Background

The September 2001 Quadrennial Defense Review outlined a strategy to  sustain and transform the military force structure that had been in place  since the mid-1990s. In that review, DOD committed to selectively  recapitalize older equipment items, which the department recognized as  being neglected for too long, to meet near-term challenges and to improve  near-term readiness. DOD is currently conducting a new Quadrennial  Defense Review, with the report scheduled to be issued in February 2006.  The results of this Quadrennial Defense Review could identify changes to  DOD’s future force structure and capabilities, thereby impacting the  funding needed for both current and replacement systems.
Based on DOD guidance, the services develop a Program Objective  Memorandum that details the specific programs and funding needed to  meet DOD requirements as determined by the Quadrennial Defense  Review. As part of this process, the services analyze alternative force  structure, weapons systems, and support systems together with their  multiyear resource implications and evaluate various trade-off options.  Basically, it is a process for balancing and integrating resources among the  various programs according to service and DOD priorities.
The annual FYDP contains DOD’s estimates of future funding needs for  programs and priorities. Through the FYDP, DOD projects costs for each  element of those programs through a period of either 5 or 6 years on the  basis of proposals made by each of the military services. The Office of the  Secretary of Defense considers the service proposals and the policy  choices made by the current administration and, where needed, makes  adjustments. For example, in preparing its 2006 budget, DOD made a  number of significant changes in its long-term acquisition plans to meet  budget targets established by the White House, as documented in Program  Budget Decision 753. The 2005 FYDP extended from fiscal year 2005 to  fiscal year 2009 and the 2006 FYDP extended from fiscal year 2006 to fiscal  year 2011.

	Condition of Some Selected Equipment Has Been Degraded by the High Pace of Operations and the Advanced Age or Complexity of the Systems

While the condition of the 30 equipment items we reviewed varied, we  found that average fleet-wide readiness rates for most of these items  declined between fiscal years 1999 and 2004. The decline in readiness  generally resulted from the high pace of recent operations and the  advanced age or complexity of the equipment systems. Therefore, we rated  the fleet-wide condition of 22 of the selected equipment items as red or  yellow. However, 8 of the 30 items—including several tactical fighter  aircraft and some newer equipment items such as the Marine Corps’  Medium Tactical Vehicle Replacement—were assessed as green (see fig. 1),  indicating that we found no specific problems that warrant additional  attention by DOD, the services, or Congress or that problems were already  being addressed. DOD is currently conducting a Quadrennial Defense  Review that will examine defense programs and policies and may change  some equipment requirements.
Eighteen of the equipment items we reviewed for this report were also  included in our December 2003 report, and 12 of these equipment items  received the same condition assessment in both analyses. For example,  the surface ships examined in this study, the Navy’s DDG-51 Arleigh Burke  Class Destroyer, the FFG-7 Oliver Hazard Perry Class Frigate, and the LPD- 4 Amphibious Transport Dock Ship received yellow condition ratings in  both studies, as did the Air Force’s B-2 Spirit Bomber, the C-5 Galaxy  Transport Aircraft, and the KC-135 Stratotanker Aircraft. However, for 6 of  the items, the assessment changed—3 systems’ fleet-wide condition  improved, 2 going from red to yellow and 1 from yellow to green, and 3  systems’ condition degraded, going from green to yellow. The condition  assessments for the Marine Corps’ CH-46E helicopter and the Navy’s F/A-18  aircraft and Standard Missile-2 improved due, in part, to additional  maintenance efforts and improvements that appear to address the  condition concerns noted in our previous report. The condition  assessments for the Army’s Abrams tank and Heavy Expanded Mobility  Tactical Truck and the Marine Corps’ Light Armored Vehicle went from  green to yellow largely as a result of increased use in ongoing operations  overseas.

		Some Selected Equipment Items Have Significant Condition Issues that Warrant Additional Attention by DOD, the Military Services, and/or Congress

For many of the equipment items included in our assessment, average fleet- wide readiness rates have declined, generally due to the high pace of recent  operations or the advanced age or complexity of the systems. We assessed  the fleet-wide condition of 3 equipment items as red, indicating that  immediate attention is warranted by DOD, the services, and/or Congress to  address problems or issues. In addition, we assessed the fleet-wide  condition of 19 items as yellow, indicating that attention is warranted to  address existing problems that, if left unattended, may worsen. Table 1  below shows the primary reasons used to rate selected equipment items’  condition and our assessment of those items as either red or yellow.
Although selected equipment items have been able to meet wartime  requirements, the high pace of recent operations appears to be taking a toll  on selected equipment items and fleet-wide mission capable rates have  been below service targets, particularly in the Army and Marine Corps.  Further, according to officials, the full extent of the equipment items’  degradation will not be known until a complete inspection of deployed  equipment is performed. Elevated flying hours in Iraq and Afghanistan,  coupled with the harsh desert environment, have negatively impacted  helicopters. For example, our assessment of the Army’s CH-47D/F Chinook  helicopter’s condition as red reflects this platform’s mission capable rates,  which were consistently below service goals. Officials stated that the  aircraft is currently being flown in Iraq and Afghanistan at three times more  than planned peacetime rates. This usage has increased the amount of  maintenance and number of parts needed to sustain the aircraft, which in  turn has negatively impacted overall readiness. Ground equipment has also  been affected by high wartime usage. For example, the Marine Corps’ M1A1  Abrams tank fleet, also rated as red for condition, is being negatively  impacted by operations in Iraq and a shortage of equipment maintainers  due to transfers of personnel to units that are deploying. This system failed  to meet its service readiness goals and recent trends indicate a steady  decline away from these targets.
Several heavily used equipment items included in our review did not have  mission capable rates below their target; however, these rates have  recently declined, primarily due to the high wartime usage. For example,  while the Army’s Abrams Tanks and Bradley Fighting Vehicles met or  exceeded the Army mission capable goals, they are both on a downward  trend due to a shortage of spare parts and trained technicians. The shortage  of spare parts is driven by the number of vehicles either deployed or being  reset to a predeployment condition and the shortage of trained technicians  is primarily due to the number of deployed National Guard military  technicians. Both of these tracked vehicles have experienced high use in  operations overseas in the past and will likely do so in the future. Similarly,  while the readiness rates of the Marine Corps’ Assault Amphibian Vehicle  varied by vehicle type in recent years, the gap between mission capable  rates and service goals increased, indicating a decline in the material  condition of this equipment.

			Maintenance Issues Resulting from the Advancing Ages and Complexity of the Equipment Items

While not all of the equipment included in our review has been heavily used  in recent overseas operations, in some cases, the advanced age or  complexity of the equipment items have contributed to readiness declines.  Many of the selected systems have either a fleet-wide average age of more  than 20 years, such as the Navy’s LPD-4 Amphibious Transport Dock Ship,  or entered the inventory prior to the 1980s, such as the Air Force’s KC-135  Stratotanker aircraft. These systems are likely to reach the end of their  useful lives in this decade unless major modernizations, some of which are  planned or underway, are made. Some of the problems degrading the fleet- wide condition of these aging systems include maintenance problems due  to parts shortages or obsolescence, shortages of trained maintenance  personnel, corrosion, deferred maintenance, and airframe fatigue. For  example, the Navy’s P-3 Orion aircraft, while not as heavily tasked as Army  and Marine Corps helicopters, have played an important role in overseas  operations as a reconnaissance and surveillance asset despite consistently  missing their mission capable goals by a significant percentage. The  condition of the P-3 fleet, which has an average age of over 24 years, has  been primarily degraded by the effects of structural fatigue on its airframe  and the obsolescence of communication, navigation, and primary war- fighting systems in this aircraft.
Some Air Force equipment also has age-related condition issues that  warrant attention and therefore received yellow ratings. For example,  mission capable rates for the C-5 Galaxy Transport Aircraft were  consistently below Air Force goals between fiscal years 1999 and 2004.  Officials stated that the size and age of the C-5 aircraft make it maintenance  intensive, and that component items on the aircraft are older, making it  difficult to find manufacturing sources for some parts, particularly avionics  and engine components. In addition, the KC-135 Stratotanker aircraft has  not met its mission capable goals due to issues associated with age and  corrosion, such as problems with the landing gear’s steel brakes.
Similarly, Navy surface ships examined in this study had a number of issues  related to condition and these vessels also received yellow ratings. The  Navy is challenged to maintain surface ships that are, in reality, a system of  systems. The failure of any one of these complex systems affects the entire  ship. For example, the DDG-51 Arleigh Burke Class Destroyer, the FFG-7  Oliver Hazard Perry Class Frigate and the LPD-4 Amphibious Transport  Dock Ship all had problematic subsystems, for example, operating with  limited communication ability or bandwidth, which affects their day-to-day  operations such as on-line training and personnel activities. Older ships,  such as the FFG-7 class which is, on average, almost 21 years old and the  LPD-4 class with an average age of 37 years, may be more challenging  because as the ships age, more maintenance will be required. Other older  Navy equipment also had condition issues in need of attention. For  example, the EA-6B Prowler consistently missed the Navy’s mission  capable goal due to problems with communications equipment and wings.

		Some Selected Equipment Items Are in Favorable Condition

Our analysis showed that the fleet-wide condition of over one quarter of the  equipment items included in our review was generally favorable, and  consequently, we assessed the condition of 8 of the 30 selected military  equipment items as green, as shown in figure 1. Not all equipment has been  heavily used for operations in Iraq and Afghanistan, and for some items,  use has not increased significantly from that of planned peacetime  operations. This was the case for several tactical fighter aircraft. In our  assessment, all three selected aircraft that provide this capability, the Air  Force’s F-15 Eagle/Strike Eagle and F-16 Fighting Falcon, and the Navy’s  F/A-18 Hornet/Super Hornet, were at or near- service mission capable rate  goals.
Moreover, we found that new equipment that has been heavily tasked in  recent operations appears to be performing well. For example, the Family  of Medium Tactical Vehicles has exceeded the Army’s fully mission capable  rate goals despite operating overseas at a rate that is nine times higher than  in peacetime. In addition, the Marine Corps’ Medium Tactical Vehicle  Replacement vehicles are being aggressively used in support of operations  in Iraq, but also met their mission capable goals for fiscal years 2003 and  2004. These trucks are both relatively new; the Family of Medium Tactical  Vehicles is on average 6 years old and the Medium Tactical Vehicle  Replacement is on average 3 years old.
In addition, we assessed the fleet-wide condition of some older equipment  items favorably. For example, the average age of the Army’s OH-58D Kiowa  is about 13 years with a life expectancy of 20 years; however, these  reconnaissance helicopters have met or exceeded their mission capable  goals from 1999 through 2004 while exceeding their planned flight hours in  recent operations. With an average age of almost 16 years, the M113  Armored Personnel Carrier has not experienced a significant decline in  mission readiness as a result of recent operations in Iraq and Afghanistan.  The Army’s High Mobility Multi-Purpose Wheeled Vehicles (HMMWV) are  experiencing usage (i.e., operational tempo) that is six times their normal  peacetime rate. Despite concerns over the availability of their armored  protection, these vehicles exceeded Army readiness goals for the past 6  years and received a green rating.

	Services Near- and Long-Term Program Strategies and Funding Plans Exist for Most Equipment Reviewed, but Some Gaps Remain

The military services have identified near- and long-term program  strategies and funding plans to ensure that most of the 30 selected  equipment items can meet defense requirements, but some gaps remain.  For the 30 selected equipment items, we found that 20 of the services’ near- term program strategies have gaps in that they do not address capability  shortfalls, full funding is not included in DOD’s 2006 budget request, or  there are supply and maintenance issues that may affect near-term  readiness. Additionally, the long-term program strategies and funding plans  are incomplete for 22 of the equipment items we reviewed in that future  requirements are not fully identified, studies are not completed, funding for  maintenance and technological upgrades may not be available, or  replacement systems are delayed or not yet identified. DOD is required to  develop sustainment plans in 10 U.S.C. § 2437, but this statute only applies  to 9 of the selected equipment items. Although the services have  identified near- and long-term program strategies and funding for most of  the equipment items we reviewed, the gaps we identified may threaten  DOD’s ability to meet some future capability requirements.

		Services Have Not Fully Identified Near-Term Program Strategies and Funding Plans for Some Selected Equipment

The services have not fully identified near-term program strategies and  funding plans for 20 of the 30 equipment items we reviewed, including 7 of  the 9 selected items covered by 10 U.S.C. § 2437. One of the items that will  not be covered by this statute, the Marine Corps’ CH-46E Sea Knight  helicopter, was the only item we assessed as red for its near-term program  strategy and funding plan because it may be unable to meet its near-term  requirements. We assessed the near-term program strategies and funding  plans of 19 of the 30 equipment items in our review as yellow because the  services’ program strategies for sustaining equipment lack sufficient  planning or full funding to meet near-term requirements. Alternatively, the  services have planned program and funding strategies to correct equipment  deficiencies or improve equipment capabilities and safety for 10 of the 30  equipment items in our review so that the equipment items can meet near- term requirements, so we assessed their near-term program strategies and  funding plans as green as shown in figure 1. The services’ near-term  program strategies to sustain or modernize equipment and address current  condition issues include restoring equipment back to its predeployment  condition, remanufacturing or recapitalizing equipment, procuring new  equipment, improving equipment through safety or technological upgrades,  or improving maintenance practices. Table 2 below shows the primary  reasons used to rate selected equipment items’ near-term program  strategies and funding plans and our assessment of those items as either  red or yellow. Without developing complete near-term plans and identifying  the associated funding needs to ensure that all key equipment items can be  sustained and modernized—and assessing the risk involved if gaps in these  strategies are not addressed—DOD may be unable to meet some future  requirements for defense capabilities.
Some of the services’ near-term program strategies do not address the  issues that affect the condition of the equipment in the near-term, thus 5 of  the 30 selected equipment items received a yellow rating as shown in table  2. For example, the Marine Corps identified a shortfall in the capability of  the Assault Amphibian Vehicle to conduct parts of their war-fighting  doctrine; however, instead of upgrading its capabilities, their plan is to  return the capability of the vehicle to its original condition while they await  its replacement. Although the Navy has a plan to correct serious LPD-4  Amphibious Transport Dock ship class deficiencies, those ships that are within 5 years of decommissioning can, by law, only receive safety  modifications, resulting in a wide variance in the condition of ships in the  class. Furthermore, while the Navy is making structural inspections and  repairs to ensure that there will be sufficient P-3 Orion aircraft to meet day- to-day requirements next year, they have not funded some improvements to  communications and defense systems, which will continue to degrade the  ability of this aircraft to fulfill all of its missions.

			Some Near-Term Strategies Are Not Fully Funded in DOD’s Fiscal Year 2006 Budget Request

The full funding requirements for nine of the Marine Corps and Army near- term strategies we reviewed were not included in DOD’s fiscal year 2006  budget request; therefore, we rated these equipment items as yellow as  shown in table 2. According to service officials, the services submit their  budgets to DOD and the department has the authority to increase or  decrease the service budgets based upon the perceived highest priority  needs. As shown in table 3 below, the Marine Corps identified requirements  that were not funded in DOD’s 2006 budget request totaling $314.7 million  for four of its selected equipment items.
The four equipment items for which the Marine Corps did not request  funding are a concern because a capability or need that the service  identified as a priority may not receive funding unless Congress intervenes.  For example, the Marine Corps identified but did not request $113 million  in funding needed to complete the standardization of its older Light  Armored Vehicles. The Marine Corps also identified funding shortages in its  tank remanufacturing program for fiscal years 2006 and 2007, noting that  only 33 percent of the plan has been funded.
In addition, for five of the selected Army items, DOD has not included  funding for part of the near-term program strategies in its regular 2006  budget request. Instead the Army is relying on supplemental appropriations  or congressional adjustments to their regular appropriations to fund these  activities and we rated these items yellow given the uncertainty of future  supplemental appropriations or congressional adjustments. For example,  the Army requested $1.4 billion in the fiscal year 2005 supplemental in  order to accelerate recapitalization of the Bradley Fighting Vehicles by  producing 93 vehicles to replace combat losses and 554 to meet its  modernization needs, and has begun planning another request for  supplemental appropriations to fund other near-term procurement  requirements associated with their transformational objectives. Further, in  the past, the Army has consistently relied on supplemental appropriations  and congressional adjustments for the M113 Armored Personnel Carrier,  and included $132 million in the fiscal year 2005 supplemental funding  request to recapitalize vehicles deployed for Operation Iraqi Freedom.

			Anticipated Parts Shortages and Maintenance Issues May Affect Equipment Condition and Indicate Near-Term Planning and Funding Concerns

Anticipated parts shortages or maintenance issues may affect the services’  ability to maintain adequate condition of 6 of the 30 selected equipment  items we reviewed; therefore, we assessed their near-term program  strategies and funding plans as yellow or, in one case, red as shown in table  2. Of the 30 equipment items we reviewed, the Marine Corps’ CH-46E Sea  Knight helicopter received a red rating for its near-term program strategy  and funding plan because the service may be unable to meet its near-term  requirements due to potential aircraft and repair parts shortages caused by  the age of the aircraft. Because of fielding delays of its replacement  aircraft, the MV-22, the CH-46E will not be retired as originally scheduled,  which may lead to additional repair parts shortages. The uncertainty in  whether the near-term program strategy addresses existing parts shortages  is also a concern for items such as the Navy’s F/A-18 Hornet/Super Hornet  aircraft and resulted in a yellow rating. Although the Navy is currently able  to maintain readiness for the Super Hornet fleet, there is an anticipated  shortage for critical spare parts like extra fuel tanks and bomb racks, and  the current program strategy does not fund the efforts necessary to ensure  adequate replacements. Additionally, we rated the Air Force’s KC-135  Stratotanker aircraft as yellow because officials expect its age-related  maintenance issues, such as fuel bladder leaks and parts obsolescence, to  increase, resulting in additional maintenance requirements. Officials also  stated that the severity of potential problems from newly discovered  corrosion remains unknown, so the potential exists for additional  maintenance requirements.

