raise absorption, and higher fuel costs. The additional amount will be needed to cover additional unfunded requirements

resulting from the decline in the value of the dollar, including Overseas Station Allowance, industrial/stock fund transfer refunds, Persian Gulf operations, Civilian Health Service costs, and the GSA stock fund surcharge.

Question: Since $1.5 billion in authority is already available, can you tell us how much of the $1.5 billion has already been proposed and how much approved?

Answer: Of the $1.5 billion already available for FY 1988, $788.1 million has been proposed for transfer in the Amended FY 1988/1989 Biennial budget. Necessary reprograming actions for the proposed $788.1 million require transmission to the congressional committees and approval prior to actual processing of the transfers. Although the $788.1 million is all that was actually included in the budget, unfunded requirements exist in the Military Personnel and Operation and Maintenance appropriations. If these requirements cannot be absorbed in the appropriations sustaining the shortfall, reprograming actions and the use of general transfer authority will be necessary.

Question: In 1986 the Congress provided $950 million in general transfer authority, in 1987 this was increased to $1.1 billion and last year it was raised to $1.5 billion. tell us what percent of each of these amounts has been transferred?

Can you

None

Answer: Of the $950 million of general transfer authority in 1986, 64 percent has been transferred with another 7 percent awaiting congressional approval for transfer. Of the $1.6 billion of general transfer authority in 1987 (an additional $.5 billion was added in the Supplemental), 58 percent has been transferred, with another 13 percent proposed for transfer. of the $1.5 billion general transfer authority for 1988 has thus far been transferred. Applicable reprograming actions that use general transfer authority require transmission to the congressional committees and approval prior to actual processing of the transfers. Although the amounts transferred so far are below the total amount of general transfer authority provided, it is important to realize that the years mentioned still have available procurement and research and development funds for obligation, and accordingly will continue to use general transfer authority.

Question: Considering the remaining transfer authority for 1988 and prior years, why isn't this amount sufficient to meet your requirements?

Answer: The unfunded requirements for FY 1988 total $4.0 billion. The Congress has set the current level of transfer authority for FY 1988 at $1.5 billion, clearly not enough to accommodate the unexpected increased operations costs.

Question: Mr. Secretary, if the additional authority is provided, which programs will be the sources for transferring $4 billion?

Answer: The sources have not yet been specifically identified but lower priority programs will be the candidates for transfers utilizing the additional requested transfer authority. Specific programs would be identified as decisions are made regarding submission of the reprograming actions. Actions requiring the use of General Transfer Authority would be transmitted in the normal manner via DD1415 Reprograming Action to the committees for approval prior to implementation.

Question: Does your support of increasing transfer authority imply that $4 billion in excess funds are available in the Department of Defense?

Answer: This in no way implies that there is $4 billion in excess funds. The increased transfer authority level will enable the Department to protect our critical readiness needs and provide DoD managers the necessary flexibility to do their jobs efficiently and effectively. The offsets will come from lower priority programs, which have not been identified at this time.

Question: Mr. Secretary, can you please provide for the record a listing by appropriations account of the sources and receiving accounts of the increased transfer authority.

Answer: We have not yet fully identified the offsetting funding sources for these requirements or to what extent these offsets will come from within the accounts experiencing the unfunded requirements. We will identify the offsets and receiving accounts as the decisions are made regarding submission of the reprograming actions.

Question: Mr. Secretary, what will be the impact on defense outlays for fiscal year 1988 if the transfer threshold is raised to $4 billion? Will increasing the transfer limitation cause outlays to increase above the level agreed to in the budget summit agreement for 1988 $285.6 billion?

Answer: We do not expect the increase in the transfer threshold to increase our outlays for FY 1988 above the level agreed to in the budget summit agreement.

Question: How will you control outlays to ensure the budget Summit agreement will not be breeched?

Answer: The Department has in the past monitored outlays throughout the year and will continue to do so. The Services are aware of the necessity of complying with the outlay constraints of the Budget Summit agreement and will be working with OSD to manage within the outlays the Congress provided.

Question: What specific activities will be taken and how much does each action save on 1988 outlays?

Answer: The Department monitors outlays throughout the year and is prepared to identify any anomolies in the rate of outlays at an early stage. In the course of reviewing outlays during the year, necessary management action will be exercised to manage within the level provided by Congress.

Question: What historical evidence can you provide which demonstrates that DoD can "manage" outlays?

Answer: The Department of Defense is constantly reviewing and monitoring outlays and has over the last five year period averaged 99.3% of our projected outlay estimate.

ATB CAPABILITY

Question: Mr. Secretary, the capability of the ATB to hit Soviet targets appears to have been downgraded by the Joint Chiefs of Staff. Last year, the chiefs said in their annual posture statement that when the ATB is deployed by the Air Force in the 1990s, it will "ensure a continued U.S. capability to penetrate Soviet airspace and attack the full range of fixed and relocatable targets." This year, the Chiefs' statement said a continued U.S. capability to penetrate hostile airspace to attack the full range of fixed

the ATB "will ensure

targets, and present an increased threat to some relocatable targets." What is the significance of the latest Joint Chiefs of Staff statement concerning the ATB capability?

Answer: [Deleted.]

