned towards integration of 
the tank farms and the plant itself as well as adjusting 
staffing towards operational personnel. The report recommended 
a $350,000,000 phased CD-4 approach. The committee directs the 
Department of Energy to provide to the congressional defense 
committees the outcome of this phased CD-4 approach no later 
than July 30, 2012, of efforts to integrate the tank farm and 
waste treatment plant contracts as well as any change to the 
total baseline cost of the project.

Other defense activities (sec. 3103)

    The committee recommends a provision that would authorize 
$828.7 million for other defense activities. The committee 
recommends $245.5 million for health and safety; $188.6 million 
for security; $177.9 million for Legacy Management; $118.8 
million for departmental administration; and $4.8 million for 
the Office of Hearings and Appeals.

   Subtitle B--Program Authorizations, Restrictions, and Limitations


Replacement project for Chemistry and Metallurgy Research building, Los 
        Alamos National Laboratory, New Mexico (sec. 3111)

    The committee recommends a provision that would direct the 
Secretary of Energy and the Administrator of the National 
Nuclear Security Administration (NNSA) to construct a building 
to replace the functions of the existing Chemistry and 
Metallurgy Research building at Los Alamos National Laboratory 
associated with Department of Energy (DOE) Hazard Category 2 
special nuclear material operations.
    The committee is strongly concerned with the budget 
proposal to defer ``by at least 5 years'' the replacement 
project for the Chemistry and Metallurgy Research Replacement 
Nuclear Facility (CMRR-NF) building at Los Alamos National 
Laboratory, New Mexico.
    A deferral ``for at least 5 years'' appears to be a 
cancellation. Based on the analysis the committee has received 
to date, it appears that such a cancellation would have an 
adverse impact on nuclear modernization programs.
    The 2009 report ``America's Strategic Posture'', chaired by 
former Secretaries of Defense, William Perry and James 
Schlesinger, recognized the significance of the CMRR project 
not because it was tied to a military number of pits but 
because it ``makes a direct contribution to the intellectual 
infrastructure that is in immediate danger of attrition''. They 
wisely noted that ``because the future size of the stockpile is 
uncertain, projects that are independent of the stockpile size 
should take priority. The uranium production facility's 
(building 9212 at Y-12) size is influenced by stockpile size . 
. . . The Los Alamos plutonium facility is required independent 
of stockpile size.'' They go further stating that, ``These 
considerations lead the commission to the conclusion that, if 
priority must be given, the Los Alamos plutonium facility 
should receive it.'' The point is that while today we are 
focused on CMRR-NF because the Department of Defense (DOD) 
states it has a pit need in the range of 50-80 by 2025, the 
fundamental reason CMRR-NF is needed is to maintain our 
Nation's ability to conduct continuous research with kilogram 
quantities of plutonium. A DOE Hazard Category 2 facility, such 
as CMRR-NF, was planned to be necessary to make a wide range of 
bulk mechanical measurements on pit behavior to ensure that 
even as pit aging occurs, we can be sure that the stockpile 
will continue to be safe, secure, and militarily effective.
    In a February 2, 2011, message from the President to the 
Senate on the New START Treaty, the President stated that he 
intends to ``(a) accelerate to the extent possible, the design 
and engineering phase of the Chemistry and Metallurgy Research 
Replacement (CMRR) building and the Uranium Processing Facility 
(UPF); and (b) request full funding, including on a multi-year 
basis as appropriate, for the CMRR building and the UPF upon 
completion of the design and engineering phase for such 
facilities.''
    The committee believes that the linkage between nuclear 
modernization and the New START Treaty's implementation is 
clearly established.
    In 2010, the Department of Defense and the Department of 
Energy signed a Memorandum of Agreement (MOA) concerning 
modernization of the U.S. nuclear infrastructure. In this MOA, 
DOD agreed to work with the Office of Management and Budget to 
transfer budget authority for NNSA's nuclear weapons and Naval 
Reactor programs. DOE agreed to use this transferred budget 
authority to supplement NNSA funding for among other things 
completing the design and beginning construction of the CMRR-NF 
facility at Los Alamos National Laboratory. The committee 
understands that DOD is providing the resources agreed to under 
the MOA and commends DOD for its commitment to the 
modernization of the nuclear weapons complex. The committee is 
disappointed in DOE's failure to comply with its previously 
agreed to obligations, and directs NNSA to provide the 
committee by September 30, 2012, a full accounting of the 
budget authority DOD is giving to DOE and a detailed 
description at the account level of the NNSA programs directly 
impacted through the transfer of DOD's budget authority.
    The committee authorizes $150.0 million of the amounts 
appropriated in fiscal year 2013 for the construction of the 
CMRR-NF facility and prohibits NNSA from reducing amounts 
authorized and appropriated for directed stockpile work, naval 
reactors, or Facility Project 06-D-141, Project Engineering & 
Design, Uranium Processing Facility, Y-12 National Security 
Complex, Oak Ridge, Tennessee, for this purpose.
    The committee expresses concern with the overall projected 
cost of the CMRR-NF facility and therefore directs that the 
facility meet the requirements identified in the April 2010 MOA 
regarding capabilities but that funding for the facility shall 
not exceed $3.7 billion. The practicability of implementing the 
design and construction of the facility shall focus on the 
costs and benefits as well as technical and economic 
feasibility of every major design characteristic that drives 
cost. The committee stresses the importance of the 
affordability of CMRR and strongly believes that a $3.7 billion 
cost ceiling is sufficient. The committee notes that One World 
Trade Center in New York City, which when complete will be the 
tallest building in the Western Hemisphere, is estimated to 
cost $3.9 billion. The committee believes both CMRR-NF and the 
UPF at Y-12 can be built affordably and directs the 
administration to achieve the cost savings necessary, so that 
the cost of CMRR-NF does not exceed the statutorily imposed 
cost ceiling.
    The committee is disappointed in the lack of transparency 
displayed by NNSA in its fiscal year 2013 budget deliberation 
process. It is evident that the level of rigor and due 
diligence necessary for a proposal as significant as the 
proposed deferral of CMRR-NF did not take place between NNSA 
and the national security laboratories, NNSA and the Department 
of Defense, and NNSA and Congress. Not until after the budget 
was released did NNSA seek input from the national laboratories 
on the cost and practicality of employing a new plutonium 
strategy. Furthermore, in testimony before the Senate Committee 
on Armed Services, General Robert Kehler, the Commander of U.S. 
Strategic Command testified that NNSA's fiscal year 2013 budget 
concerned him. According to General Kehler's testimony, ``the 
thing that concerns me the most is our continued investment in 
the weapons complex. And so the issue with CMRR-NF does concern 
me.''
    Elsewhere in this bill, the committee proposes to 
strengthen the oversight performed by the Nuclear Weapons 
Council (NWC). That provision would require the NWC to certify 
that the budget request meets nuclear stockpile and stockpile 
stewardship program requirements and seeks to prevent future 
instances where the Department of Defense and the Commander of 
U.S. Strategic Command are presented a budget that does not 
meet strategic requirements or national policy.

Submittal to Congress of selected acquisition reports and independent 
        cost estimates on nuclear weapon systems undergoing life 
        extension (sec. 3112)

    The committee recommends a provision that would require the 
National Nuclear Security Administration to provide selected 
acquisition reports on each nuclear weapon system undergoing 
life extension. The reports shall be based on existing 
provisions in section 2432 of title 10, United States Code. The 
provision also recommends independent cost estimates for 
nuclear weapons undergoing life extension at the completion of 
phase 6.2A and before entering Phase 6.5, first production.

Two year extension of schedule for disposition of weapons-usable 
        plutonium at Savannah River Site, Aiken, South Carolina (sec. 
        3113)

    The committee recommends a provision that would modify 
section 4306 of the Atomic Defense Energy Act (50 U.S.C. 2566) 
to extend the dates at which the Department of Energy must pay 
the State of South Carolina economic impact and assistance 
funds by 2 years so that it must be able to produce 1 metric 
ton of Mixed Oxide fuel by January 1, 2014, and 34 metric tons 
by January 1, 2021.

Program on science engagement for nonproliferation (sec. 3114)

    The committee proposes a provision that would authorize a 
program for scientific engagement of U.S. scientists with 
scientists in countries of concern with respect to 
nonproliferation. Such a program could bring insight and 
transparency into the ability of a country to adhere to 
international nonproliferation norms. Several conditions are 
placed on this program before any expenditure of funds: (1) a 
nonproliferation threat assessment of the country by the 
Director of National Intelligence; (2) clear metrics for 
success so that the program does not become stagnant in the 
country of concern; and (3) rigorous accounting standards 
approved by the Government Accountability Office to ensure that 
there is clear oversight of the funds expended. Items (1) and 
(2) must be performed again when the program transitions to 
another country. This overall program must demonstrate that it 
does not duplicate other nonproliferation efforts in the rest 
of the Executive Branch through a report to Congress due within 
180 days of enactment of this Act.

Repeal of requirement for annual update of Department of Energy defense 
        nuclear facilities workforce restructuring plan (sec. 3115)

    The committee recommends a provision that would repeal an 
annual reporting requirement of section 4604 of the Atomic 
Energy Defense Act (50 U.S.C. 27074). Since fiscal year 2005, 
the Department of Energy has neither requested nor received 
funding for enhanced severance benefits and community 
transition under section 4604. Given the absence of funding 
there is no need for the annual reporting requirement.

Quarterly reports to Congress on financial balances for atomic energy 
        defense activities (sec. 3116)

    The committee recommends a provision that would amend the 
Atomic Energy Defense Act (division D of Public Law 107-314) to 
require the Secretary of Energy to provide to the congressional 
defense committees quarterly obligation and expenditure rates 
for atomic energy defense programs based on the control points 
of the conference report accompanying the annual Energy and 
Water Development and Related Agencies Appropriations Act. This 
provision would cover both the National Nuclear Security 
Administration and the Department of Energy's Environmental 
Management Office (former defense sites). The committee 
understands that the Department currently provides these 
reports to the Appropriations committees of the Senate and the 
House of Representatives and requests access to that same level 
of information necessary for effective oversight.

Transparency in contractor performance evaluations by the National 
        Nuclear Security Administration leading to award fees (sec. 
        3117)

    The committee recommends a provision that would require the 
Administrator of the National Nuclear Security Administration 
to publish to the maximum extent practicable the performance 
evaluations developed by its site offices that result in award 
fees to the contractor. The provision also requires that future 
performance evaluations adhere to a common format so that 
Congress and the public can compare these evaluations between 
similar management contracts.

Expansion of authority to establish certain scientific, engineering, 
        and technical positions (sec. 3118)

    The committee recommends a provision that would amend 
section 3241 of the National Nuclear Security Act (50 U.S.C. 
2441) by increasing the ability of the Administrator to hire up 
to 700 contracting, scientific, engineering, and technical 
positions under hiring authorities used by the former Atomic 
Energy Commission (42 U.S.C. 2201(d)). This provision would 
only provide for additional hiring flexibility and would not 
result in an increase in the total number of authorized 
employees. Such authorities are also used by the Nuclear 
Regulatory Commission, which has been rated one of the best 
places to work in the Federal Government.

Modification and extension of authority on acceptance of contributions 
        for acceleration of removal or security of fissile materials, 
        radiological materials, and related equipment at vulnerable 
        sites worldwide (sec. 3119)

    The committee recommends a provision that would expand the 
authority of the Secretary of Energy under section 3132(f) of 
the Ronald W. Reagan National Defense Authorization Act for 
Fiscal Year 2005 (Public Law 108-375) for the Secretary to 
accept contributions from international partners to all 
programs within the National Nuclear Security Administration's 
Defense Nuclear Nonproliferation Program.