			Some Selected Equipment Items Have No Near-Term Program Strategy or Funding Issues of Concern

We rated 10 of the 30 equipment items examined in this review as green, as  shown in figure 1, because we did not identify any significant program or  funding issues in the near term. The services had identified program and  funding strategies to correct these equipment items’ immediate  deficiencies, or to improve the platforms’ capabilities. For the selected  equipment items that are being heavily used for operations in Iraq and  Afghanistan and received a green rating, such as the Army’s AH-64A/D  Apache helicopter and the Marine Corps’ AV-8B Harrier jet, the services are  using a combination of activities, including restoring the equipment to  predeployment status, remanufacturing or recapitalizing the equipment, or  procuring new equipment. For example, the Army is restoring the Apache  helicopters being used in combat while concurrently remanufacturing the  older AH-64A variants into newer AH-64D variants. In some cases, the  services have funded plans that upgrade the equipment items to address  structural or safety concerns and improve combat capabilities, such as for  the Air Force’s F-15 and F-16 fighter aircraft and the Navy’s DDG-51 Arleigh  Burke Class destroyers. For other items, the services modified their  maintenance practices to increase efficiencies and address concerns. For  example, the Air Force modified its stealth maintenance procedures on its  B-2 Spirit bomber, thus reducing the steps and time required to conduct it.

		Services Lack Complete Long-Term Program Strategies and Funding Plans for Selected Equipment

The services have not developed or fully funded the long-term program  strategies for 21 of the 30 selected equipment items. Title 10 U.S.C. § 2437,  which requires that DOD develop sustainment plans, applies to only 9 of  the selected equipment items. We assessed 7 of the selected equipment  items as red, only 2 of which will be covered by this statute, because the  services’ program strategies and funding plans to meet long-term  requirements are not fully identified, studies to determine future system  requirements are not complete, funding for maintenance or technological  upgrades may not be available, or replacement systems were delayed or  not identified, and in some cases, the selected equipment items may be  unable to meet their long-term requirements. We assessed the long-term  program strategies and funding plans of 14 of the selected equipment items  in our review as yellow because they are experiencing similar gaps in their  long-term program strategies and funding plans, but the consequences  would be less severe. Alternatively, we assessed the long-term program  strategies and funding plans of 9 of the 30 equipment items in our review as  green, as shown in figure 1, because the services have program strategies  and funding planned to improve or upgrade equipment capabilities and  safety or replace the equipment items so that they can meet long-term  requirements. Some of the services’ long-term program strategies include  improving or modernizing the equipment through upgrades, recapitalizing  older models to newer ones, or replacing the equipment with newer, more  modern equipment, including those associated with DOD’s force structure  changes.
Table 4 below shows the primary reasons used to rate selected equipment  items’ long-term program strategies and funding plans and our assessment  of those items as either red or yellow. As with incomplete near-term  strategies, without complete long-term plans to ensure that all key  equipment items can be sustained and modernized—and assessing the risk  involved if gaps in these strategies are not addressed—DOD may be unable  to meet some future defense requirements.
At this time, DOD has not fully identified the future requirements or the  long-term funding needs for seven of our selected equipment items,  resulting in red or yellow assessments as shown in table 4, depending on  the urgency or severity of the gaps in program strategies or funding plans.  The Army’s lack of identified future requirements and funding plans led us  to assess its Bradley Fighting Vehicle and M113 Armored Personnel Carrier  as red. In some cases, follow-on system requirements have not been  established, but the services have plans to sustain the items until the  replacement system is available, so we assessed these items as yellow. For  example, the Marine Corps plans to replace its M1A1 Abrams tank and  Light Armored Vehicle with the Marine Air-Ground Task Force  Expeditionary Force Fighting Vehicle, although at the time of our review,  they had not completely identified the program requirements or funding  needed for the replacement vehicle. However, they do have plans in place  to ensure that both the M1A1 and Light Armored Vehicle are available until  the Marine Air-Ground Task Force Expeditionary Force Fighting Vehicle is  fielded and have received supplemental funding for these plans.
The Army recently finalized the strategy for its wheeled vehicles, such as  the HMMWV, but some procurement and recapitalization plans have not  been fully funded or specific actions or time frames were not included.  Therefore, we assessed the three Army wheeled vehicles’ long-term  program strategies and funding plans as yellow. For example, we noted that  the Army’s Tactical Wheeled Vehicle and Trailer Modularity and  Modernization Strategy showed anticipated procurements for the HMMWV  that were not reflected in DOD’s 2006 budget request. Further, while the  strategy notes that future block upgrades for the Family of Medium Tactical  Vehicles are planned and describes the sustainment programs it will  include, it does not identify any specific actions or time frames for these  upgrades.

			DOD Awaiting Studies to Develop Strategies

DOD has not yet completed studies so that it can fully identify the program  strategies and funding plans needed for 2 of the 30 selected equipment  items assessed in this review. As shown in table 4, we assessed the long- term program strategy and funding plan for the Air Force’s KC-135  Stratotanker aircraft as red because the congressionally mandated study to  determine its replacement has experienced, and may continue to  experience delays. Meanwhile the KC-135 fleet, with an average age of  about 44 years, continues to experience age-related problems and delays in  fielding a replacement further exacerbate problems in maintaining the  existing fleet over the long term. We assessed the long-term program  strategy and funding plan for the Air Force’s C-5 transport aircraft, with an  average fleet age of about 26 years, as yellow because the Air Force  remains uncertain about the size of the final C-5 fleet and whether to fund  some additional C-5 aircraft upgrades while awaiting completion of DOD’s  Mobility Capabilities Study. This study is expected to be completed in the  summer of 2005; however, at the time this report was issued, results were  not available.

			Availability of Funding for Maintenance and Technological Upgrades Affecting Strategies

The availability of funding for ongoing maintenance and technological  upgrades in past and future years may affect the long-term program  strategies and funding plans for seven of the selected equipment items. As  shown in table 4, we assessed the long-term strategies and funding plans  for two items, the Navy’s P-3 Orion aircraft and the Standard Missile-2, as  red because the limited funding for maintenance and technological  upgrades may have serious consequences, such as negatively affecting  their ability to meet war-fighting requirements. The Navy has identified a  plan to address the obsolescence of the mission systems in the P-3 Orion  aircraft over the long term, but at this time has not officially approved or  funded this plan. In addition, the Standard Missile-2, which has recently  seen improved readiness ratings because DOD increased operation and  maintenance funding, is not scheduled for the same level of funding in the  long term, which may reduce the number of available missiles.
DOD budget decisions to reduce funding for maintenance and upgrades  have the potential for adversely affecting five items, so we assessed the  long-term program strategies and funding plans for these items as yellow.  For example, decreases in the Navy’s planned operation and maintenance  funding across all surface ships in the fleet may result in deferred  maintenance and may adversely affect the future material condition of the  three classes of ships included in this review, the DDG-51 Arleigh Burke  Class destroyers, the FFG-7 Oliver Hazard Perry Class frigates, and the  LPD-4 Amphibious Transport Dock ships.

			Long-Term Program Strategies Affected Because Replacement Systems for Selected Equipment Are Delayed or Not Identified

Replacement systems have either been delayed or are not yet identified for  5 of the 30 selected equipment items examined in this review and we rated  these items as red or yellow as shown in table 4. Two of these items were  assessed as red because of the urgency and severity of the delays impact on  the services’ capabilities and ability to meet future requirements. For  example, we assessed the long-term program strategy and funding plan for  the Marine Corps’ CH-53E Super Stallion Helicopters as red because the  Marine Corps has not identified a replacement for the CH-53E Super  Stallion despite an initial fielding planned for 2015. According to officials,  the Marine Corps must maintain enough CH-53E helicopters to support  Marine Corps operations until the initial fielding of the Heavy Lift  Replacement aircraft. Officials estimate that, if the current high usage rate  and expected attrition rates hold true, the number of CH-53E helicopters  may fall below the number necessary to remain in service until the Heavy  Lift Replacement becomes available.
The remaining three items’ long-term program strategies and funding plans  were assessed as yellow because the effect of the uncertainties or delays  do not appear to be as urgent or severe. In some instances, delays and  uncertainties affecting the sustainment programs of selected equipment  items are related to DOD difficulties in acquiring their replacements. For  example, uncertainty over the potential for delays in the Joint Strike  Fighter Program affects the long-term strategy and funding for the Marine  Corps’ AV-8B Harrier jet and the Navy’s F/A-18 fighter aircraft and these  systems were rated yellow.

			Some Selected Equipment Items Have No Long-Term Program Strategy and Funding Issues of Concern

We determined that 9 of the 30 selected equipment items examined in this  review have no significant program or funding issues in the long term and  therefore received green ratings as shown in figure 1. For example, the Air  Force’s F-15 aircraft upgrades are fully funded and designed to keep the  aircraft viable and functioning through at least 2025. In addition, the Marine  Corps’ plans provide sufficient numbers of Medium Tactical Vehicle  Replacement vehicles to equip all of its units in the long term. Moreover,  the Army has reprogrammed funds from the cancellation of the Comanche  program to fund other aviation modernization strategies, including those  that improve the capability and lifespan of the CH-47D/F Chinook and the  AH-64A/D Apache helicopters.

	Conclusions

Since our last review of the condition of selected military equipment in  2003, overall readiness rates for most selected equipment items have  continued to decline and some of the services’ near- and long-term program  strategies lack complete sustainment and modernization plans or are not  fully funded. Continued high use of these equipment items to support  current operations and the advancing ages of the systems suggest that DOD  will be challenged in meeting future equipment requirements without  significant upgrades to its inventory. Furthermore, because activities to  refurbish and replace vehicles, weapons, and equipment used for  operations in Iraq and Afghanistan are being funded primarily through  supplemental appropriations as opposed to being programmed in DOD’s  Future Years Defense Program, future funding is uncertain. Moreover, DOD  faces challenges to sustain and modernize its current equipment while  continuing these operations and transforming to a new force structure.  DOD is currently conducting its Quadrennial Defense Review, which could  change the future requirements for some military equipment. In light of  these challenges, it is increasingly important that DOD focus its resources  on the equipment items that are key to meeting future defense  requirements. Without a more focused investment strategy, DOD runs the  risk of a continued decline in future equipment readiness. While DOD is  required to provide sustainment plans, including time frames and projected  budgetary requirements, for some military equipment in accordance with  10 U.S.C. § 2437, this statute does not apply to many key military equipment  items we reviewed. For example, those equipment items that do not have a  replacement system in development are not covered by this statute. In fact,  most of the equipment items that we assessed as red because of long-term  strategy and funding issues were not covered by this statute. Without  developing complete sustainment and modernization plans and identifying  funding needs for all priority equipment items, including those not already  covered by law through the end of their expected useful lives, DOD risks  not being able to meet some future equipment requirements. Furthermore,  without communicating these plans and funding needs to Congress,  lawmakers will not have the clear picture of DOD’s progress on equipment  sustainment and modernization they need to provide effective oversight  over these processes.

	Recommendations

To ensure that DOD can sustain key equipment items to meet future  equipment requirements and to provide greater visibility over key  equipment items to Congress, we recommend that, after the department  completes its Quadrennial Defense Review, the Secretary of Defense, in  consultation with the Secretaries of the Military Services, take the  following two actions:   Reassess the near- and long-term program strategies for sustaining and  modernizing key equipment, particularly those items not covered by 10  U.S.C. § 2437, to ensure that the plans are complete and that the items  are sustainable until they reach the end of their serviceable life or a  replacement system is fielded. Specifically, this reassessment should  detail the strategies to sustain and modernize key equipment systems  until they are retired or replaced;  report the costs associated with the sustainment and modernization  of key equipment and identify these funds in the Future Years  Defense Program; and  identify the risks involved in delaying or not fully funding the  strategies, and the steps the department is taking to mitigate the  associated risks, for those strategies that are delayed or are not fully  funded.
Provide the information in the above recommendation to Congress at  the same time the department submits its annual budget request, to  ensure that Congress has the visibility it needs to provide effective  oversight over DOD's program strategies.

	Matter for Congressional Consideration

Congress should require the Secretary of Defense to report on program  strategies and funding plans to ensure that DOD’s budget decisions address  deficiencies related to key military equipment. We suggest that this report  be provided in conjunction with DOD’s annual budget submissions and  reflect the results of the department’s Quadrennial Defense Review.  Specifically, as stated in our recommendations, the report should (1) detail  the strategies to sustain and modernize key equipment systems until they  are retired or replaced; (2) report the costs associated with the sustainment  and modernization of key equipment and identify these funds in the Future  Years Defense Program and; (3) describe the risks involved in delaying or  not fully funding the strategies, and the steps the department is taking to  mitigate the associated risks, for those strategies that are delayed or are  not fully funded.

	Agency Comments and Our Evaluation

In written comments on a draft of this report, DOD partially concurred with  our recommendation that it should reassess the near and long-term  program strategies for sustaining and modernizing key equipment after the  department’s Quadrennial Defense Review, but did not concur with our  recommendation that the department report these plans to Congress. The  department’s written comments are reprinted in their entirety in appendix  III.
In partially concurring with our first recommendation that it should  reassess the near- and long-term program strategies for sustaining and  modernizing key equipment, the department stated that, through its current  budget processes, it is already executing an annual procedure to assess  program strategies to ensure equipment sustainment and modernization  that can support the most recent defense strategy. According to the  department, these budget reviews consider strategies and costs to sustain  and modernize equipment, and the risks incurred by not fully funding these  strategies; therefore, the resulting budget reflects the department’s best  assessment of a balanced, fully funded budget that most efficiently  accomplishes the national security mission within its limited resources.
While we acknowledge that these budget processes may provide a  department-level review of what is needed to accomplish the national  security mission, the department’s budget processes and the Future Years  Defense Program do not provide detailed strategies that include identifying  both the costs associated with sustaining and maintaining key equipment  and the risks involved in delaying or not fully funding the strategies.  Without detailed plans, the department does not have sufficient  information to ensure that adequate funding is provided or that it is taking  the necessary steps to mitigate risks associated with strategies that are  delayed or are not fully funded. We continue to believe that the department,  in conjunction with the military services, needs to develop a more  comprehensive and transparent approach for assessing the condition of  key equipment items, developing program strategies to address critical  equipment condition deficiencies, prioritizing the required funding, and  mitigating risks associated with delaying or not fully funding these  strategies upon completion of the Quadrennial Defense Review. Therefore,  we continue to believe our recommendation has merit.
The department did not concur with our second recommendation that the  Secretary of Defense provide detailed strategies and costs of sustaining key  equipments items and the associated risks in delaying or not fully funding  these strategies in an annual report to Congress to ensure that Congress  has the visibility it needs to provide effective oversight over DOD’s program  strategies. DOD believes that submitting an additional report concurrent  with the annual budget would be a duplication of effort.
We believe that the information included in the President’s Budget does not  provide Congress with sufficient information on the strategies, funding,  and risks associated with maintaining key equipment items until their  replacement systems are fielded. In our report, we identify a number of  examples of inconsistencies between the program strategies and the  funding needed to sustain and maintain key equipment items not reported  in the department’s budget documents. The department is not currently  required to report sustainment plans for some of these critical items to  Congress. We believe that Congress needs to be assured that DOD’s budget  decisions address deficiencies related to key military equipment that must  be maintained and sustained until the end of their serviceable lives,  including those currently not covered by Title 10 U.S.C§ 2437. Therefore,  we have added a Matter for Congressional Consideration.
Lastly, DOD provided technical comments concerning our assessments of  specific equipment items in appendix II. We reviewed and incorporated  these technical comments, as appropriate. In some instances, the data the  department provided in its technical comments resulted from program and  funding decisions that were made subsequent to our review. In one case,  we changed our original color-coded assessment of a key equipment item  based on these decisions. The Army approved the replacement for the OH- 58D Kiowa Helicopter, the Armed Reconnaissance Helicopter, and  therefore we changed our original assessment of the Kiowa’s long-term  program strategy and funding plans from a yellow rating to a green rating.
We are sending copies of this report to the Secretary of Defense; the  Secretaries of the Army, the Navy, and the Air Force; the Commandant of  the Marine Corps; and other interested parties. We will also make copies  available to others upon request. In addition, the report will be available at  no charge on the GAO Web site at http://www.gao.gov.
If you or your staff have questions, please contact me on (202) 512-8365 or  by e-mail at solisw@gao.gov. Contact points for our Offices of  Congressional Relations and Public Affairs may be found on the last page  of this report. Major contributors to this report are included in appendix IV.

