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TESTIMONY OF
BRIGADIER GENERAL JEROME JOHNSON
DIRECTOR FOR PLANS, OPERATIONS AND READINESS
OFFICE OF THE DEPUTY CHIEF OF STAFF, G4
UNITED STATES ARMY

AND

BRIGADIER GENERAL KEVIN T. RYAN
DIRECTOR OF STRATEGY, PLANS AND POLICY
OFFICE OF THE DEPUTY CHIEF OF STAFF, G3
UNITED STATES ARMY

BEFORE THE
HOUSE ARMED SERVICES COMMITTEE
SUBCOMMITTEE ON READINESS
UNITED STATES HOUSE OF REPRESENTATIVES

REGARDING
ARMY PROPOSITIONED STOCKS SUPPORTING
THE UNITED STATES ARMY

 March 24, 2004

Mr. Chairman and distinguished members of the Subcommittee, thank you for this opportunity to report to you today on Army Prepositioned Stocks (APS).   APS is a very important program both for the Army and our nation.  APS has been used extensively to support combat operations in Southwest Asia (SWA) where a major portion of it remains committed today.  As the Army resets, the need to modernize and improve the APS program becomes increasingly important if we are to stay strategically responsive.

Why do we have Army Prepositioned Stocks?

Through the support of Congress, APS has been a very successful program.  APS equipment and supplies drawn by units were major contributors to the success the Army experienced in recent combat operations. APS also reduced strategic lift requirements enabling the Joint Force Commander in Kuwait to rapidly build combat power.  The Army learned many lessons during Operations Enduring Freedom (OEF) and Iraqi Freedom (OIF), which are now being incorporated into the Army's future APS strategy.  The Army faces significant funding challenges as it resets and converts to modular units but recognizes that APS must also be reset and repositioned to be ready for tomorrow's challenges.

The APS program exists to support the National Military Strategy by prepositioning critical warfighting stocks in strategic locations worldwide. Prepositioning of materiel reduces the deployment response time required for an expeditionary Army.  The APS program is evolving from its Cold War mission of large amounts of equipment and supplies stored in Central Europe to tailored sets deployed ashore and afloat in three regions to better support all regional Combatant Commanders.  APS remains a cornerstone of Army power projection.

What are Army Prepositioned Stocks?

APS consists of prepositioned unit sets of equipment, operational projects (OPROJ) and sustainment stocks.  It also includes War Reserve Stocks for our allies in Korea and Israel.   Prior to OIF, the core of the program was five brigade sets -- one afloat on ships stationed at Diego Garcia (designated as APS-3) and one set ashore in Europe (APS-2), one set in Korea (APS-4) and two sets in SWA (APS-5).  Currently, there are six brigade sets in APS.  Five are on land (one in Europe, three in SWA, and one in Korea) and the sixth is afloat at Guam/Saipan.

Fourteen APS Operational Projects (APS-1) provide specialized capabilities over and above normal unit authorizations, such as petroleum distribution, Force Provider housing modules and mortuary affairs.  These are located across the globe to support regional Combatant Commander requirements.  Sustainment stocks support APS unit sets and deploying units in SWA and Korea until re-supply is initiated from the industrial and sustaining base in the Continental United States (CONUS).

New APS Strategy

Prior to Operation Iraqi Freedom, the Army leadership recognized that an APS policy based on Cold War threats must change to meet Army transformation goals, and directed development of a new APS strategy to address the current and future threat environment.  In June 2003, the Vice Chief of Staff of the Army approved a new APS strategy to comply with the current Strategic Planning Guidance (SPG).  This strategy emphasizes rapid force closure, enhances strategic responsiveness, offers flexible deterrent options to the regional Combatant Commanders, and provides capabilities to meet the demands across the full spectrum of operations.  The new APS strategy focuses on forward positioning critical enablers to influence the SPG imperative "Swiftly Defeat the Effort" Phase One (seize the initiative) and Phase Two (decisive operations), while transitioning to "Win Decisively".  The major differences in this new strategy are the development of the Army Regional Flotilla (ARF) concept and a significant reduction in combat units within APS.

The concept of APS-3 afloat in a single location will give way to three Army Regional Flotillas (ARF) positioned in the Pacific Ocean, the Indian Ocean and the Mediterranean Sea.

Land-based APS enhances Army deployment response by allowing ground units to deploy personnel by airlift and act as an immediate response force while also mitigating enemy anti-access efforts.  Additionally, land-based APS reduces the requirements for limited strategic air/sealift early in operations. Land-based APS in Europe will shift from Central Europe to a 1x1 brigade set in Italy. This is short-hand for the equipment for one armored battalion and one mechanized infantry battalion. A 2x2 brigade set will be located in both SWA and Korea.  These optimal locations were determined from numerous studies such as the Defense Mobility Requirements Study 2005 and the Center for Army Analysis study "Arcs of Instability".