Cost containment for Y-12 Uranium Processing Facility, Y-12 National 
        Security Complex, Oak Ridge, Tennessee (sec. 3120)

    The committee recommends a provision that would add 
enhanced oversight of the Uranium Processing Facility 
construction project by requiring separate and distinct 
authorizations for each phase of the project.
    The Uranium Processing Facility project was first proposed 
as a formal construction project in the fiscal year 2006 budget 
request of the National Nuclear Security Administration (NNSA). 
The ``preliminary'' estimate for the project at that time was 
between $600,000,000 to $1,000,000,000. The cost estimate in 
the fiscal year 2013 budget request is now $6,500,000,000, an 
increase of at least 650 percent.
    The committee understands that the project will now be 
broken into three phases. The first phase involves replacing 
Building 9212. The second phase involves replacing Buildings 
9215 and 9998, which perform uranium metal working, machining, 
and inspection. The third phase involves replacing Building 
9204-2E, which performs radiography, assembly, disassembly, and 
inspection of nuclear warhead components. The committee 
understands that the final cost estimate, which is to be 
completed in early 2013, will only be for replacing the 
functions of Building 9212. Building 9212 was built during the 
Manhattan Project and by all accounts needs to be replaced 
given its poor condition and the critical functions it performs 
in purifying and casting uranium components.
    The committee understands the programmatic need for 
breaking the project into three phases but is also concerned 
about additional cost growth, even after accelerating the 
project by adding an additional $150,000,000 to it for fiscal 
year 2013.
    The committee has changed the budget tables to reflect an 
authorization of $340,000,000 for phase one of this project. 
Out of concern for cost growth, the committee is putting a cap 
on phase one at $4,200,000,000. The NNSA should expect similar 
budgetary caps to appear when the committee ascertains the 
projected cost of phases two and three, and will critically 
examine any additional growth above the fiscal year 2013 total 
project cost estimate of $6,500,000,000.
    The committee requests quarterly updates from the General 
Accountability Office (GAO) on all phases of the Uranium 
Processing Facility construction project. The updates should 
include, at a minimum, progress on adhering to cost projections 
as well as meeting the requirements of section 2753 of title 
50, United States Code, ``Notification of cost overruns for 
certain Department of Energy Projects'', the status of the 
technology readiness levels for equipment and processes that 
will accompany each phase of the project, independent cost 
estimates, the programmatic structure of the relationship 
between the prime contractor and sub-contractors, and any other 
issues that the GAO believes are important pertaining to the 
project's requirements, cost, schedule, and technology 
readiness levels.

Authority to restore certain formerly Restricted Data to the Restricted 
        Data category (sec. 3121)

    The committee recommends a provision that would amend 
section 142 the Atomic Energy Act, as amended (42 U.S.C. 2162) 
to restore to the Restricted Data category certain information 
that has been removed from that category pursuant to sections 
142(d) and 142(e). This provision was at the request of the 
Department of Energy. The data is currently treated as 
classified information. The provision also makes technical 
corrections to section 142(e) to account for the Director of 
National Intelligence. The proposed provision would permit the 
Department of Energy, in conjunction with the Department of 
Defense or the Director of National Intelligence to restore 
formerly Restricted Data to its original Restricted Data 
category.

                          Subtitle C--Reports


Report on actions required for transition of regulation of non-nuclear 
        activities of the National Nuclear Security Administration to 
        other federal agencies (sec. 3131)

    The committee recommends a provision that would require the 
Secretary of Energy submit to the congressional defense 
committees a report on actions required to transition, to the 
maximum extent practicable, the regulation of non-nuclear 
operations of the National Nuclear Security Administration over 
a period of 5 years to federal agencies other than the 
Department of Energy (DOE). The provision would require the 
transition plan be submitted to the congressional defense 
committees not later than February 28, 2013.
    The committee directs the Government Accountability Office 
to concurrently report to the congressional defense committees 
by February 28, 2013, those DOE regulations in section 851 of 
title 10, Code of Federal Regulations, that are more 
protective, comparable, or less protective, than those of 
outside federal agencies.
    The committee expects the Department to perform wide 
outreach with the public, affected communities, and employees 
of its facilities in developing this plan.

Report on consolidation of facilities of the National Nuclear Security 
        Administration (sec. 3132)

    The committee recommends a provision that would require the 
Nuclear Weapons Council (NWC) to report to the congressional 
defense committees no later than 180 days after enactment of 
this Act, on the feasibility of consolidation in the National 
Nuclear Security Administration Complex if excess facilities 
exist and consolidation would reduce cost. If the NWC finds 
further consolidation is feasible, the report shall recommend a 
process for consolidation. No funds may be spent on phase CD-3 
(start of construction) of the Chemistry and Metallurgy 
Research Replacement building, Department of Energy Project 04-
D-125 and the Uranium Processing Facility, 06-D-141 until such 
report is transmitted to the congressional defense committees.

Regional radiological security zones (sec. 3133)

    The committee proposes a provision that would have the 
National Nuclear Security Administration prepare a report on 
the feasibility of establishing radiological security zones on 
a regional basis rather than on a country by country case as is 
now done. The report should include the estimated costs of 
establishing and monitoring such zones through centralized 
monitoring centers. The report is due no later than 180 days 
after date of enactment of this Act.

Report on legacy uranium mines (sec. 3134)

    The committee recommends a provision that would require the 
Secretary of Energy to prepare a report on abandoned uranium 
mines used by the U.S. atomic weapons program. The report is 
due 18 months after the date of enactment of this Act.

Comptroller General of the United States review of projects carried out 
        by the Office of Environmental Management of the Department of 
        Energy pursuant to the American Recovery and Reinvestment Act 
        projects (sec. 3135)

    The committee recommends a provision that would modify 
section 3134 of the National Defense Authorization Act (NDAA) 
for Fiscal Year 2010 (Public Law 111-84) which requires the 
Government Accountability Office (GAO) to conduct several 
reviews of clean-up projects under the American Recovery and 
Reinvestment Act (ARRA) of 2009 (Public Law 111-5) carried out 
by the Department of Energy's Office of Environmental 
Management (EM) that would eliminate the 120-day status 
briefings on project performances. Section 3134 required a 
number of reviews by the GAO: (1) an initial review due 30 days 
from the enactment of the NDAA for Fiscal Year 2010 on the 
criteria used by EM to select projects to be carried out under 
ARRA along with a description of the process used to validate 
the scope, cost, and schedule for these projects; (2) status 
briefings on project performance 30 days after submission of 
the first report and every 120 days thereafter until all EM 
ARRA funds are expended; and (3) a capping report on the 
implementation of all EM projects carried out under ARRA. GAO 
would complete its ongoing engagement as well as the capping 
report.
    GAO completed the first review and has subsequently 
completed eight status briefings. GAO is currently working on a 
full engagement to report on project status, which will provide 
the bulk of the information needed to complete the capping 
report. At this point, EM is not likely to completely expend 
ARRA funds until at least the end of fiscal year 2013.

                       Items of Special Interest


General Accountability Office Study of National Nuclear Security 
        Administration Cost Estimating Practices

    The committee has found that the National Nuclear Security 
Administration (NNSA) has been inconsistent in the application 
of cost estimating practices on the B-61 gravity bomb program 
and several other large projects such at the Chemistry and 
Metallurgy Research Replacement Facility for Nuclear 
Operations.
    The committee directs the General Accountability Office to 
conduct an audit of the cost estimating practices of the NNSA 
with recommendations to bring the NNSA into compliance with 
generally accepted cost estimating practices used for similar 
projects. The report will be due March 1, 2013.

National Ignition Facility overhead structure

    The committee has found that National Nuclear Security 
Administration (NNSA) National Ignition Facility (NIF) has been 
using a different overhead rate from the rest of the Lawrence 
Livermore National Laboratory, which has caused a large dollar 
impact when requested to be moved to a similar rate as the rest 
of the lab.
    The committee directs the NNSA to move the NIF to the 
Readiness in Technical Base and Facilities funding schedule in 
the fiscal year 2014 budget documentation.

Readiness in Technical Base and Facilities

    The committee has found that there have been recent 
attempts to consolidate the funding for the nuclear weapons 
program's Readiness in Technical Base and Facilities (RTBF) 
outside the Deputy Administrator for Defense Programs. Such 
consolidation of the RTBF away from the line manager's 
responsible for the weapons program is inconsistent with 
principals of good management. The committee directs the 
National Nuclear Security Administration to ensure that line 
responsibility for the RTBF rest with the Deputy Administrator 
for Defense Programs.

Acquisition corps

    The committee has found that the National Nuclear Security 
Administration (NNSA) suffers from a lack of consistent 
standards for large program acquisition. The committee directs 
the NNSA to report no later than January 30, 2013, on a plan to 
develop a structure for acquisition personnel similar to that 
in the Department of Defense in chapter 87 of title 10 United 
States Code.

Plan for use of Office of Science facilities

    The committee has found that the National Nuclear Security 
Administration (NNSA) uses a wide range basic science 
facilities operated by the Department of Energy's (DOE) Office 
of Science as part of its stockpile stewardship program. These 
user facilities include the Advanced Photon Source at Argonne 
National Laboratory, the Spallation Neutron Source at Oak Ridge 
National Laboratory and the Linac Coherent Light Source at the 
SLAC National Accelerator Laboratory. Using DOE's state the art 
user facilities is an excellent example of how the NNSA 
maintains excellence in its science base while supporting 
Department of Energy facilities as a whole. The committee 
directs the NNSA to prepare a report to the congressional 
defense committees a long-term plan for the use of current and 
future Office of Science facilities such as the Facility for 
Rare Isotope Beams and the National Synchrotron Light Source 
relative to support the stockpile stewardship program.

Independence of the National Nuclear Security Administration

    The committee has found that the National Nuclear Security 
Administration (NNSA) is often burdened with extra 
responsibilities assigned by the Secretary of Energy. The 
committee requests that no later than January 30, 2013, the 
Nuclear Weapons Council evaluate the semi-independent nature of 
the NNSA as originally created in 1999 and report back to the 
Committees on Armed Services of the Senate and the House of 
Representatives and Committees on Appropriations of the Senate 
and the House of Representatives on measures that can be taken 
so that the NNSA operates according to its original legislative 
intent.

Adherence to section 3114 of the Ike Skelton National Defense 
        Authorization Act for Fiscal Year 2011

    Section 3114 of the Ike Skelton National Defense 
Authorization Act for Fiscal Year 2011 (Public Law 111-383) 
titled ``Notification of cost overruns for certain Department 
of Energy Projects'' (50 U.S.C. 2753) set up a series of cost 
overrun features for life extension programs and construction 
projects both in the National Nuclear Security Administration 
and the Department of Energy Office of Environmental 
Management. To date, there has been no reporting to the 
committee on the efforts of the Department of Energy response 
to this legal requirement.
    No later than January 31, 2013, the Secretary of Energy 
shall submit a report to Congress outlining the status of 
programs affected by this provision of law.
          TITLE XXXII--DEFENSE NUCLEAR FACILITIES SAFETY BOARD

Authorization (sec. 3201)
    The committee recommends a provision that would authorize 
$29,415,000 for the Defense Nuclear Facilities Safety Board, an 
increase of $385,000 above the fiscal year 2012 funding level.
                  TITLE XXXV--MARITIME ADMINISTRATION

Maritime Administration (sec. 3501)
    The committee recommends a provision that would re-
authorize certain aspects of the Maritime Administration.
                       DIVISION D--FUNDING TABLES

Authorization of amounts in funding tables (sec. 4001)
    The committee recommends a provision that would provide for 
the allocation of funds among programs, projects, and 
activities in accordance with the tables in division D of this 
bill, subject to reprogramming in accordance with established 
procedures.
    Consistent with the previously expressed views of the 
committee, the provision would also require that decisions by 
agency heads to commit, obligate, or expend funds to a specific 
entity on the basis of such funding tables be based on 
authorized, transparent, statutory criteria, or merit-based 
selection procedures in accordance with the requirements of 
sections 2304(k) and 2374 of title 10, United States Code, and 
other applicable provisions of law.
Funding tables (secs. 4101-4701)
    The committee recommends provisions that provide line-item 
guidance for the funding authorized in this Act, in accordance 
with the requirements of section 4001. The provisions also 
display the line-item funding requested by the administration 
in the fiscal year 2013 budget request and shows where the 
committee either increased or decreased the requested amounts.
    The Department of Defense may not exceed the authorized 
amounts (as set forth in the provision or, if unchanged from 
the administration request, as set forth in budget 
justification documents of the Department of Defense) without a 
reprogramming action in accordance with established procedures. 
Unless noted in this report, funding changes to the budget 
request are made without prejudice.
                         TITLE XLI--PROCUREMENT

TITLE XLI--PROCUREMENT




SEC. 4101. PROCUREMENT.




