work.
Answer. Current DoD policies ensure we retain by grade, skill,
and experience the best-qualified individuals and treat those who
separate from the Department with the compassion and fairness
they deserve. Our programs make maximum use of voluntary sepa-
ration incentives.
For military personnel, we have implemented the temporary
early retirement program for selected active duty members and a
package of transition initiatives for selected Reserve Component
personnel.
The temporary early retirement authority may be offered by
Service Secretaries to selected members based on eligibility criteria
such as grade, years of service, and skill. Early retirees will have
the same benefits and obligations as members who retire with 20
or more years of service. However, the retired pay of a member
who retires early is reduced by 1 percent for each year of service
less than 20. Early retirees can gain additional credit for taking
jobs in teaching, law enforcement, etc. and have their retired pay
recomputed at age 62. This program will complement our other
drawdown programs and help us shape the 15- to 20-year segment
of the force.
The Reserve Component transition initiatives include special sep-
aration pay for those with more than 20 years of service, early
qualification for retired pay at age 60 for those with 15 to 20 years
of service, separation pay for those with 6 to 15 years of service,
post-separation use of commissaries and exchanges, continuation of
Montgomery GI Bill educational assistance, and VSI/SSB and tem-
porary early retirement programs for selected full-time Reservists.
We will continue to mitigate the impact of involuntary separa-
521
tions through maximum use of transition benefits, including sepa-
ration pay and extended medical care. Another benefit is Operation
Transition, which prepares servicemembers and their spouses for
life after the military.
For civilians, we will also minimize involuntary separations. We
continue our hiring restrictions, and to increase voluntary attri-
tion, we refer DoD employee resumes to Federal and other public
and private sector employers through the Defense Outplacement
Referral Service, DORS. We will also provide an outplacement sub-
sidy to encourage other Federal agencies to hire surplus DoD em-
ployees, paying up to $20,000 of an employee's moving costs to a
new Federal job at a new location. Our DoD Priority Placement
Program remains the backbone of our internal civilian placement
efforts.
As for our voluntary civilian separation incentives, we are offer-
ing targeted groups of employees a cash incentive of up to $25,000
to resign, retire, or take early retirement. The offering of these in-
centives may totally avoid the need for involuntary separations at
some installations. We have instituted other regulatory and admin-
istrative changes to help employees. Employees at closing installa-
tions have right of first refusal for jobs with contractors hired to
close the facility. Also, employees facing separation by reduction in
force may stay on the rolls on annual leave, if by doing so they
become eligible for retirement. The Department will also pay the
government portion of health insurance premiums for 18 months
for employees who are involuntarily separated.
We are helping separating military personnel, DoD civilians, and
defense workers prepare for new employment by working with the
other Departments to provide employment and retraining services.
We have released $75 million to the Department of Labor for re-
training and employment services. We have also released an addi-
tional $73.5 million to the Department of Veterans Affairs and $1.5
million to the Department of Labor to implement the Service Mem-
bers Occupational Conversion and Training Act, which will provide
training to veterans. In conjunction with the Department of Labor,
the Department of Veterans' Affairs, and state employment agen-
cies, DoD has also increased its efforts to provide employment in-
formation to separating personnel and to provide transition assist-
ance services to members of National Guard and Reserve units.
To match separating defense workers with public and community
service jobs, the Department is developing computer-based regis-
tries of defense employees interested in public and community
service organizations. We are also developing pilot programs for
placing former defense personnel in the teaching field and are con-
sidering similar programs for health care and law enforcement.
ASSISTANCE TO COMMUNITIES
Question. The President's conversion plan increases funding for
the Pentagon's Office of Economic Adjustment (OEA) and the Com-
merce Department's Economic Development Administration (EDA).
522
Both agencies assist communities with economic development and
infrastructure planning and financing. Until recently, OEA and
EDA grants were limited to helping communities plan their re-
sponses to closing military bases or major defense plants. Both
agencies now use these funds to help communities implement rede-
velopment plans as well.
Describe the results of DoD's Office of Economic Adjustment pro-
gram prior to the President's initiative.
Answer. A sample survey of 100 communities that closed be-
tween 1961 and 1990 shows that:
New jobs (158,000) more than replace the loss of 93,000 former
DoD civilian jobs;
A number of four-year colleges and post-secondary vocational
technical schools or community colleges have an enrollment of over
73,000 students;
Industrial and office parks are located at more than 75 bases;
Forty-two former DoD facilities are being used as Municipal or
General Aviation Airports.
Question. What will be done differently now?
