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Department of the Army Historical Summary
Fiscal Year 1999
Chapter 6

6.

Logistics

Management and Planning

Meeting the Army’s need for supplies and equipment has always been a formidable challenge. The transition from forward positioning to domestic basing and multiple, often remote, and quickly developing deployments during the 1990s has not reduced the complexity of meeting the Army’s requirements for timely, reliable, and cost-effective logistic support. The Army Materiel Command (AMC) and other agencies continued to meet those requirements in FY 1999 while developing new systems and procedures to improve future performance.

Overall responsibility for Army logistics changed during FY 1999 in accordance with Secretary of the Army Louis Caldera’s 16 February announcement of a secretariat reorganization. The assistant secretary of the Army for installations, logistics, and environment (ASA-IL&E) transferred logistics operations to the assistant secretary of the Army for research, development, and acquisition (ASA-RDA). Although it directly affected only nine personnel, the shift consolidated acquisition and logistics policy oversight under a single office to improve efficiency. The titles of the assistant secretaries, and their offices, changed to match their new duties. The ASA-RDA became the assistant secretary of the Army for acquisition, logistics, and technology; the ASA-IL&E became the assistant secretary of the Army for installations and environment.

In the November 1997 Defense Reform Initiative Report, the Department of Defense (DOD) established a blueprint for improved business processes, commercial alternatives, consolidated functions, and streamlined organizations to modernize the supply and acquisition process and generally improve the fiscal efficiency of the armed services. Borrowing from the best practices of major corporations, the DOD identified working capital funds and electronic commerce as two areas of potential development.

The Working Capital Funds Policy Board establishes policies at the DOD level that are then executed within the five funds that collectively make up the Defense Working Capital Fund (DWCF). In addition to the

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Army Working Capital Fund, the components of the DWCF are the Navy and Air Force Working Capital Funds, the Defense Commissary Agency Working Capital Fund, and the Defense-Wide Working Capital Fund. These funds operate continually without fiscal year limitation and collectively account for roughly one quarter of the DOD direct appropriations, creating buyer–seller relationships between the services and within the DOD. Through the DWCF structure, the Army finances support activities such as depot maintenance, supply, research and development, transportation, and information services.

Operations of the DWCF underwent substantial changes during the late 1990s as the Department of Defense sought to establish a more businesslike, vendor–customer relationship in intradepartmental transactions. DWCF transactions involve approximately $70 billion annually, as military units purchase goods, services, and industrial capability from support organizations. With such a large volume, even minor cost reductions and efficiencies offer significant savings. The goal of the DWCF is not cost reduction, however, but an improvement in the way the DOD and the services execute and document their internal financial transactions.

Electronic commerce is a steadily growing trend in business and, more recently, in the DOD. It offers both improved documentation and cost reduction. This application of digital technology to automate and improve business functions requires the integration of business activities in all services through common tools and seamless information transfers. Business affairs within the Defense Department remain expensive and slow because of their substantial requirements for personnel and paperwork and the complexities of coordinating the flow of information—situations that electronic commerce promises to correct. Transferring business processes to digital systems eliminates the time formerly spent moving paper documents from one office to the next. Electronic information processing is inherently faster and more responsive, offering cost reductions and improved service. For that reason the Joint Electronic Commerce Program Office, which opened in May 1998, continued to develop a plan to establish and implement electronic commercial practices, products, and standards within the Defense Department wherever practical.

The Defense Finance and Accounting Service (DFAS), as the armed forces’ primary agent for financial management reform, shares those goals. In FY 1999, the DFAS continued to promote the paperless exchange of financial information through electronic document management (EDM), electronic funds transfer (EFT), and electronic data interchange (EDI). EDM, relying heavily on World Wide Web applications, replaces paper-based forms and reports with their electronic equivalents to facilitate control, analysis, and overall efficiency. EFT substantially reduces the cost of disbursements by paying salary, travel, and contract expenses without

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recourse to paper. EDI improves on EFT by directly exchanging payment information with vendors.

In addition to funds management, the Defense Reform Initiative called for a more general overhaul in defense acquisition, with the goal of superior goods and services faster and cheaper than current practices allowed. Toward that end, the DOD identified twelve defense acquisition goals to be met by FY 2000, goals that all of the services pursued during FY 1999. By achieving those goals, the services can release money for modernization efforts without requesting an increase in total budget authority.

Army logistics personnel continued to include the goals of the Defense Reform Initiative in their own efforts during FY 1999. The complexity that logisticians and administrators confront in reforming Army business practices is indicated by the Army Audit Agency’s review of the FY98 Army Working Capital Fund (WCF), completed in FY 1999. Because of deficiencies in Army accounting procedures that were themselves being addressed, auditors could not verify the fund’s accounts or otherwise assess its performance, beyond noting its record-keeping and control shortcomings. The Army could not account with certainty for its expenditures from the fund.

The Army Materiel Command made progress toward meeting the goals of the Defense Reform Initiative during FY 1999 despite such obstacles. Implementation of a Single Stock Fund (SSF) program promised to streamline purchasing and eliminate the inefficiencies of the WCF by merging its wholesale and retail elements into a single, nationally managed fund. Wholesale elements of the WCF furnish goods and equipment for further distribution, and retail elements provide them for consumption. Trial programs at Fort Sill (Oklahoma), Fort Lewis (Washington), and Redstone Arsenal (Alabama) during FY 1999 paved the way for full SSF implementation.