--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                    SEC. 4101. PROCUREMENT  (In Thousands of Dollars)
---------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                           FY 2013 Request              Senate Change              Senate Authorized
              Line                              Item                ------------------------------------------------------------------------------------
                                                                         Qty          Cost           Qty           Cost           Qty          Cost
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                 AIRCRAFT PROCUREMENT, ARMY
                                 FIXED WING
001                              UTILITY F/W AIRCRAFT..............           2          18,639                                        2          18,639
002                              C-12 CARGO AIRPLANE...............                           0                                                        0
003                              MQ-1 UAV..........................          19         518,088                                       19         518,088
004                              RQ-11 (RAVEN).....................         234          25,798                                      234          25,798
005                              BCT UNMANNED AERIAL VEH (UAVS)                               0                                                        0
                                  INCR 1.
                                 ROTARY
006                              HELICOPTER, LIGHT UTILITY (LUH)...          34         271,983                                       34         271,983
007                              AH-64 APACHE BLOCK IIIA REMAN.....          40         577,115                                       40         577,115
008                                 ADVANCE PROCUREMENT (CY).......                     107,707                                                  107,707
009                              AH-64 APACHE BLOCK IIIB NEW BUILD.           8         153,993                                        8         153,993
010                                 ADVANCE PROCUREMENT (CY).......                     146,121                                                  146,121
011                              AH-64 BLOCK II/WRA................                           0                                                        0
012                              KIOWA WARRIOR (OH-58F) WRA........                           0                                                        0
013                              UH-60 BLACKHAWK M MODEL (MYP).....          59       1,107,087                                       59       1,107,087
014                                 ADVANCE PROCUREMENT (CY).......                     115,113                                                  115,113
015                              CH-47 HELICOPTER..................          38       1,076,036                                       38       1,076,036
016                                 ADVANCE PROCUREMENT (CY).......                      83,346                                                   83,346
                                 MODIFICATION OF AIRCRAFT
017                              C12 AIRCRAFT MODS.................                           0                                                        0
018                              MQ-1 PAYLOAD--UAS.................                     231,508                                                  231,508
019                              MQ-1 WEAPONIZATION--UAS...........                           0                                                        0
020                              GUARDRAIL MODS (MIP)..............                      16,272                                                   16,272
021                              MULTI SENSOR ABN RECON (MIP)......                       4,294                                                    4,294
022                              AH-64 MODS........................                     178,805                                                  178,805
023                              CH-47 CARGO HELICOPTER MODS (MYP).                      39,135                                                   39,135
024                              UTILITY/CARGO AIRPLANE MODS.......                      24,842                                                   24,842
025                              AIRCRAFT LONG RANGE MODS..........                           0                                                        0
026                              UTILITY HELICOPTER MODS...........                      73,804                                                   73,804
027                              KIOWA WARRIOR MODS................                     192,484                                                  192,484
028                              AIRBORNE AVIONICS.................                           0                                                        0
029                              NETWORK AND MISSION PLAN..........                     190,789                                                  190,789
030                              COMMS, NAV SURVEILLANCE...........                     133,191                     -44,000                       89,191
                                    JTRS integration delayed.......                                                [-44,000]
031                              GATM ROLLUP.......................                      87,280                                                   87,280
032                              RQ-7 UAV MODS.....................                     104,339                                                  104,339
                                 SPARES AND REPAIR PARTS
033                              SPARE PARTS (AIR).................                           0                                                        0
                                 GROUND SUPPORT AVIONICS
034                              AIRCRAFT SURVIVABILITY EQUIPMENT..                      34,037                                                   34,037
035                              SURVIVABILITY CM..................                           0                                                        0
036                              CMWS..............................                     127,751                                                  127,751
                                 OTHER SUPPORT
037                              AVIONICS SUPPORT EQUIPMENT........                       4,886                                                    4,886
038                              COMMON GROUND EQUIPMENT...........                      82,511                                                   82,511
039                              AIRCREW INTEGRATED SYSTEMS........                      77,381                                                   77,381
040                              AIR TRAFFIC CONTROL...............                      47,235                                                   47,235
041                              INDUSTRIAL FACILITIES.............                       1,643                                                    1,643
042                              LAUNCHER, 2.75 ROCKET.............                         516                                                      516
                                 TOTAL, AIRCRAFT PROCUREMENT, ARMY.                   5,853,729                     -44,000                    5,809,729

                                 MISSILE PROCUREMENT, ARMY
                                 SURFACE-TO-AIR MISSILE SYSTEM
001                              PATRIOT SYSTEM SUMMARY............          84         646,590                                       84         646,590
002                              MSE MISSILE.......................                      12,850                                                   12,850
003                              SURFACE-LAUNCHED AMRAAM SYSTEM                               0                                                        0
                                  SUMMARY.
004                              HELLFIRE SYS SUMMARY..............                       1,401                                                    1,401
005                              JAVELIN (AAWS-M) SYSTEM SUMMARY...         400          81,121                                      400          81,121
006                              TOW 2 SYSTEM SUMMARY..............       1,403          64,712                                    1,403          64,712
007                                 ADVANCE PROCUREMENT (CY).......                      19,931                                                   19,931
008                              GUIDED MLRS ROCKET (GMLRS)........       1,608         218,679                                    1,608         218,679
009                              MLRS REDUCED RANGE PRACTICE              2,430          18,767                                    2,430          18,767
                                  ROCKETS (RRPR).
010                              HIGH MOBILITY ARTILLERY ROCKET                          12,051                                                   12,051
                                  SYSTEM.
011                              PATRIOT MODS......................                     199,565                                                  199,565
012                              ITAS/TOW MODS.....................                           0                                                        0
013                              MLRS MODS.........................                       2,466                                                    2,466
014                              HIMARS MODIFICATIONS..............                       6,068                                                    6,068
015                              HELLFIRE MODIFICATIONS............                           0                                                        0
016                              SPARES AND REPAIR PARTS...........                       7,864                                                    7,864
017                              AIR DEFENSE TARGETS...............                       3,864                                                    3,864
018                              ITEMS LESS THAN $5 MILLION                               1,560                                                    1,560
                                  (MISSILES).
019                              PRODUCTION BASE SUPPORT...........                       5,200                                                    5,200
                                 TOTAL, MISSILE PROCUREMENT, ARMY..                   1,302,689                           0                    1,302,689

                                 PROCUREMENT OF W&TCV, ARMY
                                 TRACKED COMBAT VEHICLES
001                              STRYKER VEHICLE...................          58         286,818                                       58         286,818
002                              FCS SPIN OUTS.....................                           0                                                        0
                                 MODIFICATION OF TRACKED COMBAT
                                  VEHICLES
003                              STRYKER (MOD).....................                      60,881                                                   60,881
004                              FIST VEHICLE (MOD)................                      57,257                                                   57,257
005                              BRADLEY PROGRAM (MOD).............                     148,193                                                  148,193
006                              HOWITZER, MED SP FT 155MM M109A6                        10,341                                                   10,341
                                  (MOD).
007                              PALADIN PIM MOD IN SERVICE........          17         206,101                                       17         206,101
008                              IMPROVED RECOVERY VEHICLE (M88A2            31         107,909                     123,000           31         230,909
                                  HERCULES).
                                    Increased production...........                                                [123,000]
009                              ASSAULT BREACHER VEHICLE..........          10          50,039                                       10          50,039
010                              M88 FOV MODS......................                      29,930                                                   29,930
011                              M1 ABRAMS TANK (MOD)..............                     129,090                                                  129,090
012                              ABRAMS UPGRADE PROGRAM............                      74,433                                                   74,433
012A                                ADVANCE PROCUREMENT (CY).......                                                  91,000                       91,000
                                    Advanced procurement Abrams                                                     [91,000]
                                    upgrade program.
                                 SUPPORT EQUIPMENT & FACILITIES
013                              PRODUCTION BASE SUPPORT (TCV-WTCV)                       1,145                                                    1,145
                                 WEAPONS & OTHER COMBAT VEHICLES
014                              INTEGRATED AIR BURST WEAPON SYSTEM                         506                                                      506
                                  FAMILY.
015                              M240 MEDIUM MACHINE GUN (7.62MM)..                           0                                                        0
016                              MACHINE GUN, CAL .50 M2 ROLL......                           0                                                        0
017                              LIGHTWEIGHT .50 CALIBER MACHINE            610          25,183        -610         -25,183            0               0
                                  GUN.
                                    Program termination............                                                [-25,183]
018                              MK-19 GRENADE MACHINE GUN (40MM)..                           0                                                        0
019                              MORTAR SYSTEMS....................                       8,104                                                    8,104
020                              M107, CAL. 50, SNIPER RIFLE.......                           0                                                        0
021                              XM320 GRENADE LAUNCHER MODULE            2,280          14,096                                    2,280          14,096
                                  (GLM).
022                              M110 SEMI-AUTOMATIC SNIPER SYSTEM                            0                                                        0
                                  (SASS).
023                              M4 CARBINE........................                           0                                                        0
024                              CARBINE...........................      12,000          21,272                                   12,000          21,272
025                              SHOTGUN, MODULAR ACCESSORY SYSTEM        2,107           6,598                                    2,107           6,598
                                  (MASS).
026                              COMMON REMOTELY OPERATED WEAPONS           240          56,725                                      240          56,725
                                  STATION.
027                              HOWITZER LT WT 155MM (T)..........                      13,827                                                   13,827
                                 MOD OF WEAPONS AND OTHER COMBAT
                                  VEH
028                              MK-19 GRENADE MACHINE GUN MODS....                           0                                                        0
029                              M777 MODS.........................                      26,843                                                   26,843
030                              M4 CARBINE MODS...................                      27,243                                                   27,243
031                              M2 50 CAL MACHINE GUN MODS........                      39,974                                                   39,974
032                              M249 SAW MACHINE GUN MODS.........                       4,996                                                    4,996
033                              M240 MEDIUM MACHINE GUN MODS......                       6,806                                                    6,806
034                              SNIPER RIFLES MODIFICATIONS.......                      14,113                                                   14,113
035                              M119 MODIFICATIONS................                      20,727                                                   20,727
036                              M16 RIFLE MODS....................                       3,306                                                    3,306
037                              MODIFICATIONS LESS THAN $5.0M                            3,072                                                    3,072
                                  (WOCV-WTCV).
                                 SUPPORT EQUIPMENT & FACILITIES
038                              ITEMS LESS THAN $5 MILLION (WOCV-                        2,026                                                    2,026
                                  WTCV).
039                              PRODUCTION BASE SUPPORT (WOCV-                          10,115                                                   10,115
                                  WTCV).
040                              INDUSTRIAL PREPAREDNESS...........                         442                                                      442
                                 SUPPORT EQUIPMENT & FACILITIES
041                              SMALL ARMS EQUIPMENT (SOLDIER ENH                        2,378                                                    2,378
                                  PROG).
                                 SPARES
042                              SPARES AND REPAIR PARTS (WTCV)....                      31,217                                                   31,217
                                 TOTAL, PROCUREMENT OF W&TCV, ARMY.                   1,501,706                     188,817                    1,690,523