Answer. The approach and process will be the same. However,
OEA now will provide financial assistance beyond what is needed
for planning. It will support community requirements to transition
to the long-term entity that is responsible for acquiring and operat-
ing the former DoD property.
OEA also plans to solicit proposals from states to support local
community adjustment and business assistance programs. In addi-
tion, four pilot projects will be initiated to explore and evaluate al-
ternative methods for approaching economic adjustment.
DEVELOPMENT OF NEW TECHNOLOGIES
Question. The most widely touted part of the President's plan is
the funding of dual use technology development and other R&D
initiatives conducted by the Advanced Research Projects Agency.
Congress provided over $.5 billion for such programs in 1993.
General Dynamics has a policy of divestiture of its assets because
it believes conversion is impractical. Discuss the general reaction
so far from Defense prime contractors to DOD's program.
Answer. Reaction from large defense contractors that are pri-
marily military suppliers has been mixed. This group may indeed
have great difficulty converting to commercial products. The prob-
lems range from internal culture to a lack of understanding of the
marketplace. However, this decision process must be led by the in-
dividual companies. While these large companies sort out their con-
formation strategies, we believe that we can be successful by plac-
ing emphasis on the first, second, or third tier of defense subcon-
tractors. These companies have the culture and structure to make
the conversion since many already participate in both military and
commercial markets.
Question. Describe the Federal inter-agency mechanism that has
been developed to manage these funds.
523
Answer. Five departments negotiated a Memorandum of Under-
standing (MOU) to jointly plan and execute these programs. The
MOU establishes the Defense Technology Conversion Council
(DTCC), led by the DOD/ Advanced Research Projects Agency, with
participation initially by the Department of Energy/ Defense Pro-
grams, the Department of Commerce's National Institute of Stand-
ards and Technology, the National Science Foundation, and the
National Aeronautics and Space Administration. The Department
of Transportation has recently joined the group. The effort is also
known as the Technology Reinvestment Project (TRP).
Question. How much is budgeted for R&D conversion programs
in FY 1994?
Answer. The department is requesting $324.0 million of FY 1994
funding under PE 0603570E for R&D conversion programs.
Question. How will DOD measure success or otherwise determine
that investments of this magnitude are actually paying off?
Answer. Success of the Technology Reinvestment Project (TRP)
programs will be measured against milestones and completion
schedules that are determined when the projects are selected for
funding. However, the ultimate measure of success of each of the
TRP programs will be the extent that these programs create,
mature, and transition technologies into new products and process-
es.
APPROPRIATIONS MEMBERS' EARMARKS
Question. The Appropriations Committees in their 1993 DOD con-
ference report earmarked funds only for 24 specific projects, which
were not otherwise addressed in the Armed Services Committees'
conference report.
What is the Department's criterion for funding earmarked
projects?
Answer. Title IV Defense Conversion, Reinvestment and Transi-
tion Assistance Act funding will be competitively awarded in ac-
cordance with the statutory provisions of Public Law 102-484. On-
going programs that were separately justified in the FY 1993 Presi-
dent's budget and earmarked by the Appropriation Conference
Report are being executed as originally budgeted.
Question. Which of the earmarked projects does DoD plan to im-
plement?
Answer. With the exception of those earmarked projects original-
ly included in the FY 1993 President's budget, earmarked pro-
grams are expected to compete under the solicitation that closes in
July 1993. Those earmarked projects with significant technical
merit will be strong candidates for selection. However, it is impossi-
ble to prejudge the results of a competitive solicitation and there-
fore impossible to definitively identify those earmarked projects
that will be selected.
Question. Which of the earmarked projects does DoD plan to
ignore?
Answer. It is impossible to prejudge the outcome of a competitive
solicitation and therefore impossible to definitively identify those
earmarked projects that will be rejected.
524
Question. In the R&D area, DoD apparently interprets the
Armed Services' law to override the Appropriations' report lan-
guage earmarks. Is this Secretary Aspin's interpretation?
Answer. Public Law 102-484 mandates selection criteria that pre-
cludes targeting awards to specific projects or organizations on a
non-competitive basis. The Department makes every attempt to
comply with guidance provided by the Appropriations Conference
Report; however, report language does not override statutory direc-
tion.
Question. Explain how DoD would propose to use funds for ear-
marked projects should it reject proposals from the organizations
performing the work. Do you plan to spend our money on other
projects?
Answer. The Committee will be advised of those earmarked pro-
grams that are not competitively selected, and the reapplication of
those funds for other Defense Reinvestment programs will be re-
solved with the Committees. Pending completion of the selection
process, it is impossible to determine whether execution of the ear-
marked programs will be an issue.