Scope and Methodology

To update congressional committees on key equipment items that warrant  immediate attention by the Department of Defense (DOD) and/or  Congress, we conducted an analysis of 30 selected military equipment  items. We performed an independent evaluation of the (1) condition of key  equipment items and (2) services’ near- and long-term program strategies  and funding for the sustainment, modernization, or replacement of these  equipment items.
This report follows our December 2003 report which assessed the  condition, program strategy, funding, and wartime capability of 25 selected  military equipment items. The current report increases the number of  equipment items to 30, and instead evaluates the condition, near-term  program strategy and funding plans, and long-term program strategy and  funding plans of each system. These changes reflect the current  operational environment, and the critical linkage between a successful  program strategy and funding. We examined the near and long terms  separately to delineate the impact of current operations on the near term  and their possible effect on long-term transformational efforts.
To select the 30 equipment items we reviewed, we included 18 of the  equipment items reviewed in our December 2003 report, and based upon  input from the military services, your offices, and our prior work, we  judgmentally selected an additional 12 items. We did not include 7 of the 25  items from our previous review so that we could focus on other selected  systems that we believed were more in need of examination. Our final  selections included those items that the military services believed were  most critical to their missions, and which have been in use for a number of  years. The 30 equipment items include 9 from the Army, 6 from the Air  Force, 7 from the Navy, and 8 from the Marine Corps. Our observations and  assessments were made on active duty inventory as well as equipment in  the National Guard and reserve forces; including reserve equipment  represents another difference between this review and our December 2003  report. Our assessments apply only to the 30 equipment items we reviewed,  and the results of our assessments cannot be projected to the entire  inventory of DOD equipment. Because Section 805 of the Ronald W. Reagan  National Defense Authorization Act for Fiscal Year 2005—which amends  Title 10 of the U.S. code (Pub. L. No. 108-375, § 805.)—does not apply to  existing systems for which a replacement system will reach initial  operational capability before October 1, 2008, we did not assess  compliance with this section of the act.
Each equipment item was assessed individually on its condition, and near-  and long-term program strategy and funding. To determine which  equipment items require additional attention by the department, the  military services, and/or Congress, we developed an assessment  framework based on three criteria: (1) the extent of the existence of a  problem or issue, (2) the severity of the problem or issue, and (3) how soon  the problem or issue needs to be addressed. To indicate the existence,  severity, or urgency of problems identified for the 30 selected equipment  items, we used a traffic light approach–red, yellow, or green–as follows:  Red indicates a problem or issue that is prevalent and severe  enough to warrant immediate attention by DOD, the military services,  and/or Congress.
Yellow indicates the existence of a problem or issue that warrants  attention by DOD, the military services, and/or Congress, and that if left  unattended may worsen.
Green indicates that we did not identify any specific problems or  issues at the time of our review, or that any existing problems or issues  we identified are either not severe enough in nature to warrant  immediate action, or already being addressed by DOD, the military  services, and/or Congress.
Individual assessments were based on systematic decisions with clear and,  wherever possible, measurable criteria. Input from relevant officials— program managers, unit staffs, operators, maintainers, and engineers—was  incorporated in every step of the process.
We interviewed officials from components (active, guard, and reserve  forces) of all four of the military services, two selected combatant  commands, and several major service commands. We visited selected units  and maintenance facilities to observe the equipment items during operation  or under maintenance. We also discussed deployed and nondeployed  equipment condition, program strategy, and funding with program  managers and equipment operators and maintainers, and included these  indicators where appropriate. The specific military activities we visited or  obtained information from include the following:  Office of the Assistant Secretary of Defense, Reserve Affairs, Arlington,   U.S. Air Force, Air Combat Command, Langley Air Force Base, Va.;  U.S. Air Force, Air Mobility Command, Scott Air Force Base, Ill.;  U.S. Air Force Materiel Command, Wright Patterson Air Force Base,   U.S. Air Force, Ogden Air Logistics Center, Hill Air Force Base, Utah;  U.S. Air Force, Oklahoma City Air Logistics Center, Tinker Air Force   U.S. Air Force, Pacific Command, Hickam Air Force Base, Hawaii;  U.S. Air Force, Plans and Programs, Air Force Headquarters, Arlington,   U.S. Air Force Reserve Command, Robins Air Force Base, Ga.;  U.S. Air Force, Warner Robins Air Logistics Center, Robins Air Force   U.S. Air National Guard, Headquarters, Andrews Air Force Base, Md.;   U.S Air National Guard, Hickam Air Force Base, Hawaii;  U.S. Army, Headquarters, Arlington, Va.;  U.S. Army National Guard, Headquarters, Arlington, Va.;  U.S. Army National Guard, 81st Brigade, Washington National Guard,  Camp Murray, Wash.;  U.S. Army National Guard, Hawaii National Guard, Ft. Ruger, Hawaii;  U.S. Army, Anniston Army Depot, Anniston, Ala.;  U.S. Army Aviation and Missile Command, Redstone Arsenal, Ala.;  U.S. Army, Corpus Christi Army Depot, Corpus Christi, Tex.;  U.S. Army, Directorate of Logistics, Fort Lewis, Wash.;  U.S. Army, First Army, Ft. Gillem, Ga.;  U.S. Army, Fifth Army, Ft. Hood, Tex.;  U.S. Army Forces Command, Ft. McPherson, Ga.;  U.S. Army, 4th Infantry Division, Ft. Hood, Tex.;  U.S Army Headquarters, Arlington, Va.;  U.S. Army Material Command, Ft. Belvoir, Va.;  U.S. Army, Pacific, Ft. Shafter, Hawaii;  U.S. Army Reserve Command, Ft. McPherson, Ga.;  U.S. Army Tank – Automotive and Armaments Command, Warren,   U.S. Army, III Corps, Ft. Hood, Tex.;   U.S. Central Command, McDill Air Force Base, Tampa, Fla.;  U.S. Marine Corps, Aviation Plans, Policies, Programs, Budgets, Joint  and External Matters Branch, Arlington, Va.;  U.S. Marine Corps, Aviation Weapons Systems Requirements Branch,  Pentagon, Arlington, Va.;  U.S. Marine Corps, Installations and Logistics, Navy Annex, Arlington,   U.S. Marine Corps, Logistics Plans, Policies and Strategic Mobility  Division, Navy Annex, Arlington, Va.;  U.S. Marine Corps, 3rd Marine Air Wing, Miramar, Calif.;  U.S. Marine Corps, I Marine Expeditionary Force, Camp Pendleton,   U.S. Marine Corps, Marine Forces Pacific, Camp Smith, Hawaii;  U.S. Marine Corps, Marine Forces Atlantic Command, Norfolk, Va.;  U.S. Marine Corps, Naval Air Systems Command, Naval Air Station,  Patuxent River, Md.;  U.S. Marine Corps, Programs and Resources, Office of the Deputy  Commandant, Pentagon, Arlington, Va.;  U.S. Marine Corps, Reserve Command, New Orleans, La.;  U.S. Marine Corps Systems Command, Quantico, Va.;  U.S. Marine Corps, Army Tank Automotive and Armaments Command,   U.S. Navy, Commander Fleet Forces Command, Norfolk, Va.;  U.S. Navy, Commander Electronic Attack Wing, Pacific, Whidbey Island,   U.S. Navy, Commander Patrol and Reconnaissance Wing 10, Whidbey,   U.S. Navy, Commander Strike Fighter Wing, Atlantic, Virginia Beach, Va.;  U.S. Navy, Commander Strike Fighter Wing, Pacific, Lemoore, Calif.;  U.S. Navy, Commander, U.S. Pacific Fleet, Pearl Harbor, Hawaii;  U.S. Navy, Headquarters, Washington, D.C.;   U.S. Navy, Naval Air Systems Depot, Jacksonville, Fla.;   U.S. Navy, Naval Air Systems Depot, North Island, Coronado, Calif.;   U.S. Navy, Naval Air Systems Command, Patuxent River, Md.;   U.S. Naval Reserve Command, New Orleans, La.;   U.S. Navy, Naval Sea Systems Command Washington, D.C.;   U.S. Navy, Naval Surface Force/US Naval Air Force—Atlantic, Norfolk,   U.S. Navy, Naval Surface Force/US Naval Air Force—Pacific, San Diego,   U.S. Navy, Naval Weapons Station, Seal Beach, Calif.; and  U.S. Pacific Command, Camp Smith, Hawaii.
Assessments on the condition of these 30 equipment items were based on a  comparison of readiness metrics against service goals, and the existence,  severity, or urgency of condition problems. We obtained data on equipment  age, expected service life, mission capable rates, utilization rates, and  various other metrics for fiscal years 1999 through 2004. Readiness metrics,  such as material readiness rates and mission capable rates, were a primary  component of our assessments. We were particularly cognizant not only of  whether the equipment item met its readiness goals but, if it failed to meet  this metric, we examined the gap between the readiness achieved by these  equipment items and the services readiness objectives-–and the  significance of that difference. Equipment items were further evaluated  against metrics such as utilization rates, cannibalization rates, failure rates,  and depot maintenance data. We gauged the significance of the rates and  data as they reflected on the item’s condition. Further, this analysis also  evaluated the extent to which each of the equipment items is being used for  current operations, and their performance while deployed. Finally, we  assessed specific problems with each item that may or may not have been  captured in other metrics.
Our evaluations of DOD’s near- and long-term program strategy and funding  plans were based on the existence of near- and long-term plans, and the  extent to which there were gaps in funding for these plans as projected in  DOD’s Future Years Defense Program (FYDP). Both near- and long-term  plans include sustainment, modernization, or recapitalization of the  equipment items in order to meet mission requirements. Near-term plans  are those that address current condition problems, as well as those  projected until 2007; long-term plans address issues anticipated from 2008  until the replacement system enters the inventory or until the system  reaches the end of its expected service life. We first assessed whether near-  and long-term plans were realistic and comprehensive. For our short-term  assessment, we examined whether the plans meet near-term requirements  and address issues related to current condition and the need for near-term  technological upgrades. For our long-term evaluation, we considered if  modernizations or sustainment plans were sufficient given the timing of the  replacement and the expected service life of the equipment item. Next, we  determined the extent to which there were gaps in funding for both near-  and long-term programs as projected in the FYDP. We then considered  whether the strategy and its funding, in the near and long term, addressed  other concerns which might significantly affect the program.
While we attempted to obtain consistent metrics for each of the three  categories across all four of the military services, data availability varied  significantly by service and type of equipment. Our assessments are based  on the data available from multiple sources, and represent the problems  and issues we identified at the specific point in time that we conducted our  work. These can change quickly given current events. Although our  assessments for each of the three categories-–condition, near-term  program strategies and funding plans, and long-term program strategies  and funding plans-–are largely qualitative in nature and are derived from  consensus judgments, our analyses are based on data and information  provided by the military services and discussions with military service  officials and program managers for the individual equipment items. We  assessed the reliability of the services’ equipment readiness data by  (1) comparing key data elements to our observations of equipment items at  selected units, (2) reviewing relevant documents, and (3) interviewing  knowledgeable officials. We determined that the data obtained from DOD,  the military services, and the combatant commands were sufficiently  reliable for our use. We performed our review from July 2004 through July  2005 in accordance with generally accepted government auditing  standards.

Assessments of Selected Equipment Items

For the 30 equipment items, each assessment provides the status of the  equipment item at the time of our review. The profile presents a general  description of the equipment item. Each assessment area—condition, near- term program strategy and funding, and long-term program strategy and  funding—includes a green, yellow, or red rating indicating the existence,  severity, or urgency of problems identified based on our observations of  each equipment item, discussions with service officials, and reviews of  service-provided metrics.

	Army

		Abrams M1A1/M1A2 Tank

First delivered in the early 1980s, the Abrams is the Army’s main battle tank  and destroys enemy forces using enhanced mobility and firepower.  Variants of the Abrams include the M1, M1A1, and M1A2 and there are a  total of 5,848 tanks of all variants in the fleet. The M1A1 and M1A2 have a  120 mm main gun, a powerful turbine engine, and special armor. There are  5,109 M1A1 and M1A2 tanks in the inventory, and their estimated average  age is 12 years. Officials state that in the future, the Army is planning to use  only a two-variant fleet of the Abrams, consisting of the M1A1 Abrams  Integrated Management and the upgraded M1A2 System Enhancement  Program—the primary difference being the digital architecture of the  System Enhancement Program variant. The M1 variant is expected to be  phased out by 2015. The Abrams is expected to remain in the Army’s  inventory until at least 2045.
In our previous report we assessed the condition of the Abrams Tank as  green because it consistently met its mission capable goal of 90 percent  from fiscal year 1998 through fiscal year 2002. However, in this review we  assessed the condition of the Abrams Tank as yellow because, while it  generally met or exceeded the Army’s mission capable goal between fiscal  years 1999 and 2003 as shown in figure 3 below, the rates declined between  fiscal years 2003 and 2004. According to program officials, the recent  downward trend is a result of parts and technician shortages. Officials  stated that the shortage in parts is driven by the number of vehicles either  deployed or being reset to a predeployment condition and the shortage of  technicians is primarily due to the number of deployed National Guard  military technicians. Additionally, as of September 2004 there were a  relatively small percentage of Abrams tanks, around 5 percent, deployed in  support of operations in Iraq. Due to the high use in theater, these  operations may accelerate the aging process of the tank fleet.
We assessed the near-term program strategy and funding for the Abrams  tank as yellow because while the Army possesses plans for resetting tanks  as they return from operations in Iraq and recapitalizing the fleet to ensure  that the tank’s systems remain updated, they continue to identify shortages  of repair parts and technicians as major causes of decreased material  readiness. Without adequately addressing these issues, the condition of the  Abrams fleet could be significantly impacted in the near term. Another  potential issue affecting the Abrams in the near term is a break in the  production line, which is being used to retrofit a lesser variant Abrams to  the M1A2 System Enhancement Program, occurring in fiscal years 2006 and  2007. Army officials plan to mitigate this issue by providing $40 million to  maintain critical skills at the production facilities until production resumes  in fiscal year 2008.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy and funding for the Abrams  tank as green because the Army has identified a plan to reduce the current  inventory of 5,109 to about 3,000 tanks in keeping with current Army  transformation plans and has programmed funding to recapitalize the  remaining fleet. The Army plans to move to a two-variant fleet of the  Abrams, the M1A1 Abrams Integrated Management and M1A2 System  Enhancement Program, which they plan to utilize until at least 2045.  Officials believe this plan should reduce maintenance costs as the service  will have reduced maintenance and logistics requirements from the current  fleet arrangement. As noted in our previous report, the Army reduced the  original number of recapitalized M1A2 System Enhancement Program  tanks from 1,174 to 588. In the fiscal year 2006 President’s Budget, the Army  identified funding to increase the number of M1A2 System Enhancement  Program tanks to 803. This increase realigns the recapitalization funding  with the Army’s upgrade schedule so that they are on target to meet their  current transformation plans.

		Bradley Fighting Vehicle

Brought into service in 1981, the Army uses the family of Bradley Fighting  Vehicles to provide armored protection and transportation to infantry  units. The Bradley is able to close with and destroy enemy forces in  support of mounted and dismounted infantry and cavalry combat  operations. The Bradley Fighting Vehicle family currently consists of two  vehicles: the M2 Infantry Fighting Vehicle and the M3 Cavalry Fighting  Vehicle. There are four variations of each of these two vehicles: the A0, A2,  A2 Operation Desert Storm, and A3, each having different capabilities and  technology. For example, the A3 variants possess all of the capabilities as  the A2 variants, but utilize a digital architecture, which is compatible with  the Army’s net-centric warfare plans and the M1A2 System Enhancement  Program Abrams tank. The Army currently maintains 6,583 M2 and M3  variants of the Bradley in their fleet and plans to use the Bradley Fighting  Vehicle until at least 2045.
We assessed the condition of the Bradley as yellow because, as shown in  figure 5 below, the vehicles nearly met or exceeded the Army’s readiness  goal of 90 percent between fiscal years 1999 and 2002; however, the mission  capable rates showed a downward trend between fiscal years 2002 and  2004. According to officials, Operation Iraqi Freedom demands and efforts  to reset the vehicles to their predeployment status have had a significant  impact on repair parts availability. The National Guard has experienced  further difficulty with availability of trained maintainers due to the high  pace of operations that has resulted in the need to transfer personnel  among units to fill shortages. Additionally, program officials stated that the  composition of the fleet of Bradley Fighting Vehicles is insufficient to meet  all of the Army’s current requirements, especially those associated with  training and predeployment exercises. However, the Bradley vehicles are  able to meet all of their operational requirements.
We assessed the near-term program strategy and funding of the Bradley  program as yellow because the Army does not currently possess a funding  strategy through regular appropriations for developing the proper  composition of the Bradley Fighting Vehicles fleet to meet the Army’s near- term transformation requirements. The Army requested $1.4 billion in the  fiscal year 2005 supplemental for the Bradley Fighting Vehicle in order to  accelerate the recapitalization of vehicles by producing 93 vehicles to  replace combat losses and 554 others for the Army’s modularity needs.  Without having funding programmed for the A2 or the A3 variants of the  Bradley, Army officials have begun planning for the fiscal year 2006  supplemental in order to fulfill Army transformation plans. Program  officials stated that the Army is relying on supplemental funding and Office  of the Secretary of Defense (OSD) reprogramming actions in order to meet  equipment requirements for the Army’s transformation plans.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy and funding of the Bradley  Fighting Vehicles as red because the Army plans to significantly increase  the number of vehicles and change the composition of the fleet but has not  established a long-term funding strategy. Officials stated that the Army  plans to convert to a fleet of Bradley vehicles which will be aligned with the  Abrams tank fleet. The A3, matched with the M1A2 System Enhancement  Program tank, and a lesser variant, operating with the M1A1 Abrams  Integrated Management tank, will make up the Army’s future Brigade  Combat Teams. Neither the A3 variant nor the lesser variants, which  officials believe will be the A2 and the Operation Desert Storm variant,  have long-term program funding identified.