                                 PROCUREMENT OF AMMUNITION, ARMY
                                 SMALL/MEDIUM CAL AMMUNITION
001                              CTG, 5.56MM, ALL TYPES............                     158,313                                                  158,313
002                              CTG, 7.62MM, ALL TYPES............                      91,438                                                   91,438
003                              CTG, HANDGUN, ALL TYPES...........                       8,954                                                    8,954
004                              CTG, .50 CAL, ALL TYPES...........                     109,604                                                  109,604
005                              CTG, 20MM, ALL TYPES..............                       4,041                                                    4,041
006                              CTG, 25MM, ALL TYPES..............                      12,654                                                   12,654
007                              CTG, 30MM, ALL TYPES..............                      72,154                     -37,000                       35,154
                                    Decrease for excess............                                                [-37,000]
008                              CTG, 40MM, ALL TYPES..............                      60,138                     -60,138                            0
                                    Decrease for excess............                                                [-60,138]
                                 MORTAR AMMUNITION
009                              60MM MORTAR, ALL TYPES............                      44,375                                                   44,375
010                              81MM MORTAR, ALL TYPES............                      27,471                                                   27,471
011                              120MM MORTAR, ALL TYPES...........                      87,811                                                   87,811
                                 TANK AMMUNITION
012                              CARTRIDGES, TANK, 105MM AND 120MM,                     112,380                                                  112,380
                                  ALL TYPES.
                                 ARTILLERY AMMUNITION
013                              ARTILLERY CARTRIDGES, 75MM AND                          50,861                                                   50,861
                                  105MM, ALL TYP.
014                              ARTILLERY PROJECTILE, 155MM, ALL                        26,227                                                   26,227
                                  TYPES.
015                              PROJ 155MM EXTENDED RANGE XM982...                     110,329                     -55,000                       55,329
                                    Excalibur I-b round schedule                                                   [-55,000]
                                    delay.
016                              ARTILLERY PROPELLANTS, FUZES AND                        43,924                                                   43,924
                                  PRIMERS, ALL.
                                 MINES
017                              MINES & CLEARING CHARGES, ALL                            3,775                                                    3,775
                                  TYPES.
                                 NETWORKED MUNITIONS
018                              SPIDER NETWORK MUNITIONS, ALL                           17,408                     -14,300                        3,108
                                  TYPES.
                                    Program decrease...............                                                [-14,300]
                                 ROCKETS
019                              SHOULDER LAUNCHED MUNITIONS, ALL                         1,005                                                    1,005
                                  TYPES.
020                              ROCKET, HYDRA 70, ALL TYPES.......                     123,433                                                  123,433
                                 OTHER AMMUNITION
021                              DEMOLITION MUNITIONS, ALL TYPES...                      35,189                                                   35,189
022                              GRENADES, ALL TYPES...............                      33,477                                                   33,477
023                              SIGNALS, ALL TYPES................                       9,991                                                    9,991
024                              SIMULATORS, ALL TYPES.............                      10,388                                                   10,388
                                 MISCELLANEOUS
025                              AMMO COMPONENTS, ALL TYPES........                      19,383                                                   19,383
026                              NON-LETHAL AMMUNITION, ALL TYPES..                       7,336                                                    7,336
027                              CAD/PAD ALL TYPES.................                       6,641                                                    6,641
028                              ITEMS LESS THAN $5 MILLION........                      15,092                                                   15,092
029                              AMMUNITION PECULIAR EQUIPMENT.....                      15,692                                                   15,692
030                              FIRST DESTINATION TRANSPORTATION                        14,107                                                   14,107
                                  (AMMO).
031                              CLOSEOUT LIABILITIES..............                         106                                                      106
                                 PRODUCTION BASE SUPPORT
032                              PROVISION OF INDUSTRIAL FACILITIES                     220,171                                                  220,171
033                              CONVENTIONAL MUNITIONS                                 182,461                                                  182,461
                                  DEMILITARIZATION, ALL.
034                              ARMS INITIATIVE...................                       3,377                                                    3,377
                                 TOTAL, PROCUREMENT OF AMMUNITION,                    1,739,706                    -166,438                    1,573,268
                                  ARMY.