PHILADELPHIA NAVAL SHIPYARD
Question. The Congress appropriated $50 million to implement
conversion of the Philadelphia Naval Shipyard (PNSY).
Is O&M the correct appropriation for these funds?
Answer. O&M funds cannot be used to fund construction, pro-
curement, or research and development, three categories of activi-
ties that Philadelphia's plan probably will contain. Different appro-
priation categories would be necessary if the funds are to be used
to support the range of investments that are likely to be identified
in the consensus plan.
FINANCIAL DATA FOR THE RECORD
Question. The Committee would like to establish a complete fi-
nancial status of the Defense Department's conversion initiative
for the record. Please provide:
The 1993 and 1994 funding for each of the defense conversion
programs at the level of detail contained in the 1993 Appropria-
tions' conference report, segregated by appropriation account;
The amount included in the 1994 DoD budget for new conversion
initiatives?
Answer. The detailed breakdown is as follows:
[In millions of dollars]
Fiscal year 1993 Fiscal year 1994
appropriation budget
RDT&E, ARPA:
9603570E Defense Reinvestment • 561.6 324.0
Dual Use Critical Technology Partnerships 95.2 105.0
Commercial-Military Integration Partnerships 47.6 35.0
525
[In millions of dollars]
Fiscal year 1993 Fiscal year 1994
appropriation budget
Regional Technology Alliance Assistance Program 95.2 85.0
Agile Manufacturing and Enterprise Integration 28.6 20.0
Advanced Materials Partnerships (Synthesis & Proc) 28.6 24.0
Advanced Manufacturing Tech Partnerships 23.7 30.0
Manufacturing Engineering Education Programs 28.6 20.0
Manufacturing Extension Programs ^ 95.2 (12.0)
Defense Dual Use Assistance Extension Program ^ 95.2 (13.0)
United States- Japan Manufacturing Training ('} 5.0
Programs Transfer to ARPA 23.7
Other initiatives „ 1,210.1 1,324.9
0602301E Computing Sys & Comm Tech:
ST-1 1 Intelligence Systems/Software 38.8 68.8
ST-19 High Performance Computing 134.4 237.9
ST-21/22 Software Engineer 37.4 39.1
ST-10 Strategic Computing 68.2
0603745E Microelectronics Manufacturing 94.8 100.0
0603226E Exper. Evaluation of Major Innovative Tech EE-37 Advanced Simulation 43.5 54.0
0602708E Int Command & Control Tech IC-03 High Definition Systems 152.2 57.2
06027 12E Materials and Electronics Tech:
MPT-01 Materials Processing 73.5 81.3
MPT-02/03 Electronics Processing 74.8 79.4
MPT-06 High Temp. Super Conductivity 35.5 37.8
0603739E Electronics Manufacturing Tech:
MT-02 MIMIC 80.2 80.2
MT-03 IR Focal Plane Array 34.2 41.4
MT-04 Electronic Module Tech 67.3 97.1
MT-08 Manuf Tech Initiatives 0.0 19.2
MT-10 Advanced Lithography 71,3 47.5
0601101E Defense Research Sciences 109.6 79.7
RDT&E, OSD/WHS:
0601 109D United States-Japan Manufacturing Training 9.4 (»)
06027560 DoD Software Technology Initiative 43.3
RDT&E, all Svcs & DefAg. Small Business Innovative Research (SBIR) 85.0 161.0
â– TtK fiscal year 1994 program is a nominal display of the latest estimate. Details won't be available until ttie fiscal year 1993 program is
awarded.
2 FY 1993 funds support program over a 2-year period.
' Funded in PE0601109D in fiscal year 1993.
Question. Which OSD organization has oversight responsibihty
and which field activity has execution responsibihty for each of
these programs?
Answer. See the table below.
Program OSD organization witti oversigtit responsibility Field activity with execution responsibility
Community Economic Adjustment Assist- Office of Economic Adjustment Economic Development Administration,
ance the Economic Development Ad- Department of Commerce.
ministration.
Temporary health transition assistance Assistant Secretary of Defense (Health Armed Services.
Aftairs).
Department of Defense civilian personnel Assistant Secretary of Defense (Personnel Armed Services.
transition initiatives. and Readiness).
Defense efforts to relieve shortages of Assistant Secretary of Defense (Personnel Defense Activity for Nontraditional Educa-
elementary and secondary school and Readiness). tion.
teachers and teacher's aides.
Environmental education and retraining Deputy Under Secretary of Defense (Envi- Not applicable.
programs. ronmental Security).