		M113 Armored Personnel Carrier

The Army uses the M113 Armored Personnel Carrier in its primary mission  of personnel transportation on the battlefield, though there are many other  combat support missions for the family of vehicles, including command  and control, cargo transportation, and battlefield obscuration. The Army  originally introduced the M113 family of vehicles in 1960. The current fleet  of M113A2 and A3 Personnel Carriers, totaling 7,579, has an average age of  almost 16 years. Prior to operations in Iraq the Army planned to  discontinue use of the M113; however, the Army now plans to utilize the  M113 Armored Personnel Carrier through 2045 in accordance with its latest  modularity plans. The A3 variant of the M113 has a digital architecture,  increased suspension, and is capable of carrying add-on-armor kits to  provide additional protection for the troops.
We assessed the condition of the M113 as green because, as shown in figure  7 below, the mission capable rates have been near the Army’s goal of 90  percent between fiscal years 1999 and 2004. As of September 2004, the  Army had 666 A2 and A3 variants in Operation Iraqi Freedom, or roughly 10  percent of the combined fleet. The M113 family of vehicles has not  experienced a significant decline in mission readiness as a result of recent  operations in Iraq and Afghanistan. The National Guard has generally  maintained its M113 vehicles at a higher readiness rate than the active units  of the Army.
We assessed the near-term program strategy and funding of the M113 as  yellow because the Army has consistently relied on supplemental funding,  congressional adjustments, and OSD reprogramming actions in order to  complete modifications on the M113 family of vehicles. The Army  requested $132 million in DOD’s fiscal year 2005 supplemental funding  request to Congress in order to recapitalize 368 M113s. This represents  about 55 percent of the vehicles that were deployed to Operation Iraqi  Freedom in September 2004. Due to its armor protection, the M113 has  been used in place of less armored vehicles, such as High Mobility Multi- Purpose Wheeled Vehicles, in Operation Iraqi Freedom.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy and funding for the M113 as  red because the Army has not identified either a long-term procurement or  maintenance strategy for the M113. The Army’s funding strategy for the  M113 family of vehicles has been impacted by the Army’s plans to remove  these vehicles from service. However, according to Army officials, the  M113 family of vehicles will continue to play a significant role as the Army  transitions into the new modular force.

		Heavy Expanded Mobility Tactical Truck

The Heavy Expanded Mobility Tactical Truck (HEMTT) is used extensively  to provide transport capabilities for resupply of the combat vehicles and  weapons systems used by heavy combat forces and support units. The five  basic HEMTT variants are used to transport ammunition, petroleum, oils  and lubricants, and missile systems, and can also serve as a recovery  vehicle for other vehicle systems. There are approximately 12,700 HEMTTs  in the Army’s inventory. The average age of the HEMTT fleet is about 15  years, and although the expected useful life is 20 years, the HEMTTs are  expected to remain in the Army’s inventory through 2030.
In our previous report we assessed the condition of the HEMTT as green  because the mission capable rates were close to the Army’s goal for fiscal  years 1998 to 2002. However, in this review we assessed the condition as  yellow. While the fully mission capable rates for the HEMTTs were near the  Army’s goal from fiscal years 1999 through 2003, the trend since fiscal year  2002 for both active and reserve components has been declining, as shown  in figure 9 below. In one of the Army’s fiscal year 2004 readiness reports to  DOD, the high pace of operations and aging fleet were cited as factors  affecting HEMTT readiness for the active component. The decline in  readiness rates for the U.S. Army Reserves was attributed to the lack of  maintenance technicians. Program management officials said that the  failure to meet readiness goals was also due to parts problems. According  to Army officials, approximately 12–15 percent of the HEMTT fleet is in  theater and is being used at rates 10 times higher than during peacetime. In  a February 2005 statement to congressional committees, Army officials  stated that all wheeled vehicles being used in Iraq and Afghanistan would  be armored by March 2005. Despite concerns over armor protection, Army  officials that we visited stated that the HEMTTs have performed as  intended in theater without any significant issues.
We assessed the near-term program strategy for the HEMTT as yellow  because the Army’s near-term strategy for sustaining, modernizing, and  procuring HEMTTs has not been fully funded. In addition, the program  received significant funding from supplemental appropriations and a  congressional adjustment in fiscal years 2004 and 2005, the remanufacture  and upgrade program has continued at a slower pace than planned, and at  the time of the fiscal year 2006/2007 budget estimate submission, the  impact of modularity changes on the final acquisition objective was still  unknown. The Army’s Tactical Wheeled Vehicle and Trailer Modularity and Modernization Strategy has been updated several times and has undergone  significant changes. In addition, the strategy states that while investment is  not sufficient to meet the Army’s goals, it does address its most critical  requirements. In fiscal year 2004 the family of heavy tactical vehicles,  which includes the HEMTTs, was authorized an additional $47 million in  supplemental funding and another $39 million in congressional  adjustments and DOD’s fiscal year 2005 supplemental funding request for  $74.3 million was to replace combat losses and procure additional vehicles  to equip, backfill, and modularize various Army units. The Army is planning  to include another request for additional HEMTTs in DOD’s fiscal year 2006  supplemental budget request. The Extended Service Program, which the  Army uses to remanufacture and upgrade existing HEMTTs, has continued  at the slower pace noted in our December 2003 report, but the justification  for an additional $90.3 million included in the fiscal year 2005 supplemental  funding request cited the program’s importance to the Army’s  modularization efforts. Finally, while the Army’s acquisition objective for  HEMTTs has continued to increase, it still may not meet the Army’s  modularity requirements.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy and funding for the HEMTT as  yellow because the Tactical Wheeled Vehicle and Trailer Modularity and  Modernization Strategy for both procurement and recapitalizations has  not been fully funded and the Army’s plans and funding for procurement,  recapitalization, and sustainment of its oldest models are continuing to  evolve. The strategy has been updated several times and has undergone  significant changes. The June 2005 version of the strategy concluded with a  statement that while investment is adequate to address the Army’s most  critical requirements, it still falls short of the Army’s goals. In addition, the  goals have changed significantly. For example, in the fiscal year 2006/2007  budget estimate, dated February 2005, the Army acquisition objective for  HEMTTs was 14,269, but in July 2005 the goal was 17,850. Funding plans  also continue to change. In our December 2003 report, we noted that the  Army had reduced funding for the recapitalization program which was used  to upgrade HEMTTs. Currently, the June 2005 version of the strategy shows  that the Army plans to recapitalize 4,726 HEMTTs between fiscal years 2012  and 2018. However, past history shows that this may not occur. For  example, while the fiscal year 2003 budget estimate shows that the Army  originally planned to recapitalize 608 HEMTTs in fiscal year 2004, the fiscal  year 2005 budget estimates show that only 129 were recapitalized. The  Army’s plans to eliminate its oldest HEMTT models, which can reduce fleet  operating and support costs, have also been scaled down. In a fiscal year  2004 draft, the strategy stated that 9,200 of the oldest HEMTT models  would be eliminated by fiscal year 2018. In a 2005 version however, that  number was reduced to 7,728. In addition to receiving regular  appropriations for procuring, recapitalizing, and sustaining HEMTTs, the  Army is also relying on funds received through OSD’s reprogramming  actions to support its long-term strategy for HEMTTs. The June 2005  version of the Army’s strategy shows that between fiscal years 2006 and  2011, an additional 3,559 HEMTTs and other heavy vehicles will be  procured with funds received through OSD’s reprogramming actions.

		High Mobility Multi-Purpose Wheeled Vehicle

The High Mobility Multi-Purpose Wheeled Vehicle (HMMWV) is a light,  highly mobile, diesel-powered, four-wheel-drive vehicle that has six  configurations: troop carrier, armament carrier, shelter carrier, ambulance,  missile carrier, and Scout vehicle. There are approximately 120,000  HMMWVs in the Army’s inventory. HMMWVs entered the Army’s inventory  in 1985. Currently, the average age of the HMMWV fleet is about 13 years  and the expected service life of HMMWVs is 15 years. The HMMWV  represents 50 percent of the Army’s total tactical truck fleet.
We assessed the condition of the HMMWV as green because, as shown in  figure 11, it exceeded the Army’s fully mission capable goal from fiscal  years 1999 through 2004 for both the active and reserve components.  However, Army officials noted that the HMMWVs supporting Operation  Iraqi Freedom are experiencing usage (i.e., operational tempo) that is six  times their normal peacetime usage rate. HMMWV production has now  transitioned primarily to the Up-Armored platforms to enhance force  protection and mobility for deployed units. While the Up-Armored variant  is built to support the weight of the vehicle’s armor, Army officials have  expressed concern regarding the long-term impact from the stress placed  on the frame, engines, and transmissions by the additional weight of add-on  armor that the HMMWVs were not reinforced to handle. DOD has initiated  a Stress Study to try and quantify the effects of high usage, additional  weight, and harsh operating conditions on future maintenance/replacement  needs of vehicles such as the HMMWV. In February 2005, in a statement to  congressional committees, Army officials stated that all wheeled vehicles  being used in Iraq and Afghanistan would be armored by March 2005.
We assessed the near-term program strategy and funding for the HMMWV  as yellow because the Army has not fully funded its Tactical Wheeled  Vehicle and Trailer Modularity and Modernization Strategy and the Army  Acquisition Objective continues to change. In the near term, in addition to  receiving regular appropriations, the Army has received additional funding  for HMMWVs from supplemental appropriations and congressional  adjustments. In fiscal year 2004, the Army received $239 million of  supplemental funds and about $39 million in congressional adjustments. In  fiscal year 2005 the Army requested almost $290 million in supplemental  funds to procure HMMWVs to activate units and to supply existing units.  An additional $31 million in supplemental funds was requested to replace  combat losses and another $123 million was requested to begin  recapitalizing older HMMWV models and converting them to newer models  capable of accepting the add-on armor. The June 2005 version of the Army’s  strategy shows that it is planning to request additional supplemental  funding in fiscal year 2006. The Army’s Acquisition Objective for HMMWVs  has increased significantly since 2001. In the Army’s fiscal year 2002  amended budget estimate, submitted in June 2001, the Army’s Acquisition  Objective for HMMWVs was about 121,000 whereas in an April 2004 version  of the Army’s plan, the Army was projecting a need for 145,000 HMMWVs.  Currently, neither the fiscal year 2006/2007 nor the June 2005 version of the  Army’s plan show the Army’s Acquisition Objective for HMMWVs. Army  officials noted in an August 2004 version of the strategy that they had  resourced all known Global War on Terrorism (GWOT) requirements and  their projected battle losses.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy and funding for the  HMMWV as yellow because again, the Army has not fully funded its  Tactical Wheeled Vehicle and Trailer Modularity and Modernization  Strategy. In addition, the Army’s initial plans for the HMMWV  recapitalization programs have been significantly reduced. The June 2005  version of the Army’s strategy shows anticipated procurement  requirements of about 30,000 vehicles between fiscal years 2008 and 2011.  However, the Army’s fiscal year 2006/2007 budget request is only for about  18,000 vehicles during those years. The Army is planning on using funds  resulting from OSD reprogramming actions to procure the additional  12,000 vehicles needed to meet requirements for those fiscal years. In the  long term, according to an August 2004 version of the strategy, the Army  plans to eliminate about 45,000 of its oldest models by fiscal year 2018.  About 19,000 of the oldest models would be converted to newer models  capable of handling add-on armor kits in order to provide better soldier  protection through a recapitalization program. However, those plans, and  the associated costs, continue to change. For example, a February 2005  version of the strategy estimated a cost of about $1.8 billion to recapitalize  20,114 HMMWVs for fiscal years 2008 through 2011, but the Army’s fiscal  year 2006/2007 budget request, dated February 2005, contained about $1.9  billion in order to recapitalize 17,694 vehicles during those years. The June  2005 version of the Army’s plan shows an estimated cost of about $2 billion  to recapitalize 16,522 HMMWVs between fiscal years 2008 and 2011.

		Family of Medium Tactical Vehicles

The Family of Medium Tactical Vehicles (FMTV) is a series of vehicles  based on a common chassis which vary by payload and mission  requirements. It is currently the only medium fleet vehicle that is in  production with state-of-the-art technology. The FMTV includes the Light  Medium Tactical Vehicle with a 2.5-ton capacity in both the cargo and van  models and the Medium Tactical Vehicle with a 5-ton capacity in the cargo,  tractor, wrecker, and dump truck models. The FMTV is the replacement for  the obsolete and maintenance-intensive 2.5- and 5-ton trucks, some of  which have been in the Army’s inventory since the 1960s. The FMTV’s  missions include performing local and line hauling, unit resupply, and other  missions in combat, combat support, and combat service support units.  FMTVs are rapidly deployable and can operate in various terrains and in all  climatic conditions. The commonality of parts across the various models is  intended to reduce both the logistics burden and operating and support  costs. The FMTVs entered the Army inventory in 1996 and currently there  are approximately 19,400 vehicles with an average age of about 6 years. The  average useful life is expected to be between 20 and 22 years.
We assessed the condition of the FMTV as green because, as shown in  figure 13, it exceeded the Army’s fully mission capable goal from fiscal  years 1999 through 2004 for both the active and reserve components with  the exception of the National Guard in fiscal year 2000. Despite operating  during GWOT operations at a rate that is nine times higher than in  peacetime, officials stated that the FMTVs are not experiencing any  problems. However, in response to concerns about armored protection,  Army officials, in a February 2005 statement to congressional committees,  stated that all wheeled vehicles being used in Iraq and Afghanistan would  be armored by March 2005.
We assessed the near-term program strategy and funding for the FMTV as  yellow because the Army’s Tactical Wheeled Vehicle and Trailer Modularity  and Modernization Strategy is not fully funded and states that although  planned investment is adequate to address critical requirements, it still falls  short of the Army’s goals. According to an April 2004 version of the  strategy, the Army did not consider it to be either cost or operationally  effective to recapitalize older model vehicles. Instead, the Army’s plan is to  meet readiness and operational shortfalls through replacement with newer,  technologically improved vehicles. However, this plan will not fill the  Army’s goals in the near term. For example, the fiscal year 2005 budget  estimate states that procurement of FMTVs through fiscal year 2005 will  only fill approximately 32 percent of the Army’s Acquisition Objective for  FMTVs. Funding for FMTVs in the near term relies on supplemental  appropriations, congressional adjustments, and OSD reprogramming  actions, in addition to regular appropriations. For example, in fiscal year  2004, the FMTV program was authorized about $3.4 million from DOD’s  supplemental funding request and received another $34 million as a  congressional adjustment. DOD’s fiscal year 2005 supplemental funding  request included $217 million for the Army to procure FMTV trucks to  replace those lost in theater and to support modularity requirements. The  Army also added an additional $122.5 million in the fiscal year 2005  supplemental funding request to meet modularity requirements and to  replace combat losses of the 2.5-ton FMTV vehicles. The June 2005 version  of the plan shows that for fiscal year 2006, the Army is not planning to  request supplemental funding, but in fiscal year 2007, they are planning to  use additional funds received as a result of OSD reprogramming actions to  procure additional FMTVs to fill unit shortfalls.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy and funding for the FMTV as  yellow because again, the Army has not fully funded its Tactical Wheeled  Vehicle and Trailer Modularity and Modernization Strategy and although an  April 2004 version of the strategy states that an incremental upgrade  modernization strategy that will include a combination of field  modernizations and new procurement is envisioned, no specific actions or  time frames are identified. The June 2005 version of the Army’s plan shows  that, between fiscal years 2008 and 2011, the Army is planning to continue  using OSD reprogrammed funds to procure FMTVs in order to fill unit  shortfalls. In addition, the June 2005 plan shows that the Army plans to  remove 25,000 of the old model 2.5-ton and 5-ton trucks from the inventory.  FMTV production has been done in phases. As reported in an April 2004  version of the strategy, the first two phases together will deliver over 20,000  vehicles. The third phase is scheduled to begin in fiscal year 2005 and the  fourth phase, an outgrowth of vehicle component design and integration  under ongoing program technology/insertion efforts, does not have an  identified start date but is planned to begin shortly after the completion of  the current production contract.

		AH-64 A/D Apache Helicopter

The Apache is a multimission aircraft designed to perform rear, close, deep  operations and precision strikes, armed reconnaissance, and security  during the day, at night, and in adverse weather conditions. There are two  Apache variants: the AH-64A, which entered service in 1984, and the AH- 64D Longbow, an improved version of the AH-64A, which entered service in  1998. The Army plans to convert most of the AH-64A helicopters into AH- 64D models, and to improve the safety features on the remaining AH-64A  models. In total, there are about 703 Apache helicopters in the Army’s  inventory: 263 A models and 440 D models. The average fleet age of the A  model is about 13 years, and the average age of the D model fleet is about 4  years.
Our assessment of the Apache’s condition as yellow is unchanged since our  prior report. As shown in figure 15, the average mission capable rates for  the AH-64A models have been below the Army’s goal between fiscal years  1999 and 2004, and the average mission capable rates for the AH-64D fleet  have been above goal for 3 of the 6 years. In our December 2003 report,  safety restrictions were cited as the cause of not meeting mission capable  goals but since then, all of the issues have been addressed throughout the  fleet. However, according to officials, elevated flying hours in Iraq and  Afghanistan, coupled with the harsh environment, continue to increase  demands for limited spare parts and for maintenance for such items as  engines and rotor blades. Officials further stated that the peacetime usage  rate for the AH-64 is 15 hours a month and the actual number of flight hours  is averaging 31 hours per month in Iraq and 55 per month in Afghanistan.  Despite these challenges, officials stated that the AH-64 is capable of  conducting its mission and, between February 2003 and December 2004, its  mission capable rates in both Iraq and Afghanistan exceeded the Army’s  goal.
We assessed the near-term program strategy and funding for the Apache as  green because the Army has recapitalization and sustainment strategies,  both of which are funded. As stated in our December 2003 report, the  Apache Recapitalization Program addresses cost, reliability, and safety  problems, fleet groundings, aging aircraft, and obsolescence. The Army is  continuing to remanufacture the AH-64A models to AH-64D models with  the remaining helicopters beginning conversion during fiscal year 2005. In  addition, Apaches that have been deployed are being returned to  predeployment conditions through a combination of unit and contractor  actions. The Army received an additional $321.1 million in the fiscal year  2005 supplement to replace 13 Apaches that were lost in theater.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy and funding for the Apache as  green because the Army’s modernization strategy to improve combat  capability and aircraft safety appears likely to allow the Apache to remain  in service until 2040 and, as we reported previously, is consistent with the  Army’s stated requirements. A total of 597 AH-64A models will be  converted to AH-64D models by fiscal year 2010. All remaining AH-64A  models are scheduled to receive additional reliability and safety  modifications as part of the Army’s response to concerns of the Office of  the Secretary of Defense and Congress. There are plans for additional  upgrades to AH-64D models and funding to support the Army’s current  long-term strategy has been programmed through fiscal year 2020.