On 19 May, the SSF Executive Steering Committee recommended that certain items not managed by the Army be excluded from the SSF on the grounds that they are not supported by standard Army information systems supporting the reform. The AMC implemented the recommended changes within the Army Food Management System, Clothing Initial Issue Point System, Fuels Automated System, Integrated Facilities System, and Theater Army Medical Management Information System. Preparations for full SSF implementation went forward, with those exclusions, and included an AMC request for the future funding of a National Business Office to oversee its administration.

The FY99 transfer of major command retail divisions to AMC control placed responsibility for all Army retail activities under one command. This improved the AMC’s ability to overhaul the Army supply system and implement the SSF program. But the scale of FY99 humanitarian

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assistance missions strained the AMC’s resources as it increased sales and obligations in some supply activities. The Army’s successful attempt to seek funding for contingency and humanitarian operations through a supplemental budget request boosted wholesale (for further distribution) sales 11 percent above planned FY99 levels. Retail (end-user) sales rose through the same mechanism, ending the fiscal year at 2.7 percent over plan. This reduced the wholesale unit cost, or cost per dollar of sales, to $0.97, one cent below the goal for the fiscal year. Sales volumes that were higher than anticipated and unexpected turn-ins raised retail cost to one cent above the $1.00 goal. Despite these fluctuations, the AMC maintained the highest availability rate in the past three years, averaging 85.6 percent immediate availability of stocked items.

Other AMC programs included sustainment systems technical support, the Army mechanism to maintain and improve fielded weapons systems. The increasing age of major systems, combined with high operating tempos, strained resources in this area. For example, a shortfall in funding for contractor logistics support for fixed-wing aviation threatened to ground a portion of the Army’s aircraft late in the year, mirroring the familiar problems in funding depot maintenance activities.

To correct such problems, in 1997 the Army instituted a process of transformation that it labeled the Revolution in Military Logistics (RML). During FY 1999, the RML continued as the Army moved toward a velocity-based logistics concept that would be responsive to the needs of the force across the full mission spectrum. Velocity-based logistics, developed in the private sector, replaces large and expensive warehouse stockpiles with a constant flow of goods from producer to end user regulated by the rate of consumption. While it enables the Army to meet the sustainment challenges of the National Military Strategy, the RML also addresses the growing demand for lift, or transportation, capacity. When the program is fully implemented, it will revise logistics throughout the force and enable the Army to meet its goal of deploying a medium-weight, brigade-size force anywhere in the world within ninety-six hours.

Toward that end, the Army expects the RML to create a single logistics system, promote distribution-based logistics, enable rapid force projection, create total asset visibility, establish a flexible infrastructure, and reduce the scale of the Army’s logistical requirements (generally referred to as its “logistical footprint”). Those lofty goals are being met by applying information technology and advanced capabilities to the problems of acquisition, distribution, and management. The RML stands at the heart of the Army’s efforts to balance readiness and modernization, maximizing the use of scarce resources. Those resources transcend budgetary limitations, to include production and transportation capacity, personnel, and facilities. In addition to the obvious economic benefits, the RML increases strategic

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responsiveness, decreases deployment timelines, ensures joint force compatibility and support, creates an early-entry force able to operate without access to fixed forward bases, and reduces sustainment needs.

The Velocity Management (VM) program, which establishes velocity-based logistics throughout the Army as the core of the RML, is intended to decrease the Army’s dependence on stockpiled supplies by relying instead on automation, speed, and transportation to meet its logistics requirements as quickly as commercial systems meet the needs of industry. As it neared full implementation within the Army National Guard, VM significantly improved the flow of repair parts and other items to Guard units in FY 1999. The program continued to identify and resolve delays in the ordering, procurement, shipping, and receipt of supplies as the total force expanded its implementation.

As a key contributor to VM, Army Total Asset Visibility (ATAV) is an operational capability that integrates information from numerous automated information systems to provide logisticians visibility of stocks in use, in storage, on hand, and in transit. Bar coding and radio frequency identification technologies assist the process by facilitating automated identification and tracking of individual items and containers. ATAV meets critical management needs to reduce duplicative procurement, meet mandated cost reductions, and provide logistics system efficiencies.

The Army designated ATAV as the single authoritative database to provide data to the Joint Total Asset Visibility initiative. ATAV provides logistics data to all military services and the Defense Logistics Agency. This information can be used to redistribute critical materiel to meet emerging requirements. ATAV was used to support Operation JOINT FORGE (Bosnia-Herzegovina) and Operations DESERT THUNDER and DESERT FOX (Kuwait) during FY 1999.

Automatic identification technology (AIT) supports ATAV through the electronic identification and tracking of items as they move through the logistics system from the factory to their final destination. The AIT equipment suite being fielded by the Army includes radio frequency identification, laser optical technology, smart cards, and bar coding. All of these new capabilities are designed to enable logisticians to monitor cargo movements, divert shipments, locate critical supplies, and reduce or eliminate human error.

The Army installed radio frequency identification (RFID) equipment at fifteen continental U.S. installations designated as power-projection platforms in FY 1999 to provide theater commanders with information on cargo in transit. This effort began in July 1998 to support deployment of the 1st Cavalry Division to Bosnia. RFID equipment was used during FY 1999 to track Patriot missile equipment moving to Kuwait for Operation DESERT THUNDER and again for equipment moving to Kuwait for Operation DESERT FOX.