Job training and employment and educa- Assistant Secretary of Defense (Personnel Department of Labor.
tional opportunities. and Readiness).
526
Program
OSD organization with oversigtit responsibility Field activity wltti execution responsibility
Service members occupational conversion
and training.
Active forces transition enhancements
(temporary early retirement authority)
Guard and Reserve transition initiatives
Job placement assistance and career
training.
National Guard Civilian Youth Opportuni-
ties Pilot Program.
Civilian Community Corps
Other programs of the Commission on
National and Community Service.
Philadelphia Naval Shipyawi economic
conversion initiatives.
Dual Use Critical Technology Partnerships..
Commercial-Military Integration Partner-
ships.
Regional Technology Alliances Assistance
Program.
Defense Advanced Manufacturing Technol-
ogy Partnerships.
Manufacturing Extension Programs
Assistant Secretary of Defense (Personnel
and Readiness).
Assistant Secretary of Defense (Personnel
and Readiness).
Assistant Secretary of Defense (Reserve
Affairs).
Assistant Secretary of Defense (Personnel
and Readiness).
Assistant Secretary of Defense (Reserve
Affairs).
Assistant Secretary of Defense (Personnel
and Readiness).
Assistant Secretary of Defense (Personnel
and Readiness).
Office of Economic Adjustment
Manufacturing Engineering Education Pro-
grams.
Defense Dual Use Assistance Extension
Program.
Agile Manufacturing and Enterprise Inte-
gration.
Advanced Materials Synthesis and Proc-
essing.
U.S. Japan Management Training
Advanced Research Projects Agency
(ARPA).
Advanced Research Projects Agency
(ARPA).
Advanced Research Projects Agency
(ARPA).
Advanced Research Projects Agency
(ARPA).
Advanced Research Projects Agency
(ARPA).
Advanced Research Projects Agency
(ARPA).
Advanced Research Projects Agency
(ARPA).
Advanced Research Projects Agency
(ARPA).
Advanced Research Projects Agency
(ARPA).
Director of Defense Research and Engi-
neering.
Department of Veterans Affairs and De-
partment of Labor.
Armed Services.
Guard and Reserve Organizations.
Vietnam Veterans Leadership Program.
National Guard Bureau and state National
Guards.
Commission on National Community Serv-
ice.
Commission on National and Community
Service.
Not applicable.
Defense Technology Conversion Council.
Defense Technology Conversion Council.
Defense Technology Conversion Council.
Defense Technology Conversion Council.
Defense Technology Conversion Council.
Defense Technology Conversion Council.
Defense Technology Conversion Council.
Defense Technology Conversion Council.
Advanced Research Projects Agency
(ARPA).
Air Force Office of Scientific Research.
Question. Please provide a description of the acquisition strategy,
method of contractual execution (e.g., contract /grant /transfer-to-
another agency), and key milestones for each of these programs.
Answer. Projects that are selected for funding by Technology Re-
investment Project (TRP) solicitation will not utilize the standard
procurement contract. The legislation specifically indicates that the
two education-related programs will be funded by grants. The Ad-
vanced Research Projects Agency (ARPA) plans to use "other
transactions" whenever possible. Other members of the six-agency
Defense Technology Conversion Council (DTCC) who serve as
agents for funding TRP projects will select the most appropriate
authority delegated to their respective agencies. Our goal is to
identify initial projects for funding before the end of the fiscal
year.
Question. Please provide a forecast of the projected year end obli-
gation rate for each defense conversion program.
Answer. The FY 1993 Defense Conversion program is being exe-
cuted by the Advanced Research Projects Agency (ARPA) through
the Technology Reinvestment Project (TRP). The solicitation for
TRP proposals was released on May 14, 1993 with proposals due on
July 23, 1993. Until the proposals have been reviewed, estimated
527
obligation dates cannot be projected. Selections will be made during
the final quarter of FY 1993.
Question. Please provide the corresponding 5 year total estimated
cost for all of the DoD conversion programs; and the same informa-
tion for each of the projects earmarked in the Appropriations com-
mittee's 1993 DoD conference report.
Answer. The FY 1994 Future Year Defense Plan (FYDP) does not
identify funds at the project/ program level because of the need to
conduct a thorough bottom-up review of the Defense program. Five
year projections for the Defense Conversion programs will be sub-
mitted with the FY 1995 budget submission.
Question. The committee would like to establish a complete fi-
nancial status of the Defense Department's conversion initiative
for the record. Please provide the amount included in the Federal
Budget (other than DOD) for any of the programs for which fund-
ing is by multiple agency.