		CH-47D/F Chinook Helicopter

The CH-47 helicopter is a twin-engine, tandem rotor helicopter designed for  transporting cargo, troops, and weapons, and is the only Army helicopter  that can operate at high altitudes. By 1994, all CH-47 models were upgraded  to the CH-47D version, which comprises the Army’s heavy lift fleet. The CH- 47D will be replaced by the CH-47F, a remanufactured version of the CH- 47D with a new digital cockpit and modified airframe to reduce vibrations.  The CH-47F was approved for full-scale production in November 2004, and  officials state the Army plans to convert the entire fleet by fiscal year 2018.  There are 395 CH-47D models and 3 CH-47F models in the Army inventory,  but the CH-47F models are not assigned to units. The average age of the  CH-47D model is about 17 years. Army aircraft generally have life cycles of  20 years.
Our assessment of the CH-47D’s condition as red is unchanged since our  prior report. Mission capable rates for the fleet, as shown in figure 17,  were consistently below service goals for fiscal year 1999 through fiscal  year 2004. Officials stated that the aircraft is currently being flown in Iraq  and Afghanistan three times more than planned peacetime rates, with the  CH-47D flying 200 hours in 6 months when it was originally planned to fly  200 hours in 18 months. Deployment cycles for the CH-47D are often longer  than other equipment. While most Army helicopters remain in theater for  about a year, officials report that some CH-47D helicopters have been in  theater for almost 2 ½ years. This usage, particularly in a desert  environment, has increased the amount of maintenance and number of  parts needed to sustain the aircraft, which in turn has negatively impacted  overall readiness. According to officials, current shortages of CH-47D  helicopters and the requirement to fill nearly simultaneous competing  priorities with limited resources may require additional CH-47D helicopters  to remain in theater as stay-behind equipment. Despite these challenges,  officials state that the CH-47D has proven itself in theater. For example,  between February 2003 and December 2004 the CH-47D’s mission capable  rates in Afghanistan exceeded the Army’s goal.
We assessed the near-term program strategy for the Chinook as yellow  because the Army has plans to address the issues affecting the current  condition but has yet to implement all of the solutions. Officials stated that  the components that affect readiness the most can be repaired at the depot;  however, the emphasis (e.g., transportation priorities) is on pushing parts  to units but not necessarily returning the broken parts to the depot for  repair. According to officials, the Army is working in coordination with  depot personnel to become more efficient at identifying and returning the  broken parts for repair, as well as developing relationships with original  equipment manufacturers to allow for a faster replacement of spare parts.
However, whether these efforts will be successful and the degree to which  they resolve parts shortages remains to be seen.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy for the CH-47 as green because  the Army has and is funding a modernization strategy to improve the CH-47  capability and lifespan. The Army plans to have a final CH-47F fleet size of  452 aircraft, to include 397 CH-47F aircraft that were remanufactured from  the CH-47D and 55 new build CH-47F aircraft. Officials stated that  conversion from the CH-47D to the CH-47F adds about 20 years to the  service life of an aircraft, as well as improving performance and reducing  overall operations and sustainment costs.

		OH-58D Kiowa Helicopter

The Kiowa is a multimission armed reconnaissance helicopter designed to  support combat and contingency operations. Deliveries of the OH-58D  began in 1985, and the last new one was delivered to the Army in 1999.  There are 354 Kiowa helicopters in the Army’s inventory, and their average  age is about 13 years. While the expected service life for an OH-58Ds is 20  years, the Army plans to retire the entire OH-58D fleet by fiscal year 2013  and to replace it with the Armed Reconnaissance Helicopter.
We assessed the condition of the Kiowa as green because the mission  capable rates have been consistently above service goals for calendar years  1999 through 2004. As seen in figure 19, the OH-58D has remained at or  above the 80 percent mission capable rate. Further, 96 OH-58Ds have  deployed to support operations in Iraq and Afghanistan and have exceeded  their planned flight hours; specifically, peacetime average usage for the OH- 58D is about 20 hours per month, but the actual flight hours for  deployments has averaged between 80 and 100 hours per month. The Army  attributes higher readiness rates of the OH-58D in part to simple design and  a lighter airframe. For example, the OH-58D’s mission capable rates in Iraq  between February 2003 and December 2004 almost met the Army’s goal. In  addition, routine maintenance is performed on the Kiowa after every 40  hours of operation instead of the 300-400 hours for other aircraft, and the  original equipment manufacturer, Bell Helicopter, conducts the depot-level  repairs.
We assessed the near-term program strategy and funding for the OH-58D as  green because the Army’s plans and funding will allow the aircraft to meet  its requirements in the near term. The OH-58D reset and safety  enhancement programs, which are fully funded, include safety  enhancements, weight reduction, and other maintenance actions. Funding  for the Kiowa since fiscal year 1999 has been near Army requests.  Additionally, due to the planned replacement of the Kiowa beginning in  fiscal year 2008, public law limits funds that can be spent on the aircraft to basic sustainment, maintenance and safety measures. For that reason  Kiowa battle losses are not being replaced; however, according to the  Army, the existing fleet is sufficient to meet requirements over the next 1–3  years, even at higher usage rates.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy and funding for the Kiowa as  green because the Army has a funded strategy to field its replacement, the  Armed Reconnaissance Helicopter. According to the Army, this aircraft is a  relatively inexpensive armed aerial platform that will integrate a  commercial off the shelf aircraft with non-developmental mission  equipment packages to the extent possible. The Army’s acquisition  objective is to have a fleet of 368 armed reconnaissance aircraft. The plan is  for the Kiowa to be phased out of the Army’s inventory beginning in fiscal  year 2008 as the Armed Reconnaissance Helicopter is fielded.

	Marine Corps

		M1A1 Abrams Tank

First delivered to the Marine Corps at the beginning of Operation Desert  Storm, the Abrams is the Marine Corps’ main battle tank and destroys  enemy forces using enhanced mobility and firepower provided by a  powerful turbine engine and a 120 millimeter main gun. The Marine Corps  possesses only one variant of the Abrams, the M1A1. The M1A1 variant  fleet consists of a depleted uranium turret version and a “Plain Jane”  version, which lacks the enhanced armor. There are 403 M1A1 tanks in the  inventory, and the estimated average age is 16 years. The Marine Corps  plans to use the M1A1 as its main battle tank until it is replaced by the  Marine Air-Ground Task Force Expeditionary Family of Fighting Vehicles  which is planned to be fielded in 2025.
We assessed the condition of the Abrams tank fleet as red because the  Marine Corps has failed to meet its stated readiness goal of 90 percent on  several occasions during the fiscal years 1999 to 2004 period and, as shown  in figure 21, recent readiness trends indicate a steady decline away from  the readiness goal. Marine Corps officials attribute the decline of the  condition of the tank fleet to the demand on equipment as a result of  operations in support of the Operation Iraqi Freedom and Marine Corps  manpower levels. Since 2003, the Marine Corps has deployed tanks to  Operation Iraqi Freedom, a theater where equipment has been used  aggressively in rugged environments. Shortages of maintenance personnel  are a result of the transfers of personnel to units that are deploying and unit  staffing levels.
We assessed the near-term program strategy and funding of the M1A1  Abrams tank fleet as yellow because the Marine Corps has not fully funded  its tank remanufacture program and has identified additional unfunded  priorities for fiscal year 2006. The Marine Corps is conducting a  remanufacture program on the M1A1 tank that is intended to improve the  quality of the existing equipment by applying all equipment modifications  and replacing worn components. The Marine Corps has fully funded the  remanufacture of 79 tanks during fiscal year 2005; however, it only  identified funding for about 33 percent of the scheduled tank  remanufactures during fiscal years 2006 and 2007. Marine officials believe  that they will be able to meet all remanufacturing requirements because the  tank program has identified similar funding requirement to Marine Corps  Logistics Command in the past and has received sufficient funding to meet  the remanufacture needs. The Marine Corps identified $77 million in  unfunded priorities for the Abrams program in fiscal year 2006. The  majority of this amount, $40 million, is to support continued depot  maintenance operations and the remainder is to procure Firepower  Enhancement Program suites, which increase the detection, recognition,  and identification of targets.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy and funding of the M1A1  Abrams tank fleet as yellow because the Marine Corps has not completely  identified the program requirements or funding for its replacement system,  the Marine Air-Ground Task Force Expeditionary Family of Fighting  Vehicles; however, they are taking steps to increase the service life of the  M1A1. The Marine Air-Ground Task Force Expeditionary Family of Fighting  Vehicles is scheduled to be the replacement for the Abrams tank and other  Marine Corps ground fighting systems. In order to extend the life of the  current fleet of Abrams tanks, the Marine Corps has identified funding for  80 percent of the scheduled tank remanufactures during fiscal years 2008  and 2009. The Marine Corps has tentatively established plans to conduct a  Service Life Extension Program for the M1A1 fleet in future years. As this  program is to start in years beyond the current Future Years Defense  Program budget, no funding has been identified currently. The Service Life  Extension Program may be essential to ensure that the current fleet of  Abrams tanks remains serviceable until the replacement vehicle is fielded.

		Light Armored Vehicle – C2 and 25 Variants

The LAV-C2 Command and Control and the LAV-25 are two variants from  the family of Light Armored Vehicles (LAV) that we included in our review.  Both variants are all-terrain, all-weather vehicles with night capabilities  and can be fully amphibious within 3 minutes. The LAV-C2 variant is a  mobile command station providing field commanders with the necessary  resources to command and control Light Armored Reconnaissance units.  The average age of the LAV-C2 is 18 years and there are 50 in the inventory.  The LAV-25 provides rapid maneuverability, armor protection, and  firepower to the Light Armed Reconnaissance units. The average age of the  LAV-25 is 19 years and there are 407 in the inventory. The family of Light  Armored Vehicles is expected to be replaced by the Marine Air-Ground  Task Force Expeditionary Family of Fighting Vehicles.
In our previous report we assessed the condition of the LAV-C2 as green  because the Marine Corps had initiated a fleet-wide Service Life Extension  Program to extend the service life of the vehicle. However, in this review  we assessed both the LAV-C2 and the LAV-25 variants of the Light Armored  Vehicles and we assessed the condition of these vehicles as yellow. While  the material readiness rates for the two variants were near the readiness  goal of 85 percent between fiscal years 1999 and 2004 (see fig. 23); the  overall material readiness rate trend declined during this period. Marine  Corps officials stated that despite the fact that the vehicles did not meet the  Marine Corps’ readiness goal they were able to fulfill all mission  requirements during this period. However, the vehicle’s high usage in  support of contingency operations has placed a strain on the supply system  and has led to shortages of key Light Armored Vehicle components, such as  struts and drive train components.
We assessed the near-term program strategy and funding of the Light  Armored Vehicle as yellow because although a service life extension  program and some upgrades are planned and funded, there are some  essential program requirements that remain unfunded. A service life  extension program designed to improve the quality and extend the life of  the vehicles has already been performed on a majority of the vehicles. In  addition to the service life extension program, the LAV-C2 and LAV-25 are  planned to receive upgrades to address capabilities deficiencies. The  upgrade to the LAV-C2 will enhance communications capabilities, affording  more commonality with other vehicles and helicopter systems. The  upgrade to the LAV-25 will enhance target recognition and the lethality  upgrade will increase the fire power of the vehicle’s 25-millimeter main  gun. A program is also funded to address any obsolescence issues.  Additionally, as a result of force structure changes, the Marine Corps is  establishing five new light armored reconnaissance units and has received  fiscal year 2005 supplemental appropriations to purchase new upgraded  vehicles to equip these units and begin upgrades on the legacy fleet.  However, the Marine Corps has identified $113 million as an unfunded  requirement that is needed to complete the standardization of the older  LAVs.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy and funding of the Light  Armored Vehicle as yellow because while the Marine Corps has not  completely identified the requirements for its replacement system or  established associated program strategy or funding, the completion of the  near-term plans may help the Marine Corps sustain its fleet of LAVs until  the replacement is fielded. Both the LAV-C2 and the LAV-25 upgrades to  address capabilities deficiencies have achieved or will achieve initial  operational capability by fiscal year 2009.

		Assault Amphibian Vehicle

Three variants represent the family of Assault Amphibian Vehicles (AAV).  The AAVs are armored full-tracked landing vehicles. The Personnel variant  carries troops from ship to shore and to inland objectives and there are  930 in the inventory. The C2 Command and Communications variant  provides a mobile task force communication center in water operations  and from ship to shore and to inland areas and there are 76 in the inventory.  The Recovery variant recovers similar or smaller sized vehicles. It also  carries basic maintenance equipment to provide field support maintenance  to vehicles in the field. There are 51 Recovery variants in the inventory. The  average age of the vehicle is 28.6 years. All of the AAVs will be  remanufactured under the Reliability, Availability and  Maintainability/Rebuild to Standard upgrade program, which began in 1998  to lengthen the vehicle’s expected service life. The fleet of AAVs is  scheduled to be replaced by the Expeditionary Fighting Vehicle beginning  in 2010.
Our assessment of the condition of the AAV fleet as yellow is unchanged  since our prior report. Although the fleet material readiness rates varied  by vehicle type and by year, as shown in figure 25, the overall readiness  trend for the fleet during the fiscal years 1999 to 2004 period declined.
Despite the declining material readiness, Marine Corps officials stated that  the AAVs were able to meet all operational requirements. Wartime  utilization rates for the vehicles in Operation Iraqi Freedom were as high as  11 times the normal peacetime rate.
We assessed the condition of the near-term program strategy and funding of  the AAV fleet as yellow because while the Marine Corps is completing the  Reliability, Availability, and Maintainability/Rebuild to Standard upgrade on  all of the remaining 377 vehicles in its fleet, this upgrade only returns the  vehicle to its original operating condition and does not add any upgraded  capability. While Marine Corps officials stated that the vehicles have been  able to perform all of their operational requirements, the AAVs lack some  capabilities in areas such as target acquisition (day and night) and  land/water mobility, which are needed to carry out their warfighting  doctrine—Operational Maneuver from the Sea. The Reliability, Availability,  and Maintainability/Rebuild to Standard upgrade program for 327 of the  377 vehicles has been funded through regular Marine Corps procurement  appropriations, supplemental appropriations, and congressional  adjustments over the past few years. Funding for the conversion of the  remaining 50 vehicles, plus 8 for future replacements of combat losses, was  included in the fiscal year 2005 supplemental request. In addition to  funding the upgrades, the requested procurement will also fund  engineering changes to help sustain the AAV fleet and purchase add-on  armor.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy and funding of the AAV fleet as  yellow because while the Marine Corps will have completed an extensive  upgrade of the fleet with the Reliability, Availability, and  Maintainability/Rebuild to Standard program, the timely fielding of the  Expeditionary Fighting Vehicle remains in question. DOD reduced funding,  thus delaying the initial fielding of the Expeditionary Fighting Vehicle to  fiscal year 2010, 4 years past the original date. Operators and maintainers  we spoke with are concerned about the delay because the Reliability,  Availability, and Maintainability/Rebuild to Standard program is expected  to help the AAV fleet serve until the Expeditionary Fighting Vehicle is fully  fielded, but the current rate of usage in Operation Iraqi Freedom could  significantly shorten the serviceable life of the current fleet. Officials  expect that all Reliability, Availability, and Maintainability/Rebuild to  Standard vehicles will need to go through an Inspect and Replace Only As  Necessary maintenance program since they will have to stay in the fleet  longer than expected.

		Marine Corps Medium Tactical Vehicle Replacement

The Medium Tactical Vehicle Replacement (MTVR) is a family of trucks  with 7-ton capacity that consists of six variants. Comprising the Medium  Tactical Vehicle Replacement fleet is a standard 7-ton cargo variant, an  extended bed 7-ton vehicle, a dump truck, and a wrecker. The MTVR began  replacing two aging variants of 5-ton vehicles in fiscal year 2002. The MTVR  is capable of moving personnel and cargo cross country in support of  maneuver units. The MTVR has increased capabilities compared to the  5-ton truck and is capable of being delivered by cargo aviation assets.
We assessed the condition as green because, as can be seen in figure 27, the  Medium Tactical Vehicle Replacement fleet has met the Marine Corps’  stated material readiness goal of 85 percent for the 2 years that data were  available, fiscal years 2003 and 2004. Though the MTVRs are being  aggressively used in support of Operation Iraqi Freedom, officials stated  that they are fairly easy to maintain and there are sufficient repair parts to  meet current requirements. Officials also attribute much of the Marine  Corps’ success at keeping high material readiness rates to the maintenance  personnel.
We assessed the near-term program strategy and funding of the MTVR as  green because, despite experiencing some combat losses and the lack of  funding to replace these losses, the Marine Corps has made plans to meet 7- ton vehicle demands of the Marine Corps in the short term. The Marine  Corps possesses an indefinite delivery/indefinite quantity contract with  Oshkosh Trucks, which allows it to increase the number of vehicles in the  fleet without negotiating a new contract. The Marine Corps has utilized this  contract to procure an additional 1,850 MTVR upgrade armor kits, which  will be used to provide additional protection to deploying Marine  Expeditionary Units and as a reserve for Marine Expeditionary Brigades. In  the fiscal year 2006 Unfunded Programs List, the Marine Corps identified  $1.4 million to procure seven new MTVRs that will help replace actual and  projected combat losses.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy and funding of the MTVR as  green because the Marine Corps plans provide sufficient numbers of  MTVRs to equip all Marine Corps units in the long-term. Marine Corps  officials stated that they have plans to reconstitute equipment returning  from deployment and may rotate equipment between deploying units and  prepositioned forces. The officials believe that these actions could balance  out the usage rates of the fleet and therefore maintain the fleet’s life  expectancy. As discussed in the near-term program strategy and funding,  the Marine Corps possesses an indefinite delivery/indefinite quantity  contract with the original equipment manufacturer and program officials  believe the Marine Corps can source equipment in the future to meet  requirements.