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To meet the current needs of rapid deployment and sustainment, the Army maintains stocks of pre-positioned equipment at various locations, including some afloat. One of the seven pre-positioned armor-heavy brigade sets remains aboard fifteen Navy-operated vessels, including new large, medium-speed, roll-on/roll-off (RORO) ships. Three of the other brigade sets are in Europe (Italy, Luxembourg, and the Netherlands), and the remaining three are in Kuwait, Qatar, and South Korea. Additional support-unit equipment, mission-specific packages, and resupply sets are maintained afloat or ashore at overseas or continental U.S. facilities. These practices enable a unit to fly rapidly from the United States, draw heavy equipment from pre-positioned stock, and deploy on a mission without waiting for its equipment to arrive by ship or air from the continental United States. Pre-assembled resupply sets and mission-specific packages then simplify sustainment and theater development.

RORO ships are an invaluable component in the United States’ ability to deploy heavy equipment overseas. These vessels are equipped with ramps that make it possible to swiftly load or unload vehicles and cargo with a minimum of shore support. They are, therefore, uniquely suited to deploying the Army’s heavy forces, and in conjunction with the Air Force’s C–17 and C–5 cargo aircraft, they play a key role in sustaining joint operations overseas. The Army maintains a keen interest in these three systems and the nation’s overall airlift and sealift capabilities.

The 1995 Mobility Requirements Study Bottom-Up Review Update identified the Army’s sealift requirements to meet the goal of deploying a five and one-third division force package within seventy-five days. Doing so will require nineteen large, medium-speed ROROs (LMSRs), thirty-one smaller ROROs, eight fast sealift ships, six crane ships, two heavy lift pre-positioning ships, three lighter aboard ships, and two container ships. Five LMSRs converted from more traditional freighters are already in service, two of them deployed with pre-positioned stocks. At the end of FY 1999, six purpose-built LMSRs had been delivered, with nine more to follow. The program calls for nine of those vessels to support the afloat pre-positioning program, one for the Marine Corps and eight for the Army, with the rest assigned to the Navy’s surge sealift program.

During FY 1999, Army logisticians experimented with a new procedure to capitalize on the streamlining and automation initiatives that constitute the RML. Anticipating that RML reforms and budget restraints will inevitably reduce authorized stockage lists, planners developed a means to meet a unit’s additional stock requirements as it mobilizes for contingency deployment. The Deployment Stock Package—an automated process that improves stock visibility, supports planning, and provides real-time adjustment capabilities—can significantly improve the supply performance and readiness of a deploying unit. After successful testing

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during unit rotation at the National Training Center, the Deployment Stock Package entered service with units at Fort Stewart (Georgia), Fort Lewis (Washington), Fort Campbell (Kentucky), Fort Carson (Colorado), and, at the end of the fiscal year, in Kuwait. The program is being expanded to expedite corps and theater operations and to create a national-level visibility for deployment stock requirements.

Maintenance

Army depot facilities in the active and reserve components maintain and, when necessary, rebuild or upgrade the Army’s heavy equipment. Although they had increased, the levels of full-time support personnel at reserve-component depots continued to fall short of the Army’s need in FY 1999. Assets and parts availability hampered depot activities in both the active and reserve components, but corrective measures to increase coordination among workloads, workload schedules, and asset and repair parts requirements reduced the problem as the year progressed. Customer commands, units or organizations requiring depot services, placed orders earlier and so permitted the depots to requisition items requiring lead times earlier in the fiscal year. This ensured their availability or allowed schedules to be adjusted to correspond to delivery dates.

At the beginning of the fiscal year, commands responsible for specific commodities assumed management responsibility for the relevant depots, another step in improving depot efficiency. Thus the Army Communications-Electronics Command assumed command and control of the Tobyhanna Army Depot (Pennsylvania). Similarly, Army Tank-Automotive and Armaments Command took operational control of the Anniston (Alabama) and Red River (Texarkana, Texas) depots, and Aviation and Missile Command assumed control of the Corpus Christi (Texas) and Letterkenny (Chambersburg, Pennsylvania) depots.

Fiscal performance of the Army’s depots is assessed in five categories: cost per direct labor hour, financial operating measures, customer revenue rate, capital investment, and cash management. FY99 figures for direct labor, operating measures, customer revenue, and cash management all reflected positive trends.

In the case of capital investment, establishing the positive trend involved several major projects to maintain and improve depot capabilities by acquiring new equipment and completing minor construction projects. The automated storage and retrieval warehouse system for bulky materiel used in fabrication and overhaul activities that consists of man-aboard lift vehicles, automated guided vehicles, and miniature load controllers began replacing a similar but obsolete system. The Army Workload and Performance System, a networked personal computer software suite

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that integrates existing production and financial data, started helping production and resource managers optimize their resources and activities. The Standard Depot System/Manufacturing Resources Program, another software application, began making the Depot Maintenance System compliant with the Defense Information Infrastructure and Joint Technical Architecture. When fully implemented, the Standard Depot System/ Common Operating Environment that entered service during the year will create a common user interface across the AMC, reduce the number of unique applications in use, and enable AMC personnel to perform all functions from a single workstation.

Combining functions into a single organizing framework, as Army depots did through those software initiatives in FY 1999, is a recurring theme in improving Army logistics. Integrated Sustainment Maintenance (ISM) currently combines the general support maintenance activities of Forces Command, Training and Doctrine Command, and the reserve components into a single resource pool. The facilities within that pool compete for work, minimizing repair costs and maximizing the Army’s overall maintenance efficiency. ISM currently operates on a “repair-and-return-to-user” premise. This means that when a unit sends a particular piece of equipment in for depot maintenance, the unit will receive that same piece back when the required repairs, upgrades, and preventive procedures have been completed. Because the Army has no maintenance float, or fleet of available short-term replacement equipment, the unit is without that piece of equipment for the duration of its depot overhaul. The absence of such equipment can become a significant readiness issue even with the FY99 reductions in depot maintenance backlogs. The SSF program, once fully implemented, will replace this system with one of repairing for return to the supply system.