Army Regional Flotillas (ARF)

The new APS strategy has afloat capabilities dispersed geographically in three critical regions providing a new set of modular capabilities designed to provide regional Combatant Commanders with flexible response options.  APS afloat influences early decisive operations by providing capabilities for a rapid response force.

At the core of each of the three ARFs are two Large Medium-Speed Roll On/Roll Off (LMSR) vessels.  One LMSR contains a 1x1 brigade set consisting of equipment for one armored and one mechanized infantry battalion, a round-out assortment of brigade combat support (CS) and combat service support (CSS) units, and 15 days of supply of unit basic loads.  The second LMSR will contain equipment for units at Echelons Above Division (EAD) and Echelons Above Corps (EAC).  These units provide theater opening and sustainment support for the deployed force.

Much of the equipment scheduled for upload on the second LMSR will support not only the present 1x1 brigade set construct but will also support future deployment of STRYKER brigade combat teams.  This includes equipment such as 900-series trucks, the Family of Medium Tactical Vehicles (FMTV), Heavy Expanded Mobility Tactical Trucks (HEMTT) and Palletized Load System (PLS) trucks that will be part of the STRYKER Brigade Support Battalion (BSB) and Combat Service Support Company (CSSC).  Initial indications are that 70% of the equipment aboard this ship can support both the 1x1 brigade set and STRYKER brigade.  Using CS/CSS assets from an ARF will give the STRYKER brigade an initial sustainment capability without further straining limited strategic airlift assets.  There is no Army plan today to place STRYKER vehicles in prepositioned stocks.

A third vessel, a 26-foot shallow draft Roll On/Roll Off (RO/RO) ship, will hold humanitarian assistance and disaster relief (HA/DR) functional units and capabilities.  The smaller draft of the RO/RO ship affords it wider global port access than the LMSR.   Each ARF will also include a ship with sustainment stocks and another loaded with ammunition containers, sufficient to provide 30 days of supply to 2.5 divisions.  This requirement is under review and may change, but the number of ammunition and container ships will not.  While these ships can support the 1x1 brigade set, they are primarily intended to support the augmentation forces in a "Win Decisively" scenario.

In addition, each flotilla will incorporate a specific set of port opening and in-stream discharge enablers, such as cargo-handling equipment.  These sets will include Army watercraft stationed in Japan and Kuwait, plus theater and logistics support vessels (TSV/LSV), which will support daily operations within assigned theaters.

In its entirety, an Army Regional Flotilla provides a powerful combat capability across the full spectrum of operations to the regional Combatant Commander.  Lessons learned from the download of APS equipment and supplies for OIF are being incorporated into the design of the ARFs and their ships.   Some of the technology enhancements needed aboard the ships are still being developed, but we are confident that, given time and resources, we will arrive at optimum solutions.

APS Performance during Operation Iraqi Freedom

APS equipment proved instrumental in supporting combat operations during OIF.  Our general sense is that, in most instances, the equipment and supplies matched fairly well with unit requirements, and the equipment was well maintained.  There were some unit sets in APS that unit commanders neither wanted nor required.  These have been removed from APS and will be replaced by other units not previously prepositioned.

Most of the APS-5 (SWA) and the APS-3 (Afloat) was issued in support of OIF, including three 2x2 brigade sets.  In total, 218 unit sets including approximately 17,665 pieces of rolling stock, 124,400 sets, kits and outfits, and 119,194 Class VIII medical supply packages were issued from APS to deployed units.

The 3d Infantry Division (Mechanized) (3ID) was the largest consumer of APS equipment.  They received 121 unit sets, approximately 7,525 pieces of rolling stock including 252 Abrams tanks, 325 Bradley Fighting Vehicles, 18 Multiple Launch Rocket Systems and 59 Paladin Howitzers.  The Division's signal and air defense artillery units both drew APS and deployed equipment from home station.  The only units that were not sourced from APS were those assigned to the 3ID aviation brigade, since aviation assets are not stocked in APS.

Prior to OIF, Army Materiel Command (AMC) did a tremendous job of maintaining the equipment within the APS program as evidenced by the high readiness rates of the equipment drawn by the units.  During OIF, the equipment, in particular the Abrams tanks, Bradley Fighting Vehicles and wheeled vehicles, were subjected to the equivalent of three years of high-intensity training in the harshest of conditions.  Listed below are a few selected comments from After Action Reviews on APS:

•             Company Commander:  "When we went into the fight, they [tanks] were the best we were ever on!"