		AV-8B Harrier Jet

The AV-8B Harrier Jet’s mission is to attack and destroy surface targets  during day and night conditions and to escort assault support aircraft. It  has a short takeoff and vertical landing capability to enable it to deploy and  operate from amphibious assault ships and remote tactical landing sites.  There are 154 in inventory (131 combat capable aircraft, 17 noncombat  capable training aircraft, and 6 aircraft in storage), with an average age of 9 years. The Joint Strike Fighter is expected to replace the AV-8B beginning  in 2012.
We assessed the condition of the AV-8B as yellow because it consistently  failed to meet the Marine Corps’ mission capable rate goal of 76 percent  between fiscal years 1999 and 2004 (see fig. 29 below). However, despite  missing the mission capable goal, the mission capable trend showed some  improvement through fiscal year 2003. Further, the AV-8B aircraft  nonmission capable rates for maintenance and supply also showed  improvement during that time frame. Marine Corps officials commented  favorably on the aircraft’s performance in support of operations in Iraq and  Afghanistan, and the aircraft’s wartime utilization was about one and one- half times the normal peacetime rate. A defense panel has analyzed past  problems with the aircraft and they have recommended improvements to  maintenance cycles and technician availability.
We assessed the near-term program strategy and funding of the AV-8B as  green because the Marine Corps has several initiatives and programs  established and funded to improve the capabilities, safety, and reliability of  the aircraft. The Marine Corps has procured, either through upgrades or  remanufacture, 93 aircraft with radar/night attack which increases the  ability of the aircraft to complete assigned missions in a greater variety of  weather and light conditions. Officials also report that they have fully  equipped all AV-8B aircraft with LITENING pods which increase image  resolution for ground targeting. The Marine Corps has also developed new  maintenance practices and policies that will increase readiness and  decrease downtime spent in maintenance. According to Marine Corps  officials, as a result of these policies the Marine Corps has seen an  approximately 66 percent increase in the serviceable life of the aircraft.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy and funding of the AV-8B as  yellow given the potential for delays in the Joint Strike Fighter program  which will require the AV-8B to fly longer than expected. Increasing  program costs and unproven critical technologies could further delay the  Joint Strike Fighter program’s initial entry into service, which is currently  planned for 2012 with complete fielding in 2024. The Marine Corps  currently plans to fly the AV-8B until the 2011-2020 time frame. Marine  Corps officials note that funding is sufficient to execute the long-term  program strategy for the AV-8B through the Future Years Defense Program.

		AH-1W Super Cobra Helicopter

The AH-1W Super Cobra is a day/night, marginal weather, Marine Corps,  attack helicopter that provides en route escort and protection of troop  assault helicopters, landing zone fire suppression during the assault phase,  and fire support during ground escort operations. There are 179 aircraft in  the inventory with an average age of 15 years.
As in our prior report, we assessed the condition of the AH-1W Super  Cobra as yellow because the aircraft consistently failed to meet its mission  capable rate goal of 85 percent during the fiscal year 1999 to 2004 period, as  shown in figure 31. Despite the aircraft’s low mission capable rates,  officials stated that the AH-1W was able to meet all of its mission  requirements during this period. Further, the AH-1W upgrade program may  decrease maintenance needs due to parts commonality with other Marine  Corps utility helicopters. The AH-1W has served in both Operation  Enduring Freedom and Operation Iraqi Freedom and deployed mission  capable rates were higher than for those aircraft that were not deployed.  The aircraft wartime utilization is about two times that of peacetime  operations. The Marine Corps rotates the Super Cobras out of these  theaters and conducts depot-level maintenance on the aircraft upon their  return.
We assessed the near-term program strategy and funding of the AH-1W as  yellow because while the Marine Corps has established a program to  remanufacture the current fleet of AH-1W Super Cobras to a more capable  AH-1Z, they may experience a shortage of AH-1Ws during the  remanufacturing process. Officials stated that they may be short as many  as 40 AH-1Ws due to operational requirements and forecasts for future  attrition. Marine Corps officials further stated that if there is a shortfall, it  would largely occur in the reserves due to the current operational  requirements for the active squadrons. This could seriously impact the  reserve air wing’s ability to train pilots and meet operational requirements  in the future. Additionally, the Marine Corps identified $50 million in  unfunded requirements for engineering efforts associated with the  remanufacturing program.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy and funding for the AH-1W  Super Cobra as yellow because, as discussed in the near-term program  strategy and funding, the Marine Corps potentially faces many years of AH- 1W shortages as the remanufacturing effort and future operational  requirements place demands on the fleet. According to Marine Corps  officials, if the upgrade program remains on schedule, the entire fleet of  AH-1W will be upgraded to the AH-1Z by fiscal year 2017.

		CH-46E Sea Knight Helicopter

The CH-46E Sea Knight helicopter provides all-weather, day/night, and  night vision goggle assault transport of combat troops, supplies, and  equipment during amphibious operations ashore. The total inventory of  CH-46Es is 223 and the average age is 36 years. The Marine Corps plans to  replace the fleet of CH-46E with the MV-22 tilt rotor aircraft beginning in  2007.
In our previous report, the CH-46E received a red rating because the  aircraft consistently failed to meet mission capable goals. However, in this  review we rated the condition of the CH-46E as yellow because although  the mission capable rate trend is declining as shown in figure 33, rates were  near the goal of 80 percent between fiscal years 1999 and 2004. Further,  deployed mission capable rates were higher than nondeployed aircraft.  Marine Corps officials noted that the CH-46E was able to meet mission  requirements for operations in Iraq and Afghanistan, and the aircraft’s  wartime utilization was three times the normal peacetime rate. To help  improve the condition of the aircraft, the Marine Corps has completed an  analysis on the airframe and all major aircraft subsystems and has  established a calendar-based depot maintenance cycle. Additionally, as of  the end of August 2005, 234 engine upgrades have been completed. The  engine upgrade is expected to improve capability and reduce maintenance  requirements. However, Marine Corps officials stated that sustainment of  the aircraft is still a concern due to its age and the fact that the aircraft may  have to be in service longer due to fielding delays and funding cuts for the  MV-22.
We assessed the near-term program strategy and funding for the CH-46E as  red because the Marine Corps may be unable to meet its near-term  operational requirements due to aircraft and potential repair part shortages  caused by the age of the aircraft. Despite funding upgrades and  modifications to the CH-46E to improve its safety, reliability, and  survivability, repair parts may not be available through normal  procurement lines because some of the original production lines have been  closed. The Marine Corps is planning to rely on retiring aircraft to provide  replacement parts for operating aircraft. Due to fielding delays of the MV- 22, the CH-46E will not be retired at the pace anticipated and, according to  Marine Corps officials this could lead to some repair parts shortages. Given  the continued demands to support operations in Iraq and Afghanistan, pilot  training, and the current scheduled fielding of the MV-22, the Marine Corps  may be short one CH-46E squadron for a period of 2 years starting in  January 2006. Marine Corps officials stated that this squadron is necessary  to support current contingency operations and operational plans developed  at combatant command headquarters. They also stated that they are  considering options to mitigate these issues by engineering repair parts to  extend the serviceable life of aircraft components and utilizing other types  of aircraft to fill in for the decommissioned squadron.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy and funding for the CH-46E as  red because delays in the MV-22 fielding will force the CH-46E to continue  flying much longer than planned and this could impact the Marine Corps’  ability to support future operations. DOD reduced procurement funding for  the MV-22 aircraft in its 2006 budget request, which delays the full  authorized fielding of all MV-22 squadrons until fiscal year 2016 versus  2011. This delay will force some squadrons, especially in the reserves, to  continue to fly the older CH-46E despite the fact that it may not be able to  support Marine Corps operational doctrine. Operational Maneuver from  the Sea, a Marine Corps war-fighting doctrine, calls for forces to cross great  distances to engage an enemy. These requirements currently exceed the  capabilities of the CH-46E.

		CH-53E Super Stallion Helicopter

The CH-53E Super Stallion helicopter provides assault support by  transporting heavy weapons, equipment (such as High Mobility Multi- Wheeled Vehicles and Light Armored Vehicles), supplies, and troops. The  CH-53E is capable of in-flight refueling. The average age is 17 years and  there are 147 CH-53Es in the inventory. The expected replacement for the  CH-53E is the Heavy Lift Replacement, but the requirements are still being  determined. The Heavy Lift Replacement is expected to enter service in  2015.
We rated the condition of the CH-53E as yellow because the aircraft did not  meet its mission capable goal of 70 percent in some years and between  fiscal years 2003 and 2004 the mission capable rates declined as shown in  figure 35. The aircraft wartime utilization is about two times that of  peacetime operations, and the aircraft mission capable rates for deployed  aircraft are higher than those for aircraft that are not deployed. According  to Marine Corps officials, fatigue issues related to age, as well as structural  cracks in the tail boom area of the aircraft, have been ongoing problems  with the CH-53E fleet. The higher-than-expected usage rates in Operations  Iraqi and Enduring Freedom have accelerated the need to repair these  areas. The Marine Corps is addressing the structural cracks and engine  upgrades through several programs. The engine upgrades are expected to  improve capability and reduce maintenance requirements. Further, despite  the declining readiness rates, officials stated that the CH-53E was able to  meet all operational requirements.
We assessed the near-term program strategy and funding of the CH-53E as  yellow because, although the Marine Corps has several initiatives  underway that will help sustain and improve capabilities of the CH-53E,  some of the upgrades and safety issues are on the service’s fiscal year 2006  unfunded program list. The Marine Corps has received funding from  congressional adjustments and supplemental appropriations to fully outfit  their CH-53E squadrons with aircraft armor systems, but it lacks sufficient  funds to upgrade all engines or completely field diagnostic systems.  According to Marine Corps officials, the diagnostic systems assist  maintainers by identifying maintenance issues ahead of scheduled  maintenance programs and will reduce the maintenance man hours  required to support the aircraft. The Marine Corps identified $30.6 million  for these diagnostic systems and engine upgrades as unfunded priorities in  fiscal year 2006.

			Long-Term Program Strategy and Funding

We rated the long-term program strategy and funding of the CH-53E as red  because the requirements for the Heavy Lift Replacement, the replacement  aircraft for the CH-53E, are still being established despite an initial fielding  planned for 2015. According to officials, the Marine Corps must maintain at  least 120 CH-53Es until the initial fielding of the Heavy Lift Replacement in  order to support Marine Corps operations. Repair of the structural cracks  found in the aircraft is critical to maintaining an adequate inventory of CH- 53Es until the Heavy Lift Replacement becomes operational. Officials  estimate that, if the current high usage rate and estimates of attrition hold  true, the number of CH-53Es may fall below the number necessary to  remain in service until the Heavy Lift Replacement becomes available  unless required funding and maintenance are available.

	Navy

		DDG-51 Arleigh Burke Class Destroyer

Arleigh Burke Class Destroyers (DDG-51 class) provide multimission  offensive and defensive capabilities and can operate independently or as  part of a carrier strike group, surface action group, or expeditionary strike  group. The primary missions of the Arleigh Burke Class Destroyers are the  destruction of enemy cruise missiles, aircraft, surface ships, and  submarines and to attack land targets in support of joint or combined  operations. The first ship of this class was commissioned in 1991. The Navy  plans to build 62 ships of this type and 47 of these platforms have been  commissioned to date. The average age of DDG-51s in the fleet is 6.45  years. The final DDG-51 class ship will be delivered in fiscal year 2011.
We assessed the condition of the DDG-51 class as yellow due to  maintenance issues related to major ship systems and bandwidth  limitations experienced by this ship class. Similarly, this ship class received  a yellow rating in our previous report. Each year a number of ships in the  DDG-51 class are evaluated by Navy inspectors; most of the DDG-51 class  ships inspected in recent years have done well in important inspection  areas, such as the destroyer’s electrical and combat systems. However,  areas such as the environmental protection systems and damage control  systems performed poorly in these evaluations. For example, watertight  doors are problematic in this type of ship and generally are in poor  condition in all surface ships. In addition, the DDG-51 also has issues with  corrosion, insufficient bandwidth for Web-based communication, and  cracks on its bow, or the front, of the ship. Sufficient bandwidth is critical  to the ability of these ships to operate with the rest of the Navy, which  relies heavily on the internet for day-to-day operations.

			Near-Term Program Strategy and Funding

We assessed the near-term program strategy and funding of the DDG-51  class as green because the Navy has an effective strategy to address near- term condition and concerns and sufficient funding is available for these  plans. The Navy strategy identifies classwide deficiencies, prioritizes their  importance, and then addresses the most significant issues. The Navy  closely monitors corrosion, and has taken preventative measures to reduce  its impact. Finally, the Navy will install Super High Frequency capabilities  in the DDG-51 class to improve bandwidth limitations, and a review of the  bow cracks is in progress.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy and funding of the DDG-51  class as yellow because the Navy has a strategy to address long-term  condition and concerns, but it is not fully funded. The Navy plans a Midlife  Modernization to ensure that the DDG-51 class of ships remains a relevant  fleet asset for its full life expectancy. The fully funded modernizations are  scheduled to begin in fiscal year 2010, and include upgrades to DDG-51  combat systems that may reduce personnel costs. However, the Navy has  reduced planned future operation and maintenance funding across all  surface ships in the fleet. These reductions have the potential to affect the  material condition of the DDG-51 class, and cause higher costs in later  years to make up for deferred maintenance. The DDG-51 class is expected  to remain in the fleet until fiscal year 2046.

		FFG-7 Oliver Hazard Perry Class Frigate

Oliver Hazard Perry Class Frigates (FFG-7 class) are surface combatants  with antisubmarine warfare and limited antiair warfare capabilities.  Frigates conduct escort for amphibious expeditionary forces, protection of  shipping, maritime interdiction, and homeland defense missions. There are  30 FFGs in the fleet, with an average age of 20.8 years. The FFG-7 class is  expected to remain in service until 2019. There is no planned replacement  for this ship; however, the Littoral Combat Ship will perform many of the  missions currently performed by these ships.
We assessed the condition of FFG-7 class as yellow, the same rating it  received in the last report, due to maintenance issues related to major  ship systems and bandwidth limitations experienced by this ship class.  These frigates operate using diesel engines and these systems’ older  engines need more maintenance than modern gas turbine engines.  Additionally, the water and ventilation systems must be replaced to ensure  that the ship can operate until it reaches the end of its required service life.  Each year a number of ships in the FFG-7 class are evaluated by Navy  inspectors, and they have also found shortfalls in damage control  equipment and the environmental protection systems of these ships.  Moreover, these frigates have only a limited amount of bandwidth and this  affects their ability to operate with the rest of the Navy, which relies heavily  on electronic communications for its day-to-day operations. Naval  inspectors determined that other systems on board FFG-7 class ships were  in good condition, including its propulsion and combat systems.

			Near-Term Program Strategy and Funding

We assessed the near-term program strategy and funding for the FFG-7  class as yellow because the Navy’s near-term plan to correct FFG-7 class  condition problems does not address all issues. The Navy has decided not  to install a Super High Frequency communication system on these ships to  improve their access to bandwidth and improve their access to Web-based  communication. Instead, these ships will continue to operate with a limited  amount of available bandwidth in the future, despite the Navy’s increasing  use of the internet to share operational, training, and personnel data.

			Long-Term Program Strategy and Funding

We assessed the long-term strategy of the FFG-7 class as yellow because of  plans to decrease future operation and maintenance funding. The Navy  plan to modify and modernize the FFG-7 fleet will be complete by fiscal  year 2011; however, these modifications may not address all of the  problems that may arise in the aging FFG-7 class. DOD intends to decrease  the amount of operation and maintenance funding available for its surface  ships in the future, which may limit the Navy’s ability to address any  emerging maintenance issues. While all surface ships will likely have  maintenance funding cuts, the FFG-7 class and other older ships may be  the most affected by these shortfalls.

		LPD-4 Amphibious Transport Dock Ship

Austin-class amphibious transport dock ships (LPD-4 class) are warships  that embark, transport, and land elements of a Marine landing force and its  equipment. Austin class ships also act as helicopter refueling stations and  limited casualty receiving and treatment ships. There are currently 11 LPD- 4 class ships in the inventory with an average age of 37 years. The LPD-4  class ships are expected to remain in the fleet until 2014. The San Antonio- class LPD-17 is beginning to replace the LPD-4 class in fiscal year 2005.
We assessed the condition of the LPD-4 class as yellow due to maintenance  issues related to major ship systems and bandwidth limitations  experienced by this ship class. The LPD-4 received the same yellow rating in our previous report. Insufficient air conditioning is a habitability  concern on many LPD-4 class ships, especially given current operations in  high-temperature regions. The LPD-4 class also has issues with electrical  systems, propulsion, and insufficient bandwidth for Web-based  communication. Sufficient bandwidth is critical to the ability of these ships  to operate with the rest of the Navy, which relies heavily on the internet for  day-to-day operations. While these maintenance issues are significant,  some LPD-4 class ships have completed an Extended Sustainability  Program that addressed the most severe maintenance problems affecting  this class.