Answer. The Director of Defense Research and Engineering is
not aware of any funding in the Federal Budget which has been
designated for use on multiple agency programs.
[Clerk's note. — End of questions submitted for the record.]
WITNESSES
Page
Denman, Dr. G.L 315
Deutch, J.M 483
Forster, Lt. Gen. W.H 1
Hite, M^. Gen. R.V .^ 1
Jaquish, Lt. Gen. J.E 175
Krulak, Lt. Gen. C.C 93
Mattice, J.J 175
O'Neill, M^. Gen. M.R 401
Owens, Vice Adm. WA 93
Singley, G.T., III 1
Whitman, Dr. E.C 93
(i)
INDEX
DEFENSE REINVESTMENT AND CONVERSION PROGRAMS
Page
Acquisition Strategy 518
Assistance to Individuals 496, 512, 520
Commercial Aviation 494
Community Assistance 513, 522
Community Colleges 514
Contracting with Local Firms 509
Conversion Programs 495
Overview of Defense 519
Philosophy 492, 495
Development of New Technologies 522
Dual Use Technology 507
Earmarks, Appropriations Members' 523
Financial Data for the Record 524
Financial Status 516
Funding Issues 508
Incentives to Convert 508
Industrial Policy 494
Introduction 483
National Guard 514
New Initiatives 513
Organizational Issues 517
Philadelphia Naval Shipyard 510, 524
SEMATECH Program 493
Statement of Mr. John M. Deutch 485
Summary Statement of Mr. Deutch 483
Teaching, Law Enforcement, Health Care 507, 515
Technology Transfer 516
RESEARCH, DEVELOPMENT, TEST AND EVALUATION, AIR FORCE
Advanced Cruise Missile Program 268, 312
B-1 Program:
Convention Capability 267
ECM System 267
B-IB Bomber 305
Role of 254
B-2 Bomber Programs 248, 268, 297
Conventional Capability of 250
GPS Aided Targeting System/GPS Aided Munition (GATS/GAM) 267
Number of Aircraft 249
B-52 Bomber 310
Biographical Sketch of Mr. James J. Mattice 244
(iii)
IV
Page
Bomber Roadmap 295
Cargo Aircraft Loads 256
Cargo Platform Loaders 258
C-17 Program 256,294
DOD Inspector General Report 264
Flight Test Program 262, 263
Live Fire Testing 263
Next-Generation Fighters, Russian 253
Program Stretch-outs 264
Excimer Laser 255
F-15 Squadrons 293
F-16 Squadrons 268, 290
F-22 Aircraft 247
Advanced Tactical Fighter (ATF) 280
Alternatives 260
Funding 262
Integrated Avionics and Software 261
Overhead Rates 266, 278
Restructure of 252
TooUng 251
Weight of 261
Fighter Aircraft, Bottom-up Review 261
Fighter Industrial Base 261
Fighter Roadmap 260, 280
Flat Bed Loaders for Cargo Aircraft 262
High Energy Laser Systems Test FaciUty (HELSTF) 278
ICBM Life Extension Program 313
Introduction 175
Joint Primary Aircraft Trainer System 312
Joint Seismic Program 272
Milstar program 246, 269
Multi-Role Fighter Fvmding 268
National Aerospace Plane (NASP) Program 246, 270, 275
Peacekeeper Missile 254
Space-Related Infrastructure 277
Statement of Lt. Gen. John E. Jaquish 176
RESEARCH, DEVELOPMENT, TEST AND EVALUATION, ARMY
Acquired Immune Deficiency Sjmdrome (AIDS) 76
Advanced Command and Control Vehicle 78
Advanced Tank Armament System (ATAS) 89
Air Defense Systems 70
Anti-Satellite (ASAT) Program 56
Artillery Propellant Development 86
Bradley Fighting Vehicle (BFV) System 77
Breast Cancer Research 75
Budget Request 50
Comanche HeUcopter Program 50, 65
Alternatives 50
Buy 51
Funding 50
Longbow 67
Weight Problem 52
V
Page
Consolidation of the Sendees' Medical Research Progrsuns 76
Free Electron Laser (FEL) 65, 66
GP-160 Vaccine Trials 59
High Energy Laser Systems Test Facility (HELSTF) 61
Inflatable Intravenous Membrane Oxygenator 76
Inter-Vehicular Information System (IVIS) 81
Introduction 1
Javelin Program 74
Joint Helicopter Program 51
Light Tactical Wheeled Vehicles 79
Longbow Program 70
Apache 67
Hellfire 69