October 28, 1997
On October 23, House and Senate members reached agreement on the conference report (H. Rept. 105-340) to the FY 1998 Department of Defense Authorization Act (H.R. 1119). The report authorizes $268.2 billion in budget authority, the spending level recommended in the Concurrent Resolution on the Budget. The funding level represents an increase of $2.6 billion over the President's budget request of $265.6 billion and a real decline of 1.3 percent relative to FY 1997 spending.
See table for funding levels of major weapons programs
Personnel and Readiness Issues
The conferees continued in their efforts to increase soldiers' quality of life and to address military readiness deficiencies by:
- Authorizing a 2.8-percent pay raise for members of the uniformed services effective January 1, 1998.
- Increasing the President's request for military construction by $800 million, for a total military construction authorization of $9.2 billion. Over 55 percent ($441 million) of the increase is dedicated to quality of life enhancements, especially military housing.
In addressing a range of readiness concerns identified by military personnel out in the field, the conferees took steps to ensure that U.S. forces are ready for the 21st Century, by:
- Authorizing approximately $600 million more than the President's request for Operations and Maintenance (O&M) accounts, for a total authorization of $93.8 billion. Over the past two years, the Congress has added billions of dollars to address shortfalls in critical readiness accounts.
- Adopting a compromise on depot maintenance that would provide the Department of Defense greater flexibility to privatize additional workloads by: amending the depot maintenance 60/40 rule to 50/50 (thereby increasing from 40 percent to 50 percent the share of depot maintenance work that can be done by the private sector); and, requiring the conduct of fair and open competitions for the maintenance workloads at Kelly (TX) and McClellan (CA) Air Logistics Centers. The compromise would specifically define "depot maintenance" to include Contractor Logistics Support and Interim Contractor Support. It also requires that the DoD maintain the capability in public depots to perform maintenance work on mission-essential weapons systems identified by the Secretary of Defense and the Chairman of the Joint Chiefs as necessary to conduct the contingency and strategic scenarios prepared by the Joint Staff.
- Enhancing Congressional oversight of DoD readiness accounts by requiring the Secretary of Defense to: report monthly to Congress on the allocation of appropriations to O&M budget activities, highlighting any reallocation of $15 million or more between accounts; and, report semi-annually on transfers from high-priority readiness accounts. This action was taken to address the concern that over several years, the DoD increasingly has used funds appropriated for training, maintenance, and other key readiness programs to pay for deficiencies elsewhere in the O&M accounts, with the trend being most evident in the transfer of funds to pay for growing costs of the Bosnia operation.
- Creating two new assistant positions to the Chairman of the Joint Chiefs of Staff (JCS) at the two-star level, with one for National Guard matters and the other for reserve matters. This was done to improve the quality of advice on reserve component matters provided to the JCS Chairman. The conference report also requires the Defense Secretary to develop policy guidance to ensure that the level of reserve component officer representation on the Joint Staff is commensurate with the significant role of the reserve components in the Total Force.
- Establishing a Commission on Military Training and Gender-Related Issues to review the requirements and restrictions regarding relationships among members of the Armed Forces, to review the basic training programs of the military services, and to make recommendations for improvements. This was done in response to concerns about whether the services' basic training programs are producing graduates with the levels of physical fitness, basic military skills, and discipline needed to serve in today's military.
- Requiring the Secretary of the Army to institute a number of reforms to Army drill sergeant selection and training, and also requiring the Secretary to report to Congress by March 31, 1998, on any reforms initiated.
- Agreeing to increase aviation career incentive pay for pilots with more than 14 years of service, and to increase (retroactively through October 1, 1996) the maximum bonus for continuing an aviation career from $12,000 to $25,000. This action was taken to address Members' concerns regarding recent reports that unprecedented numbers of military aviation officers are leaving the services for the commercial aviation industry.