                                 OTHER PROCUREMENT, ARMY
                                 TACTICAL VEHICLES
001                              SEMITRAILERS, FLATBED.............          27           7,097                                       27           7,097
002                              FAMILY OF MEDIUM TACTICAL VEH            1,248         346,115                      50,000        1,248         396,115
                                  (FMTV).
                                    Program increase for USAR......                                                 [50,000]
003                              FIRETRUCKS & ASSOCIATED                                 19,292                                                   19,292
                                  FIREFIGHTING EQUIP.
004                              FAMILY OF HEAVY TACTICAL VEHICLES        1,534          52,933                                    1,534          52,933
                                  (FHTV).
005                              PLS ESP...........................                      18,035                                                   18,035
006                              ARMORED SECURITY VEHICLES (ASV)...                           0                                                        0
007                              MINE PROTECTION VEHICLE FAMILY....                           0                                                        0
008                              FAMILY OF MINE RESISTANT AMBUSH                              0                                                        0
                                  PROTEC (MRAP).
009                              TRUCK, TRACTOR, LINE HAUL, M915/            12           3,619                                       12           3,619
                                  M916.
010                              HVY EXPANDED MOBILE TACTICAL TRUCK          60          26,859                                       60          26,859
                                  EXT SERV.
011                              HMMWV RECAPITALIZATION PROGRAM....                           0                                                        0
012                              TACTICAL WHEELED VEHICLE                   950          69,163                                      950          69,163
                                  PROTECTION KITS.
013                              MODIFICATION OF IN SVC EQUIP......                      91,754                                                   91,754
014                              MINE-RESISTANT AMBUSH-PROTECTED                              0                                                        0
                                  (MRAP) MODS.
015                              TOWING DEVICE-FIFTH WHEEL.........                           0                                                        0
016                              AMC CRITICAL ITEMS, OPA1..........                           0                                                        0
                                 NON-TACTICAL VEHICLES
017                              HEAVY ARMORED SEDAN...............                           0                                                        0
018                              PASSENGER CARRYING VEHICLES.......                       2,548                                                    2,548
019                              NONTACTICAL VEHICLES, OTHER.......                      16,791                                                   16,791
                                 COMM--JOINT COMMUNICATIONS
020                              JOINT COMBAT IDENTIFICATION              7,038          10,061                                    7,038          10,061
                                  MARKING SYSTEM.
021                              WIN-T--GROUND FORCES TACTICAL            2,166         892,635                                    2,166         892,635
                                  NETWORK.
022                              SIGNAL MODERNIZATION PROGRAM......                      45,626                                                   45,626
023                              JCSE EQUIPMENT (USREDCOM).........                       5,143                                                    5,143
                                 COMM--SATELLITE COMMUNICATIONS
024                              DEFENSE ENTERPRISE WIDEBAND SATCOM          23         151,636                                       23         151,636
                                  SYSTEMS.
025                              TRANSPORTABLE TACTICAL COMMAND                           6,822                                                    6,822
                                  COMMUNICATIONS.
026                              SHF TERM..........................                       9,108                                                    9,108
027                              SAT TERM, EMUT (SPACE)............                           0                                                        0
028                              NAVSTAR GLOBAL POSITIONING SYSTEM        3,592          27,353                                    3,592          27,353
                                  (SPACE).
029                              SMART-T (SPACE)...................                      98,656                                                   98,656
030                              SCAMP (SPACE).....................                           0                                                        0
031                              GLOBAL BRDCST SVC--GBS............                      47,131                                                   47,131
032                              MOD OF IN-SVC EQUIP (TAC SAT).....          39          23,281                                       39          23,281
                                 COMM--COMBAT SUPPORT COMM
033                              MOD-IN-SERVICE PROFILER...........                           0                                                        0
                                 COMM--C3 SYSTEM
034                              ARMY GLOBAL CMD & CONTROL SYS                           10,848                                                   10,848
                                  (AGCCS).
                                 COMM--COMBAT COMMUNICATIONS
035                              ARMY DATA DISTRIBUTION SYSTEM                              979                                                      979
                                  (DATA RADIO).
036                              JOINT TACTICAL RADIO SYSTEM.......      11,059         556,250                     -30,000       11,059         526,250
                                    AMF integration ahead of need..                                                [-30,000]
037                              MID-TIER NETWORKING VEHICULAR                           86,219                                                   86,219
                                  RADIO (MNVR).
038                              RADIO TERMINAL SET, MIDS LVT(2)...                       7,798                                                    7,798
039                              SINCGARS FAMILY...................                       9,001                                                    9,001
040                              AMC CRITICAL ITEMS--OPA2..........         108          24,601                                      108          24,601
041                              TRACTOR DESK......................                       7,779                                                    7,779
042                              CMMS-ELEC EQUIP FIELDING..........                           0                                                        0
043                              SPIDER APLA REMOTE CONTROL UNIT...                      34,365                     -21,000                       13,365
                                    Funding ahead of need..........                                                [-21,000]
044                              SOLDIER ENHANCEMENT PROGRAM COMM/                        1,833                                                    1,833
                                  ELECTRONICS.
045                              TACTICAL COMMUNICATIONS AND                             12,984                                                   12,984
                                  PROTECTIVE SYSTEM.
046                              COMBAT SURVIVOR EVADER LOCATOR                               0                                                        0
                                  (CSEL).
047                              GUNSHOT DETECTION SYSTEM (GDS)....          46           2,332                                       46           2,332
048                              RADIO, IMPROVED HF (COTS) FAMILY..                       1,132                                                    1,132
049                              MEDICAL COMM FOR CBT CASUALTY CARE       2,535          22,899                                    2,535          22,899
                                  (MC4).
                                 COMM--INTELLIGENCE COMM
051                              CI AUTOMATION ARCHITECTURE........                       1,564                                                    1,564
052                              RESERVE CA/MISO GPF EQUIPMENT.....       1,540          28,781                                    1,540          28,781
                                 INFORMATION SECURITY
053                              TSEC--ARMY KEY MGT SYS (AKMS).....       6,087          23,432                                    6,087          23,432
054                              INFORMATION SYSTEM SECURITY              2,469          43,897                                    2,469          43,897
                                  PROGRAM-ISSP.
055                              BIOMETRICS ENTERPRISE.............                           0                                                        0
                                 COMM--LONG HAUL COMMUNICATIONS
056                              TERRESTRIAL TRANSMISSION..........                       2,891                                                    2,891
057                              BASE SUPPORT COMMUNICATIONS.......                      13,872                                                   13,872
058                              WW TECH CON IMP PROG (WWTCIP).....                       9,595                                                    9,595
                                 COMM--BASE COMMUNICATIONS
059                              INFORMATION SYSTEMS...............                     142,133                                                  142,133
060                              DEFENSE MESSAGE SYSTEM (DMS)......                           0                                                        0
061                              INSTALLATION INFO INFRASTRUCTURE                        57,727                                                   57,727
                                  MOD PROGRAM.
062                              PENTAGON INFORMATION MGT AND                             5,000                                                    5,000
                                  TELECOM.
                                 ELECT EQUIP--TACT INT REL ACT
                                  (TIARA)
065                              JTT/CIBS-M........................                       1,641                                                    1,641
066                              PROPHET GROUND....................          13          48,797                                       13          48,797
067                              DIGITAL TOPOGRAPHIC SPT SYS (DTSS)                           0                                                        0
068                              DRUG INTERDICTION PROGRAM (DIP)                              0                                                        0
                                  (TIARA).
069                              DCGS-A (MIP)......................       1,743         184,007                                    1,743         184,007
070                              JOINT TACTICAL GROUND STATION                5           2,680                                        5           2,680
                                  (JTAGS).
071                              TROJAN (MIP)......................                      21,483                                                   21,483
072                              MOD OF IN-SVC EQUIP (INTEL SPT)                          2,412                                                    2,412
                                  (MIP).
073                              CI HUMINT AUTO REPRINTING AND                            7,077                                                    7,077
                                  COLLECTION.
074                              ITEMS LESS THAN $5 MILLION (MIP)..                           0                                                        0
                                 ELECT EQUIP--ELECTRONIC WARFARE
                                  (EW)
075                              LIGHTWEIGHT COUNTER MORTAR RADAR..          43          72,594                                       43          72,594
076                              CREW..............................                      15,446                                                   15,446
077                              FMLY OF PERSISTENT SURVEILLANCE                              0                                                        0
                                  CAPABILITIES.
078                              COUNTERINTELLIGENCE/SECURITY                             1,470                                                    1,470
                                  COUNTERMEASURES.
079                              CI MODERNIZATION..................                       1,368                                                    1,368
                                 ELECT EQUIP--TACTICAL SURV. (TAC
                                  SURV)
080                              FAAD GBS..........................                       7,980                                                    7,980
081                              SENTINEL MODS.....................          70          33,444                                       70          33,444
082                              SENSE THROUGH THE WALL (STTW).....                       6,212                      -6,212                            0
                                    Slow execution of prior years                                                   [-6,212]
                                    appropriations.
083                              NIGHT VISION DEVICES..............       8,687         166,516                                    8,687         166,516
084                              LONG RANGE ADVANCED SCOUT                                    0                                                        0
                                  SURVEILLANCE SYSTEM.
085                              NIGHT VISION, THERMAL WPN SIGHT...                      82,162                                                   82,162
086                              SMALL TACTICAL OPTICAL RIFLE                            20,717                                                   20,717
                                  MOUNTED MLRF.
087                              COUNTER-ROCKET, ARTILLERY & MORTAR                           0                                                        0
                                  (C-RAM).
088                              BASE EXPEDITIARY TARGETING AND                               0                                                        0
                                  SURV SYS.
089                              GREEN LASER INTERDICTION SYSTEM                          1,014                                                    1,014
                                  (GLIS).
090                              INDIRECT FIRE PROTECTION FAMILY OF                      29,881                                                   29,881
                                  SYSTEMS.
091                              PROFILER..........................         136          12,482                                      136          12,482
092                              MOD OF IN-SVC EQUIP (FIREFINDER                          3,075                                                    3,075
                                  RADARS).
093                              FORCE XXI BATTLE CMD BRIGADE &                               0                                                        0
                                  BELOW (FBCB2).
094                              JOINT BATTLE COMMAND--PLATFORM           1,032         141,385                                    1,032         141,385
                                  (JBC-P).
095                              LIGHTWEIGHT LASER DESIGNATOR/                                0                                                        0
                                  RANGEFINDER.
096                              MOD OF IN-SVC EQUIP (LLDR)........                      22,403                                                   22,403
097                              COMPUTER BALLISTICS: LHMBC XM32...                           0                                                        0
098                              MORTAR FIRE CONTROL SYSTEM........                      29,505                                                   29,505
099                              COUNTERFIRE RADARS................          13         244,409                                       13         244,409
100                              ENHANCED SENSOR & MONITORING                             2,426                                                    2,426
                                  SYSTEM (WMD).
                                 ELECT EQUIP--TACTICAL C2 SYSTEMS
101                              TACTICAL OPERATIONS CENTERS.......         133          30,196                                      133          30,196
102                              FIRE SUPPORT C2 FAMILY............       1,642          58,903                                    1,642          58,903
103                              BATTLE COMMAND SUSTAINMENT SUPPORT         445           8,111                                      445           8,111
                                  SYSTEM.
104                              FAAD C2...........................                       5,031                                                    5,031
105                              AIR & MSL DEFENSE PLANNING &                12          64,144                                       12          64,144
                                  CONTROL SYS.
106                              KNIGHT FAMILY.....................                      11,999                                                   11,999
107                              LIFE CYCLE SOFTWARE SUPPORT (LCSS)                       1,853                                                    1,853
108                              AUTOMATIC IDENTIFICATION                                14,377                                                   14,377
                                  TECHNOLOGY.
109                              TC AIMS II........................                           0                                                        0
110                              TACTICAL INTERNET MANAGER.........                           0                                                        0
111                              NETWORK MANAGEMENT INITIALIZATION                       59,821                                                   59,821
                                  AND SERVICE.
112                              MANEUVER CONTROL SYSTEM (MCS).....         721          51,228                                      721          51,228
113                              SINGLE ARMY LOGISTICS ENTERPRISE         5,976         176,901                                    5,976         176,901
                                  (SALE).
114                              RECONNAISSANCE AND SURVEYING                            15,209                                                   15,209
                                  INSTRUMENT SET.
                                 ELECT EQUIP--AUTOMATION
115                              ARMY TRAINING MODERNIZATION.......                       8,866                                                    8,866
116                              AUTOMATED DATA PROCESSING EQUIP...                     129,438                                                  129,438
117                              GENERAL FUND ENTERPRISE BUSINESS                         9,184                                                    9,184
                                  SYS FAM.
118                              CSS COMMUNICATIONS................       2,062          20,639                                    2,062          20,639
119                              RESERVE COMPONENT AUTOMATION SYS                        35,493                                                   35,493
                                  (RCAS).
                                 ELECT EQUIP--AUDIO VISUAL SYS (A/
                                  V)
120                              ITEMS LESS THAN $5 MILLION (A/V)..                       8,467                                                    8,467
121                              ITEMS LESS THAN $5 MILLION........          89           5,309                                       89           5,309
                                 ELECT EQUIP--SUPPORT
122                              PRODUCTION BASE SUPPORT (C-E).....                         586                                                      586
123                              BCT NETWORK.......................                           0                                                        0
124                              DEFENSE RAPID INNOVATION PROGRAM..                           0                                                        0
                                 CLASSIFIED PROGRAMS
124A                             CLASSIFIED PROGRAMS...............                       3,435                                                    3,435
                                 CHEMICAL DEFENSIVE EQUIPMENT
125                              PROTECTIVE SYSTEMS................                           0                                                        0
126                              FAMILY OF NON-LETHAL EQUIPMENT           1,562           3,960                                    1,562           3,960
                                  (FNLE).
127                              BASE DEFENSE SYSTEMS (BDS)........         637           4,374                                      637           4,374
128                              CBRN SOLDIER PROTECTION...........         219           9,259                                      219           9,259
129                              SMOKE & OBSCURANT FAMILY: SOF (NON                           0                                                        0
                                  AAO ITEM).
                                 BRIDGING EQUIPMENT
130                              TACTICAL BRIDGING.................           7          35,499                                        7          35,499
131                              TACTICAL BRIDGE, FLOAT-RIBBON.....          68          32,893                                       68          32,893
                                 ENGINEER (NON-CONSTRUCTION)
                                  EQUIPMENT
132                              HANDHELD STANDOFF MINEFIELD                                  0                                                        0
                                  DETECTION SYS-HST.
133                              GRND STANDOFF MINE DETECTN SYSM                              0                                                        0
                                  (GSTAMIDS).
134                              ROBOTIC COMBAT SUPPORT SYSTEM                           29,106                                                   29,106
                                  (RCSS).
135                              EXPLOSIVE ORDNANCE DISPOSAL EQPMT          522          25,459                                      522          25,459
                                  (EOD EQPMT).
136                              REMOTE DEMOLITION SYSTEMS.........         364           8,044                                      364           8,044
137                              <$5M, COUNTERMINE EQUIPMENT.......                       3,698                                                    3,698
                                 COMBAT SERVICE SUPPORT EQUIPMENT
138                              HEATERS AND ECU'S.................       1,332          12,210                                    1,332          12,210
139                              SOLDIER ENHANCEMENT...............                       6,522                                                    6,522
140                              PERSONNEL RECOVERY SUPPORT SYSTEM                       11,222                                                   11,222
                                  (PRSS).
141                              GROUND SOLDIER SYSTEM.............       5,226         103,317                                    5,226         103,317
142                              MOUNTED SOLDIER SYSTEM............                           0                                                        0
143                              FORCE PROVIDER....................                           0                                                        0
144                              FIELD FEEDING EQUIPMENT...........         228          27,417                                      228          27,417
145                              CARGO AERIAL DEL & PERSONNEL             8,891          52,065                                    8,891          52,065
                                  PARACHUTE SYSTEM.
146                              MORTUARY AFFAIRS SYSTEMS..........                       2,358                                                    2,358
147                              FAMILY OF ENGR COMBAT AND                  266          31,573                                      266          31,573
                                  CONSTRUCTION SETS.
148                              ITEMS LESS THAN $5 MILLION........         818          14,093                                      818          14,093
                                 PETROLEUM EQUIPMENT
149                              DISTRIBUTION SYSTEMS, PETROLEUM &          208          36,266                                      208          36,266
                                  WATER.
                                 MEDICAL EQUIPMENT
150                              COMBAT SUPPORT MEDICAL............       1,938          34,101                                    1,938          34,101
151                              MEDEVAC MISSON EQUIPMENT PACKAGE                        20,540                                                   20,540
                                  (MEP).
                                 MAINTENANCE EQUIPMENT
152                              MOBILE MAINTENANCE EQUIPMENT                20           2,495                                       20           2,495
                                  SYSTEMS.
153                              ITEMS LESS THAN $5 MILLION (MAINT                            0                                                        0
                                  EQ).
                                 CONSTRUCTION EQUIPMENT
154                              GRADER, ROAD MTZD, HVY, 6X4 (CCE).                       2,028                                                    2,028
155                              SKID STEER LOADER (SSL) FAMILY OF                            0                                                        0
                                  SYSTEM.
156                              SCRAPERS, EARTHMOVING.............           9           6,146                                        9           6,146
157                              MISSION MODULES--ENGINEERING......          40          31,200                                       40          31,200
158                              COMPACTOR.........................                           0                                                        0
159                              LOADERS...........................                           0                                                        0
160                              HYDRAULIC EXCAVATOR...............                           0                                                        0
161                              TRACTOR, FULL TRACKED.............          61          20,867                                       61          20,867
162                              ALL TERRAIN CRANES................           1           4,003                                        1           4,003
163                              PLANT, ASPHALT MIXING.............           1           3,679                                        1           3,679
164                              HIGH MOBILITY ENGINEER EXCAVATOR            76          30,042                                       76          30,042
                                  (HMEE).
165                              ENHANCED RAPID AIRFIELD                    182          13,725                                      182          13,725
                                  CONSTRUCTION CAPA.
166                              CONST EQUIP ESP...................          47          13,351                                       47          13,351
167                              ITEMS LESS THAN $5 MILLION (CONST                        9,134                                                    9,134
                                  EQUIP).
                                 RAIL FLOAT CONTAINERIZATION
                                  EQUIPMENT
168                              JOINT HIGH SPEED VESSEL (JHSV)....                           0                                                        0
169                              HARBORMASTER COMMAND AND CONTROL                             0                                                        0
                                  CENTER.
170                              ITEMS LESS THAN $5 MILLION (FLOAT/                      10,552                                                   10,552
                                  RAIL).
                                 GENERATORS
171                              GENERATORS AND ASSOCIATED EQUIP...       2,074          60,302                                    2,074          60,302
                                 MATERIAL HANDLING EQUIPMENT
172                              ROUGH TERRAIN CONTAINER HANDLER                              0                                                        0
                                  (RTCH).
173                              FAMILY OF FORKLIFTS...............          64           5,895                                       64           5,895
174                              ALL TERRAIN LIFTING ARMY SYSTEM...                           0                                                        0
                                 TRAINING EQUIPMENT
175                              COMBAT TRAINING CENTERS SUPPORT...         339         104,649                                      339         104,649
176                              TRAINING DEVICES, NONSYSTEM.......                     125,251                                                  125,251
177                              CLOSE COMBAT TACTICAL TRAINER.....           8          19,984                                        8          19,984
178                              AVIATION COMBINED ARMS TACTICAL                         10,977                                                   10,977
                                  TRAINER.
179                              GAMING TECHNOLOGY IN SUPPORT OF                          4,056                                                    4,056
                                  ARMY TRAINING.
                                 TEST MEASURE AND DIG EQUIPMENT
                                  (TMD)
180                              CALIBRATION SETS EQUIPMENT........           3          10,494                                        3          10,494
181                              INTEGRATED FAMILY OF TEST                1,674          45,508                                    1,674          45,508
                                  EQUIPMENT (IFTE).
182                              TEST EQUIPMENT MODERNIZATION             2,786          24,334                                    2,786          24,334
                                  (TEMOD).
                                 OTHER SUPPORT EQUIPMENT
183                              RAPID EQUIPPING SOLDIER SUPPORT                          5,078                                                    5,078
                                  EQUIPMENT.
184                              PHYSICAL SECURITY SYSTEMS (OPA3)..                      46,301                                                   46,301
185                              BASE LEVEL COMMON EQUIPMENT.......                       1,373                                                    1,373
186                              MODIFICATION OF IN-SVC EQUIPMENT           248          59,141                                      248          59,141
                                  (OPA-3).
187                              PRODUCTION BASE SUPPORT (OTH).....                       2,446                                                    2,446
188                              SPECIAL EQUIPMENT FOR USER TESTING         206          12,920                                      206          12,920
189                              AMC CRITICAL ITEMS OPA3...........       1,141          19,180                                    1,141          19,180
190                              TRACTOR YARD......................                       7,368                                                    7,368
191                              UNMANNED GROUND VEHICLE...........         311          83,937                     -12,000          311          71,937
                                    Transfer to PE 0604641A at Army                                                [-12,000]
                                    request.
192                              TRAINING LOGISTICS MANAGEMENT.....                           0                                                        0
                                 OPA2
193                              INITIAL SPARES--C&E...............          34          64,507                                       34          64,507
                                 TOTAL, OTHER PROCUREMENT, ARMY....                   6,326,245                     -19,212                    6,307,033

                                 JOINT IMPR EXPLOSIVE DEV DEFEAT
                                  FUND
                                 NETWORK ATTACK
001                              ATTACK THE NETWORK................                           0                                                        0
                                 JIEDDO DEVICE DEFEAT
002                              DEFEAT THE DEVICE.................                           0                                                        0
                                 FORCE TRAINING
003                              TRAIN THE FORCE...................                           0                                                        0
                                 STAFF AND INFRASTRUCTURE
004                              OPERATIONS........................                     227,414                    -227,414                            0
                                    Transfer to OCO................                                               [-227,414]
                                 TOTAL, JOINT IMPR EXPLOSIVE DEV                        227,414                    -227,414                            0
                                  DEFEAT FUND.