			Near-Term Program Strategy and Funding

We assessed the near-term program strategy and funding of the LPD-4 class  as yellow because the Navy has a plan to address near-term condition and  concerns, but it excludes those ships scheduled to decommission within  5 years and the decommission dates have historically slipped. The Navy is  in the midst of an Extended Sustainability Program that corrects serious  LPD-4 class deficiencies, for example, its inadequate onboard electrical  system. The Navy has selected 5 of 11 LPD-class ships for this program, and  will have completed 4 by the end of fiscal year 2005. The ships that will not  undergo the Extended Sustainability Program are all within 5 years of  decommissioning, and therefore can only undergo normal repairs and  maintenance. In the past, this decommissioning date has been moved back  by several years, but ships have retained their decommissioning status— thus preventing any upgrades or modernizations. This will lead to a wide  variance of condition between different ships in the LPD-4 class.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy and funding of the LPD-4 class  as yellow because of plans to decrease future operation and maintenance  funding, and uncertainty concerning the LPD-4’s service life. The Navy has  reduced planned future operation and maintenance funding across all  surface ships in the fleet. These reductions have the potential to affect the  material condition of the LPD-4 class. Additionally, procurement of the  LPD-4 class replacement, the LPD-17 class, has been reduced from 12 ships  to 9. However, the Navy requirement remains the same—the ability to  transport two and a half Marine Expeditionary Brigades.

		F/A-18 Hornet/Super Hornet Aircraft

The F/A-18 is an all-weather fighter and attack aircraft with 6 models: the  F/A-18 A, B, C, and D, also known as the Hornet; and the E and F also  known as the Super Hornet. The capabilities of the Hornet and Super  Hornet include fighter escort, fleet air defense, force projection, and close  and deep air support. The current inventory of F/A-18’s is 914: A, 123; B, 28;  C, 396; D, 139; E, 102; and F, 126. The average age in years is: A, 18.5; B, 20.2;  C, 12.7; D, 12.1; E, 2.5; and F, 2.4. The Navy plans to gradually replace the  Hornet with the Super Hornet and the Joint Strike Fighter.
We assessed the condition of the F/A-18 as green given that it generally is  available in sufficient numbers to meet Navy requirements and though  mission capable goals vary, all models are close to or exceed mission  capable goals between calendar years 1999 and 2004, as shown in figure 40.  Additionally, all variants of the F/A-18 consistently meet their daily  availability requirements. In our previous study, the condition of the F/A-18  was rated yellow because it missed its mission capable goals, but including  the daily availability factor in our analysis improved its rating to green.
However, both the Hornet and Super Hornet have deficiencies with fuel  systems and the Super Hornet also has deficiencies with cockpit canopies,  all of which degrade mission capable rates. In addition, the Navy is  beginning a long-term effort to replace the overstressed center section of  the Hornet fuselage, the center barrel. This effort addresses the predictable  rate of wear and deterioration on the aircraft due to factors such as carrier  takeoff and landings and increases the expected service life of the aircraft.  The aircraft is not available for operations during the 1 year scheduled for  this process. According to officials, during this period the Navy takes  advantage of aircraft time out of service to conduct scheduled maintenance  and other modifications on those aircraft.
We assessed the near-term program strategy and funding of the F/A-18 as  yellow because some funding is not identified for their program strategy,  which includes important Hornet modernizations, and the Super Hornet  lacks critical spare parts. The Navy is unable to fund improved detection  and targeting systems for the Hornet, for example, the Advanced Targeting  Forward Looking Infrared system, and the Joint Helmet Mounted Cueing  System. Similarly, the Super Hornet will, in the near term, experience  shortfalls in the availability of Government Furnished Equipment:  equipment directly acquired by the government and subsequently made  available to a contractor. These equipment shortfalls for the Super Hornet  include extra fuel tanks and bomb racks.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy and funding of the F/A-18 as  yellow because of the uncertain status of its replacement, the Joint Strike  Fighter, and the complexity of the center barrel replacement effort. The  Navy has plans to maintain enough operational F/A-18 aircraft to meet the  Navy’s tactical air requirements until the Joint Strike Fighter is available by  replacing the center barrels of 40 Hornets per year, a challenging goal given  the complex nature of this effort. The Joint Strike Fighter is already behind  schedule and a number of its critical technologies are immature, indicating  that it may be delayed even further. Program officials confirmed that  another delay in arrival of the Joint Strike Fighter would require the F/A-18  program to seek other alternatives to meet requirement goals, such as to  replace more center barrels on Hornets, manage the normal wear and tear  on the aircraft, or procure additional Super Hornets. Moreover, center  barrel stress is not the only factor used when determining the expected  service life of an aircraft; flying hours and takeoff and landings also impact  the F/A 18’s life expectancy. If Hornets are required to operate longer than  currently planned, these aging aircraft may not be available in sufficient  numbers to meet Navy requirements for tactical aircraft.

		EA-6B Prowler Aircraft

The EA-6B Prowler provides Electronic Attack and Anti-Radiation Missile  capabilities against enemy radar and communications systems. The  Prowler’s primary mission is to support strike aircraft and ground troops by  jamming enemy radar, data links, and communications. The current  inventory is 119 with an average age of 21.9 years. The Prowler fleet  consists of carrier-based squadrons, and land-based expeditionary  squadrons. The expeditionary capability will be replaced by the Air Force’s  B-52 electronic jammer suites, while the EA-18G Super Hornet Airborne  Electronic Attack aircraft will begin to replace the carrier-based  capabilities in 2009.
We assessed the condition of the EA-6B as yellow, as we did in our previous  report, because it consistently misses the Navy’s mission capable goal of  73 percent between calendar years 1999 and 2004, as shown in figure 42,  due to a number of maintenance problems. However, Navy officials believe  the EA-6B will meet its daily availability requirements later this year. Much  of this improvement is due to replacement of the center wing, which had  shown signs of fatigue due to the stress of operations, on a number of these  aircraft. The Navy will have completed this complex effort, which removed  aircraft from the fleet for a number of months, on enough Prowlers to meet  their requirements. Despite this improvement, the EA-6B’s mission capable  rates have been degraded by problems with communications equipment,  canopies, and wings. Other problems with fuel cells and environmental  control systems have also diminished mission capable rates. The EA-6B’s  utilization rates have also been high, given its role as a high-demand asset  in current operations.
We assessed the near-term program strategy and funding of the EA-6B as  yellow because the Navy has not funded all of its short-term requirements.  The Navy has plans to address the major degraders of mission capable  rates; however, not all of these plans are fully funded. Navy plans include  replacing aging center wing sections in the EA-6B fleet. The condition of  the Prowler fleet will continue to improve in the near term because of this  funded initiative. Additionally, EA-6B officials have been working with  manufacturers to correct canopy deficiencies and have resolved this  problem. Current Navy plans for purchasing canopies are also fully funded  for all aircraft. However, currently no plans or funding have been identified  to correct communications equipment issues. Furthermore, the Navy has  not fully funded equipment that improves the EA-6B’s ability to use its  unique electronic warfare capabilities to counter an emerging threat.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy and funding of the EA-6B as  yellow because only a limited number of aircraft will receive an upgrade  that is critical to transition the EA-6B fleet to the EA-18G aircraft. In the  long term, the Navy has outlined an effective strategy to modernize and  replace the Prowler. This strategy includes wing replacement and  Improved Capability III upgrades on the EA-6B. The Prowler’s capabilities  will be replaced by the EA-18G and Air Force B-52 electronic jammer  suites. However, this strategy has not been fully funded. Specifically, the  Navy has a stated requirement to provide the Improved Capability III  upgrade on 21 aircraft, but has only funded the upgrade for 14 aircraft. This  improved third-generation capability is a significant technology leap  beyond the EA-6B’s current jamming capabilities, and according to  program officials, an important component in the Navy’s transition to the  EA-18G. Moreover, aircraft with this capability will be used by the Marine  Corps until 2015, at which time they plan to replace their EA-6B aircraft  with a version of the Joint Strike Fighter. The Joint Strike Fighter is already  behind schedule and a number of its critical technologies are immature,  indicating that it may be delayed even further.

		P-3 Orion Aircraft

The P-3 Orion is a four-engine turboprop antisubmarine and maritime  surveillance aircraft. It provides undersea warfare; antisurface warfare;  and Command, Control, Communications, Computers, Intelligence,  Surveillance, and Reconnaissance capabilities to naval and joint  commanders. There are 173 aircraft in the fleet and their average age is 24.4  years. The Navy will replace P-3 capabilities with the Multi-mission  Maritime Aircraft in 2013, and the Broad Area Maritime Surveillance Un- manned Aerial Vehicle.
We assessed the condition of the P-3 as red because it has consistently  missed its mission capable goals by a significant percentage, as shown in  figure 44, and the Orion is not available in sufficient numbers to meet day- to-day Navy requirements. Overall, the condition of the P-3 has been  primarily degraded by the effect of structural fatigue on its airframe and the  obsolescence of communication, navigation, and primary war-fighting  systems. To address airframe issues, specifically cracks in the aircraft’s  wings, the Navy has instituted a special structural inspection and repair  program. A number of aircraft are currently undergoing these special  structural inspections and repairs, and are not available for fleet  operations. Moreover, the obsolescence of the communication, navigation,  and war-fighting systems resulted in only about 26 percent of these aircraft  being rated as fully capable of performing all of their missions last year.
We assessed the near-term program strategy and funding of the P-3 as  yellow because the Navy’s near-term plans do not address all condition and  obsolescence issues. However, the Navy will have completed enough  structural inspections and repairs to ensure that there are sufficient P-3  Orions available to meet day-to-day requirements next year. While this  mitigates serious airframe issues, obsolescence of electronics and avionic  systems will continue to degrade the ability of this aircraft to fulfill all of its  missions. The Navy will address some of these obsolescence issues in the  short term, such as installing an improved high-frequency radio. However,  other needed improvements have not been funded, for example, efforts to  improve the aircraft’s over the horizon communications and upgrades for  the aircraft’s missile defense system.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy and funding of the P-3 as red  because while the Navy has identified what can be done to address the  obsolescence of the mission systems over the long term, this program has  not been approved or funded. The Navy plan, known as the Anti-submarine  Maritime Improvement Program, ensures the continued relevance of the P- 3 mission systems until the Multi-mission Maritime Aircraft is operational.  This improvement program has not been fully approved, nor has it been  funded. The obsolescence of its mission system may have a significant  impact on its war-fighting capabilities. Moreover, it is still not certain that  the fixes identified for the P-3 airframe will ensure that sufficient numbers  of this aircraft will be available until it is fully replaced in 2019.

		Standard Missile-2 Surface- to-Air Missile

The Standard Missile-2 is a medium to long-range, shipboard surface-to-air  missile. The primary mission of the Standard Missile-2 is fleet area air  defense and ship self-defense; its secondary mission is antisurface ship  warfare. There are four different blocks of the Standard Missile-2 in service  (III, IIIA, IIIB, and IV). The inventories of these blocks are classified, but  over 88 percent of the inventory is greater than 11 years of age, and some  blocks are older and less capable than others The capabilities of the  Standard Missile-2 will be replaced by the Standard Missile-6 Extended  Range Active Missile beginning in fiscal year 2009.
We assessed the condition of the Standard Missile-2 as yellow because it  has consistently failed to meet its asset readiness goal of 87 percent. The  asset readiness goal is the missile equivalent of the mission capable goal.  Timely certifications of missiles—assessments of equipment condition and  necessary repair and replacement of missile components—are critical to  these readiness rates. These certifications must be done approximately  every 4 years and a missile is not ready for issue until certified. These  assessments have not been done at a rate sufficient to meet asset readiness  goals. In GAO’s previous study, the condition of the Standard Missile-2 was  rated red; however, the asset readiness rates of these missiles have  improved since that time.

			Near-Term Program Strategy and Funding

We assessed the near-term program strategy and funding of the Standard  Missile-2 as green because the Navy has a plan to address near-term  condition, and the missile’s inventory meets Navy requirements in the near  term. The Navy has been able to deliver a more maneuverable version of  this missile—the Block IIIB-MU—ahead of schedule. In addition, the Navy  has increased the amount of operation and maintenance funding over the  next couple of years to maintain the asset readiness rate close to the goal.  Both of these steps will allow the Navy to meet inventory requirements in  the near term.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy and funding of the Standard  Missile-2 as red because future funding shortfalls will significantly affect  missile availability. The Navy plans to meet requirements by procuring new  missiles and modernizing existing ones. However, the new procurements  and missile modernizations are not in sufficient numbers to allow the Navy  to meet inventory requirements in the long term. Furthermore, the  operation and maintenance funding planned for the long term is not  sufficient for the Navy to meet asset readiness goals. Funding for  certifications was limited until fiscal year 2004; subsequently, increased  funding improved assets readiness rates. Funding will be limited again  beginning in fiscal year 2007, affecting the long-term availability and ready- for-issue rate of the Standard Missile-2. While the Standard Missile-6 is  currently ahead of schedule, this weapon will not be available in a timely  manner or in sufficient numbers to allow the Navy to meet long-term  inventory requirements.

	Air Force

For the six Air Force aircraft in this appendix, fiscal year 2004 data are  through July 2004.

		F-15 Eagle and Strike Eagle

There are two types of F-15 aircraft: the F-15 Eagle (A-D variants) and the  F-15E Strike Eagle. The F-15 A and F-15C are single-seat, supersonic fighter  aircraft used for air-to-air combat, and the B and D variants are their dual- seat training counterparts. The F-15E Strike Eagle is a dual-seat, supersonic  fighter aircraft used for both air-to-air combat and air-to-ground combat.  There are 513 F-15 Eagles and 221 F-15E Strike Eagles in the Air Force  inventory, and the average age depends upon the variant, with F-15 Eagles  ranging from about 21 years to 26 years, and the F-15E Strike Eagles  averaging about 12 years. The F/A-22 is the designated replacement for the  F-15 Eagle. The Air Force plans to retire most of the F-15 Eagle fleet,  retaining 179 F-15C/D variants beyond 2015 to augment the F/A-22 through  2025, while maintaining the entire fleet of F-15Es through at least 2025.
We assessed the condition of the F-15 C/D and F-15E as green because  mission capable rates have been near the Air Force’s stated goal and have  either improved or remained constant between fiscal years 1999 and 2004.  The Air Force’s stated goal depends on the variant, and ranges from 79  percent to 82 percent. As shown in figure 47, mission capable rates for the  F-15 C/D and F-15 E variants, which are expected to remain in the fleet  after retirement of the older F-15 aircraft, have increased to about 79  percent. Officials stated that cracks and issues related to the age of the  aircraft are the most common problems affecting the aircraft, but noted  that the Air Force is addressing these issues through programmed depot  maintenance. Officials also stated that the F-15 is a viable and capable  system, noting that the F-15E models were used during Operation Iraqi  Freedom.
We assessed the near-term program strategy for the F-15 and F-15E as  green because the Air Force has developed and funded a strategy to  address known problems, to include retirement of the older F-15 C/D  variants. For capability and reliability upgrades, the Air Force has funded  and is currently implementing replacements and upgrades for a variety of  different systems on 179 F-15C/D variants, to include engines, radars, and  various structural improvements. For the F-15E, the Air Force has funded  modernization of different systems—computer processors, avionics, and  software—which is collectively known as a Suite 5E upgrade. This  upgrade, which is fully funded for the F-15E fleet, is scheduled to occur  from fiscal year 2006 through fiscal year 2011, and is expected to increase  the survivability and weapons delivery capability of the aircraft. Officials  also stated that technological obsolescence and diminishing manufacturing  sources are a concern for the entire F-15 fleet; however, they also stated  that it is manageable, and were confident that the Air Force had the correct  procedures to address the issue.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy for the F-15 fleet as green  because the Air Force near-term upgrades are fully funded and designed to  keep the aircraft that will remain in the fleet viable and functioning through  at least 2025. The F/A-22 Raptor is the F-15 Eagle's designated replacement,  and officials stated that delays to its fielding schedule will not impact the  retirement schedule of the F-15 fleet. Retirements for the F-15A/B aircraft  are scheduled to begin in fiscal year 2005 with a total of 84 retirements  expected to occur through fiscal year 2009, and retirement of 26 F-15 C/D  aircraft is scheduled to begin in fiscal year 2009. The F/A-22 is expected to  achieve operational capability in December 2005, and the entire fleet of 179  aircraft is currently scheduled to be procured through fiscal year 2008.  Officials stated that the effect of changes in the F/A-22 fleet composition on  further F-15 C/D aircraft retirements beyond fiscal year 2009 remains to be  seen, as the total structure of the combat air fleet will be reviewed during  the 2005 Quadrennial Defense Review.