•             Battalion Motor Officer:  "Lowest combat power [for tanks] for any fight was 95% - that was one fight - for all the others it was 100%."

•             Battalion Motor Officer:  "We used more parts at NTC [National Training Center, Fort Irwin, California] and on home station equipment than on the [APS] M1s [tanks]."

•             Soldier:  "14 of 14 started [Bradley's].  14 of 14 finished."

•             Soldier:  "The equipment [Paladins] was good - Saw the guns and said 'yeah!'"

The Army employed significant quantities of Operational Project stocks in support of both OIF and Operation Enduring Freedom (OEF) in Afghanistan.  For example, all the Army's available Force Provider bare base housing modules have been deployed to provide bed-down facilities for soldiers and airmen in Central and Southwest Asia and in other parts of the world in support of the Global War on Terrorism.  Other operational project stocks used included the Inland Petroleum Distribution System pipeline sets, Special Operations Forces equipment, mortuary affairs materiel, bridging, aircraft landing mats and materiel for handling enemy prisoners of war.

War Reserve Secondary Items (WRSI) were another success story and continue to support current operations.  At the onset of OIF, total WRSI assets on hand were valued at $2.2 billion. The Army Materiel Command released $900 million worth of WRSI in support of OEF/OIF requirements, much of which was not readily available in the Army supply system.  WRSI also served as a buffer for the Defense Logistics Agency (DLA) as it ramped up its supply base to support service requirements.  The Army Deputy Chief of Staff, G-4 and the Commander of Army Materiel Command are revalidating WRSI requirements to support future contingencies.

Resetting APS

APS equipment in SWA continues to be used to a great extent to support current operations.  As an example, since March 2003, over 3100 individual vehicles from APS have been issued in support of theater requirements, greatly reducing the need for strategic shipping from the United States.  APS equipment will also be used to support future OEF rotations.  Both of these cases prove the value of APS to Army operations but at the same time limit our ability to complete APS reset.

Several major lessons have emerged from our OIF experience and are being incorporated into future APS strategy. We need to modernize APS to the level of the equipment used at home station by the deploying force. Our Soldiers should have the opportunity to thoroughly train and exercise with APS equipment to master any differences in capability.  The APS sets must be complete and the sustainment stocks should be theater-centric.

As of March 15, 2004, reset actions have been accomplished on APS-4 (Korea), two ammunition ships, the 1x1 brigade set for ARF Guam/Saipan, and the 1x1 brigade set for ARF Diego Garcia is being prepared.  Almost half of the equipment for the second LMSR in ARF Guam/Saipan (the combat support/combat service support sets) has been redeployed from SWA and is undergoing repair and refurbishment at Charleston, South Carolina.  The Army will attempt to completely load this ship; however, continued use of APS equipment for current operations is hindering this effort.  None of the ARF 1x1 brigade sets have been completely filled with all authorized equipment. The shortages are primarily caused by APS equipment remaining in theater.

Despite the recent success of the APS program, we do face some significant challenges.  In November 1998, the General Accounting Office (GAO) completed an audit, commissioned by the Senate Armed Services Committee, of Department of Defense prepositioning programs. Their report specifically criticized the Army for poor definition of requirements and incomplete visibility of operational projects, inappropriate APS structure in Europe, and lack of war reserve secondary item (WRSI) funding for sustainment.

Since the audit, a review of APS operations in Europe has resulted in the closure of three sites, significantly reducing APS operations in Central Europe.  In fiscal years (FY) 04-06, the Army is investing $53.4 million in military construction funding to modernize key APS maintenance, storage, and ammunition facilities at Livorno, Italy, as the enduring site for the APS-2 1x1 brigade set. 

The U.S. Army Audit Agency (AAA) just completed an audit of operational project stocks held in Korea and recommended potential savings of $114.6 million by reducing unsupported Army requirements.  The AAA also discovered that the Army had overstated requirements by $125.6 million.  The Army had already eliminated the need for aircraft matting in Korea and is in the process of disposing of some outdated bridging equipment there.   A key finding highlighted by AAA is that "none of the Operational Projects within APS-4 had enough materiel on hand to satisfy their intended purposes."   Audits are also ongoing within APS-2 (Europe).

Asset visibility once Operational Project stocks have been released suffers from the same disjointed, unconnected 20^th-century supply system that plagued the Army in its race to Baghdad.  No one system offers seamless, real-time, end-to-end visibility of items issued from Operational Projects. Implementation of an interim solution is underway to facilitate the transfer of these items from the legacy depot-level accounting system aboard the ships to the retail-level property book and maintenance systems in the using units.