                                 AIRCRAFT PROCUREMENT, NAVY
                                 COMBAT AIRCRAFT
001                              EA-18G............................          12       1,027,443                                       12       1,027,443
002                                 ADVANCE PROCUREMENT (CY).......                           0                                                        0
003                              F/A-18E/F (FIGHTER) HORNET........          26       2,035,131                                       26       2,035,131
004                                 ADVANCE PROCUREMENT (CY).......                      30,296                      60,000                       90,296
                                    Retain option for additional FY                                                 [60,000]
                                    14 aircraft.
005                              JOINT STRIKE FIGHTER CV...........           4       1,007,632                                        4       1,007,632
006                                 ADVANCE PROCUREMENT (CY).......                      65,180                                                   65,180
007                              JSF STOVL.........................           6       1,404,737                                        6       1,404,737
008                                 ADVANCE PROCUREMENT (CY).......                     106,199                                                  106,199
009                              V-22 (MEDIUM LIFT)................          17       1,303,120                                       17       1,303,120
010                                 ADVANCE PROCUREMENT (CY).......                     154,202                                                  154,202
011                              H-1 UPGRADES (UH-1Y/AH-1Z)........          27         720,933                                       27         720,933
012                                 ADVANCE PROCUREMENT (CY).......                      69,658                                                   69,658
013                              MH-60S (MYP)......................          18         384,792                                       18         384,792
014                                 ADVANCE PROCUREMENT (CY).......                      69,277                                                   69,277
015                              MH-60R (MYP)......................          19         656,866                                       19         656,866
016                                 ADVANCE PROCUREMENT (CY).......                     185,896                                                  185,896
017                              P-8A POSEIDON.....................          13       2,420,755                                       13       2,420,755
018                                 ADVANCE PROCUREMENT (CY).......                     325,679                                                  325,679
019                              E-2D ADV HAWKEYE..................           5         861,498                                        5         861,498
020                                 ADVANCE PROCUREMENT (CY).......                     123,179                                                  123,179
                                 AIRLIFT AIRCRAFT
021                              C-40A.............................                           0                                                        0
                                 TRAINER AIRCRAFT
022                              JPATS.............................          33         278,884                                       33         278,884
                                 OTHER AIRCRAFT
023                              KC-130J...........................                       3,000                                                    3,000
024                                 ADVANCE PROCUREMENT (CY).......                      22,995                                                   22,995
025                                 ADVANCE PROCUREMENT (CY).......                      51,124                                                   51,124
026                              MQ-8 UAV..........................           6         124,573                                        6         124,573
027                              STUASL0 UAV.......................           5           9,593                                        5           9,593
                                 MODIFICATION OF AIRCRAFT
028                              EA-6 SERIES.......................                      30,062                                                   30,062
029                              AEA SYSTEMS.......................                      49,999                                                   49,999
030                              AV-8 SERIES.......................                      38,703                                                   38,703
031                              ADVERSARY.........................                       4,289                                                    4,289
032                              F-18 SERIES.......................                     647,306                                                  647,306
033                              H-46 SERIES.......................                       2,343                                                    2,343
034                              AH-1W SERIES......................                       8,721                                                    8,721
035                              H-53 SERIES.......................                      45,567                                                   45,567
036                              SH-60 SERIES......................                      83,527                                                   83,527
037                              H-1 SERIES........................                       6,508                                                    6,508
038                              EP-3 SERIES.......................                      66,374                                                   66,374
039                              P-3 SERIES........................                     148,405                                                  148,405
040                              E-2 SERIES........................                      16,322                                                   16,322
041                              TRAINER A/C SERIES................                      34,284                                                   34,284
042                              C-2A..............................                       4,743                                                    4,743
043                              C-130 SERIES......................                      60,302                                                   60,302
044                              FEWSG.............................                         670                                                      670
045                              CARGO/TRANSPORT A/C SERIES........                      26,311                                                   26,311
046                              E-6 SERIES........................                     158,332                                                  158,332
047                              EXECUTIVE HELICOPTERS SERIES......                      58,163                                                   58,163
048                              SPECIAL PROJECT AIRCRAFT..........                      12,421                                                   12,421
049                              T-45 SERIES.......................                      64,488                                                   64,488
050                              POWER PLANT CHANGES...............                      21,569                                                   21,569
051                              JPATS SERIES......................                       1,552                                                    1,552
052                              AVIATION LIFE SUPPORT MODS........                       2,473                                                    2,473
053                              COMMON ECM EQUIPMENT..............                     114,690                                                  114,690
054                              COMMON AVIONICS CHANGES...........                      96,183                                                   96,183
055                              COMMON DEFENSIVE WEAPON SYSTEM....                           0                                                        0
056                              ID SYSTEMS........................                      39,846                                                   39,846
057                              P-8 SERIES........................                       5,302                                                    5,302
058                              MAGTF EW FOR AVIATION.............                      34,127                                                   34,127
059                              RQ-7 SERIES.......................                      49,324                                                   49,324
060                              V-22 (TILT/ROTOR ACFT) OSPREY.....                      95,856                                                   95,856
                                 AIRCRAFT SPARES AND REPAIR PARTS
061                              SPARES AND REPAIR PARTS...........                   1,166,430                                                1,166,430
                                 AIRCRAFT SUPPORT EQUIP &
                                  FACILITIES
062                              COMMON GROUND EQUIPMENT...........                     387,195                                                  387,195
063                              AIRCRAFT INDUSTRIAL FACILITIES....                      23,469                                                   23,469
064                              WAR CONSUMABLES...................                      43,383                                                   43,383
065                              OTHER PRODUCTION CHARGES..........                       3,399                                                    3,399
066                              SPECIAL SUPPORT EQUIPMENT.........                      32,274                                                   32,274
067                              FIRST DESTINATION TRANSPORTATION..                       1,742                                                    1,742
068                              CANCELLED ACCOUNT ADJUSTMENTS.....                           0                                                        0
                                 TOTAL, AIRCRAFT PROCUREMENT, NAVY.                  17,129,296                      60,000                   17,189,296

                                 WEAPONS PROCUREMENT, NAVY
                                 MODIFICATION OF MISSILES
001                              TRIDENT II MODS...................                   1,224,683                                                1,224,683
                                 SUPPORT EQUIPMENT & FACILITIES
002                              MISSILE INDUSTRIAL FACILITIES.....                       5,553                                                    5,553
                                 STRATEGIC MISSILES
003                              TOMAHAWK..........................         196         308,970                                      196         308,970
                                 TACTICAL MISSILES
004                              AMRAAM............................          67         102,683                                       67         102,683
005                              SIDEWINDER........................         150          80,226                                      150          80,226
006                              JSOW..............................         280         127,609                                      280         127,609
007                              STANDARD MISSILE..................          94         399,482                                       94         399,482
008                              RAM...............................          62          66,769                                       62          66,769
009                              HELLFIRE..........................         998          74,501                                      998          74,501
010                              STAND OFF PRECISION GUIDED                                   0                                                        0
                                  MUNITIONS (SOPGM).
011                              AERIAL TARGETS....................                      61,518                                                   61,518
012                              OTHER MISSILE SUPPORT.............                       3,585                                                    3,585
                                 MODIFICATION OF MISSILES
013                              ESSM..............................          37          58,194                                       37          58,194
014                              HARM MODS.........................         100          86,721                                      100          86,721
015                              STANDARD MISSILES MODS............                           0                                                        0
                                 SUPPORT EQUIPMENT & FACILITIES
016                              WEAPONS INDUSTRIAL FACILITIES.....                       2,014                                                    2,014
017                              FLEET SATELLITE COMM FOLLOW-ON....                      21,454                                                   21,454
                                 ORDNANCE SUPPORT EQUIPMENT
018                              ORDNANCE SUPPORT EQUIPMENT........                      54,945                                                   54,945
                                 TORPEDOES AND RELATED EQUIP
019                              SSTD..............................                       2,700                                                    2,700
020                              ASW TARGETS.......................                      10,385                                                   10,385
                                 MOD OF TORPEDOES AND RELATED EQUIP
021                              MK-54 TORPEDO MODS................          75          74,487                                       75          74,487
022                              MK-48 TORPEDO ADCAP MODS..........          94          54,281                                       94          54,281
023                              QUICKSTRIKE MINE..................                       6,852                                                    6,852
                                 SUPPORT EQUIPMENT
024                              TORPEDO SUPPORT EQUIPMENT.........                      46,402                                                   46,402
025                              ASW RANGE SUPPORT.................                      11,927                                                   11,927
                                 DESTINATION TRANSPORTATION
026                              FIRST DESTINATION TRANSPORTATION..                       3,614                                                    3,614
                                 GUNS AND GUN MOUNTS
027                              SMALL ARMS AND WEAPONS............                      12,594                                                   12,594
                                 MODIFICATION OF GUNS AND GUN
                                  MOUNTS
028                              CIWS MODS.........................                      59,303                       7,700                       67,003
                                    Buy additional ordnance                                                          [7,700]
                                    alteration kits.
029                              COAST GUARD WEAPONS...............                      19,072                                                   19,072
030                              GUN MOUNT MODS....................                      54,706                                                   54,706
031                              CRUISER MODERNIZATION WEAPONS.....                       1,591                                                    1,591
032                              AIRBORNE MINE NEUTRALIZATION                            20,607                                                   20,607
                                  SYSTEMS.
                                 OTHER
033                              CANCELLED ACCOUNT ADJUSTMENTS.....                           0                                                        0
                                 SPARES AND REPAIR PARTS
034                              SPARES AND REPAIR PARTS...........                      60,150                                                   60,150
                                 TOTAL, WEAPONS PROCUREMENT, NAVY..                   3,117,578                       7,700                    3,125,278

                                 PROCUREMENT OF AMMO, NAVY & MC
                                 NAVY AMMUNITION
001                              GENERAL PURPOSE BOMBS.............                      27,024                                                   27,024
002                              AIRBORNE ROCKETS, ALL TYPES.......                      56,575                                                   56,575
003                              MACHINE GUN AMMUNITION............                      21,266                                                   21,266
004                              PRACTICE BOMBS....................                      34,319                                                   34,319
005                              CARTRIDGES & CART ACTUATED DEVICES                      53,755                                                   53,755
006                              AIR EXPENDABLE COUNTERMEASURES....                      61,693                                                   61,693
007                              JATOS.............................                       2,776                                                    2,776
008                              LRLAP 6" LONG RANGE ATTACK                               7,102                                                    7,102
                                  PROJECTILE.
009                              5 INCH/54 GUN AMMUNITION..........                      48,320                                                   48,320
010                              INTERMEDIATE CALIBER GUN                                25,544                                                   25,544
                                  AMMUNITION.
011                              OTHER SHIP GUN AMMUNITION.........                      41,624                                                   41,624
012                              SMALL ARMS & LANDING PARTY AMMO...                      65,893                                                   65,893
013                              PYROTECHNIC AND DEMOLITION........                      11,176                                                   11,176
014                              AMMUNITION LESS THAN $5 MILLION...                       4,116                                                    4,116
                                 MARINE CORPS AMMUNITION
015                              SMALL ARMS AMMUNITION.............                      83,733                                                   83,733
016                              LINEAR CHARGES, ALL TYPES.........                      24,645                                                   24,645
017                              40MM, ALL TYPES...................                      16,201                                                   16,201
018                              60MM, ALL TYPES...................                           0                                                        0
019                              81MM, ALL TYPES...................                      13,711                     -10,000                        3,711
                                    Decrease for excess............                                                [-10,000]
020                              120MM, ALL TYPES..................                      12,557                                                   12,557
021                              CTG 25MM, ALL TYPES...............                           0                                                        0
022                              GRENADES, ALL TYPES...............                       7,634                        -500                        7,134
                                    Decrease for excess............                                                   [-500]
023                              ROCKETS, ALL TYPES................                      27,528                                                   27,528
024                              ARTILLERY, ALL TYPES..............                      93,065                                                   93,065
025                              DEMOLITION MUNITIONS, ALL TYPES...                       2,047                      -2,000                           47
                                    Decrease for excess............                                                 [-2,000]
026                              FUZE, ALL TYPES...................                       5,297                                                    5,297
027                              NON LETHALS.......................                       1,362                                                    1,362
028                              AMMO MODERNIZATION................                       4,566                                                    4,566
029                              ITEMS LESS THAN $5 MILLION........                       6,010                                                    6,010

                                 PRIOR YEAR SAVINGS
029B                             PRIOR YEAR SAVINGS................                                                 -88,300                      -88,300
                                    Ammunition change in                                                           [-88,300]
                                    requirements.

