Army Budget Makes Force Structure, Modernization Cuts Official (UPDATED)

By Valerie Insinna

The Army is working to balance readiness, force structure and modernization, officials said during the unveiling of the service’s $120.5 billion fiscal year 2015 budget. But fiscal constraints will keep it from achieving that balance during that year, they added

Most of the bombshells in the Army’s 2015 budget had long been whispered among industry insiders or alluded to by service officials in public remarks before being made explicit by Defense

Secretary Chuck Hagel last week. The service’s budget sets aside $20.5 billion for procurement and research and development, but also curtails several new start and modernization programs.

That won’t be much consolation to industry officials as they see programs cancelled, aircraft retired and the possibility of further cuts on the horizon if sequestration returns in 2016.

The Obama administration requested $495.6 billion for the Defense Department in its fiscal year 2015 budget, which is $45 billion below the 2014 projections. Although the request conforms to the spending levels set by the Bipartisan Budget Act, it carries increased levels of risk, officials said.

Obama’s five year defense spending plan, meanwhile, is $115 billion more than the sequestration levels that will be re-imposed in fiscal year 2016.

During budget briefings at the Pentagon, Defense Department and service officials such as comptroller Bob Hale indicated that sequestration would increase the chances that the military is unable to accomplish its strategy.

Experts, however, pushed back against the notion that the Army is under-resourced.

"I think it's overstated that we're really in trouble,” said Brad Curran, a defense analyst for Frost & Sullivan. "What is the obvious clear and present danger for a very large ground force? Are we going to fight a ground war in China or in the Ukraine or in Africa? I don't think so."

The president’s budget included Opportunity, Growth and Security Initiative, which would appropriate an extra $26 billion of defense spending in return for tax and spending reforms. The Army would net $7.5 billion of that — 55 percent to be spent on readiness and 45 percent on procurement, Maj. Gen. Karen Dyson, the service’s budget director, said at a Pentagon briefing.

Even with that funding added in, “it does not allow us to achieve balance between end strength, modernization and readiness,” in 2015, Dyson said.

Dyson’s remarks echoed the Quadrennial Defense Review released along with the budget, which also characterized the joint force as out of balance. “It will take time and funding to reset and reconstitute the Joint Force as we transition from operations in Afghanistan,” the QDR said.

In order to adjust to new fiscal and strategic realities, the Army plans on downsizing its end-strength from its current 520,000 troop level to as low as 440,000 over the next five years.

It will remain able to conduct the full scale of land operations, “including prompt and sustained land combat as part of large, multi-phase joint and multinational operations,” the QDR said.

Army National Guard and reserve forces also took a hit to their end strength that could ignite a battle between them and the active component. The budget proposed downsizing the Army National Guard from 355,000 to 335,000 soldiers and the reserves from 205,000 to 195,000.

If sequestration cuts are reinstated in 2016, the active duty Army would have to scale back even further, to 420,000 soldiers. Army National Guard and reserves would be cut to an end strength of 315,000 and 185,000 respectively.

“We have protected the National Guard and reserves from cuts to the extent possible, but to maintain a ready and capable force at a time of fiscal constraints, no component of DoD can be entirely exempted from reductions,” Hagel said last week, noting that the Guard and reserves are only being cut by 5 percent compared to a 13 percent cut to the active component.

The National Guard Association of the United States immediately criticized the proposal.

“For the last 12-plus years, Army and Air National Guard units have been nothing less than integral to the Army and Air Force accomplishing their missions around the globe. Service and Pentagon leaders have said as much countless times,” said retired Maj. Gen. Gus Hargett, the organization’s president. “Unfortunately, active military leaders all too often change their tune when budgets get tight, even when Guard cost-effectiveness can be the solution.”

Governors from 50 states sent a letter to the president asking him to preserve current Army National Guard end strength, according to a Feb. 28 letter released by the National Governors Association.

“The Army’s proposed cuts suggest a pre-2002 strategic reserve construct. … A return to a pre-9/11 role squanders the investment and value of the Guard and discredits its accomplishments at home and as an active combat force,” it said.

Along with reductions to force structure, the Army’s budget makes official an aviation proposal that has drawn ire from the National Guard community.