Procurement and Modernization Issues
The President's $42.6 billion request for procurement represents a $1.5 billion reduction from enacted FY 1997 levels and is $2.9 billion below the spending level forecast by the Administration just last year for FY 1998. This is the fourth consecutive year this Administration has reduced the FY 1998 procurement figure -- by a cumulative total of $14.5 billion -- relative to its earlier projections. And, for the third consecutive year, the conferees have added funds to modernization accounts -- $3 billion to procurement (for a total of $45.6 billion), and $570 million to Research and Development (for a total of $36.5 billion).
Recognizing that the U.S. military's technological superiority depends on a steady investment in modernization of new and upgraded weapons systems and equipment, the conference report:
- Authorizes $3.7 billion for the Ballistic Missile Defense Organization (BMDO), approximately $1.1 billion more than the President's request. Of this money, $978.1 million is for National Missile Defense (NMD), $474 million more than the President's budget request. The conferees highlighted the need to make the deployment of an NMD system a high priority because of continued global proliferation of ballistic missiles and weapons of mass destruction technology, combined with growing concerns about the security of ballistic missiles in the former Soviet Union. The report also includes a provision requiring the Defense Secretary to structure and fund the NMD program such that an integrated system test can be conducted in FY 1999, and to preserve the option of deploying a limited system in FY 2003.
- Supports the President's $2.1 billion request for research and development of the F-22 Raptor, the Air Force's next-generation air superiority fighter, and authorizes $74.9 million for advance procurement. However, the conference report reinforces discipline and accountability in the F-22 program through cost caps on the development and procurement of the aircraft, coupled with annual reporting requirements on program cost and technical performance.
- Authorizing $331.2 million ($156.9 million more than the President's request) to be used either for long-lead activities related to the procurement of additional B-2 aircraft -- or for the modification and repair of the existing B-2 fleet -- should the President certify to Congress that additional aircraft are not needed.
Seapower Issues
In the area of Seapower, the conferees considered the overall decline in modernization funding for the Department of the Navy and for the Special Operations Command, and:
- Authorized the Navy Secretary to enter into a contract for the procurement of four nuclear attack submarines under the terms of a teaming arrangement which was submitted to Congress by the Secretary of the Navy between the two contractors involved in submarine construction.
- Approved the budget request of $153.4 million as a final increment of funding for procurement of the third Seawolf submarine, the SSN-23.
- Authorized $50 million to accelerate the advance procurement and construction of components for the next nuclear aircraft carrier, CVN-77. Acceleration of funding for this ship offers an opportunity for $600 million in cost savings. The conference report includes a provision establishing a cap on total costs of the carrier that will help ensure that these savings are achieved. An increase of $17 million was authorized for R&D that will permit the CVN-77 to serve as a transition carrier to the next generation of carriers.
Other Issues
The conference report addresses a variety of other issues, as follows:
Bosnia
The conferees included a provision that would cut off funding for the deployment of U.S. ground forces in Bosnia past June 30, 1998 (the President's announced date for the mission to end), unless the President certifies to Congress that the deployment is in the U.S. national security interest and that it will remain U.S. policy that U.S. ground forces not be used as civil police in Bosnia. Also included is a requirement that the President submit a FY 1998 supplemental appropriations request for the amounts necessary for any continued deployment beyond June 30, 1998. Further, the President is to submit a report to Congress that provides: the rationale for a continued U.S. armed force presence in Bosnia; the number of U.S. military personnel participating in the deployment; the mission and objectives of U.S. military forces deployed in and around Bosnia; the exit strategy; and, the costs associated with any deployment beyond June 30, 1998.
Supercomputer Export Controls
Highlighting concerns over reports that U.S.-origin high performance computers have been shipped to military-related facilities in Russia and China without proper government review and licensing and that these supercomputers may be used to help both countries develop and maintain their nuclear weapons arsenals, the conference report includes several provisions intended to close a loophole in supercomputer export control policy.
Cooperative Threat Reduction (CTR)
The conference report authorizes $382.2 million (the President's request) for CTR activities, but prohibits the use of CTR funding for peacekeeping-related activities in Russia, or for housing, environmental restoration, or job retraining.
Attachment: chart