                                 TOTAL, PROCUREMENT OF AMMO, NAVY &                     759,539                    -100,800                      658,739
                                  MC.

                                 SHIPBUILDING & CONVERSION, NAVY
                                 OTHER WARSHIPS
001                              CARRIER REPLACEMENT PROGRAM.......           1         608,195                                        1         608,195
002                                 ADVANCE PROCUREMENT (CY).......                           0                                                        0
003                              VIRGINIA CLASS SUBMARINE..........           2       3,217,601                                        2       3,217,601
004                                 ADVANCE PROCUREMENT (CY).......                     874,878                     777,679                    1,652,557
                                    Advance procurement for 2nd SSN                                                [777,679]
                                    in FY 14.
005                              CVN REFUELING OVERHAULS...........           1       1,613,392                                        1       1,613,392
006                                 ADVANCE PROCUREMENT (CY).......                      70,010                                                   70,010
007                              SSBN ERO..........................                           0                                                        0
008                              DDG 1000..........................                     669,222                                                  669,222
009                              DDG-51............................           2       3,048,658                                        2       3,048,658
010                                 ADVANCE PROCUREMENT (CY).......                     466,283                                                  466,283
011                              LITTORAL COMBAT SHIP..............           4       1,784,959                                        4       1,784,959
012                                 ADVANCE PROCUREMENT (CY).......                           0                                                        0
                                 AMPHIBIOUS SHIPS
013                              LPD-17............................                           0                                                        0
014                              LHA REPLACEMENT...................                           0                                                        0
015                              JOINT HIGH SPEED VESSEL...........           1         189,196                                        1         189,196
                                 AUXILIARIES, CRAFT AND PRIOR YR
                                  PROGRAM COST
016                              OCEANOGRAPHIC SHIPS...............                           0                                                        0
017                                 ADVANCE PROCUREMENT (CY).......                     307,300                                                  307,300
018                              OUTFITTING........................                     309,648                                                  309,648
019                              SERVICE CRAFT.....................                           0                                                        0
020                              LCAC SLEP.........................           2          47,930                                        2          47,930
021                              COMPLETION OF PY SHIPBUILDING                          372,573                                                  372,573
                                  PROGRAMS.
                                 TOTAL, SHIPBUILDING & CONVERSION,                   13,579,845                     777,679                   14,357,524
                                  NAVY.

                                 OTHER PROCUREMENT, NAVY
                                 SHIP PROPULSION EQUIPMENT
001                              LM-2500 GAS TURBINE...............                      10,658                                                   10,658
002                              ALLISON 501K GAS TURBINE..........                       8,469                                                    8,469
                                 NAVIGATION EQUIPMENT
003                              OTHER NAVIGATION EQUIPMENT........                      23,392                                                   23,392
                                 PERISCOPES
004                              SUB PERISCOPES & IMAGING EQUIP....                      53,809                                                   53,809
                                 OTHER SHIPBOARD EQUIPMENT
005                              DDG MOD...........................                     452,371                                                  452,371
006                              FIREFIGHTING EQUIPMENT............                      16,958                                                   16,958
007                              COMMAND AND CONTROL SWITCHBOARD...                       2,492                                                    2,492
008                              POLLUTION CONTROL EQUIPMENT.......                      20,707                                                   20,707
009                              SUBMARINE SUPPORT EQUIPMENT.......                      12,046                                                   12,046
010                              VIRGINIA CLASS SUPPORT EQUIPMENT..                      79,870                                                   79,870
011                              LCS CLASS SUPPORT EQUIPMENT.......                      19,865                                                   19,865
012                              SUBMARINE BATTERIES...............                      41,522                                                   41,522
013                              LPD CLASS SUPPORT EQUIPMENT.......                      30,543                                                   30,543
014                              STRATEGIC PLATFORM SUPPORT EQUIP..                      16,257                                                   16,257
015                              DSSP EQUIPMENT....................                       3,630                                                    3,630
016                              CG MODERNIZATION..................                     101,000                                                  101,000
017                              LCAC..............................                      16,645                                                   16,645
018                              UNDERWATER EOD PROGRAMS...........                      35,446                                                   35,446
019                              ITEMS LESS THAN $5 MILLION........                      65,998                                                   65,998
020                              CHEMICAL WARFARE DETECTORS........                       4,359                                                    4,359
021                              SUBMARINE LIFE SUPPORT SYSTEM.....                      10,218                                                   10,218
                                 REACTOR PLANT EQUIPMENT
022                              REACTOR POWER UNITS...............                     286,859                                                  286,859
023                              REACTOR COMPONENTS................                     278,503                                                  278,503
                                 OCEAN ENGINEERING
024                              DIVING AND SALVAGE EQUIPMENT......                       8,998                                                    8,998
                                 SMALL BOATS
025                              STANDARD BOATS....................                      30,131                                                   30,131
                                 TRAINING EQUIPMENT
026                              OTHER SHIPS TRAINING EQUIPMENT....                      29,772                                                   29,772
                                 PRODUCTION FACILITIES EQUIPMENT
027                              OPERATING FORCES IPE..............                      64,346                                                   64,346
                                 OTHER SHIP SUPPORT
028                              NUCLEAR ALTERATIONS...............                     154,652                                                  154,652
029                              LCS COMMON MISSION MODULES                              31,319                                                   31,319
                                  EQUIPMENT.
030                              LCS MCM MISSION MODULES...........                      38,392                                                   38,392
031                              LCS SUW MISSION MODULES...........                      32,897                                                   32,897
                                 LOGISTIC SUPPORT
032                              LSD MIDLIFE.......................                      49,758                                                   49,758
                                 SHIP RADARS
033                              RADAR SUPPORT.....................                           0                                                        0
034                              SPQ-9B RADAR......................                      19,777                                                   19,777
035                              AN/SQQ-89 SURF ASW COMBAT SYSTEM..                      89,201                                                   89,201
036                              SSN ACOUSTICS.....................                     190,874                                                  190,874
037                              UNDERSEA WARFARE SUPPORT EQUIPMENT                      17,035                                                   17,035
038                              SONAR SWITCHES AND TRANSDUCERS....                      13,410                                                   13,410
039                              ELECTRONIC WARFARE MILDEC.........                           0                                                        0
                                 ASW ELECTRONIC EQUIPMENT
040                              SUBMARINE ACOUSTIC WARFARE SYSTEM.                      21,489                                                   21,489
041                              SSTD..............................                      10,716                                                   10,716
042                              FIXED SURVEILLANCE SYSTEM.........                      98,896                                                   98,896
043                              SURTASS...........................                       2,774                                                    2,774
044                              MARITIME PATROL AND RECONNAISSANCE                      18,428                                                   18,428
                                  FORCE.
                                 ELECTRONIC WARFARE EQUIPMENT
045                              AN/SLQ-32.........................                      92,270                                                   92,270
                                 RECONNAISSANCE EQUIPMENT
046                              SHIPBOARD IW EXPLOIT..............                     107,060                                                  107,060
047                              AUTOMATED IDENTIFICATION SYSTEM                            914                                                      914
                                  (AIS).
                                 SUBMARINE SURVEILLANCE EQUIPMENT
048                              SUBMARINE SUPPORT EQUIPMENT PROG..                      34,050                                                   34,050
                                 OTHER SHIP ELECTRONIC EQUIPMENT
049                              COOPERATIVE ENGAGEMENT CAPABILITY.                      27,881                                                   27,881
050                              TRUSTED INFORMATION SYSTEM (TIS)..                         448                                                      448
051                              NAVAL TACTICAL COMMAND SUPPORT                          35,732                                                   35,732
                                  SYSTEM (NTCSS).
052                              ATDLS.............................                           0                                                        0
053                              NAVY COMMAND AND CONTROL SYSTEM                          9,533                                                    9,533
                                  (NCCS).
054                              MINESWEEPING SYSTEM REPLACEMENT...                      60,111                                                   60,111
055                              SHALLOW WATER MCM.................                       6,950                                                    6,950
056                              NAVSTAR GPS RECEIVERS (SPACE).....                       9,089                                                    9,089
057                              AMERICAN FORCES RADIO AND TV                             7,768                                                    7,768
                                  SERVICE.
058                              STRATEGIC PLATFORM SUPPORT EQUIP..                       3,614                                                    3,614
                                 TRAINING EQUIPMENT
059                              OTHER TRAINING EQUIPMENT..........                      42,911                                                   42,911
                                 AVIATION ELECTRONIC EQUIPMENT
060                              MATCALS...........................                       5,861                                                    5,861
061                              SHIPBOARD AIR TRAFFIC CONTROL.....                       8,362                                                    8,362
062                              AUTOMATIC CARRIER LANDING SYSTEM..                      15,685                                                   15,685
063                              NATIONAL AIR SPACE SYSTEM.........                      16,919                                                   16,919
064                              FLEET AIR TRAFFIC CONTROL SYSTEMS.                       6,828                                                    6,828
065                              LANDING SYSTEMS...................                       7,646                                                    7,646
066                              ID SYSTEMS........................                      35,474                                                   35,474
067                              NAVAL MISSION PLANNING SYSTEMS....                       9,958                                                    9,958
                                 OTHER SHORE ELECTRONIC EQUIPMENT
068                              DEPLOYABLE JOINT COMMAND AND CONT.                       9,064                                                    9,064
069                              MARITIME INTEGRATED BROADCAST                           16,026                                                   16,026
                                  SYSTEM.
070                              TACTICAL/MOBILE C4I SYSTEMS.......                      11,886                                                   11,886
071                              DCGS-N............................                      11,887                                                   11,887
072                              CANES.............................                     341,398                                                  341,398
073                              RADIAC............................                       8,083                                                    8,083
074                              CANES-INTELL......................                      79,427                                                   79,427
075                              GPETE.............................                       6,083                                                    6,083
076                              INTEG COMBAT SYSTEM TEST FACILITY.                       4,495                                                    4,495
077                              EMI CONTROL INSTRUMENTATION.......                       4,767                                                    4,767
078                              ITEMS LESS THAN $5 MILLION........                      81,755                                                   81,755
                                 SHIPBOARD COMMUNICATIONS
079                              SHIPBOARD TACTICAL COMMUNICATIONS.                           0                                                        0
080                              SHIP COMMUNICATIONS AUTOMATION....                      56,870                                                   56,870
081                              MARITIME DOMAIN AWARENESS (MDA)...                       1,063                                                    1,063
082                              COMMUNICATIONS ITEMS UNDER $5M....                      28,522                                                   28,522
083                              SUBMARINE BROADCAST SUPPORT.......                       4,183                                                    4,183
084                              SUBMARINE COMMUNICATION EQUIPMENT.                      69,025                                                   69,025
                                 SATELLITE COMMUNICATIONS
085                              SATELLITE COMMUNICATIONS SYSTEMS..                      49,294                                                   49,294
086                              NAVY MULTIBAND TERMINAL (NMT).....                     184,825                                                  184,825
                                 SHORE COMMUNICATIONS
087                              JCS COMMUNICATIONS EQUIPMENT......                       2,180                                                    2,180
088                              ELECTRICAL POWER SYSTEMS..........                       1,354                                                    1,354
089                              NAVAL SHORE COMMUNICATIONS........                           0                                                        0
                                 CRYPTOGRAPHIC EQUIPMENT
090                              INFO SYSTEMS SECURITY PROGRAM                          144,104                                                  144,104
                                  (ISSP).
                                 CRYPTOLOGIC EQUIPMENT
091                              CRYPTOLOGIC COMMUNICATIONS EQUIP..                      12,604                                                   12,604
                                 OTHER ELECTRONIC SUPPORT
092                              COAST GUARD EQUIPMENT.............                       6,680                                                    6,680
093                              DEFENSE RAPID INNOVATION PROGRAM..                           0                                                        0
                                 DRUG INTERDICTION SUPPORT
094                              OTHER DRUG INTERDICTION SUPPORT...                           0                                                        0
                                 SONOBUOYS
095                              SONOBUOYS--ALL TYPES..............                     104,677                                                  104,677
                                 AIRCRAFT SUPPORT EQUIPMENT
096                              WEAPONS RANGE SUPPORT EQUIPMENT...                      70,753                                                   70,753
097                              EXPEDITIONARY AIRFIELDS...........                       8,678                                                    8,678
098                              AIRCRAFT REARMING EQUIPMENT.......                      11,349                                                   11,349
099                              AIRCRAFT LAUNCH & RECOVERY                              82,618                                                   82,618
                                  EQUIPMENT.
100                              METEOROLOGICAL EQUIPMENT..........                      18,339                                                   18,339
101                              DCRS/DPL..........................                       1,414                                                    1,414
102                              AVIATION LIFE SUPPORT.............                      40,475                                                   40,475
103                              AIRBORNE MINE COUNTERMEASURES.....                      61,552                                                   61,552
104                              LAMPS MK III SHIPBOARD EQUIPMENT..                      18,771                                                   18,771
105                              PORTABLE ELECTRONIC MAINTENANCE                          7,954                                                    7,954
                                  AIDS.
106                              OTHER AVIATION SUPPORT EQUIPMENT..                      10,023                                                   10,023
107                              AUTONOMIC LOGISTICS INFORMATION                          3,826                                                    3,826
                                  SYSTEM (ALIS).
                                 SHIP GUN SYSTEM EQUIPMENT
108                              NAVAL FIRES CONTROL SYSTEM........                       3,472                                                    3,472
109                              GUN FIRE CONTROL EQUIPMENT........                       4,528                                                    4,528
                                 SHIP MISSILE SYSTEMS EQUIPMENT
110                              NATO SEASPARROW...................                       8,960                                                    8,960
111                              RAM GMLS..........................                       1,185                                                    1,185
112                              SHIP SELF DEFENSE SYSTEM..........                      55,371                                                   55,371
113                              AEGIS SUPPORT EQUIPMENT...........                      81,614                                                   81,614
114                              TOMAHAWK SUPPORT EQUIPMENT........                      77,767                                                   77,767
115                              VERTICAL LAUNCH SYSTEMS...........                         754                                                      754
116                              MARITIME INTEGRATED PLANNING                             4,965                                                    4,965
                                  SYSTEM--MIPS.
                                 FBM SUPPORT EQUIPMENT
117                              STRATEGIC MISSILE SYSTEMS EQUIP...                     181,049                                                  181,049
118                              SSN COMBAT CONTROL SYSTEMS........                      71,316                                                   71,316
119                              SUBMARINE ASW SUPPORT EQUIPMENT...                       4,018                                                    4,018
120                              SURFACE ASW SUPPORT EQUIPMENT.....                       6,465                                                    6,465
121                              ASW RANGE SUPPORT EQUIPMENT.......                      47,930                                                   47,930
                                 OTHER ORDNANCE SUPPORT EQUIPMENT
122                              EXPLOSIVE ORDNANCE DISPOSAL EQUIP.                       3,579                                                    3,579
123                              ITEMS LESS THAN $5 MILLION........                       3,125                                                    3,125
                                 OTHER EXPENDABLE ORDNANCE
124                              ANTI-SHIP MISSILE DECOY SYSTEM....                      31,743                                                   31,743
125                              SURFACE TRAINING DEVICE MODS......                      34,174                                                   34,174
126                              SUBMARINE TRAINING DEVICE MODS....                      23,450                                                   23,450
                                 CIVIL ENGINEERING SUPPORT
                                  EQUIPMENT
127                              PASSENGER CARRYING VEHICLES.......                       7,158                                                    7,158
128                              GENERAL PURPOSE TRUCKS............                       3,325                                                    3,325
129                              CONSTRUCTION & MAINTENANCE EQUIP..                       8,692                                                    8,692
130                              FIRE FIGHTING EQUIPMENT...........                      14,533                                                   14,533
131                              TACTICAL VEHICLES.................                      15,330                                                   15,330
132                              AMPHIBIOUS EQUIPMENT..............                      10,803                                                   10,803
133                              POLLUTION CONTROL EQUIPMENT.......                       7,265                                                    7,265
134                              ITEMS UNDER $5 MILLION............                      15,252                                                   15,252
135                              PHYSICAL SECURITY VEHICLES........                       1,161                                                    1,161
                                 SUPPLY SUPPORT EQUIPMENT
136                              MATERIALS HANDLING EQUIPMENT......                      15,204                                                   15,204
137                              OTHER SUPPLY SUPPORT EQUIPMENT....                       6,330                                                    6,330
138                              FIRST DESTINATION TRANSPORTATION..                       6,539                                                    6,539
139                              SPECIAL PURPOSE SUPPLY SYSTEMS....                      34,804                                                   34,804
                                 TRAINING DEVICES
140                              TRAINING SUPPORT EQUIPMENT........                      25,444                                                   25,444
                                 COMMAND SUPPORT EQUIPMENT
141                              COMMAND SUPPORT EQUIPMENT.........                      43,165                                                   43,165
142                              EDUCATION SUPPORT EQUIPMENT.......                       2,251                                                    2,251
143                              MEDICAL SUPPORT EQUIPMENT.........                       3,148                                                    3,148
146                              NAVAL MIP SUPPORT EQUIPMENT.......                       3,502                                                    3,502
148                              OPERATING FORCES SUPPORT EQUIPMENT                      15,696                                                   15,696
149                              C4ISR EQUIPMENT...................                       4,344                                                    4,344
150                              ENVIRONMENTAL SUPPORT EQUIPMENT...                      19,492                                                   19,492
151                              PHYSICAL SECURITY EQUIPMENT.......                     177,149                                                  177,149
152                              ENTERPRISE INFORMATION TECHNOLOGY.                     183,995                                                  183,995
                                 CLASSIFIED PROGRAMS
152A                             CLASSIFIED PROGRAMS...............                      13,063                                                   13,063
                                 SPARES AND REPAIR PARTS
153                              SPARES AND REPAIR PARTS...........                     250,718                                                  250,718
                                 TOTAL, OTHER PROCUREMENT, NAVY....                   6,169,378                           0                    6,169,378