The high operating tempo of FY 1999 led to speculation that supply and maintenance would suffer, adversely affecting training and long-term readiness. Although the threats posed by aging equipment, heavy use, delayed maintenance, and parts or funding shortages were quite real, the Army met the challenge. Programs like VM helped in meeting the Army’s maintenance needs and they promise to do more. But preserving the Army’s long-term ability to maintain deployed equipment and personnel, or to sustain a high operating tempo without degradation in mission capabilities, is a problem quite different from routine maintenance.

Sustainability

When the Army deploys away from its permanent bases or otherwise employs its equipment in nontraining missions, its need for logistical support, and the difficulties in providing that support, increase dramatically.

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The challenge grows with the scale and duration of an operation and with its distance from established support facilities. Sustaining Army forces under such circumstances requires prior planning and a complex logistics system.

Equipment readiness is one measure of that system’s effectiveness. Despite high operating tempos, the Army met most of its readiness goals in FY 1999. The Army uses the mission readiness rates of its sixteen major weapons systems as an indicator of equipment readiness trends, and only two of those systems—the CH–47D helicopter and the heavy expanded-mobility tactical truck—failed to meet readiness standards. The entire CH– 47 fleet (446 aircraft designated CH–47D, MH–47D, and MH–47E) spent part of FY 1999 grounded after a scheduled overhaul of one helicopter revealed cracked transmission gears. The Army’s general success in mitigating the adverse impact of aging equipment, high usage rates, and maintenance backlogs is apparent in the overall adequate readiness levels of the last three fiscal years.

Some of the Army’s major weapons systems experienced minor declines in readiness during FY 1999, although still achieving readiness goals. The declines may be attributed to limited assets, parts supply problems, and changing customer orders at the Army depots. Schedule conformation reports, which calculated the percentage of major systems repairs or overhauls completed on schedule, indicated a substantial decrease in meeting depot maintenance schedules during the fiscal year.

Problems in the delivery of required parts and supplies are a potential source of decreased readiness and difficulties in sustaining a deployed force. The VM program is intended to speed the flow of those materials and prevent unnecessary delays. Although its performance fell short of the ambitious goals set for FY 1999, VM proved effective in reducing the time between ordering and receipt of supply items in three priority groups, measured against the FY95 baseline. Such success would not be possible without support by other components of the logistics system. Although parts and supplies pass through the Army’s logistics system with dramatically increased speed as a result of VM and other components of the RML, the Supply Management Activity has maintained the availability of increasingly transient items in its role as the purchaser and warehouse agent for stocks sold to Army operating units.

Securing and transporting required materiel in a timely and cost-effective manner is crucial to maintaining the Army’s ability to sustain even routine operations, a fact that the Army Medical Command (MEDCOM) addressed with a program to standardize its needs, reduce the variety of required supplies, and realize volume savings on the resultant contracts. North Atlantic Regional Medical Command began with an effort to standardize sixteen product categories in 1998. The MEDCOM

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subsequently expanded that regional effort into a broader medical/surgical standardization program.

By early 1999, the regional medical commands (RMCs) started reporting success in standardizing the sixteen categories originally examined by the North Atlantic RMC. Based on varying clinical and business practices in the RMCs, the MEDCOM developed a second informal list of categories for standardization. At the same time, the Department of Veterans Affairs provided the MEDCOM with contract access to sixteen hundred standardized medical/surgical items. To facilitate the standardization process, a Defense Supply Center Philadelphia/lead agent partnership hired contractors to staff regional business improvement cells. The MEDCOM business cell staff subsequently analyzed patient databases to develop a clinical workload-driven list of forty-two standardization categories. Items in those categories were to be considered for possible standardization throughout the Department of Defense in FY 2000. These efforts saved the Army $3 million on medical and surgical items by the end of FY 1999. The program also reduced the total volume of the MEDCOM’s supply needs, thereby improving the sustainability of Army medical units.

Efforts to maintain and improve the Army’s ability to sustain its operations range from the seemingly simple, such as standardizing medical supply categories, to the highly complex. The Army relies on maritime transportation for the bulk supplies and heavy equipment that deployed forces require. But port facilities are not always available when and where the Army needs them. Part of the Army’s afloat pre-positioned equipment program includes a port-opening package embarked aboard the vessels American Cormorant, Strong Virginian, and Gopher State. The vessels carry enough equipment to turn a bare beach into a functioning port facility capable of supporting Army logistics over-the-shore operations.

The equipment aboard these vessels requires periodic maintenance and repair. Every two years the ships are offloaded, and their cargo of tugboats, landing craft, barges, floating cranes, and other equipment is overhauled and returned to service. This procedure, and the subsequent maintenance, are carried out at the U.S. Army Equipment Base, North Atlantic, in Hythe, England. Strong Virginian underwent the process for the first time in November 1998. The ship uses its heavy-lift cranes to deploy four LCU–2000 utility landing craft and a modified LCM–8 command-and-control landing craft. Its roll-on/roll-off configuration enables Strong Virginian to store and transport 168 motorized vehicles, mostly high-mobility multipurpose wheeled vehicles and trucks, below deck.