		F-16 Fighting Falcon

The F-16 is a compact, multirole fighter with air-to-air combat and air-to- surface attack capabilities. There are four F-16 variants – the A and C  models are designed for one pilot, while the B and D models are two-seat  tandem cockpit aircraft, which are used for training and can also be flown  individually. Of the four variants, the F-16 C and D models incorporate the  latest technology and have the capability to suppress or destroy enemy air  defenses. The Air Force currently has 1,353 F-16 aircraft in its inventory,  and the average age is about 15 years. The Air Force plans to retire the A  and B variants because they are not expected to be structurally viable past  2008, although the specific schedule has yet to be published. The Air Force  also plans to replace the F-16 with the F-35 Joint Strike Fighter beginning in  2013.
Consistent with the findings of our December 2003 report, we assessed  the condition of the F-16 as green because mission capable rates have been  near the Air Force’s stated goal and have remained relatively constant. For  the A/B variants, mission capable rates were about 72 percent with an Air  Force stated goal of 75 percent in fiscal year 2004 and, as shown in figure  49, mission capable rates for the C/D variants were about 76 percent  compared to a goal of 81 percent. Officials stated that the most significant  factor affecting the F-16 is cracks, which occur mostly on older aircraft and  because of the stress caused by repeatedly landing without dropping its  two 2,000 pound bombs. Despite these concerns, the Air Force has plans to  address cracking. Further, although the rates for all variants are below the  goals, officials stated the F-16 was able to meet operational requirements.
We assessed the near-term program strategy for the F-16 as green because  the Air Force has developed and funded a strategy to address known  problems. As we noted in our December 2003 report, structural issues  related to age and use are affecting the F-16. To address these concerns, the  Air Force began a structural augmentation program that strengthens the  airframe in areas prone to cracking, namely the wings and fuselage. The  structural augmentation program is expected to affect over 1200 of the  aircraft and be completed by 2013. Other near-term initiatives that are  being implemented to improve combat capabilities include the common  configuration implementation program, which incorporates improvements  to targeting, communications, and computer systems, and improvements to  radar, avionics, and targeting systems. Officials stated that these programs  are currently funded and being implemented, although not for the entire F- 16 fleet.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy for the F-16 as green because  current and projected funding for aircraft modernizations identified in the  near-term program strategy are designed to ensure longer-term viability for  the next 15 years. Although the Air Force has yet to publish an F-16  retirement schedule, officials indicate that the older variants will be retired,  as will be reflected in future budget documents. The F-35 Joint Strike  Fighter is the designated replacement for the F-16 but, according to  officials, the retirement of the older F-16 variants will not be affected by the  F-35 fielding schedule, since operational capability of the Air Force F-35  aircraft is not expected to occur until fiscal year 2013 and the exact  quantity remains to be determined.

		B-1 Lancer Bomber

The B-1 Lancer Bomber is a long-range, high-speed, large payload global  attack aircraft that was originally designed for nuclear missions but was  transitioned to a conventional role. In 2002, the Air Force began  consolidating the fleet, reducing the B-1 inventory from 93 to 67 aircraft  and transferring all remaining B-1 bombers to the active component.  Beginning operations in 1986, the average age of the B-1 is about 17 years.  The Air Force plans to keep the B-1 in use through at least 2040, so there  are no immediate plans to replace the aircraft.
We assessed the condition of the B-1 as yellow because mission capable  rates were below the Air Force stated goal most of the time between fiscal  years 1999 and 2004. As shown in figure 51, mission capable rates have  increased between 1999 and 2004. Parts shortages were identified as a  reason keeping rates below goals, and officials identified generators,  automatic pilot controllers, and various pump and hydraulic systems as the  items that were most often in short supply. After consolidation of the B-1  fleet in fiscal year 2002, the numbers of parts in the supply system  increased as parts were taken from retired B-1 aircraft. To compensate for  the smaller fleet size, the Air Force increased the mission capable goals  from 67 percent in fiscal year 2002 to 76 percent in fiscal year 2003. The  increase in the goal occurred as B-1 usage to support operations in Iraq and  Afghanistan increased. Although the aircraft’s mission capable rate was  about 69 percent in fiscal year 2004, the rate for deployed aircraft was 80  percent. Additionally, officials noted that the B-1 is capable of  accomplishing the Air Force’s current needs.
We assessed the near-term program strategy for the B-1 as green because  the Air Force has planned and funded programs to address the near-term  sustainment issues affecting the aircraft. According to officials, the  forecasted number of flight hours serves as the basis for funding planned  maintenance activity and expected number of parts required for the  aircraft. The fluctuations in the fleet size, coupled with the increase in  usage for operations overseas, caused instability in the supply chain and  increased the difficulty in efficient planning of maintenance cycles. For the  near term, the Air Force has addressed this concern by increasing the  number of forecasted flight hours for fiscal year 2005, which increases the  funding for supply and maintenance activities and is expected to correct  the disparity. In addition to addressing near-term sustainment issues, the  Air Force has already funded and will complete plans to increase the  sustainability and wartime capabilities of the B-1, to include the planned  fielding of increased munitions capabilities, and upgrades to the central  computer systems and radar.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy for the B-1 as green because  the Air Force has a proactive strategy to address anticipated shortages and  deficiencies in the aircraft, and has funded modernization efforts to meet  requirements. Although a newer system in the Air Force’s fleet, officials  stated that technology has advanced significantly since the B-1 was fielded  in the 1980s, resulting in a reduction in the number of manufacturers that  make the original B-1 component parts. For example, the original computer  technology in the B-1 used processors that, while cutting edge at the time,  are slower than home computer processors. To address these issues, the  Air Force has funded efforts to modernize and upgrade B-1 components, to  include cockpit flight instrument displays and navigation systems. In  addition to resolving potential supply chain concerns, these upgrades are  also expected to enhance the aircraft’s combat capability.

		B-2 Spirit Bomber

The B-2 is a multirole heavy bomber with stealth characteristics, capable of  employing nuclear and conventional weapons. The aircraft was produced  in limited numbers to provide a low observable (i.e., stealth) capability to  complement the B-1 and B-52 bombers. Its unique stealth capability  enables the aircraft to penetrate air defenses. The Air Force has 21 B-2  aircraft in its inventory, and the average age is about 10 years. The B-2 was  deployed to support both Operation Enduring Freedom in Afghanistan and  Operation Iraqi Freedom. The B-2 is expected to remain in the Air Force’s  inventory until 2058, so there are no immediate plans to replace the  aircraft.
For the reasons associated with maintenance of stealth characteristics that  we identified in our December 2003 report, we continue to assess the  condition of the B-2 as yellow. As shown in figure 53, the B-2 did not  consistently meet the Air Force mission capable goal of 50 to 51 percent  between fiscal years 1999 and 2004. Officials stated that the small B-2 fleet  size increases the difficulty in achieving goals, noting that a change in the  mission capable status of one aircraft results in about a 7 percent change in  the overall mission capable rate; however, when viewing other metrics, the  B-2 condition is comparable with other bombers. Maintenance of stealth  characteristics continues to be the primary driver of lower mission capable  rates, and the Air Force is continuing to implement solutions. Despite  difficulties associated with stealth maintenance, the B-2 is capable of  accomplishing its wartime missions, achieving mission capable rates of 64  percent for Operation Enduring Freedom and 73 percent during the initial  months of Operation Iraqi Freedom.
We assessed the near-term program strategy for the B-2 as green because  the Air Force has developed and funded the strategy for sustaining the B-2  inventory. The Air Force funded and continues to implement its Alternate  High Frequency Material modification, which reduces the number of steps  and the overall length of time required to conduct stealth maintenance.  Thus far, three aircraft have received the modification, and the entire fleet  has been funded and scheduled to receive the upgrade by the end of the  decade. Other areas of concern include cracking on the aft deck and  cracking in the windshield. For the aft deck cracks, officials stated that the  extremely high temperatures from the engine cause the cracking, and have  fielded kits to stiffen the aft decks, making them less affected by the  extreme heat. For windshield cracks, officials stated that redesigning the  spacing of drill holes will address the problem; delivery of the new  windshields is scheduled to begin in late 2005. Additionally, the Air Force  has funded and is implementing improvements in B-2 connectivity and  interoperability, to include integrating advanced weapons.

			Long-Term Program Strategy and Funding

We assessed the long-term program strategy for the B-2 as green because  the Air Force is addressing immediate issues for the aircraft while  concurrently developing and funding longer-term solutions. In addition to  continuing efforts to address stealth maintenance and aft deck cracks, the  Air Force is also addressing the issue of diminishing manufacturing  sources. Officials stated that technological advancements and the small  size of the B-2 fleet are a disincentive for manufacturers to continue  making B-2 unique parts. To compensate, the Air Force is modernizing  components and systems within the B-2, developing internal processes to  contract out management of B-2 unique parts, and closely monitoring all  parts to ensure that the supply chain has ample time to adjust.

		C-5 Galaxy Transport

The C-5 Galaxy is the largest Air Force transport aircraft, and can carry  large cargo items over intercontinental ranges at jet speeds and can take off  and land in relatively short distances. The C-5 is one of only two aircraft  that can carry very large military equipment. With aerial refueling, the  aircraft’s range is limited only by crew endurance. The first C-5 was  delivered in 1970. There are 112 C-5 aircraft in the Air Force’s inventory,  and their average age is 26 years. Although the C-5 is expected to remain in  service through 2040, the exact length of service and composition of the C- 5 fleet is dependent upon the Mobility Capabilities Study and the  Quadrennial Defense Review, which were not completed at the time of our  review.
For the reasons identified in our December 2003 report, we continue to  assess the condition of the C-5 as yellow. As shown in figure 55, mission  capable rates for the C-5 consistently remained below Air Force goals  between fiscal years 1999 and 2004. Officials stated that the size and age of  the aircraft make the C-5 maintenance intensive, and provided the example  of fatigued metal and adhesives, which take time to replace. They further  stated that the age of the C-5 makes it difficult to find manufacturing  sources for some parts, particularly avionics and engine components.  Additionally, the avionics systems and engines are noncompliant with  upcoming global airspace and air traffic requirements, potentially limiting  where and how the aircraft can be used. Despite these challenges, officials  stated that the C-5 can currently perform its missions, including providing  transport for tsunami relief efforts and moving supplies for operations in  Iraq and Afghanistan.
We assessed the near-term program strategy for the C-5 as yellow because  of delays and funding shortages in key modernization efforts. The two  modernizations for the C-5 are to improve avionics and engines; avionics  upgrades must occur before engine modernization can begin. When  complete, the programs are expected to address many manufacturing  source issues, ensure compliance with global air traffic standards, and  increase the aircraft’s capability. However, officials stated that the avionics  upgrades are experiencing software integration problems, resulting in a  delay of at least 3 months and cost increases of $20 million. Since engine  modernization is predicated on avionics upgrades, the costs for engine  modernization have also increased by $30 million. Additionally, after a  projectile attack damaged a C-5 during Operation Iraqi Freedom, officials  stated that defensive systems became a top priority, and the Air Force  requested and received funding through fiscal year 2005 supplemental  appropriations to upgrade defenses against infrared guided surface-to-air  missiles for 51 C-5 aircraft.

			Long-Term Program Strategy and Funding

We assessed the Air Force’s long-term strategy for the C-5 as yellow  because requested funding is inconsistent with long-term requirements to  sustain and modernize the inventory. With upgrades to avionics and  engines, officials stated that the C-5 could last through 2040. The Air Force  has requested funding for engine upgrades for the entire fleet of 112 C-5  aircraft; however, the Air Force has only funded the procurement and  installation of avionics upgrades for 59 aircraft, resulting in 53 aircraft not  receiving the necessary avionics upgrades to support the new engines.  Officials stated that the Air Force remains uncertain about the size of the  final C-5 fleet and whether to fund the remaining C-5 upgrades, but will  have a better idea following the completion of the Mobility Capabilities  Study.

		KC-135 Stratotanker

The KC-135 is among the oldest aircraft in the Air Force’s inventory and  represents 90 percent of the aircraft in the tanker fleet. Its primary mission  is air refueling fixed-wing aircraft and it supports Air Force, Navy, Marine  Corps, and allied aircraft. There are three KC-135 variants currently in the  fleet: the E, R, and T models. Each model is a reengined version of the  original KC-135A. Of these three variants, the E model belongs to the Air  Force Reserve and Air National Guard. The first KC-135 was delivered in  June 1957. There are 531 KC-135 aircraft in the Air Force’s inventory and  the average age is about 44 years. Currently, there is no replacement  Consistent with our December 2003 report, we assessed the condition of  the KC-135 aircraft as yellow because, as shown in figure 57, it has not met  its mission capable goals and issues associated with age and corrosion  continue to be a concern. Officials stated that age is the primary driver of  KC-135 maintenance issues, and that maintainers discover new problems  with the aircraft every time it undergoes scheduled depot maintenance.  Age-related issues with the aircraft include fuel bladder leaks, parts  obsolescence, and problems with the landing gear’s steel brakes. Corrosion  has regularly been discovered in new areas on the aircraft, requiring  increased amounts of depot maintenance time. The Air Force has yet to  determine the extent of problems caused by newly discovered corrosion.  The older variants also have a higher incidence of problems; for example,  the Air Force removed 29 KC-135E aircraft from flight status due to engine  strut problems and corrosion.
We assessed the Air Force’s near-term strategy for the KC-135 as yellow  because age-related maintenance issues are expected to increase and the  severity of potential age-related issues remains unknown. Although  officials stated that maintenance problems with the aircraft are currently  manageable during programmed depot maintenance, they expect the  number of maintenance man-hours to increase by 2.5 percent each year.  Officials also stated that the severity of potential problems from newly  discovered corrosion remains unknown, so the potential for additional  maintenance requirements is likely to occur. Officials further stated that  the effects of KC-135 operations to support Iraq and Afghanistan are still  unknown, but the Air Force has instituted additional inspections and  procedures to address potential effects associated with higher usage. The  only major modification for the KC-135, Global Air Traffic Management  avionics system upgrades, remains on schedule and is fully  funded.

			Long-Term Program Strategy and Funding

We assessed the Air Force’s long-term strategy for the KC-135 as red  because the future of the KC-135 fleet and the Air Force’s tanker strategy  are unknown. Before acquiring new tankers, the Air Force must complete a  Recapitalization Analysis of Alternatives, which is a study to narrow the  field of possible future tanker options. Originally scheduled for completion  in December 2004, the analysis has been delayed until at least August 2005.  Regardless of the option, officials stated that all recapitalization efforts will  require use of the KC-135 in the near term and delays in fielding a  replacement exacerbate problems in maintaining the existing fleet over the  long term, as well as delaying modernization efforts that are predicated on  the replacement time line. In fiscal year 2005, $100 million was  appropriated for a tanker replacement transfer fund, and $9.7 billion has  been requested for the tanker replacement program in DOD’s 2006 Future  Years Defense Program.For the six Air Force aircraft in this appendix,  fiscal year 2004 data are through July 2004.

Agency Comments from the Department of Defense

GAO Contact and Staff Acknowledgments

	GAO Contact

	Acknowledgments

In addition to the contact named above, the following individuals also  made major contributions to the report: David Schmitt, Assistant Director;  Patricia Lentini; Vipin Arora; Janine Cantin; Alissa Czyz; Barbara Hills;  Barbara Gannon; Stanley Kostyla; Josh Margraf; Brian Mateja; Kimberly  Mayo; Jim Melton; Kenneth Patton; Malvern Saavedra; and John Trubey.

Summary:
Why GAO Did This Study

With continued heavy military involvement in operations in Iraq and Afghanistan, the Department of Defense (DOD) is spending billions of dollars sustaining or replacing its inventory of key equipment items while also planning to spend billions of dollars to develop and procure new systems to transform the department's warfighting capabilities. GAO developed a red, yellow, green assessment framework to (1) assess the condition of 30 selected equipment items from across the four military services, and (2) determine the extent to which DOD has identified near- and long-term program strategies and funding plans to ensure that these items can meet defense requirements. GAO selected these items based on input from the military services, congressional committees, and our prior work. These 30 equipment items included 18 items that were first assessed in GAO's 2003 report.

What GAO Found

While the fleet-wide condition of the 30 equipment items GAO selected for review varied, GAO's analysis showed that reported readiness rates declined between fiscal years 1999 and 2004 for most of these items. The decline in readiness, which occurred more markedly in fiscal years 2003 and 2004, generally resulted from (1) the continued high use of equipment to support current operations and (2) maintenance issues caused by the advancing ages and complexity of the systems. Key equipment items--such as Army and Marine Corps trucks, combat vehicles, and rotary wing aircraft--have been used well beyond normal peacetime use during deployments in support of operations in Iraq and Afghanistan. DOD is currently performing its Quadrennial Defense Review, which will examine defense programs and policies for meeting future requirements. Until the department completes this review and ensures that condition issues for key equipment are addressed, DOD risks a continued decline in readiness trends, which could threaten its ability to continue meeting mission requirements. The military services have not fully identified near- and long-term program strategies and funding plans to ensure that all of the 30 selected equipment items can meet defense requirements. GAO found that, in some cases, the services' near-term program strategies have gaps in that they do not address capability shortfalls, funding is not included in DOD's 2006 budget request, or there are supply and maintenance issues that may affect near-term readiness. Additionally, the long-term program strategies and funding plans are incomplete for some of the equipment items GAO reviewed in that future requirements are not identified, studies are not completed, funding for maintenance and upgrades was limited, or replacement systems were delayed or not yet identified. Title 10 U.S.C. 2437 requires the military services to develop sustainment plans for equipment items when their replacement programs begin development, unless they will reach initial operating capability before October 2008. However, most of the systems that GAO assessed as red had issues severe enough to warrant immediate attention because of long-term strategy and funding issues, and were not covered by this law. As a result, DOD is not required to report sustainment plans for these critical items. For the next several years, funding to sustain or modernize aging equipment will have to compete with other DOD priorities, such as current operations, force structure changes, and replacement system acquisitions. Without developing complete sustainment and modernization plans and identifying funding needs for all priority equipment items, DOD may be unable to meet future requirements for defense capabilities. Furthermore, until DOD develops these plans, Congress will be unable to ensure that DOD's budget decisions address deficiencies related to key military equipment.