                                 PROCUREMENT, MARINE CORPS
                                 TRACKED COMBAT VEHICLES
001                              AAV7A1 PIP........................                      16,089                                                   16,089
002                              LAV PIP...........................                     186,216                    -140,000                       46,216
                                    LAV procurement acquisition                                                   [-140,000]
                                    objective change.
                                 ARTILLERY AND OTHER WEAPONS
003                              EXPEDITIONARY FIRE SUPPORT SYSTEM.                       2,502                                                    2,502
004                              155MM LIGHTWEIGHT TOWED HOWITZER..                      17,913                                                   17,913
005                              HIGH MOBILITY ARTILLERY ROCKET                          47,999                                                   47,999
                                  SYSTEM.
006                              WEAPONS AND COMBAT VEHICLES UNDER                       17,706                                                   17,706
                                  $5 MILLION.
                                 OTHER SUPPORT
007                              MODIFICATION KITS.................                      48,040                                                   48,040
008                              WEAPONS ENHANCEMENT PROGRAM.......                       4,537                                                    4,537
                                 GUIDED MISSILES
009                              GROUND BASED AIR DEFENSE..........                      11,054                                                   11,054
010                              JAVELIN...........................                           0                                                        0
011                              FOLLOW ON TO SMAW.................                      19,650                                                   19,650
012                              ANTI-ARMOR WEAPONS SYSTEM-HEAVY                         20,708                                                   20,708
                                  (AAWS-H).
                                 OTHER SUPPORT
013                              MODIFICATION KITS.................                           0                                                        0
                                 COMMAND AND CONTROL SYSTEMS
014                              UNIT OPERATIONS CENTER............                       1,420                                                    1,420
                                 REPAIR AND TEST EQUIPMENT
015                              REPAIR AND TEST EQUIPMENT.........                      25,127                                                   25,127
                                 OTHER SUPPORT (TEL)
016                              COMBAT SUPPORT SYSTEM.............                      25,822                                                   25,822
017                              MODIFICATION KITS.................                       2,831                                                    2,831
                                 COMMAND AND CONTROL SYSTEM (NON-
                                  TEL)
018                              ITEMS UNDER $5 MILLION (COMM &                           5,498                                                    5,498
                                  ELEC).
019                              AIR OPERATIONS C2 SYSTEMS.........                      11,290                                                   11,290
                                 RADAR + EQUIPMENT (NON-TEL)
020                              RADAR SYSTEMS.....................                     128,079                                                  128,079
021                              RQ-21 UAS.........................           5          27,619                                        5          27,619
                                 INTELL/COMM EQUIPMENT (NON-TEL)
022                              FIRE SUPPORT SYSTEM...............                       7,319                                                    7,319
023                              INTELLIGENCE SUPPORT EQUIPMENT....                       7,466                                                    7,466
025                              RQ-11 UAV.........................                       2,318                                                    2,318
026                              DCGS-MC...........................                      18,291                                                   18,291
                                 OTHER COMM/ELEC EQUIPMENT (NON-
                                  TEL)
029                              NIGHT VISION EQUIPMENT............                      48,084                                                   48,084
                                 OTHER SUPPORT (NON-TEL)
030                              COMMON COMPUTER RESOURCES.........                     206,708                                                  206,708
031                              COMMAND POST SYSTEMS..............                      35,190                                                   35,190
032                              RADIO SYSTEMS.....................                      89,059                                                   89,059
033                              COMM SWITCHING & CONTROL SYSTEMS..                      22,500                                                   22,500
034                              COMM & ELEC INFRASTRUCTURE SUPPORT                      42,625                                                   42,625
                                 CLASSIFIED PROGRAMS
035A                             CLASSIFIED PROGRAMS...............                       2,290                                                    2,290
                                 ADMINISTRATIVE VEHICLES
035                              COMMERCIAL PASSENGER VEHICLES.....                       2,877                                                    2,877
036                              COMMERCIAL CARGO VEHICLES.........                      13,960                                                   13,960
                                 TACTICAL VEHICLES
037                              5/4T TRUCK HMMWV (MYP)............                       8,052                                                    8,052
038                              MOTOR TRANSPORT MODIFICATIONS.....                      50,269                                                   50,269
039                              MEDIUM TACTICAL VEHICLE                                      0                                                        0
                                  REPLACEMENT.
040                              LOGISTICS VEHICLE SYSTEM REP......           8          37,262                                        8          37,262
041                              FAMILY OF TACTICAL TRAILERS.......                      48,160                                                   48,160
042                              TRAILERS..........................                           0                                                        0
                                 OTHER SUPPORT
043                              ITEMS LESS THAN $5 MILLION........                       6,705                                                    6,705
                                 ENGINEER AND OTHER EQUIPMENT
044                              ENVIRONMENTAL CONTROL EQUIP ASSORT                      13,576                                                   13,576
045                              BULK LIQUID EQUIPMENT.............                      16,869                                                   16,869
046                              TACTICAL FUEL SYSTEMS.............                      19,108                                                   19,108
047                              POWER EQUIPMENT ASSORTED..........                      56,253                                                   56,253
048                              AMPHIBIOUS SUPPORT EQUIPMENT......                      13,089                                                   13,089
049                              EOD SYSTEMS.......................                      73,699                                                   73,699
                                 MATERIALS HANDLING EQUIPMENT
050                              PHYSICAL SECURITY EQUIPMENT.......                       3,510                                                    3,510
051                              GARRISON MOBILE ENGINEER EQUIPMENT                      11,490                                                   11,490
                                  (GMEE).
052                              MATERIAL HANDLING EQUIP...........                      20,659                                                   20,659
053                              FIRST DESTINATION TRANSPORTATION..                         132                                                      132
                                 GENERAL PROPERTY
054                              FIELD MEDICAL EQUIPMENT...........                      31,068                                                   31,068
055                              TRAINING DEVICES..................                      45,895                                                   45,895
056                              CONTAINER FAMILY..................                       5,801                                                    5,801
057                              FAMILY OF CONSTRUCTION EQUIPMENT..                      23,939                                                   23,939
058                              FAMILY OF INTERNALLY TRANSPORTABLE                           0                                                        0
                                  VEH (ITV).
059                              BRIDGE BOATS......................                           0                                                        0
060                              RAPID DEPLOYABLE KITCHEN..........                       8,365                                                    8,365
                                 OTHER SUPPORT
061                              ITEMS LESS THAN $5 MILLION........                       7,077                                                    7,077
                                 SPARES AND REPAIR PARTS
062                              SPARES AND REPAIR PARTS...........                       3,190                                                    3,190

                                 PRIOR YEAR SAVINGS
062A                             PRIOR YEAR SAVINGS................                                                -135,200                     -135,200
                                    LAV procurement acquisition                                                   [-135,200]
                                    objective change PY.

                                 TOTAL, PROCUREME