The Hythe shipyard—the only facility of its kind—maintains the Army’s forward-deployed watercraft and other seaborne assets, such as those aboard the Strong Virginian, in a small corner of the port of Southampton. Its mission includes materiel and maintenance support for

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thirteen additional pre-positioned equipment ships and maintenance of smaller vessels such as the one hundred–foot Army tugboat it converted to carry firefighting equipment for the Military Traffic Management Command in the spring of 1999. That conversion was the first of three that the Hythe shipyard will soon complete to enhance the Army’s firefighting capability. The facility and the 270 watercraft it supports are an important component in the Army’s ability to conduct and sustain remote operations.

The Army initiated an ambitious restructuring of its watercraft fleet in FY 1999. The 270 landing craft, tugboats, floating cranes, barges, causeway systems, and utility craft maintained at Hythe were being upgraded and restructured in compliance with warfighting requirement timelines. When complete, the program will create a globally responsive, modern, forward-positioned fleet capable of sustaining over-the-shore operations in sea state 3 (waves three to five feet high) anywhere in the world.

The Army’s ability to handle cargo at both sea and aerial port facilities is becoming ever more important as units increasingly deploy to remote locations on contingency and humanitarian missions. Although ships remain important, Force XXI and the Army After Next will feature reduced heavy-lift needs and smaller logistical requirements. Air cargo delivery, already vital, will become increasingly important in Army logistics. Units once primarily responsible for unloading and loading ships now handle aircraft and rail transit as well.

With that in mind, the Army’s stevedore units, officially designated terminal-service companies, have been redesignated as cargo-transfer companies. The shifting nature of that community’s mission was acknowledged in FY 1999 when the name of the annual Master Stevedore Rodeo, intended to recognize and promote mastery of cargo-handling skills, changed to the Master Cargo Handler Rodeo. This minor change in nomenclature reflects the social transitions that accompany the growing complexity of the Army’s logistic operations.

Security Assistance

The Army provides security assistance to allied and friendly nations in the form of foreign military sales, training, and education. Security assistance supports the Army mission by promoting U.S. foreign and defense policy and helping other countries develop or maintain their own defensive capabilities. These efforts support regional and global stability, reduce the likelihood of direct U.S. involvement in contingency or peace enforcement missions, and increase the capabilities of current or potential coalition and alliance partners and their interoperability with U.S. forces. As an added benefit, security assistance helps maintain the defense industrial base and reduce the cost of weapons systems and other materiel.

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Such activities are administered by the deputy under secretary of the Army for international affairs (DUSA-IA) in accordance with the August 1997 revision of General Order 10 that reorganized the Army secretariat. The Office of the DUSA-IA made substantial progress in regularizing its activities and updating relevant Army regulations during FY 1999. For example, its Security Assistance Division updated AR 12-1, Security Assistance and International Logistics Support Policy and Responsibilities, and AR 1-75, Administrative and Logistical Support of Overseas Security Assistance Organizations. The new version of AR 12-1 incorporates the provisions of General Order 10 that delegated responsibility for the Army’s international affairs functions to the DUSAIA. Circulation of the new regulations solidified the DUSA-IA’s authority over the conduct of such functions.

The promulgation of the Army’s policies for exporting weapons systems to friendly foreign governments holds an important position among the international affairs functions of the DUSA-IA. In FY 1999, the DUSA-IA released policies defining the configurations and capabilities of several systems approved for export. These systems included the Javelin missile, the Suite of Integrated Radio Frequency Countermeasures, M56/58 Smoke Generator, AH–64D Apache, Suite of Integrated Infrared Countermeasures, and Patriot Advanced Capability-3 missile system. The DUSA-IA also represented the Army in the Arms Transfer Policy Review Group (ATPRG) that the deputy secretary of defense established in FY 1999 to evaluate the arms-transfer process. In its first year of operation, the ATPRG examined the sale of the AH–64D to Kuwait and Singapore, foreign participation in development of the Joint Strike Fighter, transfer of the HARM antiradar missile system to Egypt, and an Arms Transfer Decision Framework to govern future decision making.

The DUSA-IA led the development of the Army’s own decision support system for formulating positions on the transfer of Army property and classified technologies to foreign governments. Work on the creation of that system, a relational database of technology transfer policies, data, and actions, continued throughout FY 1999. When complete, the system will streamline the analysis, review, and processing of requests to transfer classified data, systems, and ordnance to foreign nations. The Air Force and the Navy recognized the value of such a system and adopted that of the Army, thereby consolidating government records into one emerging integrated system.

Such international transfers can actually save the Army money. By releasing excess defense articles (EDAs) to foreign military forces, the Army can reduce inventory and avoid the cost of disposing of surplus goods. The EDA release process has become quite slow, often requiring more than a year between offering an item to a friendly nation and actually delivering

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it, absent an urgent political need. In FY 1999, the Army recommended EDA allocations to thirty-one countries, with a value of $1.14 billion. Substantially less equipment was actually transferred. Deliveries to six nations, worth approximately $158 million, were completed. Another $22 million worth of equipment was rejected by eight countries because of its poor condition or because the recipient government lacked funds to pay for repairs and shipping. Much of the Army’s foreign security assistance takes the form of training. In FY 1999, the Army provided instruction for 7,623 international students from 142 countries. The Army deployed 273 training teams, totaling 562 personnel, on overseas instructional assistance missions. Despite the size of that effort and the activities of other training centers, the United States Army School of the Americas (USARSA), housed at Fort Benning, Georgia, remained the Army’s premier venue for delivering training through its security assistance program. Title 10, U.S. Code, Section 4415 charges the Army, through the USARSA, to develop and conduct professional military education using the Spanish language for the military personnel of Central America, South America, and the Caribbean region. In FY 1991, section 541 of the Foreign Assistance Act established an Expanded International Military Education and Training (EIMET) authority that allowed the USARSA to accept civilian personnel and police officers. Under that authority, civilians professionally involved with military matters could receive training from the USARSA or other U.S. military sources in four areas: defense resource management, civilian control of the military, cooperation between law enforcement and military agencies, and military justice systems and human rights.