It retires the OH-58 Kiowa Warrior reconnaissance helicopter and TH-67 training helicopter. It also directs the Guard to transfer all of its AH-64 Apache attack helicopters to the active component, while the Guard would receive UH-60 Black Hawk utility helicopters.

Army officials have said the Black Hawks are better suited to the medical evacuation and transport missions that the Guard will take on in coming years. Meanwhile, Apaches teamed with unmanned aircraft will take over the Kiowa’s role, while the OH-58 cockpit and sensor upgrade program is cancelled.

Army National Guard generals feel as if they were not brought to the table until its was too late, said John Goheen, spokesman for the National Guard Association of the United States. He characterized the aviation restructure plan as being “shoved down the Guard’s throat.”

“This is classic case … when one side decides what the other side needs,” he said. “Why don’t they ask [the Army National Guard]? Why can’t we do this collaboratively?”

Despite the opposition from governors, National Guard organizations and even some lawmakers, Congress will likely approve the Army’s plan to reorganize aviation assets and cut down the active, reserve and Guard force, Curran said.

The Apache program is slated to receive $957 million in 2015, some of which will go toward procuring 25 AH-64E helicopters.

The service also set aside $1.5 billion for the Black Hawk program to buy 55 UH-60Ms. That funding will also be spent on the improved turbine engine program, which will build a more powerful, fuel-efficient engine for Black Hawks and Apaches.

It will spend $416 million on 55 UH-72A Lakotas that will replace TH-67s.

The Army is moving forward with other aviation modernization programs. It plans to spend $1 billion on CH-47 Chinook aircraft, including 26 remanufactured and 6 new-build “F” models.

Some $52 million will go toward the service’s joint multi role demonstrator program, which will develop rotorcraft technologies that will feed into the service’s future vertical lift program. Army officials want to begin replacing legacy helicopters with future vertical lift aircraft as early as 2035.

The Guard could take an even bigger hit to its aviation programs if sequestration returns. The Army plans to cut 50 of its UH-72 light utility helicopters if that happens, Hagel said.

One of the biggest blows to industry was the elimination of the ground combat vehicle program. General Dynamics Land Systems and BAE Systems held technology development contracts for GCV designs to replace the Bradley Fighting Vehicle.

Hagel has directed Army and Marine Corps leadership to deliver “realistic” visions for vehicle modernization by the end of fiscal year 2014, he said last week.

“The program is no longer affordable under budget constraints,” said Davis Welch, the Army’s deputy budget director. The service is directing $131 million in science and technology funding that would “look at the feasibility” of future combat vehicle technologies, but most of that will be funneled into military research labs, he added.

Other vehicle programs had better luck. The joint light tactical vehicle program netted $210 million, which will procure 176 vehicles during low rate initial production.

The Army remains committed to developing the armored multipurpose vehicle, Welch said. About $92 million in funding will go toward that program’s engineering, manufacturing and development phase.

With the GCV program cancelled, the Army will focus on modernizing older vehicles, such as the Bradley fighting vehicle, Abrams tank and Stryker armored fighting vehicle.

Terminating the ground combat vehicle is a good move for the service, which can save money by making incremental improvements to the Stryker and Bradley, Curran said.

“Keep upgrading those platforms, put the v-hull on them to make them safer from mines and things like that. Add the networking technologies and make the incremental upgrades to the vehicle electronics and to the defensive systems and to the networking capabilities,” he said. “I don’t think we need a brand new vehicle from scratch.”

In order to have the smaller — but more agile and effective — Army force, the service will need to invest in better communications, soldier technologies and networked weapons, Curran said. “You can have a smaller force, but you have to have really good equipment.”   

The budget proposes $161 million to procure 9,700 enhanced night vision goggles for special forces and brigade combat teams. It also sets aside $32 million to retrofit and procure 38,000 M4A1 carbines. Also, $84.1 million will be spent on the Army’s Nett Warrior communications system for dismounted soldiers.

In the realm of missile defense, the Army plans on procuring 70 Patriot missiles at a total cost of $420 million.

Correction: A previous version of this story misidentified the amount requested for Lakota procurement.

Topics: Aviation, Rotary Wing, C4ISR, Defense Department, DOD Budget, DOD Leadership, DOD Policy, Land Forces

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