Funding for procurement of War Reserve Secondary Items (WRSI) remains a significant problem; it competes against many other higher-priority Army programs.  $92.2 million of obligation authority was provided in FY 2004 and the Army has programmed $900 million across FY 2005-2009 against total WRSI requirements.  This was done specifically to increase the readiness of all prepositioned sets and to provide sustainment stocks to the initial corps allocated against the planning scenario of two simultaneous major combat operations.  Funding for WRSI has become critical because war reserve spares are at a 28% fill rate after their heavy usage during OIF.  WRSI requirements for program years 2006-2011 have been validated but actual funding is still to be determined, leaving future Army operations at high risk.

Modernization of APS remains a contentious issue.  Generally, APS unit set equipment is one or two generations older than equipment in first line units, e.g., M1A1 Abrams tanks instead of M1A2s; older models of Bradleys; and M-35A2 and 800-series trucks instead of the Family of Medium Tactical Vehicles (FMTV) or even the FMTV predecessors, the 900-series trucks.  The presence of this older equipment presents maintenance and training challenges.  Using less modern APS equipment during OIF required time for soldiers to become fully accustomed to it, such as learning how to drive with a manual transmission; however, the ability to accomplish assigned missions was not severely impacted.

Modern equipment generally has come into APS as a result of "cascading" from units receiving new equipment, but the Army Staff has been working to effect at least limited modernization of APS equipment as part of the Army reset initiative.  Specifically, APS-4 (Korea) and the Army Regional Flotilla in Guam/Saipan have been targeted for modernization.

Funding is also a major issue for the reset of APS.  Limited funding for FY 2004 Army APS reset actions has come from FY 2004 supplemental appropriations in the amount of 28% of Other Procurement, Army (OPA) and 5% of Operation & Maintenance, Army (OMA) requirements.  This does not include depot funding received.

FY 2004 APS operational funding (less WRSI) totaled $483.6 million.  In particular, validated requirements to store and maintain critical warfighting equipment in APS Afloat, in Korea, and SWA are fully funded.  The Army also has been able to program funds for key initiatives like prepositioning Army watercraft unit sets in the Pacific and SWA to enhance strategic responsiveness.  We anticipate that the overall funding position for APS operations will remain very good (over 90% of requirements) across the new FY 2005-2009 program, but funding for equipment modernization and to fill APS shortages, including WRSI, will remain a challenge.

The Future

Army Prepositioned Stocks remain an integral part of the Army's mobility triad, the other two legs being sealift and airlift.  To support force projection and operational requirements, the Army continues to refine its deployment goals.  In the Secretary of Defense's memorandum titled "Operational Availability Action Items", dated August 18, 2003, he provided the Services with what have become known as the DoD Joint Swiftness Goals.  The Army is currently reassessing its deployment metrics of "one brigade in 96 hours / one division in 120 hours / five divisions in 30 days". A recommendation is currently undergoing review by senior Army leadership.

The awesome force projection capabilities we leveraged in recent operations are a testament to congressional support in the aftermath of Operations Desert Shield/Desert Storm.  However, the Secretary of Defense's conflict separation objectives, and the Joint Operations Concept enabling rapid, global and credible military response options in future crises, underscore the need for a quantum leap forward in our force projection capability.  The Army is adopting a joint and expeditionary mindset in support of the defense strategy.  In coordination with the Defense and Joint Staffs, our sister Services and the regional Combatant Commanders, we will aggressively pursue advances in force projection capabilities.

While there is a strategy for APS end-state through 2006, we continually reexamine that strategy to incorporate developing Army initiatives such as modularity for the Unit of Employment concept.

Our vision for the future includes modular Army units, deploying into austere locations if necessary, and arriving intact and immediately employable.  The Army's global force projection strategy and its move to develop robust joint and expeditionary capabilities will be characterized by continued implementation of the Army Power Projection Program (AP3), force design changes, positioning and training of units, and logistics transformation.  These components are our implementing mechanisms to develop and field Army capabilities nested within an overarching Joint force projection strategy.

Full implementation of the Army vision requires improvements in several Defense power projection and counter anti-access capabilities.  Defense programs, concepts, and processes that must evolve to attain these capabilities will be further refined this year within the Defense Mobility Capabilities Study.  While some of these capabilities may not be realized until next decade, some are achievable now with sufficient resources.

Mr. Chairman and distinguished members of the Subcommittee, I want to thank you for your support and for taking the time to review our APS program today.  It is an important program for the Army and will remain so for the foreseeable future.  We are an Army serving a nation at war, and APS has played a large role in our successes so far.