During FY 1999, public and media attention focused on continuing allegations of human rights violations by graduates of the USARSA and of the USARSA’s role in promoting those alleged violations. After examining the accusations and the USARSA’s record, the Army leadership issued a strong endorsement of the program. But the unsubstantiated claims that the USARSA promoted human rights violations, and subsequent public outrage, caused the House of Representatives to include a measure in the FY00 Foreign Operations Appropriations Act prohibiting security assistance funds from being used at the USARSA—a move that effectively would have closed the school. A conference resolution restored the funds but required, before they could be spent, that the secretary of defense certify that instruction and training at the facility were consistent with training and doctrine (particularly in human rights) provided at other defense department institutions that trained primarily U.S. military personnel.

Since 1993, a number of legislators have supported efforts to close the USARSA in response to its alleged role in promoting human rights abuses. In FY 1999, Massachusetts congressman Joseph J. Moakley and Illinois senator Richard C. Durbin introduced bills to repeal the school’s statutory

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authorization. Army leaders responded with an education and information campaign intended to counter the school’s negative image. As the fiscal year approached its end, the secretary of the Army directed the DUSA-IA to develop a long-term strategy to ensure the school’s continued viability. The August 1999 Report of the Board of Visitors, an external committee responsible for reviewing the USARSA’s academic program, noted the exemplary nature of the school’s human rights training.

FY 1999 was a busy year for international cooperative research and development projects. The DUSA-IA’s Cooperative Research, Development, and Acquisition Division established fourteen project agreements and eleven data exchange agreements, arranged four loans, and pursued eighteen additional proposals in those categories. Such activities provide the Army with different perspectives and lines of research that it cannot pursue alone and they strengthen ties between the United States and other nations.

Ties between the Russian Federation Army and the U.S. Army weakened in FY 1999 in response to North Atlantic Treaty Organization (NATO) operations in Serbia. As one example, the Russian procurator general had settled on the U.S. Uniform Code of Military Justice as the best available model for reforming the Russian military justice system. The Office of the DUSA-IA strongly supported the Russian interest, seeing a means to support Russian development of improved democratic rule of law in military affairs. Unfortunately, the strained relations postponed a scheduled visit to the United States by the Russian Main Procuracy to discuss the reform.

Relations with the Chinese People’s Liberation Army suffered a similar setback. A May 1999 China Engagement Workshop hosted by the DUSA-IA developed a schedule of exchange events, including a visit to China by the superintendent of the United States Military Academy, a language exchange visit by Academy cadets, and a possible military history exchange. Planning came to a halt, and all military ties with China were severed, as a result of the 7 May accidental U.S. bombing of the Embassy of the People’s Republic of China in Belgrade during NATO air strikes targeted against the Yugoslavian government.

In accordance with the 1997 Defense Reform Initiative, the international emergency planning function of the Office of the Secretary of Defense transferred to the Army. The DUSA-IA assumed responsibility for the function—known as civil–military emergency planning (CMEP)— on 11 March 1999, and executed its first CMEP event in September 1999. The Earthquake Preparedness Workshop for Southeastern Europe Defense Ministerial (SEDM) nations met in Varna, Bulgaria, to discuss database development and communications needs in planning for shared response to major earthquakes. In a concurrent session within the SEDM, the

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five Partnership for Peace (PFP) members discussed sustained regional cooperation in civil protection. The PFP is a program that promotes practical security cooperation between NATO and former Warsaw Pact nations. Bulgaria introduced a proposal to establish a CMEP Council for the five PFP and three NATO nations of the SEDM.

Research, Development, and Acquisition

The reconfiguration of the Army from the Cold War force, through Force XXI, to the Army After Next is partly a response to the technology-driven revolution in military affairs. To fully exploit the capabilities that digital information technologies, advanced materials, and parallel changes in business and operational practices offer, the Army continues to invest heavily in the development and production of new systems and the revision of old policies.

A sample of the potential this process offers may be found in two comparatively small, complementary programs: the Army fuel privatization/ outsourcing initiative and the procurement of alternative-fueled vehicles under the Army energy program. In November 1998, the Army replaced thirteen government-owned and -operated fuel facilities at Fort Bragg, North Carolina, with two contractor-owned and-operated facilities. In February 1999, a single privately owned and operated facility replaced the government fuel facilities at Schofield Barracks, Hawaii. Those two contracts will save the Army an estimated $3 million over a twenty-year period. Seventeen other Army facilities are under consideration for this program, which reduces government-owned infrastructure and associated personnel costs while maintaining a vital support activity.

During FY 1999, the Army’s alternative-fueled vehicle (AFV) program, involving energy sources such as propane, liquid natural gas, and electricity, accounted for 32 percent of all acquired or leased general service vehicles. Although still short of the 75 percent goal of the Energy Policy Act, the 1,365 AFVs in service decrease the Army’s thirst for petroleum products and help meet environmental goals. In conjunction with fuel privatization, AFVs offer the potential to significantly alter transportation on Army facilities without requiring extensive government investment in alternative fuel infrastructure.