AIR FORCE TACTICAL FIGHTER WINGS

QUESTION: If the 401st Tactical Fighter Wing is relocated within Europe, how will the Department allocate the reduction proposed in the budget? Will aircraft and personnel reduction be made in Continental U.S. Air Force Wings? ANSWER: Since relocation of the 401 Tactical Fighter Wing to another NATO southern region country is being studied by the alliance at this time, it would be premature to postulate alternatives to the stated position that the 401st will begin deactivation in the last quarter of Fiscal Year 1989. Should NATO agree to satisfactory financial arrangements for relocation of the 401st in Europe, then discussion of alternative CONUS or other overseas unit reductions would be appropriate.

Question: Mr. Secretary, your statement indicates that the budget proposes to reduce to 36 Tactical Fighter Wings. Secretary Carlucci's statement before the Senate Armed Services Committee on February 18, 1988, states that the budget proposes to reduce to 35 Wings. Which is correct?

Answer: Our force reduction proposal for the Air Force would reduce the number of equivalent Tactical Fighter Wings to 36 in FY 1989 and 35 by FY 1990.

Coast Guard Support

Questions: Mr. Secretary, the 1988 Appropriations Actions Act (Section 8136) requires the Department of Defense to provide not less than $105 million in supplies, fuel, training assistance and other operational support for the Coast Guard. Could you please provide a status report on implementation of this provision. Could you describe how this credit system will work? Do you think this system is preferable to the $100 million transfer of Defense funds to the Coast Guard provided for in FY 1987?

Answer: The Department is working with the Coast Guard on a daily basis to implement this provision of law. An agreement providing implementing details will be completed this month (March 1988). Refunds will be provided to the Coast Guard for charges made to the Coast Guard in the early part of the fiscal year and credits will be extended for future requirements.

The effect of this provision is to reduce the assets of the Defense Department without providing the reimbursements to replace them. Additional funds will be budgeted in FY 1990 to replenish approved inventory levels depleted by this action. The reimbursement procedures required to implement section 8136 entailed substantial effort. Significant accounting adjustments are required to implement this section. Coast Guard business with DoD had to be analyzed to determine the accounts in which credit could be given. These accounts may vary as Coast Guard operations vary. Additionally, the procedure does not generate efficiencies through consolidation of Coast Guard procurements with those of Defense as suggested in the Appropriation

Conference Report. Because the items to be provided without reimbursement are routinely provided to the Coast Guard, they do not represent additional procurements and there are no additional buying efficiencies to be realized. In view of the administrative and accounting adjustments required to implement this direction and the unreimbursed drawdown of DoD inventory to support it, this method of supporting Coast Guard requirements should not be repeated.

Question: You have stated that some of our allies have contributed to paying some of the costs of our presence in the Persian Gulf. Provide for the record the amount of funds each nation has contributed since our increased Persian Gulf presence began in late 1987, and how much each nation has agreed to contribute in FY 1989?

Answer: Often we are questioned about the contributions of our GCC friends and European allies to our protection regime in the Gulf. It is important that you understand that we could not achieve the success that we enjoy today without their help. While, for political and security reasons, I prefer not to be specific as to exact numbers and countries, I can give you a rough order of magnitude.

From the Gulf states, we get help in direct contributions of fuel for ships and aircraft, food and billeting for some of our military personnel, port services and ship repairs, and landing and overflight rights to mention some of the more important items. We attempted to provide some figures for ourselves on this assistance to gauge the value of the support provided. While there may be some double counting involved in trying to quantify the value of goods and services provided gratis, since we never receive a bill for such help, according to our calculations, contributions (most of them in kind) have reduced our incremental costs in the Gulf by approximately one-third. This really does not account for other additional support which cannot be quantified in dollar terms, but is no less valuable such as overflight clearances mentioned above.

Our European allies make no direct contribution to us in terms of financial assistance, but they participate in a much more meaningful way. The British, French, Italians, Dutch and Belgians all have forces in the Gulf helping protect nonbelligerent shipping and contributing to the total minesweeping capability in the Gulf. The FRG helps by backfilling with naval forces in the Mediterranean, and Japan contributes with financial offsets for U.S. forces in Japan as well as navigational equipment in the Gulf and aid to regional Arab states.

Force Structure

Question: Please provide details on the major force structure changes proposed in the budget. Please provide: 1) rationale for the reduction: 2) baseline operation and support costs and personnel (military and civilian) for each unit (by appropriation: 3) the planned schedule for force reduction and 4) savings by appropriation account in 1988, 1989 and 1990.

Answer: The major force structure changes proposed in the budget are listed below by Service. All of the force structure changes listed were made to accomodate the reduced resources

available to the Department of Defense in FY 1989. All dollar savings are expressed in millions.

Army

Deactivate one active brigade of the 9th Infantry Division (Motorized) at Fort Lewis, Washington (4th Qtr/FY 1988).

Deactivate the Army National Guard ROLAND unit in New Mexico (4th Qtr/FY 1988). Reassign 293 Active Guard/Reserve (AGR) personnel and 115 drilling reserves to CHAPARRAL and HAWK battalions.

Cancel planned FY 1989 activation of two 6th Infantry Division (Light) battalions in Alaska, one at Fort Richardson in October 1988 and one at Fort Wainwright in May 1989.

-Retire 170 OH-58/UH-1 scout aircraft from Army units worldwide, January through September 1989. Retire additional 742 OH-58/UH-1 scout aircraft in FY 1990 through FY 1994.