But alternative fuels and environmental protection are only two aspects of the Army’s ongoing efforts to develop and procure more effective and efficient systems to facilitate its mission. During FY 1999, the Army ordered the reorganization of the offices responsible for those efforts. On 18 November 1998, the vice chief of staff approved the 1 October 1999 consolidation of Army developmental and operational testing under a single command, the preexisting Army Operational Test and Evaluation

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Command (OPTEC). That command’s name was slated to change to Army Test and Evaluation Command when the consolidation occurred.

Army research and development did not halt to await the restructuring scheduled for the first day of FY 2000. The OPTEC, originally formed as an independent Army agency, pursued an extensive list of projects during FY 1999 in cooperation with other Army agencies and civilian contractors. Those projects were guided by the Army Development, Acquisition, and Fielding Strategy (DAFS), a 1999 statement supporting the Army Science and Technology Master Plan and the Army Modernization Plan. In accordance with the DAFS, the Army is moving away from the traditional “stovepipe” model of linear research, development, and acquisition of individual systems to a system-of-systems approach. That concept recognizes every piece of equipment, soldier, and system as part of a larger system for performing the Army mission. It stresses integration, cooperative development, and component commonality. Spiral development, in which the combat developer, materiel developer, contractor, and warfighter work closely to advance a project from requirements, through design, to implementation and testing, complements this system-of-systems approach to speed the process and ensure its focus on the warfighter’s needs.

New Army systems, in accordance with the DAFS and Army practice, advance through four phases in the development, acquisition, and fielding process. The first phase, concept exploration, marks the transition between basic research and systems development. It consists of competitive, parallel, short-term studies to define and evaluate alternative concepts. In the program definition and risk-reduction phase, programs are identified as specific concepts and approaches. Alternatives are assessed and risks identified. During the engineering and manufacturing development phase, the most promising approach is translated into a stable, interoperable, producible, supportable, and cost-effective design. Manufacturing processes are validated, and the system ’s capabilities are tested to identify necessary fixes or upgrades. In the final phase— production, fielding/deployment, and operational support—the system achieves operational status, fulfilling mission requirements. Remaining difficulties are identified and resolved, and systems in this phase retain the potential for further development.

The Army’s publication Weapons Systems 1999 identifies ongoing projects within those four phases. It also links systems with the relevant pattern(s) of operation defined in Army Vision 2010. Those patterns provide a template for Army development and identify the role that specific systems will play in the overall system of systems. The patterns of operation are these: project the force, protect the force, gain information dominance, shape the battlespace, conduct decisive operations, and sustain the force. Specific projects however, may be better understood in the broader mission

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categories of information dominance, force overmatch, essential research, recapitalization, and contributing capabilities.

The Army pursued a number of projects intended to enhance information dominance in FY 1999. Many of those programs were already in the production, fielding/deployment, and operational support phase of development. These included the Advanced Field Artillery Tactical Data System, Analysis and Control Team Enclave, Army Airborne Command and Control System, Army Key Management System, and the Digital Topographic Support System. These systems, and those in the engineering and manufacturing development and other phases (like the Force XXI Battle Command Brigade-and-Below system) collect, process, and disseminate information on the digital battlefield.

Such systems are part of the infrastructure of the Army Battle Command System (ABCS), the overall concept for a system of systems integrating information from various platforms and sensors. Their continued development in FY 1999 supports the emergence of the ABCS as an operational reality. As it nears full functionality, the ABCS will link automation assets, communications media, and operational forces to support the Army’s command, control, communications, and intelligence capabilities in real time. The potential impact of such a rapid, integrated flow of communications, enabled by information technology, is the driving force behind the Revolution in Military Affairs.

Knowing where and how to employ force does little good if the Army lacks the fire power and robustness to accomplish its mission. The Army avoids this obvious pitfall by maintaining force overmatch—the combination of lethal, mobile, and survivable weapons systems that enables its units to seize and exploit the advantage provided by information dominance. Most of the high-profile systems under development during FY 1999 fell under this general category. But the dividing line between information dominance and force overmatch is not entirely clear because the two mission categories interact closely and frequently coexist within the same unit or piece of equipment.

This ambiguity in mission categorization is embodied in the RAH– 66 Comanche helicopter, which remained in the program definition and risk-reduction phase during FY 1999. The Comanche, as a stealthy armed reconnaissance helicopter, contributes to both information dominance and force overmatch. Its digital information suite will facilitate communications among flight crews, Joint Surveillance and Target Attack Radar System aircraft, and other ground-based and airborne weapons platforms and command-and-control facilities. Advanced electro-optical sensors and target recognition capabilities will allow the Comanche to add information to the battlespace network. And its low radar signature and armament of air-to-ground missiles and rockets, air-to-air missiles, and 20-mm cannon

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enable the Comanche to exploit that information on deep, precision-strike missions as a potent ingredient in force overmatch.

The first Comanche prototype returned to the skies in late October 1998 after the installation of various improvements. The second prototype completed its first flight test on 30 March, and both aircraft continued to operate throughout the year. The testing proved successful enough that the Boeing Sikorsky RAH–66 Comanche Joint Program Office delivered a $3.1 billion proposal to the Army on 23 August. The proposal recommended the construction of thirteen more RAH–66 helicopters for continued Army testing and evaluation and the initiation of the engineering and development phase of the Comanche program in early 2000.

Crusader, like Comanche, was in the program definition and risk-reduction phase during FY 1999 as a program contributing to the Army’s ability to overmatch an opposing force. As the premier indirect fire support system of Force XXI, the Crusader is a notable advance over the M109A6 Paladin and M992 ammunition supply vehicle combination it will replace. Improvements include extending the new howitzer’s radius of fire more than ten kilometers beyond the Paladin’s thirty-kilometer maximum, a sustained rate of fire of ten to twelve rounds per minute compared to the Paladin’s one round per minute sustained rate or three-minute burst of four rounds per minute, and the ability to launch a simultaneous impact strike of four to eight rounds with a single gun. The new 155-mm howitzer also offers automated ammunition handling, automatic resupply and refueling from the system’s integral support vehicle, and a remote multi-option fuze capability, all improvements over the older system. A Crusader’s three-man crew is one person smaller than the Paladin’s and, as a result of the range and rate-of-fire improvements, it commands combat power surpassing that of three of the older Paladin artillery pieces combined.

A March 1998 in-process review determined that the Crusader program was ready to proceed from the design stage into the construction of initial prototypes. The prototypes were to be delivered in December 1999, but in the FY99 Defense Authorization Act the legislature withheld funding for the Crusader until five critical issues could be resolved. The Army responded to those concerns in a February 1999 report that asserted the new system would be the first American 155-mm howitzer since the First World War that could claim superiority over other self-propelled 155-mm systems. The Crusader, clearly a revolution in tactical artillery systems, would fill an urgent requirement, provide critical support for the Army and Joint Vision 2010, deliver an optimum blend of cost and performance, and satisfy the requirements of the Force XXI campaign. With those concerns resolved, the program continued, but it remained behind schedule for the rest of the fiscal year.

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In addition to programs providing information dominance and force overmatch in the near to mid-term, the Army supports essential research and development projects seeking both incremental improvements in existing systems and leap-ahead technologies. Careful management of the service’s limited science and technology funding is vital to the success of these efforts, which also seek to leverage the advances of other services, government agencies, industry, and academia. Funding for these programs is guided by a set of more than two hundred science and technology objectives that establish specific, measurable advances to be achieved in each fiscal year.

The Brilliant Antiarmor submunition (BAT) and the Tactical High- Energy Laser (THEL), which were in the engineering and manufacturing development stage that immediately precedes production, were among the most mature research projects the Army pursued during FY 1999. The BAT submunition completed production qualification and received approval for initial production before the end of the fiscal year, while design and testing of its first scheduled product improvement upgrade continued. The upgrade will possess improved target acquisition capabilities, adding millimeter-wavelength radar to the acoustic and infrared seekers of the original BAT submunition, and will feature an enhanced warhead. The THEL, a cooperative project of the DOD and the Israeli ministry of defense, is intended to provide local and theater-level protection from short-range artillery rockets. With the Space and Missile Defense Command as its U.S. executive agent, the THEL successfully demonstrated its target identification and tracking capabilities and achieved “first light”—the first firing of its weapon-strength laser—during FY 1999. On 7 July, the Joint Requirements Oversight Council approved the Joint Theater Air and Missile Defense Mission Needs Statement, identifying the need for the capabilities that the THEL, as an advanced-concept technology demonstration project, promises to develop.

Such efforts to develop future systems and technologies cannot ignore the need to adapt and improve existing Army systems to maximize their capabilities and extend their useful operational life spans. Identifying such potential developments is part of the Army’s research and development strategy. Overhauling, updating, and modifying existing equipment is the purpose of the Army’s recapitalization effort.

The Army recapitalized a number of systems during FY 1999. For example, during the second quarter of FY 1999, managers of the high-mobility multipurpose wheeled vehicle program completed their analysis of alternatives, the basis of the strategy that will guide the program’s modernization efforts through FY 2023. The product manager of the M113 family of vehicles derived from the basic armored personnel carrier continued to purchase upgrade kits to convert older variants of the tracked

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vehicle into new configurations, completing 230 such modifications during the fiscal year. Full-rate production of the M109A6 model of the Paladin self-propelled howitzer ended on 25 June, whereas the Army continued to pursue upgrades such as the Automatic Fire-Control System XXI to increase the weapon’s capabilities. National Guard artillery battalions in New Mexico, South Carolina, Utah, West Virginia, and Wisconsin received the howitzer during FY 1999 as the Army continued to upgrade the existing M109A2/A3 Paladins to the M109A5 model.

Finally, the Army also develops and acquires capabilities that support the patterns of operation identified in Army Vision 2010 but do not fit into any of the clearly definable patterns of operation. Such systems fall into the general mission category of contributing capabilities. They improve the mobility and lethality of Army forces, enhance their survivability, or otherwise promote their mission performance.

During FY 1999, those projects included continuing research into the environmental restoration of Army facilities and tele-engineering, the Army Corps of Engineers’ initiative to support deployed engineers by providing them with the capability to teleconference with, and otherwise draw on, the knowledge and capabilities of subject matter experts located elsewhere. Army medical researchers continued development of the fibrin bandage in conjunction with the American Red Cross, and contracted to the University of Cincinnati (Ohio) the development of a means for extending the shelf-life of blood stores. The first project will save lives by including a clotting agent in bandages, and the second will enhance the Army’s ability to maintain blood supplies in remote locations.

Through such research, development, and procurement programs the Army maintains its current and future ability to fulfill its mission under the National Military Strategy. Army logisticians manage the flow of goods and services to the active and reserve components; provide for the maintenance of equipment and facilities; sustain Army forces in the field; assist friendly nations with their security and emergency response requirements; and direct the Army’s research, development, and acquisition programs. They provide Army personnel with the supplies and tools required to put doctrine and training into practice.

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